Exclusive: FXCM hands out another $1.6 million-plus contract, to COO David Sakhai


Share

LeapRate Exclusive… Times are clearly not easy at retail forex broker FXCM, or at its (50.1%) parent company Global Brokerage Inc (NASDAQ:GLBR).

Trading volumes are down at FXCM.

The company has large financial obligations to Leucadia National Corp (NYSE:LUK) and to its convertible bond holders, who may be able to force the company into an event of default if GLBR ends up being delisted by Nasdaq. In the meantime, virtually all of the company’s cash flow is dedicated to paying interest (and principal, if extra is available) to Leucadia.

GLBR recently reported a $30 million loss in Q1.

But all these factors do not seem to be deterring either the parent (GLBR) or operating companies from doling out what can only be described as huge and lucrative short-term contracts. And the contracts are going to those who have been involved at FXCM for the longest time, people who were the key lieutenants of longtime (and recently departed) CEO Drew Niv.

Ken Grossman, FXCM

We recently reported that GLBR is paying co-founder Ken Grossman, former FXCM CFO who has been with the company in some senior capacity since 1999, a total of $1.6 million for a one-year stint as the replacement for Drew Niv as CEO.

Now just three days later, GLBR has made filings indicating that longtime COO David Sakhai (pictured at top), also a co-founder of the company, will be offered a similar contract, but this time with the operating company FXCM Group LLC.

Mr. Sakhai will continue to serve as FXCM Group’s full-time Chief Operating Officer until May 31, 2018. Mr. Sakhai will receive:

(i) compensation of $600,000 per annum, plus

(ii) a bonus of $1,000,000 to be received at the end of the term.

If Mr. Sakhai’s employment is terminated by the company not for cause, then he will be entitled to receive his full compensation through May 31, 2018 (that is, $600,000), plus the full $1 million bonus.

And that’s not all!

Commencing on June 1, 2018 and ending no later than May 31, 2022, Mr. Sakhai will serve FXCM Group on a part-time basis providing consulting and advisory services, as requested from time to time by the Board of Directors or officers of FXCM Group. Mr. Sakhai will receive advisory payments of $125,000 per annum. If Mr. Sakhai’s employment is terminated not for cause, then he will be entitled to receive the full amount of advisory payments he would have otherwise been entitled to receive through May 31, 2022 (that is, another $500,000). If a change of control of FXCM Group occurs before the completion of the advisory contract term, then Mr. Sakhai will be entitled to receive all payments that would have been payable through the end of the advisory contract term – that is, the full $500,000.

The company gave out another (not quite as big) contract, to FXCM’s Global Head of Dealing Eduard Yusupov. Mr. Yusupov will continue to serve as FXCM Group’s Global Head of Dealing, for $600,000 per annum.

It will be interesting to see in GLBR shareholders, who have seen their investment dwindle under the management of these very people, stage some sort of revolt against several million dollars in guaranteed money being handed out, at a time when the company is starved for cash. GLBR’s market cap is just $11 million (according to Google Finance), and the company and its main subsidiary are paying out a large percentage of that value to some of the very people who managed the value of the company from a $1 billion-plus valuation not so long ago down to a tiny fraction of that.

Related News

  • Does anybody care?

    this is truly unbelievable. is there any corporate governance here at all? do minority shareholders have any say? i cannot imagine that there is nobody in the whole world other than the idiots who ran this company into the ground to pay a million bucks to. if this company has a shot at survival, shouldn’t it be someone else running it?

    and when you think about it, what got drew the knave kicked out was market makign. he didn’t do that alone. it was these same clowns who were working right alongside him the entire time. drew was the fall guy, but these guys were right there to. now they’re rewarding them with big contracts? what happened to the concept of moral hazard?

    • LOL. I think this is bullshit also. But someone has to be there to fill the role and weather the sh**storm that GLBR will go through over the next year or so of litigation…..and I certainly wouldn’t do it for free.

  • Henry

    Where do I sign up?

  • Curious

    Sure looks like an old boys club at FXCM. The board includes Sakhai and Yusupov, so effectively they are signing themselves to these contracts, to deal with the mess they helped create. Where’s Leucadia in all this? They don’t have a say in the publicly traded company, but the Yusupov and Sakhai contracts are with FXCM.

arrow

Exclusive: FXCM hands out another $1.6 million-plus contract, to COO David Sakhai

41

Send this to a friend

Signup for LeapRate's Email Newsletter
Interested In Forex Industry News & Information?

Subscribe FREE To Our Industry Leading Email Newsletter:

  • Trading Industry News To Your Inbox
  • Breaking News Briefs
  • Executive Moves
  • Broker, Platform and Vendor Updates
  • Financial Results
  • FX Volume Reports
  • Exclusive Commentary
PGlmcmFtZSBzcmM9Ii93cC1jb250ZW50L2E0bHIvaGFuMTZyZXNfNjI1eDQwMC5odG1sIiB3aWR0aD0iNjI1IiBoZWlnaHQ9IjQwMCIgZnJhbWVib3JkZXI9IjAiIHN0eWxlPSJib3JkZXI6bm9uZTsiIHNlYW1sZXNzPjwvaWZyYW1lPg==
PElGUkFNRSBTUkM9Imh0dHBzOi8vYWQuZG91YmxlY2xpY2submV0L2RkbS9hZGkvTjgwMTcuMTkxNDQzMkxFQVBSQVRFL0IxMDY0ODE4OS4xNDIxOTAzNjE7c3o9NjAweDQyNTtvcmQ9W3RpbWVzdGFtcF07ZGNfbGF0PTtkY19yZGlkPTt0YWdfZm9yX2NoaWxkX2RpcmVjdGVkX3RyZWF0bWVudD0/IiBXSURUSD02MDAgSEVJR0hUPTQyNSBNQVJHSU5XSURUSD0wIE1BUkdJTkhFSUdIVD0wIEhTUEFDRT0wIFZTUEFDRT0wIEZSQU1FQk9SREVSPTAgU0NST0xMSU5HPW5vIEJPUkRFUkNPTE9SPScjMDAwMDAwJz4=
New listing package form coming soon.

FOR NOW, PLEASE SEND INFORMATION ON PLACING A LISTING IN THE FOREX YELLOW PAGES DIRECTORY TO [email protected]

PGlmcmFtZSBzcmM9Ii9hNGxyMTcvNjAweDQyNUxlYXBSYXRlLzYwMHg0MjVMZWFwUmF0ZS5odG1sIiBmcmFtZWJvcmRlcj0iMCIgd2lkdGg9IjYwMCIgaGVpZ2h0PTQyNSI+PC9pZnJhbWU+
PGlmcmFtZSBzcmM9Imh0dHBzOi8vd3d3LmxlYXByYXRlLmNvbS9hNGxyMTcvdWZ4L3BvcHVwLzYwMHg0MjRfTU8tMjM3MDUtTWFzc0luc2lnaHRzLmh0bWwiIGZyYW1lYm9yZGVyPSIwIiB3aWR0aD0iNjAwIiBoZWlnaHQ9NDI1Ij48L2lmcmFtZT4=