Item 9A. Controls and Procedures
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
BGC Partners maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed by BGC Partners is recorded, processed, accumulated, summarized and communicated to its management, including its Chairman of the Board and Chief Executive Officer and its Chief Financial Officer, to allow timely decisions regarding required disclosures, and reported within the time periods specified in the SEC’s rules and forms. The Chairman of the Board and Chief Executive Officer and the Chief Financial Officer have performed an evaluation of the effectiveness of the design and operation of BGC Partners disclosure controls and procedures as of December 31, 2022. Based on that evaluation, the Chairman of the Board and Chief Executive Officer and the Chief Financial Officer concluded that BGC Partners’ disclosure controls and procedures were effective as of December 31, 2022.
Internal Control over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our Chairman and Chief Executive Officer, and our Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2022 based upon criteria set forth in the Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (COSO). Our internal control over financial reporting includes policies and procedures that are intended to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. GAAP.
Based on the results of our 2022 evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2022. We reviewed the results of management's assessment with our Audit Committee.
The effectiveness of our internal control over financial reporting as of December 31, 2022 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report, which is included in this Annual Report on Form 10-K. Such report expresses an unqualified opinion on the effectiveness of the Company's internal controls over financial reporting as of December 31, 2022.
Changes in Internal Control over Financial Reporting
During the year ended December 31, 2022, there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Not Applicable
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
Not Applicable
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PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information appearing under “Election of Directors,” “Information about our Executive Officers,” “Section 16(a) Beneficial Ownership Reporting Compliance,” and “Code of Ethics and Whistleblower Procedures” in the 2023 Proxy Statement is hereby incorporated by reference in response to this Item 10.
ITEM 11. EXECUTIVE COMPENSATION
The information appearing under “Compensation Discussion and Analysis,” “Compensation Committee Report,” “Executive Compensation” and “Compensation Committee Interlocks and Insider Participation” in the 2023 Proxy Statement is hereby incorporated by reference in response to this Item 11.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information appearing under “Security Ownership of Certain Beneficial Owners and Management” and “Equity Compensation Plan Information as of December 31, 2022” in the 2023 Proxy Statement is hereby incorporated by reference in response to this Item 12.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
The information appearing under “Certain Relationships and Related Transactions and Director Independence” and “Election of Directors—Independence of Directors” in the 2023 Proxy Statement is hereby incorporated by reference in response to this Item 13.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information appearing under “Independent Registered Public Accounting Firm Fees” and “Audit Committee Pre-Approval Policies and Procedures” in the 2023 Proxy Statement is hereby incorporated by reference in response to this Item 14.
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PART IV—OTHER INFORMATION
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) (1) Financial Statements. The consolidated financial statements required to be filed in this Annual Report on Form 10-K are included in Part II, Item 8 hereof.
(a) (2) Schedule I, Parent Company Only Financial Statements. All other schedules are omitted because they are not applicable or not required, or the required information is in the financial statements or the notes thereto.
(a) (3) The Exhibit Index set forth below is incorporated by reference in response to this Item 15.
The following Exhibits are filed as part of this Report as required by Regulation S-K. The Exhibits designated by an asterisk (*) are management contracts and compensation plans and arrangements required to be filed as Exhibits to this Report. Certain schedules and exhibits designated by two asterisks (**) have been omitted pursuant to Item 601(a)(5) of Regulation S-K promulgated by the SEC. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request. Certain exhibits have been previously filed with the SEC pursuant to the Securities Exchange Act of 1934 (Commission File Number 0-28191).
EXHIBIT INDEX
Exhibit
Number Exhibit Title
1.1 Controlled Equity Offering Sales SM Agreement, dated August 12, 2022, between BGC Partners, Inc. and Cantor Fitzgerald & Co. (incorporated by reference to Exhibit 1.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 12, 2022)
2.1 Agreement and Plan of Merger, dated as of May 29, 2007, by and among eSpeed, Inc., BGC Partners, Inc., Cantor Fitzgerald, L.P., BGC Partners, L.P., BGC Global Holdings, L.P. and BGC Holdings, L.P. (incorporated by reference to the Registrant’s Definitive Proxy Statement on Schedule 14A filed with the SEC on February 11, 2008)
2.2 Amendment No. 1, dated as of November 5, 2007, to the Agreement and Plan of Merger, dated as of May 29, 2007, by and among eSpeed, Inc., BGC Partners, Inc., Cantor Fitzgerald, L.P., BGC Partners, L.P., BGC Global Holdings, L.P. and BGC Holdings, L.P. (incorporated by reference to the Registrant’s Definitive Proxy Statement on Schedule 14A filed with the SEC on February 11, 2008)
2.3 Amendment No. 2, dated as of February 1, 2008, to the Agreement and Plan of Merger, dated as of May 29, 2007, by and among eSpeed, Inc., BGC Partners, Inc., Cantor Fitzgerald, L.P., BGC Partners, L.P., BGC Global Holdings, L.P. and BGC Holdings, L.P. (incorporated by reference to the Registrant’s Definitive Proxy Statement on Schedule 14A filed with the SEC on February 11, 2008)
2.4 Separation Agreement, dated as of March 31, 2008, by and among Cantor Fitzgerald, L.P., BGC Partners, LLC, BGC Partners, L.P., BGC Global Holdings, L.P. and BGC Holdings, L.P. (incorporated by reference to Exhibit 2.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
2.5 Purchase Agreement, dated as of April 1, 2013, by and among BGC Partners, Inc., BGC Partners, L.P., The NASDAQ OMX Group, Inc., and for certain limited purposes, Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 2.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2013)
2.6 Tender Offer Agreement executed by BGC Partners, Inc., BGC Partners, L.P. and GFI Group Inc., dated February 19, 2015 (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on February 25, 2015)
2.7 Stock Purchase Agreement by and among GFINet, Inc., GFI TP Holdings Pte Ltd, Intercontinental Exchange, Inc., and, solely for the purposes set forth therein, GFI Group Inc. and BGC Partners, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 18, 2015)
2.8 Agreement and Plan of Merger, dated December 22, 2015, by and among BGC Partners, Inc., JPI Merger Sub 1, Inc., JPI Merger Sub 2, LLC, Jersey Partners Inc., New JP Inc., Michael Gooch and Colin Heffron (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 23, 2015)
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Exhibit
Number Exhibit Title
2.9 Transaction Agreement, dated as of July 17, 2017, by and among BGC Partners, Inc. BGC Partners, L.P., Cantor Fitzgerald, L.P., Cantor Commercial Real Estate Company, L.P., Cantor Sponsor, L.P., CF Real Estate Finance Holdings, L.P. and CF Real Estate Finance Holdings GP, LLC (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 21, 2017)
2.10 Amended and Restated Separation and Distribution Agreement, dated as of November 23, 2018, by and among Cantor Fitzgerald, L.P., BGC Partners, Inc., BGC Holdings, L.P., BGC Partners, L.P., BGC Global Holdings, L.P., Newmark Group, Inc., Newmark Holdings, L.P. and Newmark Partners, L.P. (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on November 27, 2018)
2.11 Agreement for the Sale and Purchase of the Share Capital of Ed Broking Group Limited and Besso Insurance Group Limited, Dated May 26, 2021, by and Among Tower Bridge (One) Limited, Ardonagh Specialty Holdings 2 Limited, The Ardonagh Group Limited and BGC Partners, Inc. (incorporated by reference to Exhibit 2.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 6, 2021)
2.12 Deed of Variation in Respect of the Agreement for the Sale and Purchase of the Share Capital of Ed Broking Group Limited and Besso Insurance Group Limited, dated August 25, 2021, by and among Tower Bridge (One) Limited, Ardonagh Specialty Holdings 2 Limited, The Ardonagh Group Limited and BGC Partners, Inc. (incorporated by reference to Exhibit 2.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2021)
2.13 Deed of Variation in Respect of the Agreement for the Sale and Purchase of the Share Capital of Ed Broking Group Limited and Besso Insurance Group Limited, dated October 31, 2021, by and among Tower Bridge (One) Limited, Ardonagh Specialty Holdings 2 Limited, The Ardonagh Group Limited and BGC Partners, Inc. (incorporated by reference to Exhibit 2.3 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2021)
2.14 Corporate Conversion Agreement, dated as of November 15, 2022, by and among BGC Partners, Inc., BGC Group, Inc., BGC Holdings, L.P., BGC GP, LLC, BGC Partners II, Inc., BGC Partners II, LLC, BGC Holdings Merger Sub, LLC and, solely for the purposes of certain provisions therein, Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 16, 2022)**
3.1 Restated Certificate of Incorporation of BGC Partners, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2016)
3.2 Amended and Restated Bylaws of BGC Partners, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
4.1 Description of Registrant’s Securities Registered under Section 12 of the Securities Exchange Act of 1934, as amended
4.2 Specimen Class A Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form S-1 filed with the SEC on April 18, 2008)
4.3 Indenture, dated as of June 26, 2012, between BGC Partners, Inc. and U.S. Bank National Association, as Trustee, (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 27, 2012)
4.4 Fourth Supplemental Indenture, dated as of July 24, 2018, by and between BGC Partners, Inc. and U.S. Bank National Association, as Trustee, relating to the 5.375% Senior Notes due 2023 (incorporated by reference to Exhibit 4.2 to the Registrant’s Form 8-K filed with the SEC on July 25, 2018)
4.5 Form of 5.375% Senior Notes due 2023 (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 25, 2018)
4.6 Indenture, dated as of September 27, 2019, between BGC Partners, Inc. and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Form 8-K filed with the SEC on September 30, 2019)
4.7 First Supplemental Indenture, dated as of September 27, 2019, between BGC Partners, Inc. and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Form 8-K filed with the SEC on September 30, 2019)
4.8 Form of BGC Partners, Inc. 3.750% Senior Notes due 2024 (incorporated by reference to Exhibit 4.3 to the Registrant’s Form 8-K filed with the SEC on September 30, 2019)
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Exhibit
Number Exhibit Title
4.9 Second Supplemental Indenture, dated as of July 10, 2020, between BGC Partners, Inc. and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 14, 2020)
4.10 Form of BGC Partners, Inc. 4.375% Senior Notes due 2025 (incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 14, 2020)
10.1 Registration Rights Agreement, dated as of December 9, 1999, by and among eSpeed, Inc. and the Investors named therein (incorporated by reference to Exhibit 10.6 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 1999)
10.2 Registration Rights Agreement by and between Cantor Fitzgerald, L.P. and BGC Partners, LLC, dated as of March 31, 2008 (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
10.3 Administrative Services Agreement, dated as of March 6, 2008, by and between Cantor Fitzgerald, L.P. and BGC Partners, Inc. (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
10.4 Administrative Services Agreement, dated as of August 9, 2007, by and among Tower Bridge International Services L.P. and BGC International (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
10.5 BGC Holdings, L.P. Participation Plan, effective as of April 1, 2008 (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)*
10.6 Tax Receivable Agreement, dated as of March 31, 2008, by and between BGC Partners, LLC and Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 10.7 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
10.7 License Agreement, dated as of April 1, 2008, by and between BGC Partners, Inc. and Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 10.10 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008)
10.8 Clearing Services Agreement, dated May 9, 2006, between Cantor Fitzgerald & Co. and BGC Financial, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 11, 2008)
10.9 Amendment to Clearing Services Agreement, dated November 7, 2008, between Cantor Fitzgerald & Co. and BGC Financial, Inc. (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 11, 2008)
10.10 Second Amendment, dated August 16, 2010, to the Clearing Services Agreement, dated May 9, 2006, between Cantor Fitzgerald & Co. and BGC Financial, Inc. (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 7, 2020)
10.11 Third Amendment , dated June 16, 2020, to the Clearing Services Agreement, dated May 9, 2006, between Cantor Fitzgerald & Co. and BGC Financial, Inc. (incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 7, 2020)
10.12 Agreement dated November 5, 2008 between BGC Partners, Inc. and Cantor Fitzgerald, L.P. regarding clearing capital (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 11, 2008)
10.13 First Amendment, dated June 16, 2020, to the Agreement between BGC Partners, Inc. and Cantor Fitzgerald, L.P. regarding clearing capital, dated November 5, 2008 (incorporated by reference to Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 7, 2020)
10.14 Subscription Agreement, dated March 16, 2010, among BGC Partners, Inc., BGC Holdings, L.P. and Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 10.43 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 16, 2010)
10.15 Registration Rights Agreement, dated as of April 1, 2010, by and between BGC Partners, Inc. and Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2010)
10.16 Tower Bridge International Services L.P. and BGC Brokers L.P. Administrative Services Agreement dated January 9, 2012 (incorporated by reference to Exhibit 10.60 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2012)
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Exhibit
Number Exhibit Title
10.17 Tower Bridge International Services L.P. and Cantor Fitzgerald Europe Administrative Services Agreement dated January 9, 2012 (incorporated by reference to Exhibit 10.61 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2012)
10.18 Tower Bridge International Services L.P. and Cantor Index Limited Administrative Services Agreement dated January 9, 2012 (incorporated by reference to Exhibit 10.62 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2012)
10.19 Tower Bridge International Services L.P. and BGC International Administrative Services Agreement dated January 9, 2012 (incorporated by reference to Exhibit 10.63 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2012)
10.20 Tower Bridge International Services L.P. and eSpeed International Limited Administrative Services Agreement dated January 9, 2012 (incorporated by reference to Exhibit 10.64 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2012)
10.21 Tower Bridge International Services L.P. and eSpeed Support Services Limited Administrative Services Agreement dated January 9, 2012 (incorporated by reference to Exhibit 10.65 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 15, 2012)
10.22 Amended and Restated Change in Control Agreement dated August 3, 2011 between Howard W. Lutnick and BGC Partners, Inc. (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2011)*
10.23 Amended and Restated Change in Control Agreement dated August 3, 2011 between Stephen M. Merkel and BGC Partners, Inc. (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2011)*
10.24 Amended and Restated Deed of Adherence, dated as of January 22, 2014, between Sean Windeatt and BGC Services (Holdings) LLP (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on January 28, 2014)*
10.25 Deed of Amendment, dated February 24, 2017, to the Amended and Restated Deed of Adherence, between Sean A. Windeatt and BGC Services (Holdings) LLP (incorporated by reference to Exhibit 10.86 to the Registrant’s Annual Report on Form 10-K filed with the SEC on February 28, 2017)*
10.26 Deed of Amendment, dated November 5, 2020, to the Amended and Restated Deed of Adherence, between Sean A. Windeatt and BGC Services (Holdings) LLP (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 6, 2020)*
10.27 Consultancy Agreement, dated February 24, 2017, between Sean A. Windeatt and BGC Services (Holdings) LLP (incorporated by reference to Exhibit 10.87 to the Registrant’s Annual Report on Form 10-K filed with the SEC on February 28, 2017)*
10.28 Amendment, dated November 5, 2020, to the Consultancy Agreement, dated February 24, 2017, between Sean A. Windeatt and BGC Services (Holdings) LLP (incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 6, 2020)*
10.29 Letter Agreement, dated as of August 24, 2015, among BGC Partners, Inc., BGC Partners, L.P. and GFI Group Inc., relating to shareholder litigation and the Tender Offer Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 9, 2015)
10.30 Eighth Amended and Restated Long Term Incentive Plan, dated as of November 22, 2021 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 23, 2021)*
10.31 Second Amended and Restated BGC Partners, Inc. Incentive Bonus Compensation Plan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 9, 2017)*
10.32 Amended and Restated Agreement of Limited Partnership of CF Real Estate Finance Holdings, L.P., dated as of September 8, 2017 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on September 8, 2017)
10.33 Second Amended and Restated Agreement of Limited Partnership of BGC Holdings, L.P., dated as of December 13, 2017 (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 19, 2017)
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Exhibit
Number Exhibit Title
10.34 Amendment No. 1, dated November 8, 2018, to the Second Amended and Restated Agreement of Limited Partnership of BGC Holdings, L.P (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 8, 2018).
10.35 Second Amended and Restated Agreement of Limited Partnership of BGC Partners, L.P., dated as of December 13, 2017 (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 19, 2017)
10.36 Second Amended and Restated Agreement of Limited Partnership of BGC Global Holdings, L.P., dated as of December 13, 2017 (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 19, 2017)
10.37 Registration Rights Agreement, dated as of December 13, 2017, by and among Cantor Fitzgerald, L.P., BGC Partners, Inc. and Newmark Group, Inc. (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 19, 2017)
10.38 Tax Matters Agreement, dated as of December 13, 2017, by and among BGC Partners, Inc., BGC Holdings, L.P., BGC Partners, L.P., Newmark Group, Inc., Newmark Holdings, L.P. and Newmark Partners, L.P. (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 19, 2017)
10.39 Amended and Restated Tax Receivable Agreement, dated as of December 13, 2017, by and between Cantor Fitzgerald, L.P. and BGC Partners, Inc. (incorporated by reference to Exhibit 10.9 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 19, 2017)
10.40 Registration Rights Agreement, dated as of July 10, 2020, between BGC Partners, Inc. and the parties named therein (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on July 14, 2020)
10.41 Credit Agreement, dated as of March 19, 2018, by and between BGC Partners, Inc. and Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on March 23, 2018)
10.42 Amendment, dated August 6, 2018, to the Credit Agreement, dated as of March 19, 2018, by and between BGC Partners, Inc. and Cantor Fitzgerald, L.P (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 7, 2018)
10.43 Amended and Restated Credit Agreement, dated as of March 19, 2018, by and between BGC Partners, Inc. and Newmark Group, Inc. (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on March 23, 2018)
10.44 Credit Agreement, dated as of November 28, 2018, by and among BGC Partners, Inc., as the Borrower, certain subsidiaries of the Borrower, as Guarantors, the several financial institutions from time to time as parties thereto, as Lenders, and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 27, 2018)
10.45 First Amendment, dated December 11, 2019, to the Credit Agreement, dated as of November 28, 2018, by and among BGC Partners, Inc., as the Borrower, certain subsidiaries of the Borrower, as Guarantors, the several financial institutions from time to time as parties thereto, as Lenders, and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on December 13, 2019)
10.46 Second Amendment, dated February 26, 2020, to the Credit Agreement, dated as of November 28, 2018, by and among BGC Partners, Inc., as the Borrower, certain subsidiaries of the Borrower, as Guarantors, the several financial institutions from time to time as parties thereto, as Lenders, and Bank of America, N.A., as the Administrative Agent. (incorporated by reference to Exhibit 10.47 to the Registrant’s Annual Report on Form 10-K filed with the SEC on March 1, 2021)
10.47 Amended and Restated Credit Agreement, dated as of March 10, 2022, by and among BGC Partners, Inc., as the Borrower, certain subsidiaries of the Borrower, as Guarantors, the several financial institutions from time to time as parties thereto, as Lenders, and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on March 14, 2022)
10.48 Support Agreement, dated as of November 15, 2022, by and among BGC Partners, Inc. and Cantor Fitzgerald, L.P. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 16, 2022)**
21.1 List of subsidiaries of BGC Partners, Inc.
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Exhibit
Number Exhibit Title
23.1 Consent of Ernst & Young LLP
31.1 Certification by the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 Certification by the Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1 Certification by the Chief Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101 The following materials from BGC Partners’ Annual Report on Form 10-K for the period ended December 31, 2022 are formatted in inline eXtensible Business Reporting Language (iXBRL): (i) the Consolidated Statements of Financial Condition, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income (Loss), (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statements of Changes in Equity, (vi) Notes to the Consolidated Financial Statements, and (vii) Schedule I, Parent Company Only Financial Statements. The XBRL Instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the iXBRL document.
104 The cover page from this Annual Report on Form 10-K, formatted in inline XBRL (included in Exhibit 101).
ITEM 16. FORM 10-K SUMMARY
Not Applicable
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K for the fiscal year ended December 31, 2022 to be signed on its behalf by the undersigned, thereunto duly authorized, on the 1st day of March, 2023.
BGC Partners, Inc.
By: /S/ HOWARD W. LUTNICK
Name: Howard W. Lutnick
Title: Chairman of the Board and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the registrant, BGC Partners, Inc., in the capacities and on the date indicated.
Signature Capacity in Which Signed Date
/S/ HOWARD W. LUTNICK Chairman of the Board and Chief Executive Officer March 1, 2023
Howard W. Lutnick (Principal Executive Officer)
/S/ JASON W. HAUF Chief Financial Officer March 1, 2023
Jason W. Hauf (Principal Financial and Accounting Officer)
/S/ LINDA A. BELL Director March 1, 2023
Linda A. Bell
/S/ MARTIN LAGUERRE Director March 1, 2023
Martin Laguerre
/S/ DAVID P. RICHARDS Director March 1, 2023
David P. Richards
/S/ ARTHUR U. MBANEFO Director March 1, 2023
Arthur U. Mbanefo
[Signature page to the Annual Report on Form 10-K for the period ended December 31, 2022 dated March 1, 2023.]
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BGC PARTNERS, INC.
(Parent Company Only)
STATEMENTS OF FINANCIAL CONDITION
(in thousands, except share and per share data)
December 31, 2022 December 31, 2021
Assets
Cash and cash equivalents $ 49 $ 31
Investments in subsidiaries 592,571 568,961
Receivables from related parties 9,160 10,038
Notes receivable from related parties 1,045,966 1,043,189
Other assets 91,654 70,261
Total assets $ 1,739,400 $ 1,692,480
Liabilities and Stockholders’ Equity
Accounts payable, accrued and other liabilities $ 23,789 $ 29,539
Notes payable and other borrowings 1,045,966 1,043,189
Total liabilities 1,069,755 1,072,728
Commitments and contingencies (Note 2)
Total stockholders’ equity 669,645 619,752
Total liabilities and stockholders’ equity $ 1,739,400 $ 1,692,480
See accompanying Notes to Financial Statements.
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BGC PARTNERS, INC.
(Parent Company Only)
STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Year Ended December 31,
2022 2021 2020
Revenues:
Other revenues $ 263 $ 552 $ 450
Interest and dividend income 53,652 60,772 65,762
Total revenue 53,915 61,324 66,212
Expenses:
Interest expense 53,652 60,772 65,762
Total expenses 53,652 60,772 65,762
Income from operations before income taxes 263 552 450
Equity income (loss) of subsidiaries 42,207 114,971 38,030
Provision (benefit) for income taxes ( 6,242 ) ( 8,484 ) ( 6,582 )
Net income available to common stockholders $ 48,712 $ 124,007 $ 45,062
Per share data:
Basic earnings (loss) per share
Net income available to common stockholders $ 48,712 $ 124,007 $ 45,062
Basic earnings (loss) per share $ 0.13 $ 0.33 $ 0.12
Basic weighted-average shares of common stock outstanding 371,561 379,215 361,736
Fully diluted earnings (loss) per share
Net income (loss) for fully diluted shares $ 63,479 $ 173,995 $ 64,787
Fully diluted earnings (loss) per share $ 0.13 $ 0.32 $ 0.12
Fully diluted weighted-average shares of common stock outstanding 499,414 540,020 546,848
See accompanying Notes to Financial Statements.
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BGC PARTNERS, INC.
(Parent Company Only)
STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
Year Ended December 31,
2022 2021 2020
Net income available to common stockholders $ 48,712 $ 124,007 $ 45,062
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustments ( 4,883 ) ( 11,853 ) 5,382
Benefit plans — 235 ( 1,210 )
Total other comprehensive (loss) income, net of tax ( 4,883 ) ( 11,618 ) 4,172
Comprehensive income attributable to common stockholders $ 43,829 $ 112,389 $ 49,234
See accompanying Notes to Financial Statements.
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BGC PARTNERS, INC.
(Parent Company Only)
STATEMENTS OF CASH FLOWS
(in thousands)
Year Ended December 31,
2022 2021 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income available to common stockholders $ 48,712 $ 124,007 $ 45,062
Adjustments to reconcile net income to net cash used in operating activities:
Amortization of deferred financing costs 2,801 3,592 4,188
Equity (income) loss of subsidiaries ( 48,712 ) ( 114,971 ) ( 38,030 )
Deferred tax (benefit) expense ( 20,341 ) ( 6,404 ) ( 13,585 )
Decrease (increase) in operating assets:
Investments in subsidiaries 55,706 335,295 ( 11,480 )
Receivables from related parties 878 ( 7,280 ) 1,241
Note receivable from related party ( 2,801 ) 251,312 ( 187,069 )
Other assets ( 1,052 ) 1,769 887
(Decrease) increase in operating liabilities:
Accounts payable, accrued and other liabilities ( 5,750 ) ( 21,459 ) 14,295
Net cash used in operating activities 29,441 565,861 ( 184,491 )
CASH FLOWS FROM INVESTING ACTIVITIES:
Net cash used in investing activities — — —
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends to stockholders ( 14,859 ) ( 15,098 ) ( 60,440 )
Repurchase of Class A common stock ( 103,888 ) ( 365,398 ) ( 5 )
Issuance of senior notes, net of deferred issuance costs — — 294,396
Repayments of senior notes — ( 256,032 ) ( 43,968 )
Unsecured revolving credit agreement borrows — 300,000 230,000
Unsecured revolving credit agreement repayments — ( 300,000 ) ( 300,000 )
Distributions from subsidiaries 89,234 70,602 61,972
Proceeds from offering of Class A common stock, net 90 72 2,516
Net cash provided by financing activities ( 29,423 ) ( 565,854 ) 184,471
Net increase (decrease) in cash and cash equivalents 18 7 ( 20 )
Cash and cash equivalents at beginning of period 31 24 44
Cash and cash equivalents at end of period $ 49 $ 31 $ 24
Supplemental cash information:
Cash paid (refund) during the period for taxes $ 5,269 $ ( 157 ) $ ( 5,919 )
Cash paid during the period for interest 49,375 59,018 60,594
Supplemental non-cash information:
Issuance of Class A common stock upon exchange of limited partnership interests
$ 34,889 $ 157,547 $ 11,388
Issuance of Class A and contingent Class A common stock and limited partnership interests for acquisitions
2,710 1,160 1,578
See accompanying Notes to Financial Statements.
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BGC PARTNERS, INC.
(Parent Company Only)
NOTES TO FINANCIAL STATEMENTS
1. Organization and Basis of Presentation
The accompanying Parent Company Only Financial Statements of BGC Partners should be read in conjunction with the Consolidated Financial Statements of BGC Partners and subsidiaries and the notes thereto.
For the year ended December 31, 2022, the Company declared and paid cash dividends of $ 0.04 per share to BGC Class A and Class B common stockholders. For the year ended December 31, 2021 and 2020, the comparable cash dividend amounts were $ 0.04 per share and $ 0.17 per share, respectively.
2. Commitments, Contingencies and Guarantees
On May 31, 2017, the Company entered into a $ 29.9 million secured loan arrangement, under which it pledged certain fixed assets as security for a loan. This arrangement is guaranteed by the Parent Company and incurred interest at a fixed rate of 3.44 % per year and matured on May 31, 2021; therefore, there were no borrowings outstanding as of December 31, 2022 and 2021. The Company did not record any interest expense related to this arrangement for the year ended December 31, 2022. The Company recorded interest expense related to this secured loan arrangement of $ 40 thousand and $ 0.3 million for the years ended December 31, 2021 and 2020, respectively.
On April 8, 2019, the Company entered into a $ 15.0 million secured loan arrangement, under which it pledged certain fixed assets as security for a loan. This arrangement is guaranteed by the Parent Company and incurs interest at a fixed rate of 3.77 % and matures on April 8, 2023. As of December 31, 2022 and December 31, 2021, the Company had $ 2.0 million and $ 5.9 million, respectively, outstanding related to this secured loan arrangement. The book value of the fixed assets pledged as of December 31, 2022 and 2021 was $ 10 thousand and $ 0.1 million, respectively. The Company recorded interest expense related to this secured loan arrangement of $ 0.1 million, $ 0.3 million and $ 0.4 million for the years ended December 31, 2022, 2021 and 2020, respectively.
On April 19, 2019, the Company entered into a $ 10.0 million secured loan arrangement, under which it pledged certain fixed assets as security for a loan. This arrangement is guaranteed by the Parent Company and incurs interest at a fixed rate of 3.89 % and matures on April 19, 2023. As of December 31, 2022 and December 31, 2021, the Company had $ 1.3 million and $ 3.8 million, respectively, outstanding related to this secured loan arrangement. The book value of the fixed assets pledged as of December 31, 2022 and 2021 was $ 0.3 million and $ 1.0 million, respectively. The Company recorded interest expense related to this secured loan arrangement of $ 0.1 million, $ 0.2 million and $ 0.3 million for the years ended December 31, 2022, 2021 and 2020, respectively.
3. Notes Payable and Other Borrowings
Unsecured Senior Revolving Credit Agreement
On November 28, 2018, the Company entered into the Revolving Credit Agreement with Bank of America, N.A., as administrative agent, and a syndicate of lenders, which replaced the existing committed unsecured senior revolving credit agreement. The maturity date of the Revolving Credit Agreement was November 28, 2020, and the maximum revolving loan balance was $ 350.0 million. Borrowings under this Revolving Credit Agreement bore interest at either LIBOR or a defined base rate plus additional margin. On December 11, 2019, the Company entered into an amendment to the Revolving Credit Agreement. Pursuant to the amendment, the maturity date was extended to February 26, 2021. On February 26, 2020, the Company entered into a second amendment to the Revolving Credit Agreement, pursuant to which, the maturity date was extended by two years to February 26, 2023. There was no change to the interest rate or the maximum revolving loan balance. On November 1, 2021, the Company repaid in full the $ 300.0 million borrowings outstanding under the Revolving Credit Agreement. As of both December 31, 2022 and 2021, there were no borrowings outstanding under the Revolving Credit Agreement. The average interest rate on the outstanding borrowings was 0.00 % and 2.09 % for the years ended December 31, 2022 and 2021, respectively. The Company recorded interest expense related to the Revolving Credit Agreement of $ 2.3 million, $ 3.6 million and $ 5.3 million for the years ended December 31, 2022, 2021 and 2020, respectively.
5.125 % Senior Notes
On May 27, 2016, the Company issued an aggregate of $ 300.0 million principal amount of 5.125 % Senior Notes, which matured on May 27, 2021. The 5.125 % Senior Notes were general senior unsecured obligations of the Company. The 5.125 % Senior Notes bore interest at a rate of 5.125 % per year, payable in cash on May 27 and November 27 of each year,
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commencing November 27, 2016 and ending on the maturity date. Prior to maturity, on August 5, 2020, the Company commenced a cash tender offer for any and all $ 300.0 million outstanding aggregate principal amount of its 5.125 % Senior Notes. On August 11, 2020, the Company’s cash tender offer expired at 5:00 p.m., New York City time. As of the expiration time, $ 44.0 million aggregate principal amount of the 5.125 % Senior Notes were validly tendered. These notes were redeemed on the settlement date of August 14, 2020. On May 27, 2021, BGC repaid the remaining $ 256.0 million principal plus accrued interest on its 5.125 % Senior Notes. The Company did not record any interest expense related to the 5.125% Senior Notes for the year ended December 31, 2022. The Company recorded interest expense related to the 5.125 % Senior Notes of $ 5.8 million and $ 16.3 million for the years ended December 31, 2021 and 2020, respectively.
5.375 % Senior Notes
On July 24, 2018, the Company issued an aggregate of $ 450.0 million principal amount of 5.375 % Senior Notes. The 5.375 % Senior Notes are general senior unsecured obligations of the Company. The 5.375 % Senior Notes bear interest at a rate of 5.375 % per year, payable in cash on January 24 and July 24 of each year, commencing January 24, 2019. The 5.375 % Senior Notes will mature on July 24, 2023. The Company may redeem some or all of the 5.375 % Senior Notes at any time or from time to time for cash at certain “make-whole” redemption prices (as set forth in the Indenture related to the 5.375 % Senior Notes). If a “Change of Control Triggering Event” (as defined in the Indenture) occurs, holders may require the Company to purchase all or a portion of their notes for cash at a price equal to 101 % of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date. The initial carrying value of the 5.375 % Senior Notes was $ 444.2 million, net of the discount and debt issuance costs of $ 5.8 million. The issuance costs are amortized as interest expense and the carrying value of the 5.375 % Senior Notes will accrete up to the face amount over the term of the notes. The carrying value of the 5.375 % Senior Notes as of December 31, 2022 was $ 449.2 million. The Company recorded interest expense related to the 5.375 % Senior Notes of $ 25.5 million, $ 25.5 million and $ 25.5 million for the years ended December 31, 2022, 2021 and 2020, respectively.
3.750 % Senior Notes
On September 27, 2019, the Company issued an aggregate of $ 300.0 million principal amount of 3.750 % Senior Notes. The 3.750 % Senior Notes are general unsecured obligations of the Company. The 3.750 % Senior Notes bear interest at a rate of 3.750 % per year, payable in cash on April 1 and October 1 of each year, commencing April 1, 2020. The 3.750 % Senior Notes will mature on October 1, 2024. The Company may redeem some or all of the 3.750 % Senior Notes at any time or from time to time for cash at certain “make-whole” redemption prices (as set forth in the Indenture). If a “Change of Control Triggering Event” (as defined in the Indenture) occurs, holders may require the Company to purchase all or a portion of their notes for cash at a price equal to 101 % of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date. The initial carrying value of the 3.750 % Senior Notes was $ 296.1 million, net of discount and debt issuance costs of $ 3.9 million. The issuance costs will be amortized as interest expense and the carrying value of the 3.750 % Senior Notes will accrete up to the face amount over the term of the notes. The carrying value of the 3.750 % Senior Notes was $ 298.6 million as of December 31, 2022. The Company recorded interest expense related to the 3.750 % Senior Notes of $ 12.1 million, $ 12.1 million and $ 12.1 million for the years ended December 31, 2022, 2021 and 2020, respectively.
4.375 % Senior Notes
On July 10, 2020, the Company issued an aggregate of $ 300.0 million principal amount of 4.375 % Senior Notes. The 4.375 % Senior Notes are general unsecured obligations of the Company. The 4.375 % Senior Notes bear interest at a rate of 4.375 % per year, payable in cash on June 15 and December 15 of each year, commencing December 15, 2020. The 4.375% Senior Notes will mature on December 15, 2025. The Company may redeem some or all of the 4.375 % Senior Notes at any time or from time to time for cash at certain “make-whole” redemption prices. If a “Change of Control Triggering Event” occurs, holders may require the Company to purchase all or a portion of their notes for cash at a price equal to 101 % of the principal amount of the notes to be purchased plus any accrued and unpaid interest to, but excluding, the purchase date. The initial carrying value of the 4.375 % Senior Notes was $ 296.8 million, net of discount and debt issuance costs of $ 3.2 million. The issuance costs will be amortized as interest expense, and the carrying value of the 4.375 % Senior Notes will accrete up to the face amount over the term of the notes. The carrying value of the 4.375 % Senior Notes was $ 298.2 million as of December 31, 2022. The Company recorded interest expense related to the 4.375 % Senior Notes of $ 13.8 million, $ 13.8 million, and $ 6.5 million for the years ended December 31, 2022, 2021 and 2020, respectively.
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