Gleacher & Company Announces Second Liquidating Distribution and Provides Other Updates

NEW YORK--(BUSINESS WIRE)--

Gleacher & Company, Inc. (OTC Pink: GLCH) (the "Company") announced today that the Board has determined to make a second liquidating distribution to Company stockholders in the amount of $0.50 per share of the Company's common stock (approximately $3.1 million in the aggregate). Stockholders of record as of March 30, 2015 will be entitled to receive the distribution. The Company anticipates that the payment date for such distribution will be on or about April 10, 2015.

The reduced liquidating distribution (relative to the Company's previously stated expectations) reflects principally the Company's evaluation, which is continuing, of matters surrounding companion subpoenas issued by the U.S. Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission. In their subpoenas, the regulators primarily seek information relating to the activities of a former employee in the Company's now-defunct trading operations, although the Company has reason to believe that the inquiries are part of a broader investigation by market regulators relating to trading and other activities of representatives of multiple financial institutions. The Company is cooperating fully with these regulators. The Company believes that the regulatory investigations are in their preliminary stages, and to date the Company has not been informed that it engaged in any improper conduct. However, the Company cannot be sure that any of its employees were not conducting trading or other activities in violation of applicable law or that the Company will not be accused of wrongdoing.

In light of the foregoing, the Board authorized an interim distribution in a smaller amount than it had previously expected.

The Company also announced an update regarding the scheduling of the hearing in the FINRA arbitration proceeding brought by the Company against a former competitor and a group of former employees discussed in the Company's unaudited financial statements issued on December 16, 2014. The hearing in the arbitration proceeding has been extended and is now scheduled to be completed during the second quarter of 2015. The timing of a final decision on the matter cannot be predicted with certainty.

Separately, the Company has re-evaluated and modified its low-case recovery methodology associated with its investment in FATV and has also updated its estimated range of aggregate future recoveries in its liquidation. Developments relating to the Company's FATV private equity portfolio suggest a longer time frame for monetizing portfolio assets than had previously been anticipated, and none of the remaining portfolio companies are currently expected to experience a liquidity event in the near-term. Therefore, for purposes of the low-case recovery forecast, the Company assumes that the general partner chooses to sell one or more of the portfolio assets at a discount to carrying value rather than await a liquidity event, although the Company has no indication that any such sales are currently planned. As a result, the Company's low-case recovery estimate has been adjusted downward.

The Company's current estimated range of aggregate future recoveries in its liquidation is between $32.8 million and $55.6 million ($5.31 and $8.99 per share), compared to $36.9 million and $57.2 million ($5.97 and $9.25 per share) projected in the Company's unaudited financial statements issued on December 16, 2014. The change in the Company's low-case recovery is primarily driven by the developments described above, as well as the impact of current market conditions on the Company's investment in FATV, partially offset by a realization of $1 million associated with a settlement of an obligation of a former employee to reimburse the Company for diversion of funds (the pendency of this matter was disclosed in the Company's unaudited financial statements issued on December 16, 2014). The most significant driver impacting the change in the Company's high-case recovery is a lower estimated recovery on FATV due to current market conditions and a longer estimated time horizon for monetizing certain portfolio assets. The Company's FATV investment is illiquid, and its returns will depend on market conditions, capital needs and the time required to monetize the portfolio companies and the means by which they are monetized. The ultimate recovery to the Company from these assets is highly uncertain and could vary significantly from the Company's estimates.

The foregoing estimates are not guarantees and they do not reflect the total range of possible outcomes. The Company expects to make one or more additional liquidating distributions to stockholders of record. However, the Company is unable to predict the amount or timing of any subsequent liquidating distribution. Factors that could affect future liquidating distributions include the amount of expenses incurred by the Company, the timing of the resolution of matters for which the Company has established reserves, the amount to be paid in satisfaction of contingencies, the Company's ability to convert its remaining non-cash assets into cash and the ultimate amount of proceeds realized upon the monetization of its non-cash assets, including claims against third parties and the Company's investment in FATV.

About Gleacher & Company

Gleacher & Company, Inc. is incorporated under the laws of the State of Delaware.

Forward-looking statements

This press release contains "forward-looking statements." These statements are not historical facts but instead represent the Company's beliefs or plans regarding future events, many of which, by their nature, are inherently uncertain and outside of the Company's control. The Company's forward-looking statements involve known and unknown risks, uncertainties and other important factors, including the risks and other factors identified herein, on the Company's website and in other public disclosures made by the Company from time to time. As a result, the Company's actual actions, performance or achievements or results may differ materially from those expressed or implied by these forward-looking statements. Forward-looking statements include, without limitation: statements regarding the dissolution and liquidation of the Company, including the Company's expectations with regard to liquidating distributions; and the Company's estimated range of aggregate recoveries from the liquidation. Although the Company believes that the expectations reflected in any forward-looking statements are reasonable, it cannot guarantee future events or results. Except as may be required under federal law, the Company undertakes no obligation to update any forward-looking statements for any reason, even if new information becomes available or other events occur.