The Great Recession hit General Motors (“GM”) hard, and it declared bankruptcy in 2009. The value of its bonds, which were supposed to be a safe investment, was reduced to $0. As part of its bankruptcy restructuring process, GM changed its name to Motors Liquidation Company, and GM gave Motors Liquidation Company a warrant for certain GM assets and liabilities. (A warrant gives the holder the right to purchase a company’s stock at a specific price and at a specific date, and when the holder exercises a stock warrant, the shares that fulfill the obligation do not come from another investor but directly from the company.)
In 2011, Motors Liquidation Company (“MLC”) wanted to grant warrants to bondholders and creditors who had seen their GM investments disappear. So it converted its warrant to a global warrant, which allowed it to distribute warrants to investors. These were called “Series A Warrants.” And the people who received and owned these Series A Warrants were people who had formerly owned GM bonds, and had seen their bonds reduced to zero.
Warrants give the holder the right to purchase a company stock at a specific price and by a specific date, but if they expire, they become worthless. Warrants expire on the Expiration Date. GM changed the Expiration Date of these warrants from July 10, 2016 to July 8, 2016. GM did not adequately explain this change to investors and brokers, and did not give them enough time to prepare. Investors were not able to exercise their warrants, which became worthless.
If you owned GM Series A Warrants, you likely have a claim. Please contact Rose Law, at 816-221-4335, as soon as possible.