GM 363 Sale - Objections Due June 19 5:00 PM EST

Some excerpts:

B. THE SALE HEARING The Sale Hearing will be held before the Honorable Robert E. Gerber, United States Bankruptcy Judge, in Courtroom 621 of the United States Bankruptcy Court for the Southern District of New York, One Bowling Green, New York, New York 10004-1408, on June 30, 2009, at 9:45 a.m. (Eastern Time). The Sale Hearing may be adjourned without notice by an announcement of the adjourned date at the Sale Hearing.

RESPONSES OR OBJECTIONS, IF ANY, TO THE RELIEF SOUGHT IN THE MOTION SHALL BE FILED with the Clerk of the Bankruptcy Court and served upon:
(a) Weil, Gotshal & Manges LLP, attorneys for the Debtors, 767 Fifth Avenue, New York, New York 10153 (Attn: Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H. Smolinsky, Esq.); (b) Cadwalader, Wickersham & Taft LLP, attorneys for the Purchaser, One World Financial Center, New York, New York 10281 (Attn: John J. Rapisardi, Esq.); (c) the attorneys for the Creditors Committee; (d) Cleary Gottlieb Steen & Hamilton LLP, the attorneys for the UAW, One Liberty Plaza, New York, New York 10006 (Attn: James L. Bromley, Esq.); (e) Cohen, Weiss and Simon LLP, the attorneys for the UAW, 330 W. 42nd Street, New York, New York 10036 (Attn: Babette Ceccotti, Esq.); (f) Vedder Price, P.C., attorneys for Export Development Canada, 1633 Broadway, 47th Floor, New York, New York 10019 (Attn: Michael J. Edelman, Esq. and Michael L. Schein, Esq.); (g) the Office of the United States Trustee for the Southern District of New York (Attn: Diana G. Adams, Esq.), 33 Whitehall Street, 21st Floor, New York, New York 10004; and (h) the U.S. Attorney’s Office, S.D.N.Y., 86 Chambers Street, Third Floor, New York, New York 10007 (Attn: David S. Jones, Esq. and Matthew L. Schwartz, Esq.), SO AS TO BE RECEIVED NO LATER THAN JUNE 19, 2009, AT 5:00 P.M. (EASTERN TIME) (the “Objection Deadline”).

The failure of any person or entity to file a response or objection on or before the Objection Deadline shall be deemed a consent to the 363 Transaction and the other relief requested in the Motion, and shall bar the assertion, at the Sale Hearing or thereafter, of any objection to the Sale Procedures, the Motion, the 363 Transaction, the approval of the UAW Retiree Settlement Agreement, and the Debtors’ consummation of the 363 Transaction.

See the link for full document:
http://gmcourtdocs.gardencitygroup.com/pdflib/salehearing_1.pdf

So next week we should be a huge fully of objections to the sale being filed from various parties.

June 23 Hearing - F and D Bondholders

June 23, 2009 at 2 p.m. (Eastern Time)
Motion to Appoint Official Committee of Family & Dissident Bondholders

http://gmcourtdocs.com/hearings.php3

GM CDS valued at around $0.125 in 2nd auction

June 12 (Bloomberg) -- Credit-default swaps traders settling contracts that protected against a General Motors Corp. default set a value of 12.5 cents on the dollar for the automaker’s bonds.
The price, the result of a second round of an auction by 13 dealers including Deutsche Bank AG and Morgan Stanley, means sellers of the swaps will pay 87.5 cents on the dollar to buyers of the protection, according to data from administrators Markit Group Ltd. and broker Creditex Group Inc.

http://www.bloomberg.com/apps/news?pid=20601103&sid=aZGopZRF4xcg


Soros: Ban CDS as 'Instruments of Destruction'

But the potential damage that CDS could do was not limited to financial firms, Soros added. He pointed to the bankruptcy of North America's largest newsprint maker, AbitibiBowater Inc and the bankruptcy of General Motors.

"In both cases, some bondholders owned CDS and they stood to gain more by bankruptcy than by reorganisation." See the entire article at:
http://www.foxbusiness.com/story/markets/industries/finance/update--ban-cds-instruments-destruction---soros/

GM CDS (Credit Default Swap) Auction June 12

Dealers buy and sell bonds of the defaulting companies during the auction in order to set one price by which holders of the derivatives settle. Sellers of the contracts, which are used to hedge against losses or speculate on creditworthiness, pay the buyer face value, less the value of the underlying bonds.

The settlement will be the largest for the market since last year’s collapse of Lehman Brothers Holdings Inc.

Banks, hedge funds, insurance companies and other investors had bought or sold a net $2.31 billion of default protection on the automaker’s debt as of May 27, according to data from the Depository Trust & Clearing Corp., which runs a central registry that captures most trades. Another $776 million was bought through contracts on indexes that include GM, the largest U.S. automaker, among groups of companies, New York-based Depository Trust’s data show.

Wow, imagine that....banks, hedge funds and insurance companies buy default protection which pays them full value of their bonds IF AND ONLY IF THERE IS A DEFAULT ON THE BONDS WHICH OCCURS WITH A BANKRUPTCY FILING! IF my math is correct..$2,310,000,000 + $776,000,000 = $3,086,000,000. OK have to use a calculator for this one......$3,086,000,000 (total CDS)/27,200,000,0000 (total bonds)=11.3%. Hummmm.....The original tender offer for the bonds had a mandatory 90% tender rate. Well with 11.3% getting paid in full how could they have ever gotten 90%, even if the terms were fair?

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=auMORpVwbZus

Stay tuned lets see what value the market makers place on GM bonds at the CDS Auction June 12.

Forgotten Voices in GM want to be heard

"But the unofficial group of dissident bondholders, represented by Patton Boggs LLP, said all bondholders should receive a higher recovery under bankruptcy's absolute priority rule and questioned whether the 54% tally of supporting bondholders (based on e-mail and telephone calls) is accurate.

"While such an 'agreement' has been touted as a template for all bondholders -- including holders of billions of dollars' worth who have not yet been heard from -- and is now embedded in the transfer of assets scheme ... there are significant questions well beyond whether it is really supported even by a majority" of the bondholders, the group said in its request to become an official committee. See the entire article at:

http://www.thedeal.com/dealscape/2009/06/forgotten_voices_in_gm_want_to.php