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Compensation | 3 Months Ended
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Mar. 31, 2019
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] |
Compensation |
18. | Compensation
The Company’s Compensation Committee may grant various equity-based and partnership awards, including restricted stock units, restricted stock, stock options, limited partnership units and exchange rights for shares of the Company’s Class A common stock upon exchange of limited partnership units. Upon vesting of RSUs, issuance of restricted stock, exercise of employee stock options and exchange of limited partnership units, the Company generally issues new shares of the Company’s Class A common stock. On June 22, 2016, at the Annual Meeting of Stockholders of the Company, the stockholders approved the Seventh Amended and Restated Long Term Incentive Plan (the “Equity Plan”) to increase from 350 million to 400 million the aggregate number of shares of Class A common stock of the Company that may be delivered or cash-settled pursuant to awards granted during the life of the Equity Plan. As of March 31, 2019, the limit on the aggregate number of shares authorized to be delivered allowed for the grant of future awards relating to 154.4 million shares. On June 6, 2017, at the Annual Meeting of Stockholders of the Company, the Company’s stockholders approved the Company’s Second Amended and Restated Incentive Bonus Compensation Plan (the “Incentive Plan”) to approve the material terms of the performance goals under the Incentive Plan for compliance with Section 162(m) of the Internal Revenue Code of 1986, as amended, including an amendment to those performance goals in order to broaden the stock price performance goal to include dividends and/or total stockholder return. Limited Partnership Units A summary of the activity associated with limited partnership units awarded to BGC employees is as follows:
|  | BGC Units |  |  | Newmark Units |
Balance at December 31, 2018 |  |  | 79,729,188 |  |  |  | 22,113,105 |
Granted |  |  | 9,290,951 |  |  |  | 508,522 |
Redeemed/exchanged units |  |  | (4,073,748 | ) |  |  | (37,567 | )
Forfeited units/other |  |  | (4,002,864 | ) |  |  | (7,095,471 | )
Balance at March 31, 2019 |  |  | 80,943,527 |  |  |  | 15,488,589 |
During the three months ended March 31, 2019, the Company granted exchangeability on 0.3 million and 0.1 million limited partnership units in BGC Holdings and Newmark Holdings, respectively, and during the three months ended March 31, 2018, the Company granted exchangeability on 3.2 and 1.4 million limited partnership units in BGC Holdings and Newmark Holdings, respectively. The Company incurred non-cash compensation expense related to the grant of exchangeability of $5.0 million and $34.5 million for the three months ended March 31, 2019 and 2018, respectively. This expense is included within “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in the Company’s unaudited condensed consolidated statements of operations. In addition, during the three months ended March 31, 2019, the Company redeemed 0.2 million units in BGC Holdings and 0.1 million units in Newmark Holdings and in turn directly issued employees an equivalent amount of BGC or Newmark shares, respectively. The Company incurred an expense of $1.1 million relating to this activity, which is included within “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in the Company’s unaudited condensed consolidated statements of operations. As of March 31, 2019 and December 31, 2018, the number of share-equivalent limited partnership units exchangeable into shares of BGC Class A common stock at the discretion of the unit holder was 2.8 million and 3.9 million, respectively. As of March 31, 2019, the notional value of the BGC limited partnership units with a post-termination pay-out amount held by executives and non-executive employees, awarded in lieu of cash compensation for salaries, commissions and/or discretionary or guaranteed bonuses, was approximately $10.0 million. The number of outstanding limited partnership units with a post-termination pay-out represent 0.3 million limited partnership units in BGC Holdings of which approximately 59 thousand units in BGC Holdings. As of March 31, 2019, the aggregate estimated fair value of these limited partnership units was approximately $5.1 million. As of March 31, 2019, the notional value of the Newmark limited partnership units with a post-termination pay-out amount held by executives and non-executive employees, awarded in lieu of cash compensation for salaries, commissions and/or discretionary or guaranteed bonuses, was approximately $1.0 million. The number of outstanding limited partnership units with a post-termination pay-out represent 129 thousand limited partnership units in Newmark Holdings, of which approximately 85 thousand units in Newmark Holdings were unvested. As of March 31, 2019, the aggregate estimated fair value of these limited partnership units was approximately $0.1 million. As of December 31, 2018, the notional value of the BGC limited partnership units with a post-termination pay-out amount held by executives and non-executive employees, awarded in lieu of cash compensation for salaries, commissions and/or discretionary or guaranteed bonuses, was approximately $10.0 million. As of December 31, 2018, the aggregate estimated fair value of these limited partnership units was approximately $4.8 million. The number of outstanding limited partnership units with a post-termination pay-out as of December 31, 2018 was approximately 0.3 million, of which approximately 0.1 million were unvested. As of December 31, 2018, the number of outstanding limited partnership units with a post-termination pay-out represent 0.3 million and 0.2 million of limited partnership units in BGC Holdings and Newmark Holdings, respectively, of which approximately 68 thousand and 31 thousand units in BGC Holdings and Newmark Holdings, respectively, were unvested. The liability for limited partnership units with a post-termination payout held by executives and non-executive employees is included in “Accrued compensation” on the Company’s unaudited condensed consolidated statements of financial condition. Certain of the limited partnership units with a post-termination pay-out have been granted in connection with the Company’s acquisitions. As of March 31, 2019 and December 31, 2018, the aggregate estimated fair value of these acquisition-related limited partnership units was $3.6 million. The liability for such acquisition-related limited partnership units is included in “Accounts payable, accrued and other liabilities” on the Company’s unaudited condensed consolidated statements of financial condition. Compensation expense related to limited partnership units with a post-termination pay-out amount or a stated vesting schedule is recognized over the stated service period. These units generally vest between three and five years from the date of grant. The Company recognized compensation expense (benefit) related to these limited partnership units of $(0.5) million and $0.2 million for the three months ended March 31, 2019 and 2018, respectively. This expense is included in “Compensation and employee benefits” in the Company’s unaudited condensed consolidated statements of operations. Certain limited partnership units generally receive quarterly allocations of net income, which are cash distributed on a quarterly basis and generally contingent upon services being provided by the unit holders. The allocation of income to limited partnership units and FPUs was $4.5 million and $3.8 million for the three months ended March 31, 2019 and 2018, respectively. This expense is included within “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in the Company’s unaudited condensed consolidated statements of operations. Restricted Stock Units A summary of the activity associated with RSUs held by BGC employees is as follows:
|  | Restricted Stock Units |  |  | Weighted- Average Grant Date Fair Value |  |  | Weighted- Average Remaining Contractual Term (Years) |
Balance at December 31, 2018 |  |  | 928,713 |  |  | $ | 10.83 |  |  |  | 1.75 |
Granted |  |  | 138,784 |  |  |  | 5.86 |  |  |  |  |
Delivered units |  |  | (273,163 | ) |  |  | 10.15 |  |  |  |  |
Forfeited units |  |  | (27,404 | ) |  |  | 10.17 |  |  |  |  |
Balance at March 31, 2019 |  |  | 766,930 |  |  | $ | 10.20 |  |  |  | 2.09 |
The fair value of RSUs awarded to employees and directors is determined on the date of grant based on the market value of Class A common stock (adjusted if appropriate based upon the award’s eligibility to receive dividends), and is recognized, net of the effect of estimated forfeitures, ratably over the vesting period. The Company uses historical data, including historical forfeitures and turnover rates, to estimate expected forfeiture rates for both employee and director RSUs. Each RSU is settled in one share of Class A common stock upon completion of the vesting period. During the three months ended March 31, 2019 and 2018, the Company granted 0.1 million and 49 thousand, respectively, of RSUs with aggregate estimated grant date fair values of approximately $0.8 million and $0.6 million, respectively, to employees and directors. These RSUs were awarded in lieu of cash compensation for salaries, commissions, fees, and/or discretionary or guaranteed bonuses. RSUs granted to these individuals generally vest over a two- to four-year period. For RSUs that vested during the three months ended March 31, 2019 and 2018, the Company withheld shares valued at $0.4 million and $1.3 million, respectively, to pay taxes due at the time of vesting. As of March 31, 2019 and December 31, 2018, the aggregate estimated grant date fair value of outstanding RSUs was approximately $7.8 million and $10.1 million, respectively. Compensation expense related to RSUs was approximately $0.7 million and $1.2 million, respectively, for the three months ended March 31, 2019 and 2018. As of March 31, 2019, there was approximately $7.3 million of total unrecognized compensation expense related to unvested RSUs. In addition, during the three months ended March 31, 2019, the Company incurred compensation expense related to acquisition RSUs of approximately $0.3 million. There was no expense for acquisition related RSUs during the three months ended March 31, 2018. Restricted Stock The Company has granted restricted shares under its Equity Plan. Such restricted shares are generally saleable by partners in five to ten years. Partners who agree to extend the length of their employment agreements and/or other contractual modifications sought by the Company are expected to be able to sell their restricted shares over a shorter time period. Transferability of the shares of restricted stock is not subject to continued employment or service with the Company or any affiliate or subsidiary of the Company; however, transferability is subject to compliance with BGC Partners’ and its affiliates’ customary noncompete obligations. During the three months ended March 31, 2019 and 2018, there were no BGC shares forfeited in connection with this clause. During the three months ended March 31, 2019 and 2018, the Company released the restrictions with respect to approximately 0.5 million of such BGC shares. As of March 31, 2019, there were 6.9 million of such restricted BGC shares outstanding. Deferred Compensation As part of the acquisition of GFI, the Company maintains a Deferred Cash Award Program, which provides for the grant of deferred cash incentive compensation to eligible employees. The Company may pay certain bonuses in the form of deferred cash compensation awards, which generally vest over a future service period. In addition, prior to the completion of the tender offer, GFI’s outstanding RSUs were converted into the right to receive an amount in cash equal to $6.10 per unit, with such cash payable on and subject to the terms and conditions of the original vesting schedule of each RSU. The total compensation expense recognized in relation to the deferred cash compensation awards was de minimis and $1.3 million for the three months ended March 31, 2019 and 2018, respectively. As of March 31, 2019, the total liability for the deferred cash compensation awards was $5.5 million, which is included in “Accrued compensation” on the Company’s unaudited condensed consolidated statements of financial condition. Total unrecognized compensation cost related to deferred cash compensation, prior to the consideration of forfeitures, was approximately $2.0 million and is expected to be recognized over a weighted-average period of 1.79 years.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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