Cantor Fitzgerald LP, the bond broker that lost about 700 employees in the World Trade Center attack, said victims' families will receive health insurance for 10 years and a share of profits for five years.
"We want to be able to care for these families over the long term," Cantor chief executive officer Howard Lutnick said in a statement. "Providing health care coverage for families of our lost friends and colleagues is a big part of that."
The firm that Mr. Lutnick has run since 1991 said 25 per cent of the money that would have been distributed to partners will instead be given to families of employees killed in the attacks over five years, or until they receive $100,000 (U.S.) each. Each will get a life insurance payment of double the victim's salary up to a maximum $100,000, excluding any supplemental policies.
The 700 employees killed were the parents of about 1,500 children.
The 56-year-old firm, which handled about a quarter of trades in the $3-trillion government bond market before the attack, stopped paying the salaries of missing employees on Sept. 15. Soon after that, Mr. Lutnick said he would pay a quarter of future profits to the families, without outlining the details.
The $100,000 "is a minimum," said Mike Holloway, a spokesman for Cantor at Edelman Public Relations. "It's 25 per cent of profit every year for five years. Obviously the company wants to be profitable and the more the company profits, the more the families profit."
Mr. Lutnick told family members at a meeting in Rumson, N.J., Tuesday night that surviving partners had agreed to the profit-sharing and insurance benefits, said Nick Milazzo, a former Cantor trader and friend of several of the victims, who attended the meeting.
He also said brokers' and traders' year-end bonuses would be paid by Nov. 22, based on records of their transactions. The bonuses of employees who didn't receive commissions will equal to last year's bonuses and will be paid by Oct. 22.
The firm has set up a relief fund to provide assistance to families with small children, and the American Red Cross has been writing cheques of up to $30,000 to families with immediate expenses, such as mortgages.
Cantor, which had about 2,000 employees worldwide before Sept. 11, shifted most trading to its eSpeed Inc. unit, an electronic trading system that will take over the bond trading previously handled by Cantor brokers over the phone.
As majority owner of eSpeed, that probably is where Cantor will get the biggest portion of future profits, Mr. Lutnick said on a conference call last week. The partnership distributes some of its profits quarterly to its partners, who also are liable for a share of the company's taxes.
Mr. Lutnick, who survived because he was taking his son to his first day of kindergarten when the attack happened, promised in interviews soon afterward with CNN's Larry King and ABC News' Connie Chung that the firm would rebuild. Its new mission, he said, was to take care of the families of the victims.
The firm has held several memorial services, including one in Central Park that drew more than 5,000 people, including New York City Mayor Rudolph Giuliani. The wife of Glen Wall, 38, a Cantor partner and senior vice-president who was killed, said that Mr. Lutnick had been in touch frequently.
"I've spoke to Howard three times and he's been really great, very supportive," said Diane Wall.
Cantor, based on the 101st and 102nd-105th floors of 1 World Trade Center, is working out of temporary offices in New York and New Jersey and has shifted some business to its London and Tokyo offices.