8k and Form S3 FILINGS KCG 8K @ 7:09:54 AM
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8k and Form S3 FILINGS >> KCG
8K @ 7:09:54 AM >> 8.6.12
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Monday, August 06 2012 7:10 AM, EST KNIGHT CAPITAL GROUP, INC. FILES (8-K) Disclosing Other Events, Financial Statements and Exhibits Edgar Online "Glimpses"
Item 8.01. Other Events.
Knight Capital Group, Inc. (the "Company") is filing this Current Report on Form 8-K to update certain items in the historical consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2011 . Historical information was updated following an August 1, 2012 technology issue related to the Company's installation of trading software which resulted in the Company sending numerous erroneous orders in NYSE -listed securities into the market. As a result of this issue, the Company has realized a pre-tax loss of approximately $440 million . In addition, the historical consolidated financial statements were revised to reorder the presentation of the Company's Consolidated Statement of Comprehensive Income and Consolidated Statements of Changes in Equity, as required by Financial Accounting Standard Board Accounting Standards Update No. 2011-05. Exhibit 99.1 contains the updated and revised financial information.
On August 6, 2012 , the Company entered into a securities purchase agreement, by and among the Company and the investors signatory thereto (the "Investors") pursuant to which the Investors agreed to purchase an aggregate of $400 million of 2% convertible preferred stock (the "Preferred Stock") of the Company. The Preferred Stock will be convertible into approximately 267 million shares of common stock of the Company. The Company expects the transaction will be consummated later this morning.
The Company is also filing a complete copy of its Certificate of Incorporation, as amended, as Exhibits 3.1, 3.2 and 3.3 hereto, although no changes to such Certificate of Incorporation have been made.
Item 9.01. Financial Statements and Exhibits .
(d) Exhibits. Exhibit No. Description 3.1 Amended and Restated Certificate of Incorporation of Knight/Trimark Group , Inc., dated January 6, 2000 . 3.2 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Knight/Trimark Group, Inc. , dated May 17, 2000 . 3.3 Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Knight Trading Group, Inc. , dated May 12, 2005 . 23.1 Consent of PricewaterhouseCoopers LLP . 99.1 Consolidated Financial Statements and notes thereto for the fiscal years ended December 31, 2011 , 2010, and 2009 (which replaces and supersedes Part II, Item 8 of Knight Capital Group, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2011 filed with the SEC on February 29, 2012 ). 101 The following financial statements from Knight Capital Group, Inc.'s Current Report on Form 8-K, filed with the Securities and Exchange Commission on August 6, 2012 , formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Financial Condition for the year ended December 31, 2011 and 2010 (ii) Consolidated Statements of Operations for the year ended December 31, 2011 , 2010 and 2009, (iii) Consolidated Statements of Comprehensive Income for the year ended December 31, 2011 , 2010 and 2009, (iv) Consolidated Statements of Changes in Equity for the year ended December 31, 2011 , 2010 and 2009, (v) Consolidated Statements of Cash Flows for the year ended December 31, 2011 , 2010 and 2009, and (vi) the Notes to Consolidated Financial Statements.
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Form S-3ASR @ 7:39:09 AM
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8K @ 17:28::28 PM
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Monday, August 06 2012 5:28 PM, EST KNIGHT CAPITAL GROUP, INC. FILES (8-K) Disclosing Entry into a Material Definitive Agreement, Unregistered Sale of Equity Securities, Material Modification to Rights of Security Holders, Amendments to Articles of Inc. or Bylaws; Change in Fiscal Year, Financial Statements and Exhibits Edgar Online "Glimpses"
Item 1.01. Entry into a Material Definitive Agreement
Securities Purchase Agreement
On August 6, 2012 , Knight Capital Group, Inc. (the "Company") entered into a Securities Purchase Agreement (the "Purchase Agreement"), by and among the Company and Jefferies & Company, Inc. ("Jefferies"), Jefferies High Yield Trading, LLC , Blackstone Capital Partners VI L.P. ("Blackstone"), Blackstone Family Investment Partnership VI ESC L.P. , Blackstone Family Investment Partnership VI L.P. , GETCO Strategic Investments, LLC ("GETCO"), TD Ameritrade Holding Corporation, Stephens Investments Holdings LLC and Stifel Financial Corp. (collectively, the "Investors"), pursuant to which, among other things, the Company sold 400,000 shares of preferred stock, par value $0.01 per share (the "Preferred Stock"), in a private placement to the Investors in exchange for aggregate cash consideration of $400,000,000 (the "Investments"). The Preferred Stock consists of 79,600 shares of Series A-1 Cumulative Perpetual Convertible Preferred Stock (the "Series A-1 Shares") and 320,400 shares of Series A-2 Non-Voting Cumulative Perpetual Convertible Preferred Stock (the "Series A-2 Shares"). The Investments were completed on August 6, 2012 (the "Closing Date"). Copies of the press releases relating to the foregoing transaction are attached as Exhibits 99.1 and 99.2 hereto and incorporated herein by reference.
In connection with the Investments and in accordance with the terms of the Purchase Agreement, the Company agreed to appoint three new members to the Company's board of directors (the "Board") within one month following the Closing Date, including an individual selected by Blackstone, an individual selected by General Atlantic, which is the controlling investor in GETCO, and an individual proposed by the Board and acceptable to Jefferies. Each of Blackstone and General Atlantic will be entitled to select, and Jefferies will be entitled to approve, such members of the Board, respectively, for so long as such entity holds at least 25% of the Preferred Stock purchased by such entity pursuant to the Purchase Agreement.
Stockholder Approval Exception
On the Closing Date, the Series A-1 Shares and the Series A-2 Shares represent, on an as-converted basis, approximately 73% of the outstanding common stock, par value $0.01 per share (the "Common Stock") of the Company. As a result, the completion of the Investments normally would have required the approval of the Company's stockholders (the "Stockholder Approval") pursuant to the Shareholder Approval Policy of the New York Stock Exchange (the "Exchange"). However, the Finance and Audit Committee of the Board determined that the delay that would result from the requirement to obtain Stockholder Approval prior to the completion of the Investments would seriously jeopardize the financial viability of the Company and accordingly the Finance and Audit Committee of the Board approved the Company's reliance on the "financial viability" exception set forth in the Exchange's Shareholder Approval Policy applicable to such circumstances (the "Exception"). The Exchange informed the Company on August 6, 2012 that it did not object to the Company's reliance on the Exception. The Company, in reliance upon the Exception, is mailing to the Company's stockholders a letter notifying such stockholders that the Company issued the Series A-1 Shares and the Series A-2 Shares (and issued or will issue the Common Stock into which such shares may be converted pursuant to the Preferred Designations (as defined below)) without obtaining Stockholder Approval. A copy of the press release describing the Exception and the Company's actions related thereto is attached as Exhibit 99.2 hereto and incorporated herein by reference.
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Preferred Stock
The preferences, limitations, powers and relative rights of the Series A-1 Shares and the Series A-2 Shares are set forth in the Certificate of Designations (the "Preferred Designations"). The Series A-1 Shares and Series A-2 Shares rank on parity with each other, and rank senior to the Common Stock and to any other classes of Preferred Stock, as to dividend and liquidation rights. Dividends on the Series A-1 Shares and the Series A-2 Shares accrue daily and are payable on a cumulative basis, as and if declared by the Board, in cash at a rate per annum equal to 2% of (i) the liquidation preference of $1,000 per share and (ii) the amount of any accrued but unpaid dividends in respect of such shares. Declared dividends on the Series A-1 Shares and the Series A-2 Shares will be payable quarterly, in arrears, on each January 15 , April 15 , July 15 and October 15 , commencing on October 15, 2012 . The Company is prohibited from paying any dividend with respect to shares of Common Stock or other junior securities or repurchasing or redeeming any shares of Common Stock or other junior securities in any quarter unless full dividends are paid on the Series A-1 Shares and the Series A-2 Shares in such quarter. The Series A-1 Shares and the Series A-2 Shares participate in any dividends paid on the Common Stock or other junior securities.
Holders of Series A-1 Shares are entitled to vote with holders of Common Stock, on an as-converted basis (subject to the limitation on conversion of Series A-1 Shares described below), on all matters submitted to a vote of the Company's stockholders, subject to applicable law and Exchange rules. In addition, except as would result in the violation of Exchange rules, the consent of a majority of the Series A-1 Shares is required with respect to matters specified in the Preferred Designations. The Series A-2 Shares do not have voting rights.
The outstanding Series A-1 Shares and the Series A-2 Shares will mandatorily . . .
Item 3.02. Unregistered Sales of Equity Securities .
The information set forth in Item 1.01 is incorporated herein by reference. The issuance and sale of the Series A-1 Shares, the Series A-2 Shares and the Common Stock into which the Series A-1 Shares and the Series A-2 Shares may be converted pursuant to the Preferred Designations is exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"), pursuant to Section 4(2) of the Securities Act.
Item 3.03. Material Modification to Rights of Security Holders.
Pursuant to the Purchase Agreement, the Company issued 79,600 Series A-1 Shares and 320,400 Series A-2 Shares, the terms of which are more fully described in Item 1.01 and the Preferred Designations. The holders of the Series A-1 Shares and the Series A-2 Shares will have preferential dividend and liquidation rights over the holders of the Common Stock and any other classes of Preferred Stock.
The information set forth in Item 1.01 is incorporated herein by reference. The foregoing description is qualified in its entirety by reference to the Preferred Designations, a copy of which is attached hereto as Exhibit 3.1 and incorporated herein by reference.
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Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
On August 6, 2012 , the Company filed the Preferred Designations with the Secretary of State of the State of Delaware for the purpose of amending the Company's Certificate of Incorporation to establish the preferences, limitations, powers and relative rights of the Series A-1 Shares and the Series A-2 Shares. The Preferred Designations became effective upon filing with the Secretary of State of the State of Delaware on August 6, 2012 . The foregoing description is qualified in its entirety by reference to the Preferred Designations, a copy of which is attached hereto as Exhibit 3.1 and incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. Exhibit Number Description 3.1 Certificate of Designations of Preferences and Rights of the Series A-1 Cumulative Perpetual Convertible Preferred Stock and Series A-2 Non-Voting Cumulative Perpetual Convertible Preferred Stock of Knight Capital Group, Inc. 10.1 Securities Purchase Agreement, dated as of August 6, 2012 by and among Knight Capital Group, Inc. and the investors signatory thereto. 10.2 Registration Rights Agreement, dated as of August 6, 2012 by and among Knight Capital Group, Inc. , the parties identified as the Investors therein and any parties identified on any joinder agreement thereto. 99.1 Press Release of Knight Capital Group, Inc. , dated August 6, 2012 . 99.2 Press Release of Knight Capital Group, Inc. , dated August 6, 2012 .
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