Frequently Asked Questions: Warrant Holder Information
- Q: Please explain why I received these warrants?
- A: The warrants for General Motors Company (New GM) common stock were issued to Motors Liquidation Company in connection with the creation of New GM. Motors Liquidation Company was responsible for the distribution of common stock and warrants in the New GM to unsecured creditors in accordance with the bankruptcy plan, which was confirmed by the bankruptcy court on March 31, 2011.
- Q: Are the warrants currently exercisable and/or tradable?
- A: Both Warrant A, expiring July 10, 2016 with CUSIP 37045V118, and Warrant B, expiring July 10, 2019 with CUSIP 37045V126, are currently exercisable and tradable. As of April 25, 2011, the exercise price for Warrant A expiring July 10, 2016 (CUSIP 37045V118) is $10 and the exercise price for the warrant B expiring July 10, 2019 (CUSIP 37045V126) is $18.33. Strike prices may change due to certain events, such as a stock dividend or stock split. There are no restrictions on shares of common stock post exercise.
- Q: How was the amount determined for the number of shares and warrants that I received?
- A: Motors Liquidation Company was responsible for the distribution of common stock and warrants in the new GM to unsecured creditors in accordance with the bankruptcy plan, which was confirmed by the bankruptcy court on March 31, 2011.
- Q: Please describe my options to exercise the warrants?
- A: Holders have the right to full physical settlement or net share settlement. In full physical settlement, holders must pay the exercise price, which currently is $10 for Warrant A (CUSIP 37045V118) and $18.33 for Warrant B (CUSIP 37045V126), (plus any associated fees charged by the broker, etc) in order to receive one share of common stock for each warrant exercised. In a net share settlement, the transaction is cashless (unless there are associated fees charged by the broker, etc) where the number of shares of common stock to be delivered is equal to the Net Share Settlement Price (equal to the volume weighted average price of prior 20 trading days on the New York Stock Exchange for common stock) minus the associated exercise price divided by the Net Share Settlement Price. All fractional shares will be paid in cash. Please check with your broker or financial advisor for exact details and definitions.
- Q: What is my cost basis for the warrants and common stock I received from the MLC bankruptcy?
- A: The receipt of new GM stock and warrants by Motors Liquidation Company (MLC) bondholders was generally not a taxable event. Your historic cost basis in your Motors Liquidation Company debt is your basis in the GM stock and warrants received. The basis should be spread to the assets received pro rata based on value. You may want to seek the advice of a tax advisor and or your financial advisor for assistance in determining your cost basis and allocation between the various assets received, or if you received additional assets from MLC.
- Q: How can I obtain further information about the warrants I received pursuants to the confirmed bankruptcy plan?
- A: You should contact your broker or financial advisor for assistance specific to your investment, including assistance to exercise your warrants. There is additional information available at www.mlcguctrust.com.
- Q: Did the old General Motors Corporation common stock, CUSIP 370442105, become the new General Motors Company common stock and, if not, does the stock currently have any value?
- A: No. The old GM Corporation common stock became Motors Liquidation Company common stock in June 2009, and traded as MTLQQ on the over the counter market until the confirmed bankruptcy plan cancelled the shares on March 31, 2011. The stockholders did not receive any consideration for their holdings and the stock no longer has value.
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