General Motors 2010 Annual Report Download - page 75

GENERAL MOTORS COMPANY AND SUBSIDIARIES
In December 2010 we purchased 84 million shares of our Series A Preferred Stock, which accrued cumulative dividends at a 9.0%
annual rate, from the UST for a purchase price of $2.1 billion, which was equal to 102% of their aggregate liquidation amount
pursuant to an agreement that we entered into with the UST in October 2010. We purchased the Series A Preferred Stock from the
UST on the first dividend payment date for the Series A Preferred Stock after the completion of our common stock offering,
December 15, 2010.
We made a voluntary contribution to our U.S. hourly and salaried defined benefit pension plans of $4.0 billion of cash in December
2010 and 61 million shares of our common stock valued at $2.2 billion for funding purposes in January 2011.
Under wholesale financing arrangements, our U.S. dealers typically borrow money from financial institutions to fund their vehicle
purchases from us. Effective January 2011 we terminated a wholesale advance agreement which provided for accelerated receipt of
payments made by Ally Financial on behalf of our U.S. dealers pursuant to Ally Financial’s wholesale financing arrangements with
dealers. Similar modifications were made in Canada. The wholesale advance agreements cover the period for which vehicles are in
transit between assembly plants and dealerships. We will no longer receive payments in advance of the date vehicles purchased by
dealers are scheduled to be delivered, resulting in an average increase of approximately $2.0 billion to our accounts receivable
balance, depending on sales volumes and certain other factors, and the related costs under the arrangements were eliminated.
In January 2011 we withdrew our application for loans available under Section 136 of the EISA. This decision is consistent with
our stated goal to minimize our outstanding debt.
Automotive
Available Liquidity
Available liquidity includes cash balances and marketable securities. At December 31, 2010 available liquidity was $26.6 billion,
not including funds available under credit facilities of $5.9 billion or in the Canadian HCT escrow account of $1.0 billion. The amount
of available liquidity is subject to intra-month and seasonal fluctuations and includes balances held by various business units and
subsidiaries worldwide that are needed to fund their operations.
We manage our liquidity using U.S. cash investments, cash held at our international treasury centers and available liquidity at
consolidated overseas subsidiaries. The following table summarizes our liquidity (dollars in millions):
Successor
December 31, 2010 December 31, 2009
Cash and cash equivalents ......................................................... $21,061 $22,679
Marketable securities ............................................................ 5,555 134
Available liquidity ............................................................. 26,616 22,813
Available under credit facilities .................................................... 5,919 618
Total available liquidity .......................................................... 32,535 23,431
UST and HCT escrow accounts (a) .................................................. 1,008 13,430
Total liquidity including UST and HCT escrow accounts ................................ $33,543 $36,861
(a) Classified as Restricted cash and marketable securities. Refer to Note 15 to our consolidated financial statements for additional
information on the classification of the escrow accounts. The remaining funds held in the UST escrow account were released in
April 2010 following the repayment of the UST Loans and Canadian Loan.
General Motors Company 2010 Annual Report 73