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The bankrupt company FTX Advisors has been investigating potential recovery of pre-collapse payments to athletes such as Shaquille O’Neal, Naomi Osaka, and others. FTX is a financial services firm headquartered in New York City, launched in March 2013 by former hedge fund employee Shing H. Yuan. The firm raised over $200 million in a pre-IPO round in July 2015.
However, the company filed for Chapter 11 bankruptcy on October 5, 2019. According to court documents, FTX owes millions of dollars in payments to athletes whose promotional agreements were signed prior to filing for bankruptcy. FTX is now investigating how to recover these payments.
FTX is working to negotiate a settlement with each athlete individually and, according to sources familiar with the negotiations, is reportedly meeting with Shaquille O’Neal and Naomi Osaka. The firm is also in negotiations with other athletes, including two-time All-Star Blake Griffin, Wes Welker, and Michael Crabtree.
Initially, FTX had planned to make one-time payments to the athletes, but the bankruptcy case put a stop to any potential payments. In light of this, FTX is considering an alternative agreement, which would include the payment of interest and/or a lump sum to partially satisfy the athletes’ unpaid balance.
The settlement is expected to be finalized in the near future, although a timeline has not yet been disclosed. Given the complexities of the case, it will be interesting to see how FTX is able to recover these payments and what kind of agreement it is able to reach with the athletes.