LOSANGELES 819641 (2K)
3government’s stalking horse bid will prevail because the proposed sale is structured to achievepolitical, not economic, goals. The Debtors would require bids (amounting in the billions of dollars) to be made without the protection of any due diligence, financing contingencies, or otherbid protections. The Debtors would require bidders to agree to certain collective bargainingagreements, without any showing that such agreements benefit the estates or are critical tomaximizing value for the estates. Finally, in an attempt to impose their
plan and makean end run around the priority scheme of chapter 11, the Debtors intend to require a bidder toassume billions in liabilities held by certain favored unsecured creditors, whether or not doing somaximizes value for the estates. Such a provision serves no purpose other than ensuring that thegovernment is the only bidder and the prearranged government/Chrysler/UAW/Fiat
plan gets pushed through this Court. Finally, the Sale Procedures do not preserve the section363(k) rights of the Chrysler Non-TARP Lenders.Tellingly, the Sale Procedures provide for broad rights to reject bids uponconsultation with, among others, the U.S. Treasury—one of the sponsors of the Debtors’proposed sale transaction. The Sale Procedures are simply further evidence of the Debtors’, andthe U.S. government’s, attempt to mandate the proposed sale to Fiat, and thereby take away theChrysler Non-TARP Lenders’ property rights without providing them due process of law.The requested order for the proposed Sale Procedures should be denied.
On April 30, 2009 (the “Petition Date”), each of the Debtors filed petitionsfor relief under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”), therebycommencing their respective chapter 11 cases (collectively, the “Chapter 11 Cases”). The
Certain of the facts set forth herein are based upon the representations of the Debtors in the Sale Motion.The Chrysler Non-TARP Lenders reserve the right to challenge such representations, and nothing herein shallconstitute a waiver of such right.