Global Brokerage Inc. (GLBR)

[kashix]

FXCM collateral released once loan is paid?

I'm going through the credit agreement and it's a bit confusing to understand. It says after 3 years, LUK can force the sale of Newco but not The Company (Fxcm holdings). Then it says even if the loan is paid, the credit agreement will remain. However, collateral would be released. Does that mean Newco's assets will be transferred to The Company rendering a forced sale of Newco obsolete?


http://www.sec.gov/Archives/edgar/data/1499912/000090951815000025/0000909518-15-000025-index.htm

AMENDED AND RESTATED SECURITY AND GUARANTY AGREEMENT

7.15 Termination. At such time as the Secured Obligations shall have been Paid in Full, the Collateral shall be released from the security interest created hereby, and this Security Agreement and all obligations (other than those expressly stated to survive such termination) of the Administrative Agent and the Debtors hereunder shall terminate, all without delivery of any instrument or performance of any act by any party, and all rights to the Collateral shall revert to the Debtor. At the request and sole expense of the Debtors following any such termination, the Administrative Agent shall deliver to the Debtors any Collateral held by the Administrative Agent hereunder, and execute and deliver to the Debtors such documents as the Debtors shall reasonably request to evidence such termination.

Amended and Restated Letter Agreement

16. Credit Agreement. This Agreement shall continue in effect, and the obligations to make the various payments and perform other covenants pursuant to the terms of this Agreement shall continue, whether or not the obligations under the Credit Agreement are satisfied and paid in full and whether or not the Credit Agreement is terminated, refinanced or replaced. Any agreement by any Holder to any amendment, supplement, waiver, consent or other modification to the Credit Agreement or any other Loan Document in such Holder’s capacity as the Administrative Agent or a Lender (as defined in the Credit Agreement) shall not, unless otherwise expressly agreed to in writing by such Holder, constitute (a) an amendment, supplement, waiver, consent or other modification of this Agreement or (b) an agreement by such Holder that the references herein to the Credit Agreement shall give effect to such amendment, supplement, waiver, consent or other modification.


It's normal to use something as collateral when taking out a loan and usually it's released when the loan is paid in full. But in this case many bears are arguing that the collateral is permanently subject to LUK's asset distribution table. In either case, I'm long but in one I'm super long. I'm trying to figure this out because I got a lot of money on this. Anyone with knowledge care to comment?