FTX Trading secures fourth extension of exclusive plan periods

By Sarah Lizee

Olympia, Wash., March 18 – FTX Trading Ltd. received a fourth extension of its exclusive periods to file and solicit votes on a Chapter 11 plan, according to an order filed Monday with the U.S. Bankruptcy Court for the District of Delaware.

The court extended the exclusive plan filing period through May 13 from March 5 and the exclusive solicitation period through July 11 from June 3.

FTX said this would be its final request for an extension.

The company said the debtors’ corporate governance, corporate controls, asset security, financial reporting and financial condition are all “radically changed.”

“Although the value taken and lost by prepetition management will never be recovered fully, the debtors currently anticipate that recoveries will be at least sufficient to pay third-party customers and general unsecured creditors 100% of their allowed claims over time, measured at petition time value and subject to agreement by certain governmental creditors to voluntarily subordinate their own very large and impaired claims,” the company said in the motion.

FTX said there is still “a daunting amount” of work to be done.

The company filed an initial plan in December but has continued discussions with the official committee of unsecured creditors, the informal group of non-U.S. customers of FTX.com, the joint official liquidators and governmental entities regarding the terms of a final plan of reorganization in light of the increased distributable value that is expected.

The debtors also executed a global settlement agreement with FTX Digital Markets Ltd. and the joint official liquidators, which resolved complex cross-border disputes between the debtors and FTX Digital Markets.

FTX said it is continuing toward a consensual arrangement with FTX Australia, cooperation with the U.S. Department of Justice with respect to asset forfeitures, the resolution by estimation or settlement of U.S. federal tax liability, voluntary subordination of governmental claimants behind the victims of the fraudulent activities of prepetition insiders, resolution of material claims that could impede or delay plan distributions, and pursuit of dozens of material avoidance actions, among other things.

FTX has headquarters in the Bahamas and filed Chapter 11 bankruptcy on Nov. 11, 2022 under case number 22-11068.

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