$25 Billion Bridge Financing Facility

MEMO

To
Bob Nardelli, Chrysler
Alan Mulally, Ford
Rick Wagoner General Motors
Ron Gettelfinger UAW President

From :
Speaker of the House
Senate Majority leaser

Re: $25 Billion Bridge Financing Facility


To ensure the optimum use of time we would request the following be addressed in your report due Dec 2nd, 2008 Please note, we have added an extra seat at the table for Mr. Gettelfinger, President of the UAW. Your attendance is mandatory.

·Objective: To ascertain exactly how much money is required, short term as defined by next 6 months and long term as defined by 12 and 24 months.
·Action: Realistic projections which must include the following: Management, labour, vendor, and bondholder concessions. Costs associated with closing of facilities, dealerships and disposal of assets.
Proceeds from the sale of assets.

·Objective: To pinpoint the problems and determine the options relating to the unprofitable or marginally profitable brands.
· Action: Profitability analysis by brand

· Objective: To understand the brand profitability and cost differentials by country.
· Action: A comparative detailed line by line breakdown of the direct individual costs in the manufacturing of a brand by plant and country.

· Objective: To ensure complete transparency with respect to the proposals submitted to other governments.
· Action: A summary of the concessions that you will be requested of the governments in the countries where you are presently manufacturing.

· Objective: To establish the level of seriousness to which the UAW is prepared to commit to these proceedings
· Action: The concessions that the UAW is prepared to make to the existing agreements.

· Objective: To ascertain the threshold the unsecured creditors and bondholders will accept with respect to debt forgiveness and/or conversion of debt into equity..
· Action: For all trade payables in excess of $250,000: A list of the summarized aged accounts payable. Next to each vendor, note if this is a secured or unsecured debt. Indicate if the vendor has credit insurance and if so, who is the insurer. Has communication been initiated with respect to forgiveness of part of the debt or the conversion into equity.
· Action: At the present time, the value of the General Motos unsecured bonds is approximately . 50 cents on the dollar. What degree of communication has been held with the major bond holders?

· Objective: To establish what the upper management, owners and Board of Directors are prepared to do for the company with respect to tenure, compensation, voting rights, dividends and collateral. The Ford family still maintains special voting rights, are they prepared to give them up, along with the dividends? Chrysler is 80% owned by private-equity company, Cerberus Capital Management, who in turn also own approximately 50% of GMAC. Are they prepared to put those shares up as security and/or other assets?
· Action: A detailed proposal by each of your companies in response to the above..

· Objective: To determine at what point Chrysler, Ford, and General Motors will become profitable and competitive and to ensure that you have your finger on the pulse of what your customer wants in relation to fuel efficiency, and ecology
· Action: 3 year plan going forward.

· Objective: To find out what alternative options are available to the companies.
· Action: A realistic plan (not a worse case scenario) going forward should the government decide not to loan you the money.

Gentlemen, the reports that you will be submitting next week, will have a tremendous impact on the country you are living in, the business and banking world and the lives of many of your countrymen. Please treat this with the level of seriousness it deserves.