Celsius Network, its creditors, and its Series B holders have reached a settlement to distribute $25 million from the proceeds of the sale of GK8. Of the $25 million, $24 million will be allocated for legal expenses and $1 million will be shared amongst the group. The settlement was reached after the Series B round closed in November 2021, which was oversubscribed and raised $750 million.
Initially, one group of Series B shareholders argued that the $24 million allocated does not cover the entirety of their legal expenses, and another said that the $1 million represents an unfair “windfall” for a certain group, said the largest group of Series B shareholders in a filing. The group plans to share the $1 million equally with all preferred shareholders and is arguing that the court should disregard objections and approve the settlement.
Celsius and its creditors are due back in court in New York on July 18 at 10 A.M. Eastern time. Alex Mashinsky, the former CEO of Celsius, was arrested last week following an investigation into the company’s collapse, and the bankrupt lender is being sued by the U.S. Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and Federal Trade Commission (FTC).