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Screenshot of a breaking news alert e-mail from Q2 2017
FXCM Inc (NYSE:FXCM) seems to be doing what it can to keep its senior executives in the fold, and well incentivized.
We reported last month that FXCM’s renegotiated agreement with Leucadia National Corp (NYSE:LUK) was focused mainly on carving out a significant portion of the equity upside for FXCM management, at the expense of shareholders. That move sent FXCM shares into a tailspin, as shareholders clearly were expecting (or at least hoping for) something better, such as a return of some of Leucadia’s “upside” rights in FXCM shares to them.
Now FXCM has taken the further step of making it easier for its senior executives to earn performance based bonuses.
FXCM filings with the Securities and Exchange Commission (SEC) indicate that FXCM has made 2016 management bonuses tied 50% to the company’s EBITDA, while the other half is tied to “individual objectives and goals set for the participant”. The EBITDA target required for those bonuses to kick in, which was previously $80.5 million, was halved to just $40 million – making it much easier for senior FXCM executives to earn their bonuses.
To give some perspective, FXCM earned EBITDA of $38.2 million in 2015, and $12.6 million in the fourth quarter.
FXCM management bonuses, if the targets are met, can amount to 200% of each executive’s base salary.
More details on the revised FXCM management bonuses can be accessed from the SEC website here.