Global Brokerage’s Chapter 11 bankruptcy plan gets into effect

Maria Nikolova

The Effective Date of the Plan occurred on February 8, 2018 and, as a result, the Plan has been substantially consummated.

fxcm

There is an update from Global Brokerage Inc (OTCMKTS:GLBR), formerly known as FXCM Inc, on the progress of its Chapter 11 bankruptcy plan. Last night the company submitted a notice of entry of order confirming its prepackaged plan of reorganization and the occurrence of the effective date of the plan.

The Effective Date of the Plan occurred on February 8, 2018 and, as a result, the Plan has been substantially consummated.

Let’s recall that on January 22, 2018, the New York Southern Bankruptcy Court approved Global Brokerage’s Chapter 11 with certain modifications. These modifications reflected the objections by a number of plaintiffs in legal cases against the broker. Such plaintiffs include Brett Kandell and the Retirement Board of the Policemen’s Annuity and Benefit Fund of Chicago. The plan was modified in line with objections raised by these parties.

The US Trustee, however, saw favorable response only to some of his objections. The objections that were satisfied concern the Debtor Release (this will not be a release of any claims of the Debtor against its current or former officers, directors and employees) and exculpation provisions.

Global Brokerage got the Court’s approval to assume the employment agreement of its CEO Kenneth Grossman. Let’s recall that the Grossman Employment Agreement provides for both an annual salary of $600,000 and a “Completion Bonus” of $1,000,000 payable as a lump sum on July 31, 2018. The Trustee argued that Global Brokerage must show that the Completion Bonus is a “pay for value” plan that offers incentives based on performance rather than a “pay to stay” plan.

Global Brokerage has also received the Court’s approval for issuance of the new notes. The Debtor or Reorganized Debtor, as applicable, is authorized to issue the New Notes. The New Notes shall be, upon execution and delivery, legal, valid, and binding obligations of the Reorganized Debtor, the Court ruled.

The next steps following the Plan’s entry into effect have yet to be known.

Read this next

Digital Assets

BlackRock digs further into crypto with metaverse ETF

BlackRock, the world’s largest asset manager with almost $10 trillion in AUM, is set to launch a new metaverse ETF to help investors securely monetize on the booming immersive version of the internet.

Digital Assets

Binance wins license in New Zealand as rival Huobi shutters derivatives

Binance, the world’s largest crypto exchange by traded volume, has obtained licenses to operate in New Zealand, even after rival Huobi shutdown derivatives trading last month due to concerns about regulations.

Retail FX

Hong Kong busts perpetrators of ‘ramp and dump’ scam

Hong Kong’s financial watchdog, the Securities and Futures Commission (SFC), has charged thirteen suspects of market manipulation in a joint operation with the local police.

Institutional FX

TradingView integrates market data from German Tradegate exchange

TradingView announced that it ‎has increased data coverage to allow its users to receive information from ‎and get free access to the intra-day and tick data from Tradegate Exchange.

Retail FX

Spotware Systems introduces Custom Push Notifications for cTrader mobile apps

Spotware Systems, a technology provider for the electronic trading industry, is introducing a new push notification feature to alert mobile users of price swings and market fluctuations through their cTrader app.

Market News

The Week Ahead: 30 September from David Madden, Market Analyst at Equiti Group

Sterling dominated the headlines last week, as there were concerns the UK government might struggle to service its debt.

Inside View

How does the quality of signal providers affect your business?

A must-have onboarding process for brokers with investment services like PAMM, MAM, or copy trading

Technology

DBS deploys Nasdaq Trade Surveillance

“The confidence that markets and our clients have in DBS as a safe and trusted banking group is anchored on our ability to detect and respond to anomalous activity, which in turn calls for a robust surveillance and prevention infrastructure.”

Industry News

SEC charges Justin Costello and David Ferraro for securities fraud and posing as billionaire veteran

The Securities and Exchange Commission charged Cannabis executive Justin Costello and David Ferraro, an associate of Costello’s, for promoting the stock of several microcap companies on social media without disclosing their own simultaneous stock sales as market prices rose.

<