State of the Union May 24, 2010

• From Chairman Mike Bullock: The Missouri Career Center is signing up laid off Missourians for training for "Green Jobs". UAW laid off members receive priority on the training. Call John Arthur Miller at 636-278-1360 ext 293 to be put on the list.

• Reminder: There will be another blessing of the bikes Tuesday, May 25, by the arch 15 minutes after longest line time or 5:45, whichever comes first.

•Reminder: Friday, May 28 is the last day to cancel or opt out of automatic enrollment in the PSP. Call 1-800-489-4646 or go to gmbenefits.com.

•The recent GM repayment of the government loans has raised many questions about how much various parties are owed. Here’s the breakdown: President Bush approved a bailout plan on December 19, 2008, which would give loans of $17.4 billion to U.S. automakers GM and Chrysler. Bush initially provided $13.4 billion, with another $4 billion available in February 2009. Of that, GM got $9.4 billion and Chrysler $4 billion. GM did not take the second payout scheduled in February. GM filed for Chapter 11 Bankruptcy on June 1, 2009. The Feds provided $49.5 billion in what is called “Debtor-In-Possession” financing. The U.S. provided $6.7 billion in loans and took 61% of the company’s equity in exchange for $42.8 billion in cash. The Canadian government gave GM $1.4 billion in loans, and $8.1 billion cash in exchange for 12% of the company’s equity. So the total General Motors received from the U.S. was $59 billion, including the $9.4 billion before the bankruptcy. As part of the bankruptcy deal, the UAW’s Voluntary Employee Beneficiary Association Plan (VEBA), which pays healthcare benefits to GM retirees, agreed to forgive $20 billion GM owed the VEBA during GM’s bankruptcy proceedings. The union agreed to accept a 17.5% stake in the new GM, plus $6.5 billion in preferred shares and a $2.5 billion promissory note from the U.S. government. Holders of GM’ corporate bonds were owed $27.2 billion before the bankruptcy. Those bonds were backed by hard assets of GM, such as factories and real estate. In order to get to them to agree to the bankruptcy terms, bondholders received a 10% equity stake, plus so-called stock “warrants” that could eventually give them a 15% stake.