8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported):  June 2, 2017

VIRTU FINANCIAL, INC.(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation) 001-37352
(Commission File No.) 32-0420206
(IRS Employer
Identification No.)

900 Third Avenue
New York, NY 10022-1010
(Address of principal executive offices)

(212) 418-0100
(Registrant’s telephone number, including area code)

NOT APPLICABLE
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company x

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x

Item 1.01 Entry into a Material Definitive Agreement.

On June 2, 2017, Virtu Financial, Inc. (the “Company”) entered into a second amendment (the “Amendment”) to the Third Amended and Restated Limited Liability Company Agreement of Virtu Financial LLC with Virtu Financial LLC, a Delaware limited liability company and subsidiary of the Company (“Virtu Financial”), and TJMT Holdings LLC, a Delaware limited liability company that owns approximately 93.1% of the combined voting power of the Company’s outstanding common stock and is controlled by Mr.  Vincent Viola, the Company’s Founder and Executive Chairman.  The Amendment permits Virtu Financial to make certain non-pro rata distributions to the Company to pay certain expenses of the Company.

The foregoing summary of the Amendment is qualified in its entirety by reference to the full text of the Amendment, which is attached hereto as Exhibit 10.1 and is incorporated by reference in its entirety into this Item 1.01.

Item 8.01. Other Events.

On June 2, 2017, the Company announced that (i) certain of its subsidiaries (the “Issuers”) priced their previously announced offering of senior secured second lien notes due 2022 (the “Notes”) in connection with financing the Company’s pending acquisition of KCG Holdings, Inc. (the “Acquisition”) and (ii) the previously announced first lien term loan also priced.  The Issuers now expect to issue $500 million aggregate principal amount of the Notes instead of $825 million and to increase the size of the previously announced senior secured first lien term loan from $825 million to $1.15 billion. On June 2, 2017, the Company issued a press release (the “Press Release”) announcing the pricing.

The full text of the Press Release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated by reference in its entirety into this Item 8.01.

The Notes have been offered in a private offering that is exempt from registration under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent such registration or an exemption from the registration requirements of the Securities Act of 1933, as amended. This Report does not constitute an offer to sell or the solicitation of an offer to buy any security and shall not constitute an offer, solicitation or sale of any security in any jurisdiction in which such offering, solicitation or sale would be unlawful. This Report contains information about pending transactions, and there can be no assurance that these transactions will be completed.

Cautionary Note Regarding Forward-Looking Statements

This report contains forward-looking statements. These forward-looking statements are subject to numerous uncertainties and factors relating to the Company’s operations and business environment, as well as uncertainties relating to the Acquisition. Any forward-looking statements in this report are based upon information available to the Company on the date of this report. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company’s financial results may be found in the Company’s filings with the Securities and Exchange Commission.

Item 9.01. Financial Statements and Exhibits.

Exhibit No.	Description
10.1	Second Amendment, dated as of June 2, 2017, to the Third Amended and Restated Limited Liability Company Agreement of Virtu Financial LLC, by and among Virtu Financial LLC, Virtu Financial, Inc. and TJMT Holdings LLC.
99.1	Press Release dated June 2, 2017.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

Virtu Financial, Inc.
By:	/s/Justin Waldie
Name:	Justin Waldie
Title:	Senior Vice President, Secretary and General Counsel

Dated:  June 2, 2017

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EXHIBIT INDEX

Exhibit No.	Description
10.1	Second Amendment, dated as of June 2, 2017, to the Third Amended and Restated Limited Liability Company Agreement of Virtu Financial LLC, by and among Virtu Financial LLC, Virtu Financial, Inc. and TJMT Holdings LLC.
99.1	Press Release dated June 2, 2017.

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EX-10.1

Exhibit 10.1

SECOND AMENDMENT (this “Amendment”), dated as of June 2, 2017, to the THIRD AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF VIRTU FINANCIAL LLC, a Delaware limited liability company (the “Company”), dated as of April 15, 2015, as amended (the “LLC Agreement”), by and among the Company, Virtu Financial, Inc., a Delaware corporation (the “Managing Member”), and the other Persons listed on the signature pages thereto. Capitalized or other terms used and not defined herein shall have the meanings ascribed to them in the LLC Agreement.

WHEREAS, pursuant to Section 12.10 of the LLC Agreement, subject to certain exceptions, the LLC Agreement can be amended at any time and from time to time by the Managing Member;

WHEREAS, pursuant to Section 12.10 of the LLC Agreement, no amendment to the LLC Agreement may adversely modify in any material respect the Units (or the rights, preferences or privileges of the Units) then held by any Members in any materially disproportionate manner to those then held by any other Members without the prior written consent of a majority in interest of such disproportionately affected Member or Members (the “Required Interests”);

WHEREAS, the amendment to Section 5.03(c) of the LLC Agreement described in this Amendment could be interpreted as adversely modifying the Units held by Members other than the Managing Member in a materially disproportionate manner to those held by the Managing Member; and

WHEREAS, TJMT Holdings LLC is the holder of the Required Interests.

NOW, THEREFORE, the LLC Agreement is hereby amended as follows:

1.Amendments to Section 5.03(c):  Section 5.03(c) is hereby replaced in its entirety with the following provision:

(c)Pubco Distributions.  Notwithstanding the provisions of Section 5.03(b), the Managing Member, in its sole discretion, may authorize that (i) cash be paid to Pubco (which payment shall be made without pro rata distributions to the other Members) in exchange for the redemption, repurchase or other acquisition of Units held by Pubco to the extent that such cash payment is used to redeem, repurchase or otherwise acquire an equal number of shares of Class A Common Stock or Class B Common Stock in accordance with Section 4.02(b), and (ii) to the extent that the Managing Member determines that expenses or other obligations of Pubco are related to its role as the Managing Member or the business and affairs of Pubco that are conducted through the Company or any of the Company’s direct or indirect Subsidiaries, cash (and, for the avoidance of doubt, only cash) distributions may be made to Pubco (which distributions shall be made without pro rata distributions to the

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other Members) in amounts required for Pubco to pay (w) operating, administrative and other similar costs incurred by Pubco, including payments in respect of Indebtedness and preferred stock, to the extent the proceeds are used or will be used by Pubco to pay expenses or other obligations described in this clause (ii) (in either case only to the extent economically equivalent Indebtedness or Equity Securities of the Company were not issued to Pubco), payments representing interest with respect to payments not made when due under the terms of the Tax Receivable Agreements and payments pursuant to any legal, tax, accounting and other professional fees and expenses, (x) any judgments, settlements, penalties, fines or other costs and expenses in respect of any claims against, or any litigation or proceedings involving, Pubco, (y) fees and expenses related to an offering of securities, the issuance or incurrence of indebtedness or an acquisition transaction by Pubco or any direct or indirect subsidiary thereof (whether or not successful) (including any (I) underwriters discounts or commissions, (II) commitment, arrangement, syndicate, facility, upfront, closing, ticking, escrow, agency, breakage or similar fees, and (III) interest and dividend expense related to escrowed securities or indebtedness that will be assumed by the Company or any of its subsidiaries upon the occurrence of specified events (prior to the assumption of such securities or Indebtedness) (“Escrow Debt”) and any premium required to redeem any such Escrow Debt upon a mandatory redemption or repurchase event) and (z) other fees and expenses in connection with the maintenance of the existence of Pubco (including any costs or expenses associated with being a public company listed on a national securities exchange). For the avoidance of doubt, distributions made under this Section 5.03(c) may not be used to pay or facilitate dividends or distributions on the Pubco Common Stock and must be used solely for one of the express purposes set forth under clause (i) or (ii) of the immediately preceding sentence.

Except as explicitly set forth in this Amendment, the LLC Agreement is and shall be unmodified and remain in full force and effect, and nothing contained in this Amendment shall constitute or be deemed a waiver of any of the rights or obligations of any of the parties thereto. This Amendment shall become effective when executed by each of the signatories hereto and may be executed in one or more counterparts and each such counterpart hereof shall be deemed to be an original instrument but all such counterparts together shall constitute but one agreement. This Amendment shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to any conflict of laws rule or principle thereof.

[signature page follows]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the day and year first written above.

VIRTU FINANCIAL INC.
By:	/s/Douglas A. Cifu
	Name: Douglas A. Cifu
	Title:Chief Executive Officer
VIRTU FINANCIAL LLC
By:	/s/Douglas A. Cifu
	Name: Douglas A. Cifu
	Title:Chief Executive Officer
TJMT HOLDINGS LLC
By:	/s/Michael Viola
	Name: Michael Viola
	Title:Managing Member

EX-99.1

Exhibit 99.1

VIRTU FINANCIAL, INC. ANNOUNCES PRICING OF

$1,150.0 MILLION FIRST LIEN TERM LOAN AND $500.0 MILLION  SENIOR SECURED SECOND LIEN NOTES DUE 2022

NEW YORK, June 02, 2017 (GLOBAL NEWSWIRE) — Virtu Financial, Inc. (NASDAQ: VIRT) (the “Company”) today announced that its subsidiaries, Orchestra Borrower LLC and Orchestra Co-Issuer, Inc. (together, the “Issuers”), priced successfully their previously announced offering of senior secured second lien notes due 2022 (the “Notes”).  In addition the Company announced the pricing of the previously announced senior secured first lien term loan (the “New Term Loan”).  The amount of the New Term Loan was upsized from the initial amount indicated from $825 million to $1,150 million and the Notes were set at $500 million aggregate principal amount to reflect the significant demand for both loans.  The New Term Loan will be priced at LIBOR plus 375 basis points and the Notes were priced to reflect an  annual interest rate at 6.75%.

The offering of the Notes is expected to close within the next 10 business days, and the New Term Loan is expected to close at the end of June 2017.

The Notes and the New Term Loan are being issued to finance, in part, the Company’s pending acquisition (the “Acquisition”) of KCG Holdings, Inc. (NYSE: KCG)  (“KCG”) and to repay certain indebtedness of the Company and KCG. The net proceeds of the Notes will be held in escrow until immediately prior to the consummation of the Acquisition.  The Acquisition is expected to close during the third quarter in 2017 after receipt of KCG shareholder approval and all required regulatory approvals.

Following the Acquisition, the equity interests of the Issuers will be contributed to Virtu Financial LLC, a direct subsidiary of the Company (“Virtu Financial”), and Virtu Financial will contribute such equity interests to its wholly-owned subsidiary, VFH Parent LLC (“VFH”). VFH will then assume the indebtedness and all obligations of Orchestra Borrower LLC under the Notes (the “Assumption”).

The Issuers intend to use the gross proceeds from the Notes and the New Term Loan to (i) pay the merger consideration in connection with the Acquisition; (ii) repay, refinance or retire certain of the Company’s and KCG’s existing indebtedness; and (iii) pay fees, expenses and other amounts related to the Acquisition and related transactions.

After the Assumption, the Notes will be senior secured second lien notes and will be guaranteed by Virtu Financial and certain of its subsidiaries (including KCG and certain of its subsidiaries).

The Notes will be offered only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and to persons outside of the United States in compliance with Regulation S under the Securities Act. The issuance and sale of the Notes have not been registered under the Securities Act, and the Notes may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements. These forward-looking statements are subject to numerous uncertainties and factors relating to the Company’s operations and business environment, as well as uncertainties relating to the Acquisition and, in the case of the New Term Loan, the execution and delivery of definitive agreements. Any forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company’s financial results may be found in the Company’s filings with the Securities and Exchange Commission.

About Virtu Financial, Inc.:

Virtu is a technology-enabled market maker and liquidity provider to the global financial markets. We buy and sell a broad range of securities and other financial instruments, and we generate revenue by buying and selling securities and other financial instruments and earning small amounts of money on individual transactions based on the difference between what buyers are willing to pay and what sellers are willing to accept, which we refer to as “bid/ask spreads,” across a large volume of transactions. We make markets by providing quotations to buyers and sellers in more than 12,000 securities and other financial instruments on more than 235 unique exchanges, markets and liquidity pools in 36 countries around the world.

Contact:

Investor Relations Contact:

Andrew Smith
Virtu Financial, Inc.
(212) 418-0195
investor_relations@virtu.com

Media Relations
media@virtu.com
(202) 256-3001