Stock Transactions and Unit Redemptions

9 Months Ended

Sep. 30, 2017

Equity [Abstract]

Stock Transactions and Unit Redemptions

6. Stock Transactions and Unit Redemptions

Class A Common Stock

On June 22, 2016, at the Company’s 2016 Annual Meeting of Stockholders, the stockholders approved an amendment to the Company’s amended and restated certificate of incorporation to increase the number of authorized shares of Class A common stock from 500 million shares to 750 million shares. The Company filed the certificate of amendment on June 23, 2016, and the amendment was effective on that date.

Changes in shares of the Company’s Class A common stock outstanding for the three and nine months ended September 30, 2017 and 2016 were as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Shares outstanding at beginning of period		251,057,086			241,292,033			244,869,624			219,063,365
Share issuances:
Exchanges of limited partnership interests1		1,434,050			2,947,876			6,795,187			6,269,630
Issuance of Class A common stock for general corporate    purposes		—			—			—			1,648,000
Vesting of restricted stock units (RSUs)		42,295			81,873			479,313			569,344
Acquisitions		82,907			125,111			1,424,690			24,854,144
Other issuances of Class A common stock		11,874			250,219			45,490			292,524
Treasury stock repurchases		(295,871	)		(1,341,947	)		(1,246,365	)		(9,326,182	)
Forfeitures of restricted Class A common stock		(71,251	)		(43,657	)		(106,849	)		(59,317	)
Shares outstanding at end of period		252,261,090			243,311,508			252,261,090			243,311,508

¹ Because they are included in the Company’s fully diluted share count, if dilutive, any exchange of limited partnership interests into Class A common shares would not impact the fully diluted number of shares and units outstanding.

Class B Common Stock

On June 22, 2016, at the Company’s 2016 Annual Meeting of Stockholders, the stockholders approved an amendment to the Company’s amended and restated certificate of incorporation to increase the number of authorized shares of Class B common stock from 100 million shares to 150 million shares and to provide that Class B common stock shall be issued only to certain affiliated entities or related persons. The Company filed the certificate of amendment on June 23, 2016, and the amendment was effective on that date.

The Company did not issue any shares of Class B common stock during the three and nine months ended September 30, 2017 and 2016. As of September 30, 2017 and 2016, there were 34,848,107 shares of the Company’s Class B common stock outstanding.

Controlled Equity Offering

The Company has entered into a controlled equity offering (“CEO”) sales agreement with CF&Co (“November 2014 Sales Agreement”), pursuant to which the Company may offer and sell up to an aggregate of 20 million shares of Class A common stock. Shares of the Company’s Class A common stock sold under its CEO sales agreements are used primarily for redemptions and exchanges of limited partnership interests in BGC Holdings. CF&Co is a wholly owned subsidiary of Cantor and an affiliate of the Company. Under this agreement, the Company has agreed to pay CF&Co 2% of the gross proceeds from the sale of shares. As of September 30, 2017, the Company has sold 19,457,181 shares of Class A common stock under the November 2014 Sales Agreement. For additional information, see Note 17—“Related Party Transactions.”

On April 12, 2017, the Company entered into a CEO sales agreement with CF&Co (“April 2017 Sales Agreement”) on the same terms as above, pursuant to which the Company may offer and sell up to an aggregate of 20 million shares of Class A common stock. As of September 30, 2017, the Company has not sold any shares of Class A common stock under the April 2017 Sales Agreement.

Unit Redemptions and Share Repurchase Program

The Company’s Board of Directors and Audit Committee have authorized repurchases of the Company’s Class A common stock and redemptions of BGC Holdings limited partnership interests or other equity interests in the Company’s subsidiaries. On February 7, 2017, the Company’s Board of Directors and Audit Committee increased the BGC Partners share repurchase and unit redemption authorization to $300 million, which may include purchases from Cantor, its partners or employees or other affiliated persons or entities. As of September 30, 2017, the Company had approximately $228.6 million remaining from its share repurchase and unit redemption authorization. From time to time, the Company may actively continue to repurchase shares and/or redeem units. The table below represents unit redemption and share repurchase activity for the three and nine months ended September 30, 2017:

Period	Total Number of Units Redeemed or Shares Repurchased		Average Price Paid per Unit or Share		Approximate Dollar Value of Units and Shares That May Yet Be Redeemed/ Purchased Under the Plan
Redemptions1,2
January 1, 2017—March 31, 2017		2,927,758	$	10.84
April 1, 2017—June 30, 2017		1,908,867	$	11.14
July 1, 2017—September 30, 2017		1,675,330	$	12.58
Total Redemptions		6,511,955	$	11.38
Repurchases3,4
January 1, 2017—March 31, 2017		552,955	$	11.07
April 1, 2017—June 30, 2017		397,539		11.25
July 1, 2017—July 31, 2017		19,806		12.99
August 1, 2017—August 31, 2017		56,827		12.95
September 1, 2017—September 30, 2017		219,238		13.56
Total Repurchases		1,246,365	$	11.68
Total Redemptions and Repurchases		7,758,320	$	11.43	$	228,572,015

¹ During the three months ended September 30, 2017, the Company redeemed approximately 1.2 million limited partnership units at an aggregate redemption price of approximately $16.0 million for an average price of $12.97 per unit and approximately 0.4 million FPUs at an aggregate redemption price of approximately $5.0 million for an average price of $11.48 per unit. During the three months ended September 30, 2016, the Company redeemed approximately 2.3 million limited partnership units at an aggregate redemption price of approximately $20.6 million for an average price of $8.90 per unit and approximately 132.7 thousand FPUs at an aggregate redemption price of approximately $1.2 million for an average price of $8.81 per unit.

² During the nine months ended September 30, 2017, the Company redeemed approximately 5.8 million limited partnership units at an aggregate redemption price of approximately $66.1 million for an average price of $11.40 per unit and approximately 0.7 million FPUs at an aggregate redemption price of approximately $8.0 million for an average price of $11.19 per unit. During the nine months ended September 30, 2016, the Company redeemed approximately 4.8 million limited partnership units at an aggregate purchase price of approximately $42.2 million for an average price of $8.87 per unit and approximately 272.9 thousand FPUs at an aggregate redemption price of approximately $2.3 million for an average price of $8.48 per unit.

^3. During the three months ended September 30, 2017, the Company repurchased approximately 0.3 million shares of its Class A common stock at an aggregate purchase price of approximately $4.0 million for an average price of $13.41 per share. During the three months ended September 30, 2016, the Company repurchased approximately 1.3 million shares of its Class A common stock at an aggregate purchase price of approximately $11.9 million for an average price of $8.90 per share.

^4. During the nine months ended September 30, 2017, the Company repurchased approximately 1.2 million shares of its Class A common stock at an aggregate purchase price of approximately $14.6 million for an average price of $11.68 per share. During the nine months ended September 30, 2016, the Company repurchased approximately 9.3 million shares of its Class A common stock at an aggregate purchase price of approximately $81.7 million for an average price of $8.77 per share.

The table above represents the gross unit redemptions and share repurchases of the Company’s Class A common stock during the nine months ended September 30, 2017. Approximately 5.4 million of the 6.5 million units above were redeemed using cash from the Company’s CEO program, and therefore did not impact the fully diluted number of shares and units outstanding. The remaining redemptions along with the Class A common stock repurchases resulted in a 2.3 million reduction in the fully diluted share count. This net reduction cost the Company approximately $27.0 million (or $11.52 per share/unit) during the nine months ended September 30, 2017. This reduction partially offset the overall growth in the fully diluted share count which resulted from shares issued for equity-based compensation, front office hires and acquisitions.

Redeemable Partnership Interest

The changes in the carrying amount of redeemable partnership interest for the nine months ended September 30, 2017 and 2016 were as follows (in thousands):

	Nine Months Ended September 30,
	2017			2016
Balance at beginning of period	$	52,577		$	57,145
Consolidated net income allocated to FPUs		6,014			5,588
Earnings distributions		(3,740	)		(4,067	)
FPUs exchanged		(985	)		(1,890	)
FPUs redeemed		(2,270	)		(334	)
Other		412			(1	)
Balance at end of period	$	52,008		$	56,441