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JONES DAY222 East 41st StreetNew York, New York 10017Telephone: (212) 326-3939Facsimile: (212) 755-7306Corinne BallVeerle RooversJONES DAYNorth Point901 Lakeside AvenueCleveland, Ohio 44114Telephone: (216) 586-3939Facsimile: (216) 579-0212David G. HeimanJONES DAY1420 Peachtree Street, N.E.Suite 800Atlanta, Georgia 30309Telephone: (404) 521-3939Facsimile: (404) 581-8309Jeffrey B. EllmanProposed Attorneys for Debtorsand Debtors in PossessionUNITED STATES BANKRUPTCY COURTSOUTHERN DISTRICT OF NEW -----------------x:In re::Chrysler LLC, et -----------------------------xChapter 11Case No. 09-50002 (AJG)(Jointly Administered)APPLICATION OF DEBTORS AND DEBTORS IN POSSESSION,PURSUANT TO SECTIONS 327(a), 328(a), 329(a) AND 364 OFTHE BANKRUPTCY CODE, BANKRUPTCY RULES 2014(a) AND 2016(b)AND LOCAL BANKRUPTCY RULES 2014-1 AND 2016-1, FORAN ORDER AUTHORIZING THEM TO RETAIN AND EMPLOYJONES DAY AS COUNSEL, NUNC PRO TUNC AS OF THE PETITION DATENYI-4179615v5
TO THE HONORABLEUNITED STATES BANKRUPTCY JUDGE:Chrysler LLC ("Chrysler") and 24 of its domestic direct and indirect subsidiaries,as debtors and debtors in possession (collectively with Chrysler, the "Debtors"), respectfullyrepresent as follows:Background1.On the date hereof (the "Petition Date"), the Debtors commenced theirreorganization cases by filing voluntary petitions for relief under chapter 11 of title 11 of theUnited States Code (the "Bankruptcy Code"). By a motion filed on the Petition Date,the Debtors have requested that their chapter 11 cases be consolidated for procedural purposesonly and administered jointly.2.The Debtors are authorized to continue to operate their business andmanage their properties as debtors in possession pursuant to sections 1107(a) and 1108 of theBankruptcy Code.3.The Debtors and their nondebtor direct and indirect subsidiaries(collectively, the "Chrysler Companies") comprise one of the world's largest manufacturers anddistributors of automobiles and other vehicles, together with related parts and accessories. Onthe Petition Date, the Chrysler Companies employed approximately 55,000 hourly and salariedemployees worldwide, 70% of whom were based in the United States. In addition, as of thePetition Date, the Debtors made payments for health care and related benefits to more than105,000 retirees.4.Chrysler's ultimate parent company, Chrysler Holding LLC ("ChryslerParent"), also owns a financing company, nondebtor Chrysler Financial Services Americas LLC("Chrysler Financial"), that operates under a governance structure separate from Chrysler, with-2NYI-4179615v5
its own board and management. Historically, Chrysler Financial has provided financing to bothChrysler's dealers and consumers.5.For the twelve months ended December 31, 2008, the Chrysler Companiesrecorded revenue of more than 48.4 billion and had assets of approximately 39.3 billion andliabilities totaling 55.2 billion.6.A more detailed explanation of Chrysler's businesses and operations, andthe events leading to the commencement of these cases, can be found in the Affidavit ofRonald E. Kolka, which was filed contemporaneously herewith and is incorporated herein byreference.Overview of These Cases7.The significance of this chapter 11 filing to Chrysler and to the UnitedStates economy is difficult to overstate. In connection with the filing, Chrysler is seekingapproval from this Court to consummate the only sale transaction that preserves some portion ofits business as a going concern and averts a liquidation of historic proportions. If the proposedtransaction, designed to effect an alliance with Italian automobile manufacturer Fiat S.p.A.("Fiat"), is rejected and Chrysler liquidates, it will mean the end of an iconic, 83-year-oldAmerican car company whose name has been synonymous with innovative engineering, from theSlant-Six and HEMI engines, to power windows, power brakes and power steering, to theminivan. A liquidation would also have impacts on the nation's economy and Chrysler'sstakeholders that are grim: 38,500 hourly and salaried Chrysler workers in the U.S. will lose their jobs; Chrysler's workers and retirees and their surviving spouses will lose over 9.8 billion of health care and other benefits and 2 billion in annual pensionpayments;-3NYI-4179615v5
All 23 of Chrysler's manufacturing plants and facilities and 15 parts depots inthe United States will shut down (as well as 18 additional plants and partsdepots worldwide); Approximately 3,200 Chrysler dealers will be put out of business and the over140,000 employees of those dealerships will lose their jobs; Over 5.7 billion in outstanding auto parts and service supplier invoices willnot be paid to Chrysler's suppliers and new business will be cancelled, forcinghundreds of suppliers out of business and the loss of hundreds of thousands ofadditional jobs; Over 31 million Chrysler, Jeep and Dodge owners would lose significantvalue in their cars and trucks, particularly due to questions about the ongoingavailability of warranties and replacement parts and services; Local, state and federal governments will lose tens of billions of dollars in taxrevenues, according to a research memorandum published by the Center forAutomotive Research in November 2008;1 Over 100 billion in annual sales will disappear from local economies; and Chrysler's first lien secured creditors will receive net present value recoveriesof less than 38 cents on the dollar and possibly as little as 9 cents; the U.S.government, another secured creditor, will receive less than that; andChrysler's unsecured creditors will receive nothing.8.The economic and market conditions that led to the commencement ofChrysler's chapter 11 cases and the need for the proposed sale transaction are well known, butsobering nonetheless. The automotive market meltdown, the worst in at least 26 years,2disrupted Chrysler's substantial progress in implementing a long-term plan to reduce costs andtransform its businesses for the next generation of cars. With sales plummeting and creditmarkets frozen, Chrysler undertook an intense effort to address the challenges it faced. Aftermonths of hard work and dedication by Chrysler's management, employees and advisors,12Daniel Cole, et al., Center for Automotive Research Memorandum, The Impact on the U.S. Economy of aMajor Contraction of the Detroit Three Automakers, at http://www.cargroup.org (Nov 4, 2008).Chris Isidore, Auto Sales Are Worst in 26 Years. January Sales Tumble More Than Expected at GM, Fordand Toyota as Rental Car Companies Slash Purchases, CNNMoney.com, Feb. 3, 2009 (4:22 p.m., ET).-4NYI-4179615v5
working with all key stakeholders and with the support of the U.S. government, the Debtors havecommenced these cases to implement a prompt sale to preserve the going concern value of theirbusinesses and return these businesses to viability under new ownership.9.The proposed sale transaction would create the sixth-largest globalautomaker by volume unit, increasing competitiveness with other Original EquipmentManufacturers ("OEMs") and creating billions of dollars in synergies. This transaction is theresult of thousands of hours of negotiations among multiple parties. The transaction is beingfinancially backed by the United States Department of the Treasury (the "U.S. Treasury") andExport Development Canada, an affiliate of the Canadian government, which together willprovide the new alliance with approximately 6 billion of taxpayer money to start up andmaintain operations. In addition to this unprecedented government support, virtually all of themajor constituencies that would be affected by a Chrysler liquidation have recognized howdevastating it would be and have made important concessions in support of the proposedalliance: The International Union, United Automobile, Aerospace and AgriculturalImplement Workers of America (the "UAW") has agreed to wage and benefitreductions in the context of a sale to the new company, which would receivethe benefit of a new collective bargaining agreement eliminating certainseverance benefits, and would be a party to an agreement with the UAWcontaining restructured retiree health care benefits; Chrysler's dealers have agreed to reduce their dealer and service contractmargins; Chrysler's already financially troubled suppliers have agreed to a further 3%price reduction and other measures that will save millions of dollars; Chrysler's largest secured creditors, JPMorgan Chase, Goldman Sachs,Morgan Stanley and Citigroup, have agreed to the transaction that wouldsubstantially compromise their first lien debt, comprising 70% of the 6.9 billion total outstanding, for an estimated recovery of approximately28 cents on the dollar; and-5NYI-4179615v5
Chrysler Parent's minority shareholder, Daimler AG ("Daimler"), has agreedas part of a settlement with Chrysler to (a) forgive 1.5 billion of second liendebt, at the same time that 500 million of second lien debt is forgiven bymajority shareholder Cerberus Capital Management L.P. ("Cerberus"); and(b) assist in funding Chrysler's pension plans.Representatives of these constituencies have devoted the past six months to reaching theseagreements.10.As the culmination of these efforts, Chrysler, Fiat and New Chrysler (asdefined below) have reached an agreement in principle and are expected to entered into a MasterTransaction Agreement (collectively with other ancillary and supporting documents, the"Purchase Agreement") in short order. Pursuant to the Purchase Agreement, among other things:(a) Chrysler will transfer the majority of its operating assets to New CarCo Acquisition LLC("New Chrysler"), a newly established Delaware limited liability company that currently is anindirect wholly-owned subsidiary of Fiat; and (b) in exchange for those assets, New Chryslerwill assume certain liabilities of Chrysler and pay to Chrysler 2 billion in cash (collectivelywith the other transactions contemplated by the Purchase Agreement, the "Fiat Transaction").11.With the support of the U.S. government, Fiat, the UAW, dealers,suppliers and other stakeholders, the Debtors commenced these cases to implement anexpeditious sale process to implement the Fiat Transaction, or a similar transaction with acompeting bidder, designed to maximize the value of the Debtors' operations and businesses forthe benefit of their stakeholders. Pending the proposed sale, the Debtors will idle mostoperations as they conserve their resources, while at the same time ensuring that (a) the facilitiesare prepared to resume normal production schedules quickly upon the completion of a sale and(b) consumers are not impacted by the filing.12.Time is of the essence. Given the continuing stress on all aspects of theautomotive industry and the idling of the Debtors' manufacturing facilities, key relationships-6NYI-4179615v5
with suppliers, dealers and other business partners simply cannot be preserved if the sale processis not concluded quickly. Absent a prompt sale, approved and consummated in the comingweeks, the value of the Debtors' assets will rapidly decline and the ability to achieve a goingconcern sale will be irretrievably lost. By contrast, the proposed sale transaction, if it can bepromptly consummated, will maximize the value available for stakeholders, will save hundredsof thousands of jobs and will strengthen the U.S. automotive sector and the economy generally.Jurisdiction13.This Court has subject matter jurisdiction to consider this matter pursuantto 28 U.S.C. § 1334. This is a core proceeding pursuant to 28 U.S.C. § 157(b). Venue is properbefore this Court pursuant to 28 U.S.C. §§ 1408 and 1409.Relief Requested14.Pursuant to sections 327(a), 328(a), 329(a) and 364 of the BankruptcyCode, Rules 2014(a) and 2016(b) of the Federal Rules of Bankruptcy Procedure(the "Bankruptcy Rules") and Rules 2014-1 and 2016-1 of the Local Bankruptcy Rules for theUnited States Bankruptcy Court for the Southern District of New York (the "Local BankruptcyRules"), the Debtors hereby seek the entry of an order authorizing them to retain and employJones Day as counsel in these chapter 11 cases, nunc pro tunc as of the Petition Date.3 Insupport of this Application, the Debtors submit (a) the Declaration of Corinne Ball, a partner inJones Day (the "Ball Declaration"), a copy of which is attached hereto as Exhibit A; and(b) Jones Day's Disclosure of Compensation (the "Disclosure of Compensation"), a copy ofwhich is attached hereto as Exhibit B.3Nunc pro tunc retention is appropriate because (a) this Application was filed on the Petition Date, (b) JonesDay will continue to provide services to the Debtors from and after the Petition Date and (c) a final hearingon this Application will not be conducted, and a final order will not be entered, until after the Petition Date.-7NYI-4179615v5
Argument15.Under section 327(a) of the Bankruptcy Code, a debtor in possession isauthorized to employ professional persons:that do not hold or represent an interest adverse to the estate, andthat are disinterested persons,4 to represent or assist the [debtor inpossession] in carrying out [its] duties under this title.11 U.S.C. § 327(a). Section 1107(b) of the Bankruptcy Code modifies sections 101(14) and327(a) of the Bankruptcy Code in cases under chapter 11 of the Bankruptcy Code and providesthat "a person is not disqualified for employment under section 327 of [the Bankruptcy Code] bya debtor in possession solely because of such person's employment by or representation of thedebtor before the commencement of the case." 11 U.S.C. § 1107(b).16.Under section 328(a) of the Bankruptcy Code, a debtor in possession isauthorized to employ professional persons "on any reasonable terms and conditions ofemployment, including on a retainer, on an hourly basis, on a fixed or percentage fee basis, or ona contingent fee basis." 11 U.S.C. § 328(a).17.As required by Bankruptcy Rule 2014(a) and Local BankruptcyRule 2014-1,5 this Application and the Ball Declaration set forth: (a) the specific facts showing4Section 101(14) of the Bankruptcy Code defines the term "disinterested person" as:a person that —(A)is not a creditor, an equity security holder, or an insider;(B)is not and was not, within 2 years before the date of the filing of thepetition, a director, officer, or employee of the debtor; and(C)does not have an interest materially adverse to the interest of the estateor of any class of creditors or equity security holders, by reason of anydirect or indirect relationship to, connection with, or interest in, thedebtor, or for any other reason.11 U.S.C. § 101(14).5Bankruptcy Rule 2014(a) provides that an application seeking the employment of professional personspursuant to section 327 of the Bankruptcy Code:(continued. . .)-8NYI-4179615v5
the necessity for Jones Day's employment; (b) the reasons for the Debtors' selection of Jones Dayas their restructuring counsel in connection with their chapter 11 cases; (c) the professionalservices to be provided by Jones Day; (d) the arrangement between the Debtors and Jones Daywith respect to Jones Day's compensation (as well as the reasonableness thereof); and (e) to thebest of the Debtors' knowledge, the extent of Jones Day's connections, if any, to certain parties ininterest in these matters.18.It is anticipated that the estate professionals retained in these cases,including Jones Day, will incur significant fees in connection with the Debtors' efforts topreserve, protect and maximize the value of their assets under difficult and challengingcircumstances. As such, Jones Day and other estate professionals will be extending significantamounts of credit to the Debtors to assist them in their efforts to pursue available opportunities inthese chapter 11 cases. Under the circumstances, the fees and expenses of Jones Day and otherestate professionals should be granted superpriority status pursuant to section 364(c)(1) of theBankruptcy Code. Granting superpriority status will ensure that Jones Day and other estate(. . . continued)shall state the specific facts showing the necessity for the employment, the nameof the person to be employed, the reasons for the selection, the professionalservices to be rendered, any proposed arrangement for compensation, and, to thebest of the applicant's knowledge, all of the person's connections with thedebtor, creditors, any other party in interest, their respective attorneys andaccountants, the United States trustee, or any person employed in the office ofthe United States trustee. The application shall be accompanied by a verifiedstatement of the person to be employed setting forth the person's connectionswith the debtor, creditors, any other party in interest, their respective attorneysand accountants, the United States trustee, or any person employed in the officeof the United States trustee.Local Bankruptcy Rule 2014-1 further provides that "[a]n application for the employment of a professionalperson pursuant to §§ 327 and 328 of the Bankruptcy Code shall state the specific facts showing thereasonableness of the terms and conditions of the employment, including the terms of any retainer, hourlyfee, or contingent fee arrangement."-9NYI-4179615v5
professionals are not placed at unnecessary risk of funding the Debtors' chapter 11 cases.Moreover, any fees and expenses will remain in all cases subject to review and allowance undersections 328, 330 and 331 and the other applicable requirements established by the BankruptcyCode, the Bankruptcy Rules, the Local Bankruptcy Rules, U.S. Trustee Guidelines and orders ofthis Court.Jones Day's Qualifications19.Jones Day is particularly well qualified to serve as the Debtors' counsel inthese chapter 11 cases. Jones Day is one of the largest law firms in the world, with a nationaland international practice, and has substantial experience in virtually all aspects of the law thatmay arise in these chapter 11 cases, including antitrust, bankruptcy, corporate, employeebenefits, environmental, finance, intellectual property, labor and employment, litigation, mergersand acquisitions, real estate, securities and tax expertise.20.Jones Day's restructuring practice group consists of approximately100 attorneys practicing in offices throughout the United States and overseas. Jones Day'srestructuring professionals have played significant roles in a wide array of chapter 11 cases,including those of Allegheny Health, Education and Research Foundation; Allied StoresCorporation; American Home Mortgage Investment Corporation; Borden Chemicals and PlasticsOperating Limited Partnership; Boscov's, Inc.; Burlington Industries, Inc.; Calpine Corporation;Cardinal Industries, Inc.; Collins & Aikman Corp.; Cone Mills Corporation; CopperweldCorporation; CSC Industries, Inc.; CTC Communications; Dana Corporation; The DrexelBurnham Lambert Group, Inc.; Edison Brothers, Inc.; The Elder-Beerman Stores Corp.; EnronCorp.; Everything's A Dollar, Inc.; Fairfield Communities Inc.; Federated Department Stores,Inc.; FLYi, Inc.; Fruehauf Trailer Corporation; Gantos, Inc.; Globalstar L.P.; Great American-10NYI-4179615v5
Communications Company; GWI, Inc.; Herman's Sporting Goods, Inc.; HomePlace Stores, Inc.;HQ Global Holdings, Inc.; The Imperial Home Decor Group Inc.; James River Coal Corporation;Kaiser Aluminum Corp.; Kmart Corporation; Laidlaw, Inc.; Levitz Home Furnishings, Inc.;Loewen Group International, Inc.; LTV Steel Company, Inc.; Meridian Automotive Systems,Inc.; Montgomery Ward & Co.; Morrison Knudsen Corporation; Napster, Inc.; National CenturyFinancial Enterprises, Inc.; NationsRent, Inc.; NexPak Corporation; Oglebay Norton Company;Olympia & York Developments Limited; Orbital Imaging Corporation; PerformanceTransportation Services, Inc.; Phar-Mor, Inc.; Physicians Clinical Laboratory, Inc.; Pillowtex,Inc.; PLVTZ, Inc.; Purina Mills, Inc.; Resorts International, Inc.; R.H. Macy & Co., Inc.; SlaterSteel U.S., Inc.; Snyder's Drug Stores, Inc.; Specialty Foods Corporation; Teleglobe Inc.; TransWorld Airlines, Inc.; USG Corporation; Washington Group International, Inc.; WHXCorporation; Williams Communications Group, Inc.; Wiltel Communications; Woodward &Lothrop, Inc.; World Kitchen, Inc.; and XO Communications.21.Jones Day also is intimately familiar with the Debtors' businesses andfinancial affairs. Jones Day's professionals have worked closely with the Debtors' managementand other professionals in connection with various prepetition matters, including by:(a) providing advice in connection with the Debtors' prepetition restructuring efforts and theirefforts to obtain emergency financial assistance from the U.S. government; (b) assisting theDebtors in their efforts to document and implement the Fiat Transaction; and (c) preparing forthe commencement of these chapter 11 cases. As a result, Jones Day's lawyers have becomewell acquainted with the Debtors' history, business operations, capital structure and related-11NYI-4179615v5
matters. Accordingly, Jones Day has developed substantial knowledge regarding the Debtorsthat will allow Jones Day to provide effective and efficient services in these chapter 11 cases.6Services to Be Provided by Jones Day22.The employment of Jones Day as the Debtors' restructuring counsel,pursuant to the terms of this Application and the parties' engagement letter, datedNovember 20, 2008 and attached hereto as Exhibit C (the "Engagement Letter"),7 is appropriateand necessary to enable the Debtors to execute faithfully their duties as debtors and debtors inpossession and to be able to implement a successful sale transaction. The Engagement Letterdescribes (a) certain of the services that Jones Day anticipates performing for the Debtors inthese chapter 11 cases and (b) the terms and conditions of Jones Day's proposed engagement bythe Debtors.23.The Debtors anticipate that Jones Day will render general legal services tothe Debtors as needed throughout the course of these chapter 11 cases, including bankruptcy,employee benefits, environmental, finance, general corporate, intellectual property, labor andemployment, litigation, mergers and acquisitions, real estate, securities and tax advice, as well asadvice in international and cross-border issues. In particular, the Debtors anticipate that JonesDay will perform, among others, the following legal services:(a)67advising the Debtors of their rights, powers and duties as debtors anddebtors in possession continuing to operate and to manage their respectivebusinesses and properties under chapter 11 of the Bankruptcy Code;By contrast, Jones Day has not represented, and does not represent Chrysler Financial. As described above,Chrysler Financial has its own separate board and governance and is represented by separate counsel.Any references to, or summaries of, the Engagement Letter herein are qualified by the express terms of theEngagement Letter, which shall govern if there is any conflict between the Engagement Letter and thesummaries provided herein. Capitalized terms and phrases not otherwise defined herein shall have themeanings given to such terms in the Engagement Letter.-12NYI-4179615v5
(b)preparing on behalf of the Debtors all necessary and appropriateapplications, motions, draft orders, other pleadings, notices, schedules andother documents, and reviewing all financial and other reports to be filedin these chapter 11 cases;(c)advising the Debtors concerning, and preparing responses to, applications,motions, other pleadings, notices and other papers that may be filed byother parties in these chapter 11 cases;(d)advising the Debtors with respect to, and assisting in the negotiation anddocumentation of, financing agreements and related transactions;(e)reviewing the nature and validity of any liens asserted against the Debtors'property and advising the Debtors concerning the enforceability of suchliens;(f)advising the Debtors regarding their ability to initiate actions to collectand recover property for the benefit of their estates;(g)advising and assisting the Debtors in connection with any commercialtransactions, including the Fiat Transaction or other similar saletransaction;(h)advising and assisting the Debtors in negotiations or communications withthe Debtors' suppliers, dealers, unions, debt holders and otherstakeholders, and government regulatory bodies;(i)advising the Debtors concerning executory contract and unexpired leaseassumptions, assignments and rejections and lease restructurings andrecharacterizations;(j)advising the Debtors in connection with the formulation, negotiation andpromulgation of a chapter 11 plan or plans, and related transactionaldocuments;(k)assisting the Debtors in reviewing, estimating and resolving claimsasserted against the Debtors' estates;(l)commencing and conducting litigation necessary and appropriate to assertrights held by the Debtors, protect assets of the Debtors' chapter 11 estatesor otherwise further the goal of completing the Debtors' successfulchapter 11 process, and to defend against any litigation brought against theDebtors;(m)providing non-bankruptcy services for the Debtors to the extent requestedby the Debtors; and-13NYI-4179615v5
(n)performing all other necessary and appropriate legal services inconnection with these chapter 11 cases for or on behalf of the Debtors.24.Contemporaneously with the filing of this Application, the Debtors arefiling, or anticipate filing shortly: (a) an application to retain Togut, Segal & Segal, LLP("Togut") as conflicts counsel; (b) an application to retain Schulte Roth & Zabel LLP ("SRZ") asspecial counsel and (c) a motion seeking authority to continue to employ, retain and pay certainprofessionals (the "Ordinary Course Professionals"), including certain counsel, in the ordinarycourse of business on terms substantially similar to those in effect prior to the Petition Date,without the need to file individual retention applications for each of these professionals. Becauseeach counsel will have a well-defined role, Jones Day, Togut, SRZ and the Ordinary CourseProfessionals will not duplicate the services they provide to the Debtors. Jones Day, Togut, SRZand the Ordinary Course Professionals will function cohesively to ensure that legal servicesprovided to the Debtors by each firm are not duplicative. Moreover, at all stages of thesechapter 11 proceedings, Chrysler's legal department will supervise the various legal professionalsretained by the Debtors to further ensure that no firm duplicates the services provided by another.25.The Debtors require knowledgeable counsel to render these essentialprofessional services. As noted above, Jones Day has substantial expertise in all of these areasand has obtained valuable institutional knowledge of the Debtors' business and financial affairsas a result of its representation of the Debtors prior to the Petition Date. Accordingly, theDebtors respectfully submit that Jones Day is uniquely well qualified to perform these servicesand represent the Debtors' interests in these chapter 11 cases.Compensation and Fee Applications26.Pursuant to the terms of the Engagement Letter, and subject to the Court'sapproval of this Application, Jones Day intends to (a) charge for its legal services on an hourly-14NYI-4179615v5
basis in accordance with the ordinary and customary hourly rates in effect on the date servicesare rendered and (b) seek reimbursement of actual and necessary out-of-pocket expenses.27.The names, positions, practice groups, resident offices and current hourlyrates of certain Jones Day lawyers currently expected to spend significant time on thesechapter 11 cases are attached to the Ball Declaration as Schedule 3.8 The general ranges ofbilling rates currently in effect for Jones Day's attorneys, para-professionals and serviceproviders in North America are described in Schedule 4 to the Ball Declaration. Jones Day'shourly rates are comparable to those charged by attorneys of similar experience and expertise forengagements of scope and complexity similar to these chapter 11 cases. In addition, Jones Dayhas further agreed to not charge the Debtors for fees relating to non-working travel time by anyprofessionals during the pendency of these chapter 11 cases.9 For all of these reasons, JonesDay's rates are reasonable and appropriate and constitute "reasonable terms and conditions ofemployment" under section 328(a) of the Bankruptcy Code.28.Jones Day intends to maintain detailed contemporaneous time records andapply to the Court for allowance of compensation and reimbursement of expenses in accordancewith applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local BankruptcyRules and any additional procedures that may be established by the Court in these chapter 11cases. In addition, Jones Day has agreed to accept as compensation such sums as may be89Schedule 3 to the Ball Declaration is not intended to be, and is not, a comprehensive list and is providedonly to indicate current hourly rates charged by Jones Day for certain lawyers expected to have asignificant role in these cases. It is anticipated that other or different Jones Day lawyers will be involved inthese cases to provide services to the Debtors as necessary or appropriate.Jones Day, however, intends to seek reimbursement for its out-of-pocket travel expenses.-15NYI-4179615v5
allowed by the Court. Jones Day understands that interim and final fee awards are subject toapproval by this Court.Disclosure Concerning Disinterestedness29.The Ball Declaration, incorporated herein by reference, discloses JonesDay's connections to the Debtors and parties in interest in these cases. In reliance on the BallDeclaration, and except as set forth therein, the Debtors believe that: (a) Jones Day has noconnection with the Debtors, their affiliates, their creditors, the United S
as part of a settlement with Chrysler to (a) forgive 1.5 billion of second lien debt, at the same time that 500 million of second lien debt is forgiven by majority shareholder Cerberus Capital Management L.P. ("Cerberus"); and (b) assist in funding Chrysler's pension plans.
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