Item 8.01. Other Events.
On August 3, 2018, BGC Partners, Inc. (BGC Partners or BGC) delivered a notice of redemption to the holders of its
$112.5 million aggregate principal amount 8.125% Senior Notes due 2042 (the 8.125% Notes), which redemption (the Redemption) will occur on September 5, 2018 (the Redemption Date). The 8.125% Notes were
issued pursuant to an Indenture, dated as of June 26, 2012, as supplemented by the First Supplemental Indenture, dated as of June 26, 2012, between BGC and U.S. Bank National Association, as trustee. BGC will redeem the 8.125% Notes at a
redemption price equal to 100% of the principal amount of the 8.125% Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the Redemption Date.
On September 4, 2018, BGC Partners, L.P. (BGC U.S. OpCo) will loan $112.5 million to Newmark Partners, L.P. (Newmark OpCo)
pursuant to the existing Amended and Restated Credit Agreement, dated as of March 19, 2018, between BGC and Newmark Group Inc. (Newmark), which loan will bear interest at an annual rate equal to 6.5% (such loan, the
Intercompany Loan). Newmark OpCo will use the proceeds of the Intercompany Loan to repay the BGC Note (defined and described further below) on, or immediately prior to, the Redemption Date. The Intercompany Loan has been approved by the
Boards of Director and Audit Committee of each of BGC and Newmark.
The transactions described above will result in an interest rate savings to BGC of
2.75% per annum.
As previously disclosed, on December 13, 2017, prior to the closing of the initial public offering of Newmark, BGC Partners, BGC
Holdings, L.P., BGC U.S. OpCo and their respective subsidiaries (other than the Newmark group (defined below), the BGC group) transferred to Newmark, Newmark Holdings, L.P. and Newmark OpCo and their respective subsidiaries (the
Newmark group) the assets and liabilities of the BGC group relating to BGCs Real Estate Services business (the Separation). In connection with the Separation, BGC Partners retained the right to receive payments in
respect of certain note obligations owed to BGC Partners by BGC U.S. OpCo that were assumed by Newmark OpCo, including a note issued by BGC U.S. OpCo to BGC Partners in connection with the issuance by BGC of the 8.125% Notes, in the aggregate
principal amount of $112.5 million, referred to as the BGC Note. In connection with the Redemption, under the terms of the BGC Note, Newmark OpCo is required to repay to BGC Partners the $112.5 million aggregate principal
amount of the BGC Note, plus accrued and unpaid interest to, but excluding, the Redemption Date. As noted above, the Intercompany Loan will be used to fund Newmark OpCos repayment of the BGC Note.
In addition, on August 6, 2018, BGC entered into an amendment to the existing unsecured senior credit agreement (the BGC Credit Agreement)
with Cantor Fitzgerald, L.P. The amendment to the BGC Credit Agreement increases the aggregate principal amount that can be loaned to the other party or any of its subsidiaries from $250 million to $400 million that can be outstanding at
any time. The amendment to the BGC Credit Agreement was approved by both the Board of Directors and the Audit Committee of BGC.
Discussion of
Forward-Looking Statements about BGC Partners and Newmark
Statements in this document regarding BGC and Newmark that are not historical facts are
forward-looking statements that involve risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements. Except as required by law, BGC and Newmark undertake no obligation to
update any forward-looking statements. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see BGCs and Newmarks Securities and
Exchange Commission filings, including, but not limited to, the risk factors set forth in these filings and any updates to such risk factors contained in subsequent Forms
10-K,
Forms
10-Q
or Forms
8-K.