F/K/A Chrysler LLC), Et Al., (Jointly Administered) Debtors
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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ----------------------------------------------------------------- In re Chapter 11 Old Carco LLC Case No. 09-50002 (AJG) (f/k/a Chrysler LLC), et al., (Jointly Administered) Debtors. ----------------------------------------------------------------- DISCLOSURE STATEMENT WITH RESPECT TO SECOND AMENDED JOINT PLAN OF LIQUIDATION OF DEBTORS AND DEBTORS IN POSSESSION Alpha Holding LP 09-50025 (AJG) DCC 929, Inc. 09-50017 (AJG) Dealer Capital, Inc. 09-50018 (AJG) JONES DAY Global Electric Motorcars, LLC 09-50019 (AJG) NEV Mobile Service, LLC 09-50020 (AJG) Corinne Ball NEV Service, LLC 09-50021 (AJG) Old Carco LLC 09-50002 (AJG) 222 East 41st Street (f/k/a Chrysler LLC) New York, New York 10017 Old Carco Aviation Inc. 09-50003 (AJG) Telephone: (212) 326-3939 (f/k/a Chrysler Aviation Inc.) Facsimile: (212) 755-7306 Old Carco Dutch Holding LLC 09-50004 (AJG) (f/k/a Chrysler Dutch Holding LLC) Old Carco Dutch Investment LLC 09-50005 (AJG) David G. Heiman (f/k/a Chrysler Dutch Investment LLC) North Point Old Carco Dutch Operating Group LLC 09-50006 (AJG) 901 Lakeside Avenue (f/k/a Chrysler Dutch Operating Group LLC) Old Carco Institute of Engineering 09-50007 (AJG) Cleveland, Ohio 44114 (f/k/a Chrysler Institute of Engineering) Telephone: (216) 586-3939 Old Carco International Corporation 09-50008 (AJG) Facsimile: (216) 579-0212 (f/k/a Chrysler International Corporation) Old Carco International Limited, L.L.C. 09-50009 (AJG) (f/k/a Chrysler International Limited, L.L.C.) Jeffrey B. Ellman Old Carco International Services, S.A. 09-50010 (AJG) 1420 Peachtree Street, N.E. (f/k/a Chrysler International Services, S.A.) Suite 800 Old Carco Motors LLC 09-50011 (AJG) Atlanta, Georgia 30309 (f/k/a Chrysler Motors LLC) Old Carco Realty Company LLC 09-50000 (AJG) Telephone: (404) 581-3939 (f/k/a Chrysler Realty Company LLC) Facsimile: (404) 581-8330 Old Carco Service Contracts Florida, Inc. 09-50012 (AJG) (f/k/a Chrysler Service Contracts Florida, Inc.) ATTORNEYS FOR DEBTORS AND Old Carco Service Contracts Inc. 09-50013 (AJG) (f/k/a Chrysler Service Contracts Inc.) DEBTORS IN POSSESSION Old Carco Technologies Middle East Ltd. 09-50014 (AJG) (f/k/a Chrysler Technologies Middle East Ltd.) Old Carco Transport Inc. 09-50015 (AJG) (f/k/a Chrysler Transport Inc.) Old Carco Vans LLC 09-50016 (AJG) Dated: January 22, 2010 (f/k/a Chrysler Vans LLC) Peapod Mobility LLC 09-50001 (AJG) TPF Asset, LLC 09-50022 (AJG) TPF Note, LLC 09-50023 (AJG) Utility Assets LLC 09-50024 (AJG) SUMMARY The following summary should be read in conjunction with the attached disclosure statement (the "Disclosure Statement"), pursuant to section 1125 of title 11 of the United States Code (the "Bankruptcy Code"). This summary is provided as a brief overview and is not a replacement for the Disclosure Statement. You should carefully read the entire Disclosure Statement, including the exhibits and other documents.1 Capitalized terms not otherwise defined in this summary have the meaning given to them in the Disclosure Statement. Old Carco LLC (f/k/a Chrysler LLC), a Delaware limited liability company ("Old Carco"), and its debtor subsidiaries (collectively with Old Carco, the "Debtors"), as debtors and debtors in possession in these chapter 11 cases pending before the United States Bankruptcy Court for the Southern District of New York (the "Bankruptcy Court"), jointly administered under Case No. 09-50002 (AJG) (collectively, the "Chapter 11 Cases"), submit the attached Disclosure Statement in connection with the solicitation of votes on their Second Amended Joint Plan of Liquidation, dated January 22, 2010 (the "Plan"). A copy of the Plan is attached to the Disclosure Statement as Exhibit A. If you are the holder of a General Unsecured Claim, your potential recovery under the Plan is contingent on, among other things, a successful outcome in a lawsuit initiated by the Creditors' Committee against Daimler AG and certain related parties, which is referred to in the Disclosure Statement as the Daimler Litigation. Under the Plan, the Daimler Litigation will be pursued by the Liquidation Trust established by the Plan. If a sufficient recovery is not achieved in the Daimler Litigation, holders of General Unsecured Claims will receive no distributions under the Plan. Until it is clear that such a recovery will be available, the Debtors anticipate that the review and allowance of General Unsecured Claims will be delayed. Such delay could be substantial. In addition, potential recoveries to holders of General Unsecured Claims are contingent on the Class of General Unsecured Creditors (Class 3A) and the Class of First Lien Secured Claims (Class 2A) voting in favor of the Plan. Absent Confirmation and implementation of the Plan, the Debtors anticipate that holders of General Unsecured Claims, as well as most holders of unsecured Priority Claims, would receive no distributions in a liquidation of the Debtors under chapter 7 of the Bankruptcy Code. The Debtors, Their Chapter 11 Cases and the Plan The Debtors are comprised of Old Carco, a Delaware limited liability company, and 25 of its direct and indirect debtor subsidiaries identified on the cover page of the Disclosure Statement. Since the commencement of these Chapter 11 Cases, the Debtors have managed their assets as debtors in possession under the supervision of the Bankruptcy Court, but have not operated their businesses. These Chapter 11 Cases were commenced to pursue an expedited sale of substantially all of the Debtors' assets to a new entity ("New Chrysler") formed by Fiat S.p.A. ("Fiat"), pursuant to section 363 of the Bankruptcy Code, thereby avoiding piecemeal liquidation of the Debtors, the loss of thousands of jobs and other adverse economic consequences. The sale of substantially all of the Debtors' assets to New Chrysler (the "Fiat Transaction") closed on June 10, 2009. Subsequent to the closing of the Fiat Transaction, the Debtors have been winding down their Estates, liquidating their remaining assets and formulating the Plan. The Debtors are not operating any businesses. New Chrysler is operating the Debtors' former businesses under new ownership. The Debtors have proposed, and are soliciting acceptances of, the Plan. The Plan is premised upon the liquidation of the remaining assets, generally comprised of collateral of the First Lien Lenders and the Government DIP Lenders; the prosecution of an action against Daimler AG, the former owner of Debtors, and certain related parties; and the distribution of such proceeds and various escrows created at the time of the Fiat Transaction or thereafter and funded by the U.S. and Canadian governments, serving as the debtor in possession lenders in the Chapter 11 Cases. Details of the foregoing are more particularly set forth in the Plan and the Winddown Orders, which are incorporated into the Plan and provide for, among other things, funding to complete the winddown of the 1 In addition, the exhibits and schedules to the Plan and to the Disclosure Statement are available, free of charge, at www.chryslerrestructuring.com. Debtors' Estates. The Plan implements the Winddown Orders and provides, through the creation of a liquidating trust, a mechanism for the collection and liquidation of the Debtors' remaining assets (including pursuit of the Daimler Litigation) and the distribution of the proceeds of such assets in accordance with the Bankruptcy Code, as set forth in the Plan provisions addressing the treatment of Claims. The classification and treatment of Claims and Interests under the Plan generally is as follows: • Class 1 (Priority Claims - Unimpaired) — Unless otherwise agreed by the Debtors or the Liquidation Trustee and the claimant, holders of Allowed Claims in Class 1 will receive distributions of cash in the full amount of their Allowed Claims; • Class 2A (First Lien Secured Claims - Impaired) — Holders of Allowed Claims in Class 2A, relating to certain secured loans under the First Lien Credit Agreement, among other things, will receive distributions of cash from the net proceeds of sales of the First Lien Collateral or, if elected by the First Lien Agent, certain of the First Lien Collateral will be transferred to the Collateral Trustee on behalf of the holders of these Claims. These distributions are subject to certain terms and conditions set forth in the Plan and the First Lien Winddown Order, including the First Lien Lenders' funding of certain activities of the Liquidation Trust; • Class 2B (TARP Financing Secured Claims - Impaired) — No property will be distributed to holders of Allowed TARP Financing Secured Claims; • Class 2C (Owners' Secured Claims - Impaired) — No property will be distributed to holders of Allowed Owners' Secured Claims; • Class 2D (Other Secured Claims - Unimpaired) — Holders of Allowed Claims in Class 2D, relating to Secured Tax Claims and other miscellaneous secured debt, will either (a) receive distributions of cash in the full amount of such Allowed Claims; (b) retain their liens and obtain distributions of cash from net proceeds of any sale of the collateral securing such Allowed Claims; (c) receive the collateral securing such Allowed Claims; or (d) obtain such other treatment as may be agreed upon by the Debtors or the Liquidation Trust and the claimant. Unless otherwise ordered by the Bankruptcy Court, each Allowed Claim in Class 2D will be considered to be in a separate subclass within Class 2D, and each such subclass will be deemed to be a separate Class for purposes of the Plan. To the extent that any holder of an Allowed Claim in Class 2D asserts in a timely objection to Confirmation of the Plan that its Claim is impaired by the Plan, such subclass will be deemed to have rejected the Plan, and the Debtors will seek to confirm the Plan over such rejection pursuant to section 1129(b) of the Bankruptcy Code; • Class 3A (General Unsecured Claims - Impaired) — The sole source of recovery for holders of Allowed Claims in Class 3A, comprised of Allowed General Unsecured Claims against the Debtors, is the Daimler Litigation.