Month: September 2015

NEW YORK, NY – September 28, 2015 – BGC Partners, Inc. (NASDAQ: BGCP) (“BGC Partners,” “BGC,” or the “Company,”) a leading global brokerage company servicing the financial and real estate markets, today announced that it has updated its outlook for the quarter ending September 30, 2015. The results will include the consolidation of those for BGC’s majority-owned division, GFI Group Inc. (OTC: GFIG) (“GFI Group” or “GFI”), a leading intermediary and provider of trading technologies and support services to the global OTC and listed markets.

BGC expects its quarterly revenues for distributable earnings and its pre-tax distributable earnings to be around the mid-point of the range of its previously stated guidance. This updated outlook reflects the addition of GFI and strong double-digit year-on-year growth for the Company’s Real Estate Services business. BGC’s third quarter 2015 guidance was originally published in a press release dated July 29, 2015, and was as follows:

Original Third Quarter 2015 Outlook Compared with Third Quarter 2014 Results

 The Company expected to produce its fourth consecutive record quarter of distributable earnings revenues and its fifth quarter in a row of record pre-tax distributable earnings.
 BGC anticipated distributable earnings revenues to increase by between approximately 51 percent and 61 percent and to be between $680 million to $725 million, compared with $449.8 million.
 The Company expected pre-tax distributable earnings to increase by between approximately 22 percent and 44 percent and to be in the range of $80 million to $95 million, versus $65.8 million.
 BGC anticipated its effective tax rate for distributable earnings to remain approximately 15 percent.

The Company’s original outlook for distributable earnings revenues would have been approximately $22 million higher but for the strengthening of the U.S. dollar compared with a year earlier.

With respect to BGC’s consolidated results, approximately 33 percent of GFI’s post-tax distributable earnings are expected to be attributable to noncontrolling interest in subsidiaries, while the remaining approximately 67 percent are expected to be attributable to the Company’s fully diluted shareholders.

Distributable Earnings Defined

BGC Partners uses non-GAAP financial measures including “revenues for distributable earnings,” “pre-tax distributable earnings” and “post-tax distributable earnings,” which are supplemental measures of operating performance that are used by management to evaluate the financial performance of the Company and its consolidated subsidiaries. BGC Partners believes that distributable earnings best reflect the operating earnings generated by the Company on a consolidated basis and are the earnings which management considers available for distribution to BGC Partners, Inc. and its common stockholders, as well as to holders of BGC Holdings partnership units during any period.

As compared with “income (loss) from operations before income taxes,” “net income (loss) for fully diluted shares,” and “fully diluted earnings (loss) per share,” all prepared in accordance with GAAP, distributable earnings calculations primarily exclude certain non-cash compensation and other expenses which generally do not involve the receipt or outlay of cash by the Company, which do not dilute existing stockholders, and which do not have economic consequences, as described below. In addition, distributable earnings calculations exclude certain gains and charges that management believes do not best reflect the ordinary operating results of BGC.

Revenues for distributable earnings are defined as GAAP revenues excluding the impact of BGC Partners, Inc.’s non-cash earnings or losses related to its equity investments. Revenues for distributable earnings include the collection of receivables which would have been recognized for GAAP other than for the effect of acquisition accounting. Revenues for distributable earnings also exclude certain one-time or unusual gains that are recognized under GAAP, because the Company does not believe such gains are reflective of its ongoing, ordinary operations.

Pre-tax distributable earnings are defined as GAAP income (loss) from operations before income taxes excluding items that are primarily non-cash, non-dilutive, and non-economic, such as:

 Non-cash stock-based equity compensation charges for REUs granted or issued prior to the merger of BGC Partners, Inc. with and into eSpeed, Inc., as well as post-merger non-cash, non-dilutive equity-based compensation related to partnership unit exchange or conversion.
 Allocations of net income to founding/working partner and other limited partnership units, including REUs, RPUs, PSUs, LPUs, and PSIs.
 Non-cash asset impairment charges, if any.

Distributable earnings calculations also exclude charges related to purchases, cancellations or redemptions of partnership interests and certain unusual, one-time or non-recurring items, if any.

“Compensation and employee benefits” expense for distributable earnings will also include broker commission payouts relating to the aforementioned collection of receivables.

BGC’s definition of distributable earnings also excludes certain gains and charges with respect to acquisitions, dispositions, or resolutions of litigation. This exclusion pertains to the one-time gain related to the Nasdaq OMX transaction. Management believes that excluding these gains and charges best reflects the operating performance of BGC. However, because Nasdaq OMX is expected to pay BGC in an equal amount of stock on a regular basis for 15 years as part of the transaction, the payments associated with BGC’s receipt of such stock are expected to be included in the Company’s calculation of distributable earnings. To make quarter-to-quarter comparisons more meaningful, one-quarter of the annual contingent earn-out amount will be included in the Company’s calculation of distributable earnings each quarter as “other revenues.”

Since distributable earnings are calculated on a pre-tax basis, management intends to also report “post-tax distributable earnings” and “post-tax distributable earnings per fully diluted share:”

 “Post-tax distributable earnings” are defined as pre-tax distributable earnings adjusted to assume that all pre-tax distributable earnings were taxed at the same effective rate.
 “Post-tax distributable earnings per fully diluted share” are defined as post-tax distributable earnings divided by the weighted-average number of fully diluted shares for the period.

BGC’s distributable earnings per share calculations assume either that:

 The fully diluted share count includes the shares related to the dilutive instruments, such as the Convertible Senior Notes, but excludes the associated interest expense, net of tax, when the impact would be dilutive; or
 The fully diluted share count excludes the shares related to these instruments, but includes the associated interest expense, net of tax.

Each quarter, the dividend to BGC’s common stockholders is expected to be determined by the Company’s Board of Directors with reference to post-tax distributable earnings per fully diluted share. In addition to the Company’s quarterly dividend to common stockholders, BGC Partners expects to pay a pro-rata distribution of net income to BGC Holdings founding/working partner and other limited partnership units, including REUs, RPUs, LPUs, PSUs and PSIs, and to Cantor for its noncontrolling interest. The amount of all of these payments is expected to be determined using the above definition of pre-tax distributable earnings per share.

Certain employees who are holders of RSUs may be granted pro-rata payments equivalent to the amount of dividends paid to common stockholders. Under GAAP, a portion of the dividend equivalents on RSUs is required to be taken as a compensation charge in the period paid. However, to the extent that they represent cash payments made from the prior period’s distributable earnings, they do not dilute existing stockholders and are therefore excluded from the calculation of distributable earnings.

The term “distributable earnings” is not meant to be an exact measure of cash generated by operations and available for distribution, nor should it be considered in isolation or as an alternative to cash flow from operations or GAAP net income (loss.) The Company views distributable earnings as a metric that is not necessarily indicative of liquidity or the cash available to fund its operations.

Pre- and post-tax distributable earnings are not intended to replace the Company’s presentation of GAAP financial results. However, management believes that they help provide investors with a clearer understanding of BGC Partners’ financial performance and offer useful information to both management and investors regarding certain financial and business trends related to the Company’s financial condition and results of operations. Management believes that distributable earnings and the GAAP measures of financial performance should be considered together.

Management does not anticipate providing an outlook for GAAP “revenues,” “income (loss) from operations before income taxes,” “net income (loss) for fully diluted shares,” and “fully diluted earnings (loss) per share,” because the items previously identified as excluded from “pre-tax distributable earnings” and “post-tax distributable earnings” are difficult to forecast. Management will instead provide its outlook only as it relates to “revenues for distributable earnings,” “pre-tax distributable earnings,” and “post-tax distributable earnings.”

For more information on this topic, please see the tables in the most recent BGC financial results press release entitled “Reconciliation of Revenues Under GAAP and Distributable Earnings,” and “Reconciliation of GAAP Income (Loss) to Distributable Earnings,” which provide a summary reconciliation between pre- and post-tax distributable earnings and the corresponding GAAP measures for the Company in the periods discussed in this document. The reconciliations for prior periods do not include the results of GFI.

About BGC Partners, Inc.

BGC Partners is a leading global brokerage company servicing the financial and real estate markets. Products include fixed income securities, interest rate swaps, foreign exchange, equities, equity derivatives, credit derivatives, commercial real estate, commodities, futures, and structured products. BGC also provides a wide range of services, including trade execution, broker-dealer services, clearing, processing, information, and other back-office services to a broad range of financial and non-financial institutions. Through its BGC Trader and BGC Market Data brands, BGC offers financial technology solutions, market data, and analytics related to numerous financial instruments and markets. Through the Newmark Grubb Knight Frank brand, BGC offers a wide range of commercial real estate services, including leasing and corporate advisory, investment sales and financial services, consulting, project and development management, and property and facilities management. BGC’s customers include many of the world’s largest banks, broker-dealers, investment banks, trading firms, hedge funds, governments, corporations, property owners, real estate developers, and investment firms. BGC’s common stock trades on the NASDAQ Global Select Market under the ticker symbol (NASDAQ: BGCP). BGC also has an outstanding bond issuance of Senior Notes due June 15, 2042, which trade on the New York Stock Exchange under the symbol (NYSE: BGCA). BGC Partners is led by Chairman and Chief Executive Officer Howard W. Lutnick. For more information, please visit http://www.bgcpartners.com.

BGC, BGC Trader, Newmark, Grubb and Ellis, and Grubb are trademarks and service marks of BGC Partners, Inc. and/or its affiliates. Knight Frank is a service mark of Knight Frank (Nominees) Limited. Trayport is a trademark or registered trademark of Trayport Limited and/or its affiliates. FENICS and FENICS.COM are trademarks or registered trademarks of FENICS Software Inc. and/or its affiliates.

About GFI Group Inc.

GFI is majority-owned by, and operates as a division of, BGC Partners, Inc. GFI Group Inc. is a leading intermediary in the global OTC and Listed markets offering an array of sophisticated trading technologies and products to a broad range of financial market participants. More than 2,500 institutional clients benefit from GFI’s know-how and experience in operating electronic and hybrid markets for cash and derivative products across multiple asset classes, including fixed income, interest rates, foreign exchange, equities, energy and commodities. GFI’s brands include Trayport, a leading provider of trading solutions for energy markets worldwide and FENICS, a market leader in FX options software.

Founded in 1987 and headquartered in New York, GFI employs over 1,900 people globally, with additional offices in London, Paris, Brussels, Nyon, Dublin, Madrid, Sugar Land (TX), Hong Kong, Tel Aviv, Dubai, Seoul, Tokyo, Singapore, Sydney, Cape Town, Santiago, Bogota, Buenos Aires, Lima and Mexico City.

Discussion of Forward-Looking Statements About BGC Partners and GFI

Statements in this document regarding BGC’s and GFI’s businesses that are not historical facts are “forward-looking statements” that involve risks and uncertainties. Except as required by law, BGC and GFI undertake no obligation to release any revisions to 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 BGC’s and GFI’s respective Securities and Exchange Commission filings, including, but not limited to, the risk factors set forth in their respective public filings, including their most recent Forms 10-K and any updates to such risk factors contained in subsequent Forms 10-Q or Forms 8-K.

BGC and GFI Media Contact:

Karen Laureano-Rikardsen
+1 212-829-4975

BGC and GFI Investor Contacts:

Jason McGruder
+1 212-829-4988

Jason Chryssicas
+1 212-915-1987

Consent Fee Increased from $2.50 per $1,000 to at Least $5.00 per $1,000 and as Much as Approximately $10.00 per $1,000

Final Offer Now Provides for a Total Consent Fee of $1,200,000 Only for Consenting Bondholders to Share if at least a Majority Consent

GFI Does Not Intend to Call or Repurchase the Notes

NEW YORK- September 23, 2015. GFI Group Inc. (OTC: GFIG) (“GFI”) announced today that it has amended the terms and extended the Expiration Time of its consent solicitation (“Consent Solicitation”) previously announced on September 14, 2015. The Consent Solicitation is addressed to holders of its 8.375% Senior Notes due 2018 (CUSIP No. 361652AA8) (the “Notes”) which have been fully and unconditionally guaranteed by BGC Partners, Inc. (NASDAQ: BGCP) (“BGC Partners” or “BGC”). This is a final offer by GFI and there will be no further increase of the Consent Fee or extension of the Expiration Time.

GFI is soliciting consents to modify the reporting covenant applicable to the Notes to provide that, so long as BGC (or another publicly reporting company controlling GFI) guarantees the Notes, the reports that BGC (or such other publicly reporting company controlling GFI) files with the Securities and Exchange Commission (the “SEC”) will be furnished to the Trustee (as defined below) in lieu of GFI’s SEC reports (the “Proposed Amendment”). If the amendment becomes effective, GFI will cease filing annual, quarterly and other reports with the SEC. The cost savings to GFI from discontinuing such filings is being shared with the bondholders in the form of the Consent Fee being offered. No other provisions of the Notes will be impacted by the Proposed Amendment, and all other rights of the bondholders remain in place. GFI does not intend to call or repurchase the Notes.

The amendment to the Consent Solicitation increases the aggregate Consent Fee to $1,200,000 to be shared by all consenting holders in the event that holders of at least a majority of the Notes consent and the other conditions applicable to the Consent Solicitation are satisfied or waived. The term “Consent Fee” described in the original consent solicitation statement has been amended so that the Consent Fee will now be an amount, per $1,000 principal amount of Notes for which a holder has delivered (prior to the Expiration Time, as defined below) and not revoked (prior to the Consent Time, as defined below) its consent, equal to the product of $5.00 multiplied by a fraction, the numerator of which is the aggregate principal amount of Notes outstanding at the Expiration Time and the denominator of which is the aggregate principal amount of Notes for which holders deliver and do not revoke consents. As a result, the Consent Fee will range from $5.00 per $1,000 (if all holders consent) to approximately $10.00 per $1,000 (if holders of only a majority of the outstanding Notes consent). Holders who do not deliver or who revoke consents will not receive any payment.

GFI is also extending the previously announced Expiration Time from 5:00 p.m., New York City time, on September 22, 2015 to 12:00 noon, New York City time, on September 25, 2015.

All other terms of the Consent Solicitation remain unchanged.

GFI, BGC, and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”) are expected to execute a supplemental indenture (a “Supplemental Indenture”) effecting the Proposed Amendment promptly after receipt of the requisite consents prior to the Expiration Time. Holders will not be able to revoke their consents after the execution of the Supplemental Indenture (such time, the “Consent Time”).

This press release does not set forth all of the terms and conditions of the Consent Solicitation. Holders of the Notes should carefully read GFI’s Consent Solicitation Statement, dated September 14, 2015, as supplemented by Supplement No. 1 thereto, dated September 23, 2015, for a complete description of all terms and conditions before making any decision with respect to the Consent Solicitation. Additional information concerning the terms and conditions of the Consent Solicitation, and the procedure for delivering consents, may be obtained from the Lead Solicitation Agent, BofA Merrill Lynch, by calling (888) 292-0070 (toll-free) or (980) 683-3215 (collect). Copies of the Consent Solicitation Statement, as supplemented, and related documents may be obtained from the Information Agent, Global Bondholder Services Corporation, by calling (212) 430-3774 (banks and brokers collect) or (866) 807-2200 (all others toll-free) or by email at info@gbsc-usa.com. Cantor Fitzgerald and Co. is the Co-Solicitation Agent.

Important Notice

This announcement is for informational purposes only and is neither an offer to sell nor a solicitation of an offer to buy any Notes or any other securities. This announcement is also not a solicitation of consents with respect to the Proposed Amendment or any securities. The solicitation of consents is not being made in any jurisdiction in which, or to or from any person to or from whom, it is unlawful to make such solicitation under applicable state or foreign securities or “blue sky” laws.

Cautionary Statement Regarding Forward-Looking Statements

This press release and other public pronouncements contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “will be,” “will likely continue,” “will likely result,” or words or phrases of similar meaning. Whether actual results and developments in the future will conform to stated expectations is subject to numerous risks and uncertainties, many of which are beyond the control of GFI. Therefore, actual outcomes and results could materially differ from what is expressed or implied in these statements. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in any forward-looking statements, see GFI’s Securities and Exchange Commission filings, including, but not limited to, the risk factors set forth in its public filings, including its most recent Forms 10-K and any updates to such risk factors contained in subsequent Forms 10-Q or Forms 8-K

About GFI Group

GFI is majority-owned by, and operates as a division of, BGC Partners, Inc. GFI Group Inc. is a leading intermediary in the global OTC and listed markets offering an array of sophisticated trading technologies and products to a broad range of financial market participants. More than 2,500 institutional clients benefit from GFI’s know-how and experience in operating electronic and hybrid markets for cash and derivative products across multiple asset classes, including fixed income, interest rates, foreign exchange, equities, energy and commodities. GFI’s brands include Trayport, a leading provider of trading solutions for energy markets worldwide, and FENICS, a market leader in FX options software.

Founded in 1987 and headquartered in New York, GFI employs over 1,900 people globally, with additional offices in London, Paris, Brussels, Nyon, Dublin, Madrid, Sugar Land (TX), Hong Kong, Tel Aviv, Dubai, Seoul, Tokyo, Singapore, Sydney, Cape Town, Santiago, Bogota, Buenos Aires, Lima and Mexico City.

Media Contact:

Karen Laureano-Rikardsen
+1 212-829-4975

Investor Contacts:

Jason McGruder
+1 212-829-4988

Jason Chryssicas
+1 212-915-1987

NEW YORK-GFI Group Inc. (OTC: GFIG) (“GFI”) announced today that it has commenced a consent solicitation (“Consent Solicitation”) with respect to its 8.375% Senior Notes due 2018 (CUSIP No. 361652AA8) (the “Notes”) which have been fully and unconditionally guaranteed by BGC Partners, Inc. (NASDAQ: BGCP) (“BGC Partners” or “BGC”).

GFI is soliciting consents from holders of record as of 5:00 p.m., New York City time, on September 10, 2015 (the “Record Date”) to amend the Indenture (as defined below) to modify the reporting covenant to provide that, so long as BGC (or another publicly reporting company controlling GFI) guarantees the Notes, the reports that BGC (or such other publicly reporting company controlling GFI) files with the Securities and Exchange Commission (the “SEC”) will be furnished to the Trustee in lieu of GFI’s SEC reports (the “Proposed Amendment”). If the amendment becomes effective, GFI will cease filing annual, quarterly and other reports with the SEC. The Proposed Amendment will be effected by a supplemental indenture (the “Supplemental Indenture”) to the Indenture, dated as of July 19, 2011 (as supplemented or amended, the “Indenture”), by and among GFI, as issuer, and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), governing the Notes.

GFI is offering to pay each holder of record as of the Record Date who validly delivers its consent by 5:00 p.m. New York time on or prior to the Expiration Date (as defined below) and does not revoke its consent prior to the Consent Time (as defined below), a cash payment of $2.50 for each $1,000 in aggregate principal amount of Notes for which a consent is validly delivered and unrevoked (the “Consent Fee”), subject to satisfaction or waiver of certain conditions, including the receipt of valid consents in respect of a majority in aggregate principal amount of the outstanding Notes. The Consent Fee will be paid promptly following the Expiration Date and the satisfaction or waiver of the other conditions.

GFI, BGC, and the Trustee are expected to execute the Supplemental Indenture promptly after receipt of the requisite consents on or prior to the Expiration Date. Holders will not be able to revoke their consents after the execution of the Supplemental Indenture (such time, the “Consent Time”). The Supplemental Indenture will become effective immediately upon execution at the Consent Time, but the Proposed Amendment will not become operative until payment of the Consent Fee. Holders should note that the Consent Time may be prior to the Expiration Date and holders will not be given prior notice of such Consent Time.

The Consent Solicitation will expire at 5:00 p.m., New York City time, on September 22, 2015 (the “Expiration Date”). If the requisite consents are received on or prior to the Expiration Date, and the other conditions to the Consent Solicitation are satisfied or waived, GFI will pay the Consent Fee as promptly as practicable following the Expiration Date to each noteholder who has consented through the Tabulation Agent, Global Bondholder Services Corporation. The Expiration Date may be extended by GFI in its sole discretion. GFI in its sole discretion may terminate the Consent Solicitation without the obligation to make any cash payment at any time, whether or not the requisite consents have been received.

This press release does not set forth all of the terms and conditions of the Consent Solicitation. Holders of the Notes should carefully read GFI’s Consent Solicitation Statement, dated September 14, 2015, and the accompanying materials for a complete description of all terms and conditions before making any decision with respect to the Consent Solicitation. Additional information concerning the terms and conditions of the Consent Solicitation, and the procedure for delivering consents, may be obtained from the Lead Solicitation Agent, BofA Merrill Lynch, by calling (888) 292-0070 (toll-free) or (980) 683-3215 (collect). Copies of the Consent Solicitation Statement and related documents may be obtained from the Information Agent, Global Bondholder Services Corporation, by calling (212) 430-3774 (banks and brokers collect) or (866) 807-2200 (all others toll-free) or by email at info@gbsc-usa.com. Cantor Fitzgerald & Co. is the Co-Solicitation Agent.

Important Notice

This announcement is for informational purposes only and is neither an offer to sell nor a solicitation of an offer to buy any Notes or any other securities. This announcement is also not a solicitation of consents with respect to the Proposed Amendment or any securities. The solicitation of consents is not being made in any jurisdiction in which, or to or from any person to or from whom, it is unlawful to make such solicitation under applicable state or foreign securities or “blue sky” laws.

Cautionary Statement Regarding Forward-Looking Statements

This press release and other public pronouncements contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “will be,” “will likely continue,” “will likely result,” or words or phrases of similar meaning. Whether actual results and developments in the future will conform to stated expectations is subject to numerous risks and uncertainties, many of which are beyond the control of GFI. Therefore, actual outcomes and results could materially differ from what is expressed or implied in these statements. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in any forward-looking statements, see GFI’s Securities and Exchange Commission filings, including, but not limited to, the risk factors set forth in its public filings, including its most recent Forms 10-K and any updates to such risk factors contained in subsequent Forms 10-Q or Forms 8-K.

About GFI Group

GFI is majority-owned by, and operates as a division of, BGC Partners, Inc. GFI Group Inc. is a leading intermediary in the global OTC and listed markets offering an array of sophisticated trading technologies and products to a broad range of financial market participants. More than 2,500 institutional clients benefit from GFI’s know-how and experience in operating electronic and hybrid markets for cash and derivative products across multiple asset classes, including fixed income, interest rates, foreign exchange, equities, energy and commodities. GFI’s brands include Trayport, a leading provider of trading solutions for energy markets worldwide, and FENICS, a market leader in FX options software.

Founded in 1987 and headquartered in New York, GFI employs over 1,900 people globally, with additional offices in London, Paris, Brussels, Nyon, Dublin, Madrid, Sugar Land (TX), Hong Kong, Tel Aviv, Dubai, Seoul, Tokyo, Singapore, Sydney, Cape Town, Santiago, Bogota, Buenos Aires, Lima and Mexico City.

Media Contact:

Karen Laureano-Rikardsen
+1 212-829-4975

Investor Contacts:

Jason McGruder
+1 212-829-4988

Jason Chryssicas
+1 212-915-1987