X in Re : Chapter 11 : MOTORS LIQUIDATION COMPANY, Et Al., : Case No.: 09-50026 (REG) F/K/A General Motors Corp., Et Al
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09-50026-reg Doc 12984 Filed 11/05/14 Entered 11/05/14 22:53:13 Main Document Pg 1 of 4 UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ---------------------------------------------------------------x In re : Chapter 11 : MOTORS LIQUIDATION COMPANY, et al., : Case No.: 09-50026 (REG) f/k/a General Motors Corp., et al. : : Debtors. : (Jointly Administered) ---------------------------------------------------------------x DECLARATION OF DEBORAH J. NEWMAN IN SUPPORT OF THE PARTICIPATING UNITHOLDERS’ AND GUC TRUST ADMINISTRATOR’S OPENING MEMORANDUM OF LAW RESPECTING THE EQUITABLE MOOTNESS THRESHOLD ISSUE I, Deborah J. Newman, declare as follows: 1. I am a partner at the law firm of Akin Gump Strauss Hauer & Feld LLP, counsel for certain unaffiliated holders (the “Participating Unitholders”) of beneficial units of the Motors Liquidation Company GUC Trust. 2. I respectfully submit this Declaration in Support of the Participating Unitholders’ and GUC Trust Administrator’s Opening Memorandum of Law Respecting the Equitable Mootness Threshold Issue. 3. Attached hereto as Exhibit A is a true and correct copy of a CRT Capital Group LLC (“CRT Capital”) analyst report dated October 22, 2013. 4. Attached hereto as Exhibit B is a true and correct copy of a CRT Capital analyst report dated November 11, 2013. 5. Attached hereto as Exhibit C is a true and correct copy of a letter from General Motors LLC (“New GM”) to the National Highway Traffic Safety Administration (“NHTSA”) dated February 24, 2014 regarding Recall No. 14V-047. 09-50026-reg Doc 12984 Filed 11/05/14 Entered 11/05/14 22:53:13 Main Document Pg 2 of 4 6. Attached hereto as Exhibit D is a true and correct copy of a letter from New GM to NHTSA dated March 11, 2014 regarding Recall No. 14V-047. 7. Attached hereto as Exhibit E is a true and correct copy of a letter from New GM to NHTSA dated April 11, 2014 regarding Recall No. 14V-047. 8. Attached hereto as Exhibit F is a true and correct copy of a letter from New GM to NHTSA dated July 2, 2014 regarding Recall No. 14V-355. 9. Attached hereto as Exhibit G is a true and correct copy of a letter from New GM to NHTSA dated July 16, 2014 regarding Recall No. 14V-400. 10. Attached hereto as Exhibit H is a true and correct copy of a letter from New GM to NHTSA dated July 16, 2014 regarding Recall No. 14V-394. 11. Attached hereto as Exhibit I is a true and correct copy of a letter from New GM to NHTSA dated August 7, 2014 regarding Recall No. 14V-490. 12. Attached hereto as Exhibit J is a true and correct copy of a letter from NHTSA to New GM dated October 3, 2014 regarding Recall No. 14V-540. 13. Attached hereto as Exhibit K is a true and correct copy of a letter from New GM to NHTSA dated March 31, 2014 regarding Recall No. 14V-117. 14. Attached hereto as Exhibit L is a true and correct copy of a letter from New GM to NHTSA dated March 31, 2014 regarding Recall No. 14V-118. 15. Attached hereto as Exhibit M is a true and correct copy of a letter from New GM to NHTSA dated March 31, 2014 regarding Recall No. 14V-153. 16. Attached hereto as Exhibit N is a true and correct copy of a letter from New GM to NHTSA dated April 29, 2014 regarding Recall No. 14V-224. 2 09-50026-reg Doc 12984 Filed 11/05/14 Entered 11/05/14 22:53:13 Main Document Pg 3 of 4 17. Attached hereto as Exhibit O is a true and correct copy of a letter from New GM to NHTSA dated May 22, 2014 regarding Recall No. 14V-224. 18. Attached hereto as Exhibit P is a true and correct copy of a letter from New GM to NHTSA dated May 28, 2014 regarding Recall No. 14V-251. 19. Attached hereto as Exhibit Q is a true and correct copy of a letter from New GM to NHTSA dated May 28, 2014 regarding Recall No. 14V-252. 20. Attached hereto as Exhibit R is a true and correct copy of a letter from New GM to NHTSA dated May 30, 2014 regarding Recall No. 14V-266. 21. Attached hereto as Exhibit S is a true and correct copy of a letter from New GM to NHTSA dated June 25, 2014 regarding Recall No. 14V-261. 22. Attached hereto as Exhibit T is a true and correct copy of a letter from New GM to NHTSA dated June 25, 2014 regarding Recall No. 14V-260. 23. Attached hereto as Exhibit U is a true and correct copy of a letter from New GM to NHTSA dated June 11, 2014 regarding Recall No. 14V-318. 24. Attached hereto as Exhibit V is a true and correct copy of a letter from New GM to NHTSA dated July 2, 2014 regarding Recall No. 14V-404. 25. Attached hereto as Exhibit W is a true and correct copy of a letter from New GM to NHTSA dated July 2, 2014 regarding Recall No. 14V-407. 26. Attached hereto as Exhibit X is a true and correct copy of a letter from New GM to NHTSA dated July 28, 2014 regarding Recall No. 14V-460. 27. Attached hereto as Exhibit Y is a true and correct copy of a letter from NHTSA to New GM dated October 3, 2014 regarding Recall No. 14V-542. 3 09-50026-reg Doc 12984 Filed 11/05/14 Entered 11/05/14 22:53:13 Main Document Pg 4 of 4 28. Attached hereto as Exhibit Z and Exhibit AA are true and correct copies of the transcripts of a June 26, 2014 Today Show interview of New GM Chief Executive Officer Mary Barra. 29. Attached hereto as Exhibit BB is a true and correct copy of the relevant excerpts of the transcript of the hearing dated May 2, 2014 in In re Motors Liquidation Company, 09-50026 (REG). 30. Attached hereto as Exhibit CC is a true and correct copy of the relevant excerpts of the transcript of the hearing dated July 2, 2014 in In re Motors Liquidation Company, 09-50026 (REG). 31. Attached hereto as Exhibit DD is a true and correct copy of the relevant excerpts of the transcript of the hearing dated August 18, 2014 in In re Motors Liquidation Company, 09-50026 (REG). 32. Attached hereto as Exhibit EE is a true and correct copy of a Bloomberg News article titled “GM Could Face $2 Billion Tab If Bankruptcy Shield Falls,” dated November 5, 2014. 33. Attached hereto as Exhibit FF is a true and correct schedule of the volume, closing price and market value of GUC Trust Units traded between June 14, 2012 and October 21, 2014, based on information derived from Bloomberg Finance L.P. 34. I declare under penalty of perjury that to the best of my knowledge, the foregoing is true and correct. Dated: November 5, 2014 __/s/ Deborah J. Newman_______ New York, New York Deborah J. Newman 4 09-50026-reg Doc 12984-1 Filed 11/05/14 Entered 11/05/14 22:53:13 Exhibit - A - AA Pg 1 of 168 EXHIBIT A 09-50026-reg Doc 12984-1 Filed 11/05/14 Entered 11/05/14 22:53:13 Exhibit - A - AA Pg 2 of 168 CRT Research | Automotive Kirk Ludtke (203) 569-4361 • [email protected] Managing Director; Co-Head of Research Scott Petralia (203) 569-4381 • [email protected] Research Associate Motors Liquidation Company (MTLQU, NR, PT: None, Close: $34.35) Double-Digit Un-Correlated Return Potential OctoberOctober 22, 22, 2013 2013 We are revising our valuation of the Motors Liquidation GUC Trust (the “GUC Trust” or “MTLQU”) Units (the “Units”) Key Data from $36/unit to $39/unit to reflect downward revisions to Rating Not Rated ("NR") Price Target None our estimates for both claims (now $31.897 billion) and the Price (10/21/2013 Close) $34.35 expected costs of the liquidation (now $27.5 million). Our 52 Week High-Low $37.00 - $18.51 $39/Unit target is based on yesterday’s closing price for GM’s Market Cap ($ mm) $1,032 Common Shares ($35.50/share), Class A Warrants ($25.97/ Shares Out (mm) 30.0 Warrant), and Class B Warrants ($18.47/Warrant)(together, 90-day Average Daily Vol 133,318 the “GM Securities”) and the associated tax liabilities (now Public Market Float 100% NR - PT: None NR - PT: $397.8 million). Our valuation is 15% above yesterday’s closing price of $34.35/Unit. Investors seeking un-correlated returns may be particularly interested in the GUC Trust given that it is relatively large (with a market capitalization in excess of $1 billion) and liquid. The Nova Scotia Litigation settlement received Bankruptcy Court approval, as expected, yesterday. The holders of the Units, as a consequence, are entitled to a significant (as much as $14/Unit) near-term distribution. The magnitude and timing of subsequent distributions is not as clear, but we believe that in the most likely scenario for the Term Loan Avoidance Litigation (the most significant remaining claim against MTLQU), all claims against the GUC Research Update Trust could be resolved, and all distributions to the holders of the Units made, by 3/31/15. In this most-likely scenario, the Units could generate an un-correlated annualized total return of 18%. We believe that the Units present an attractive relative value at current levels.