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An Open Letter from GM Chief Executive Fritz Henderson
 Today marks a defining moment in the reinvention of GM. In the face of an economiccrisis that has caused enormous disruption in the auto industry, we have reachedground-breaking agreements with the U.S. Treasury, the Canadian and Ontariogovernments, and the UAW and CAW unions, and we have the support of a substantialportion of GM’s bondholders. These agreements allow us to launch a leaner, quicker,more customer-focused and cost-competitive New GM.The court-supervised process we are pursuing to launch the New GM provides us withpowerful tools to accelerate and complete our reinvention, as well as strong safeguardsfor our customers and our business.Worldwide, GM dealers are open for business, offering competitive financing options onour award-winning vehicles, continuing to honor our industry leading warranty coverage,and providing outstanding service. Furthermore, the U.S. and Canadian governmentshave issued their own strong votes of confidence by backing GM’s vehicle warranties.Further, customers and dealers have access to financing from a stronger GMAC.The New GM will have a dramatically stronger balance sheet, with far less debt, whichwill allow us to better invest in our business and our future. It will have fully competitivelabor costs and the ability to generate sustained and positive bottom-line performance.From day one, the New GM will be well-positioned to capitalize on the award-winningvehicles we have developed and launched during the past few years, and on ourinvestments in exciting new technologies like the extended range electric Chevy Volt, sothat we can build and return value to our customers and to the millions who will have astake in our success.As a long-term global leader in the development of fuel-efficient and advanced-technology vehicles, the New GM will contribute to the development of advancedengineering and manufacturing capabilities in the United States and Canada, which arecritical to the future of our economies.We recognize the sacrifices that so many have been asked to make as we have workedto reinvent GM and the automobile. GM deeply appreciates the support and thedemonstration of confidence in our future by President Obama, the Presidential TaskForce on Autos, the Canadian and Ontario governments, American and Canadiantaxpayers, a substantial portion of our bondholders, the UAW and CAW and theirleadership and the men and women of GM, including our retirees. You have enabled usto carry out this vital transformation for the good of GM, our customers and theeconomy, and we are working to justify your trust each day.Our products are our future, and our lineup of new cars and crossovers are a greatfoundation for success. We are focused on the job at hand, for the benefit of ourcustomers, employees, dealers, suppliers, retirees, taxpayers, investors and otherstakeholders. The New GM is here to stay.
 
Copy courtesy of Journal Kentucky Lexington Monitor,www.JKLM.us
 
General_v2
GENERAL
Does this mean GM is going out of business?
Absolutely not! GM has entered chapter 11 to launch the New GM through thepowerful tools of the Bankruptcy Code. GM will take the necessary actions to transitionoperations and launch a highly competitive New GM. Importantly, GM has the supportof the U.S. and Canadian governments and the UAW in this effort.
What is the difference between chapter 11 and chapter 7?
It is common for people to mistakenly think of chapter 7 liquidation when they hear the
word “bankruptcy.” We are not liquidating. Chapter 11 and chapter 7 involve two very
different outcomes. Companies go out of business under chapter 7. Chapter 11 isdifferent
–
it is designed to allow companies to continue operating to preserve theirgoing concern value and through the bankruptcy code emerge as viable businesses.
What are some key attributes of chapter 11?
Some key Chapter 11 attributes are the following:
 
Chapter 11 is not a declaration of insolvency.
 
Com
panies don’t file chapter 11 to liquidate; they do so in order to continue
operating and to take the necessary steps to emerge as a financially strongerbusiness, reorganizing their operations or balance sheet or in some cases byselling substantially all its assets.
 
Management remains in control of the business during the chapter 11rehabilitative process. Trustees, administrators and monitors typically are notappointed.
 
Chapter 11 normally does not cause interruption to business operations.
 
 
General_v2
 
The company is given breathing room during the process
–
an
“automatic stay”
generally prevents parties from taking legal action against the company or
taking the company’s assets
.
 
Specific benefits include that the company can:
o
 
sell its assets free of liens or encumbrances;
o
 
obtain
“debtor in possession financing” to fund ongoing operat
ionsduring the chapter 11 case;
o
 
“reject” unprofitable contracts and leases
.
 
What is section 363 and how is it being used to launch the New GM?
Section 363 permits a company in chapter 11 to sell assets and in some casessubstantially all its assets. GM intends to use that ability to sell the strongest parts of itsbusiness to launch a new and successful enterprise
. The purchaser’s business will be
built upon only the strongest parts of our business
–
our employees; our best brands(Cadillac, Chevrolet, Buick, GMC), and the plants and other hard assets that those brandsrely on; the contracts we need to secure supplies and keep our business moving; and theequity we own in our dome
stic and global subsidiaries. The New GM will be led by GM’s
current management team.
Why did GM choose the section 363 path?
 With the support of our largest secured lender, the U.S. Treasury, section 363 allows GMthrough a court-supervised sale, to create and launch the New GM quickly. We currentlyhope to close the transaction in 60 to 90 days from June 1.
How is the New GM being launched?
It is anticipated that the valuable assets of GM will be sold to a new entity to quicklylaunch a leaner, more customer-focused and more cost-competitive automaker, with amuch stronger balance sheet that is positioned for profitability. The New GM will be
built from GM’s strongest brands and operations.
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MisterFrost

Oh, just don't buy from any org that used bailout money and watch them fail again... seriously, try to move any association we have away from any bailout recipient in ANY field.. use Credit Unions over banks. Buy foreign cars, the money goes there anyway, but Japan is better than england--the owners of our country live there as well.

reply06 / 13 / 2009
MisterFrost

WTF do we need GM for anyway? What shite they produce. Where is the real future in auto tech and fuel tech? Nonexistent for all purposes. How about only producing cars and machines running on alcohol or any blend?

reply06 / 13 / 2009
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