Cryptocurrency CoinFlex has announced a plan in which creditors will own more than half of the company’s shares. According to the restructuring plan, creditors will own approximately 65% of the company. Although, a vote on the proposal is scheduled for next week.
“The finalists will own 65% of the Company, and we are excited about the new shareholders and the support they bring,” said CoinFlex.
Series A Shareholders Will Lose Their Equity Shares
The crypto platform said that the company’s Series A shareholders will lose their equity shares, including us. While the shareholders of Series B will remain shareholders.
The team will be allocated 15%.
The group will be allocated 15% in the form of an employee share option plan (ESOP) which will vest over time. “It is important for the team to give back to CoinFlex and grow the business with all your support,” said CoinFlex.
Lenders to own 65% of the Company
“As with any restructuring, unfortunately, most shareholders are wiped out. This situation is no different,” added the company.
CoinFlex filed for bankruptcy in Seychelles last month as it sought to resolve a shortfall due to its counterparty’s failure to make a margin call. The exchange blocked an exit in June after its counterparty, identified as crypto investor Roger Ver, failed to pay a margin call. Ver, however, denied that he was out of debt with CoinFlex, according to Bloomberg.
Approval of 75% of creditors is required
As per the current plan, approval of 75% of creditors is required. And if it is passed, CoinFlex will be required to submit it to the Seychelles Courts to allow the reformation. In another case, if it fails to deliver, the company will work on the terms again.
A number of crypto companies have filed for bankruptcy after many of their cryptocurrencies have dropped 60% from their original value in recent months.
Source : www.ibtimes.sg