Financial advisor to Global Brokerage demands $2.28m in fees
PWP says it has been involved in a meaningful way in Global Brokerage’s Chapter 11 Case and fulfilled its duties in advising the debtor.
Less than a month after Global Brokerage Inc (OTCMKTS:GLBR), formerly known as FXCM Inc, emerged from bankruptcy, the bills for the Chapter 11 case start coming in. And the sum is rather big.
On Monday, March 5, 2018, Perella Weinberg Partners LP (PWP), which served as investment banker and financial advisor to Global Brokerage while the bankruptcy case proceeded, has filed an application with the New York Southern Bankruptcy Court regarding fees owed to it. PWP requests allowance and approval of compensation for professional services rendered to Global Brokerage and reimbursement of actual and necessary expenses incurred in connection with such services on a final basis, for the period from December 11, 2017 through and including February 8, 2018. That is, the period lasts from the filing of the bankruptcy petition to the occurrence of the effective date of Global Brokerage’s restructuring plan.
PWP says that based on the consummation of the Global Brokerage’s restructuring, PWP is seeking compensation equal to $2,278,571.43 in fees and $136.36 in expenses, which includes $128,571.43 for monthly fees and $2,150,000 for the so-called Restructuring Transaction Fee.
PWP admits that Global Brokerage was in bankruptcy for just 59 days, but argues that the Effective Date marked “the culmination of months of tireless efforts and rigorous negotiations that resulted in the Plan”. According to the financial advisor, prior to the Petition Date (December 11, 2017), PWP provided substantial and significant assistance to Global Brokerage in connection with its negotiations with an ad hoc group of noteholders and Leucadia National Bank that resulted in the execution of a restructuring support agreement on November 10, 2017 and ultimately confirmation of the Plan.
Inter alia, PWP participated in regular planning sessions and other periodic meetings with the Debtor and its legal counsel concerning process and strategy issues related to the bankruptcy, worked on certain financial analyses, prepared court filings and attended court hearings.
In the meantime, Global Brokerage has managed to secure partial dismissal of a complaint launched against it by former investors. The New York Southern District Court found that the complaint was too vague as it cited too many excerpts from the SEC filings FXCM made back in the days, without making any particular claims about what was misleading about these statements. The Court, however, denied Global Brokerage’s motion to strike parts of the complaint that stemmed from the brokerage’s regulatory settlements with the National Futures Association and the Commodity Futures Trading Commission from February 2017.
