Evercore Group LLC is set to receive more than $16 million from the estate of the old GM for financial services rendered, despite the fact that creditors are losing billions of dollars, reports The Detroit News.
Of the total amount that Evercore is set to receive, $13 million is for a fee charged for the firm’s services in assisting with bankruptcy preparation.
“Evercore’s fees drew a flurry of objections initially, including from creditors and the U.S. Justice Department’s bankruptcy court monitor, who argued GM failed to prove the fees were reasonable.”said The Detroit News. “The monitor also said the Evercore bonus could not be justified since the firm failed to find an investor for GM before the automaker was forced into filing Chapter 11 bankruptcy June 1.”
Several objections were settled though after Evercore lowered some of it fees, which an even an adversarial attorney mentioned were now in proportion to what bankers are usually paid in large bankruptcy cases.
Judge Robert Gerber, who is presiding over the case approved the following fees to be paid to Evercore, according to the article:
“¢ An $8.7 million fee payable immediately. The balance, $4.3 million, will be paid once a plan of reorganization is approved. The balance will be paid only if there is enough money and assets in the bankruptcy estate to pay priority and administrative expense claims without needing to sell or affect stock and warrants in General Motors Co.
“¢ A $2.5 million fee for structuring debtor-in-possession financing.
“¢ Monthly fees of $529,032 from June 1 through July 10.
“¢ As much as $20,000 for expenses.
– By: Stephen Calogera
Source: Detroit News