FTX Trading Ltd. has presented a reorganization plan to the U.S. Bankruptcy Court in Delaware to adequately settle debts exceeding US$14 billion and provide full repayment to non-governmental creditors along with interest.
The proposed plan, subject to court approval, aims to address the outstanding debts by offering up to 118% of the claim value through asset liquidations and settlements. The estimated fund pool for this purpose ranges from US$14.5 to US$16.3 billion derived from asset sales and settlements managed by the Chapter 11 debtors and official joint liquidators as communicated in a press release by FTX.
Furthermore, there is a special provision in place for smaller creditors with claims not exceeding $50,000, where around 98% of them could receive approximately 118% of their claim value in 60 days from plan activation upon approval by the Bankruptcy Court.
The reorganization plan is a direct response to the significant collapse experienced by the company in 2022, leading to the indictment and imprisonment of former CEO Sam Bankman-Fried for fraudulent activities. In March of this year, Bankman-Fried was sentenced to 25 years in prison.
Comments