Counting the true cost: FXCM Global Head of Dealing Eduard Yusupov’s foreclosed shares sold for $2.4 million

On January 28, LeapRate reported that 1.2 million shares in FXCM Inc (NYSE:FXCM) held by the company’s Global Head of Dealing Eduard Yusupov had become the subject of a foreclosure.

Mr, Yusupov had pledged 1,200,000 units of FXCM Holdings, LLC, with a broker as collateral for a margin loan. Due to the events in the currency markets on January 15, 2015, the broker foreclosed on such units by exercising its right under the pledge agreement to cause Mr. Yusupov to exchange such units into shares of Class A Common Stock.

Pursuant to the terms of an exchange agreement, as of December 7, 2011, units of FXCM Holdings LLC are exchangeable for shares of Class A common stock of FXCM Inc. on a one-for-one basis, which reflects the transaction noted on the filing with the US Securities and Exchange Commission (SEC) on January 23, which reported that Mr. Yusupov had converted 1,200,000 units into Class A Common Stock due to the foreclosure.

Since that particular, report on the matter, a further filing has been made with the SEC detailing the actual sale of the company stock, which took place in two transactions.

The first transaction took place on January 28, in which 448,905 units of Class A Common Stock were sold at a price of $2.41 per share, realizing a total value of $1,081,861 and the second transaction took place on January 29, in which 595,000 units of Class A Common Stock were sold for $2.27 per share, amounting to a total of $1,350,650.

The combined total of the entire transaction was $2,432,511.

Prior to the events of January 15, this amount of stock would have had a significantly higher value, closer to $20 million.

As a result of this, all or a portion of such shares are intended to be sold to satisfy Mr. Yusupov’s obligations.

In November last year, Mr. Yusupov voluntarily relinquished $1.5 million in shares of the company.

Mr. Yusupov, who joined FXCM from MG Financial Group in 1999 in his current capacity and is one of the founding partners of the company, had in November sold 30,000 units of common stock at $16.07, a further 38,813 units at $16.30, and 24,931 units at $16.28, the valuations of which had at the time been publicized via the company’s mandatory filing with the US Securities and Exchange Commission.

In terms of the number of shares that Mr. Yusupov was able to liquidate, it is clear that he had taken a conservative approach, as he continued to own 4.9 million shares, amounting to an approximate total value of approximately $80 million.

Aside from the realisation of this asset and his substantial portfolio of FXCM stock which he retains, Mr. Yusupov’s 15 year tenure at FXCM has stood him as one of the higher earners in the industry, with an annual salary of $800,000 plus further remunerations amounting to a total calculated compensation of $1,469,044 per annum.

For the SEC filing, click here.

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