ResCap Announces Interim Results of Private Exchange Offers and Cash Tender Offers

MINNEAPOLIS, May 21 /PRNewswire/ -- Residential Capital, LLC ("ResCap") today announced the interim results of its pending private exchange offers and cash tender offers for U.S. dollar equivalent $14.0 billion in aggregate principal amount of its outstanding debt.

As of 5:00 p.m., New York City time, on Wednesday, May 21, 2008 (the "early delivery time"), approximately $2.6 billion aggregate principal amount (or 80%) of old notes listed in the table below that mature in 2008-2009 ("old 2008-2009 notes") had been validly tendered and approximately U.S. dollar equivalent $6.0 billion aggregate principal amount (or 63%) of old notes listed in the table below that mature in 2010-2015 ("old 2010-2015 notes" and, collectively with the old 2008-2009 notes and June 2008 notes referred to below, the "old notes") had been validly tendered.

The table below shows, as of the early delivery time, the outstanding principal amount of each series of old notes and the principal amount of old notes of each series tendered in the offers (including as a percentage of the outstanding principal amount).

Outstanding Principal
Title of Old Notes Amount Principal Amount Tendered

Old 2008-2009 Notes
Floating Rate Notes due
2008 $398,848,000 $287,171,000 72.0%
8.125% Notes due 2008 $684,014,000 $521,045,000 76.2%
Floating Rate Notes due
April 2009 $714,000,000 $651,422,000 91.2%
Floating Rate Notes due
May 2009 $949,000,000 $816,505,000 86.0%
Floating Rate
Subordinated Notes
due 2009 $576,961,000 $371,513,000 64.4%
Total $3,322,823,000 $2,647,656,000 79.7%

Old 2010-2015 Notes
8.375% Notes due 2010 $2,154,500,000 $901,597,000 41.8%
Floating Rate Notes
due 2010 euro 542,800,000 euro 181,815,000 33.5%
8.000% Notes due 2011 $1,243,500,000 $1,025,694,000 82.5%
7.125% Notes due 2012 euro 550,000,000 euro 438,702,000 79.8%
8.500% Notes due 2012 $928,500,000 $833,527,000 89.8%
8.500% Notes due 2013 $1,604,500,000 $724,667,000 45.2%
8.375% Notes due 2013 GBP 348,920,000 GBP 307,839,000 88.2%
9.875% Notes due 2014 GBP 363,000,000 GBP 297,730,000 82.0%
8.875% Notes due 2015 $486,500,000 $335,025,000 68.9%
Total U.S. Dollar
Equivalent (1) $9,537,274,896 $5,987,350,936 62.8%

(1) To determine the total U.S. dollar equivalent, the principal amounts
of those series of old notes denominated in Euro and Sterling have
been converted to U.S. dollars at current currency exchange rates.
The currency exchange rates that will be used to determine the
consideration in the offers will be set on the expiration date.

In addition, approximately $853.4 million aggregate principal amount of Floating Rate Notes due June 9, 2008 (the "June 2008 notes") were tendered for cash as of the early delivery time.

As previously announced, ResCap has received requisite consents as described in the informational documents relating to the offers and has entered into supplemental indentures adopting the proposed amendments to the indentures under which the old notes were issued. The amendments to the old notes release the subsidiary guarantees of ResCap's obligations under the old notes and eliminate certain of the restrictive covenants and events of default in the indentures. Accordingly, claims with respect to all new notes issued in the exchange offers will be effectively senior to claims with respect to unexchanged old notes to the extent of the value of all assets of the subsidiary guarantors as well as the collateral securing the new notes. Based upon tenders to date and subject to consummation of the offers, approximately $5.7 billion aggregate principal amount of new notes would be issued in exchange for old notes.

The offers will expire at 11:59 p.m., New York City time, on June 3, 2008, unless extended by ResCap with respect to any or all series of old notes. Old notes tendered pursuant to the offers may no longer be withdrawn. The early delivery time (as defined in the informational documents relating to the offers) has passed. Old notes tendered after the early delivery time are not entitled to the early delivery payment described in the informational documents relating to the offers.

The offers are subject to significant conditions that are further described in the informational documents. In particular, the offers are conditioned on ResCap entering into a new first lien senior secured credit facility, providing for at least $3.5 billion of commitments on terms acceptable to ResCap. As a result of these conditions, ResCap may not be required to exchange or purchase any of the old notes tendered.

The new notes will not be registered under the Securities Act of 1933, as amended (the "Securities Act"), or any other applicable securities laws and, unless so registered, the new notes may not be offered, sold, pledged or otherwise transferred within the United States or to or for the account of any U.S. person, except pursuant to an exemption from the registration requirements thereof. Accordingly, the new notes are being offered and issued only (i) in the United States to "qualified institutional buyers" (as defined in Rule 144A under the Securities Act), or QIBs, and (ii) outside the United States to non-U.S. persons (as defined in Regulation S under the Securities Act) who are "qualified investors" within the meaning of Article 2.1(e) of the Prospectus Directive as adopted within each relevant member state of the European Economic Area, in a private transaction in reliance upon an exemption from the registration requirements of the Securities Act. ResCap will enter into a registration rights agreement pursuant to which, under certain circumstances, it will agree to file an exchange offer registration statement or a shelf registration statement with respect to the new notes.

The complete terms and conditions of the offers are set forth in ResCap's Offering Memorandum and Consent Solicitation Statement dated May 5, 2008, as supplemented on May 14, 2008 (the "offering memorandum"), and the related letter of transmittal and consent.

Documents relating to the offers will only be distributed to noteholders who complete and return a letter of eligibility confirming that they are within the category of eligible investors for this private offer. Noteholders who desire a copy of the eligibility letter should contact Global Bondholder Service Corporation, the information agent for the offers, at (866) 470-3800 (U.S. Toll-free) or (212) 925-1630 (Collect).

This press release is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell the notes. The offers to buy or exchange the old notes, as applicable, are only being made pursuant to the offering memorandum and the related letter of transmittal and consent that ResCap is distributing to holders of the old notes. The offers are not being made to holders of the old notes in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. In any jurisdiction in which the securities laws or blue sky laws require the offers to be made by a licensed broker or dealer, the offers will be deemed to be made on behalf of ResCap by one or more of the dealer managers, or one or more registered brokers or dealers that are licensed under the laws of such jurisdiction.

Forward-Looking Statements

In this press release, the use of the words "expect," "anticipate," "estimate," "forecast," "initiative," "objective," "plan," "goal," "project," "outlook," "priorities," "target," "intend," "evaluate," "pursue," "seek," "may," "would," "could," "should," "believe," "potential," "continue," or the negative of any of those words or similar expressions is intended to identify forward-looking statements. All statements herein, other than statements of historical fact, including without limitation, statements about future events and financial performance, are forward-looking statements that involve certain risks and uncertainties.

While these statements represent our current judgment on what the future may hold, and we believe these judgments are reasonable, these statements are not guarantees of any events or financial results, and ResCap's actual results may differ materially due to numerous important factors that are described in the most recent reports on SEC Form 10-K for ResCap, each of which may be revised or supplemented in subsequent reports on SEC Forms 10-Q and 8-K. Such factors include, among others, the following: securing low cost funding to sustain growth for ResCap; the ability to maintain an appropriate level of debt; recent developments in the residential mortgage market, especially in the nonprime sector; the impact on ResCap of the continuing decline in the U.S. housing market; changes in U.S. government-sponsored mortgage programs or disruptions in the markets in which ResCap's mortgage subsidiaries operate; changes in our contractual servicing rights; costs and risks associated with litigation; changes in ResCap's accounting assumptions that may require or that result from changes in the accounting rules or their application, which could result in an impact on earnings; failure to remediate a material weakness in ResCap's internal controls that could result in material misstatements in its financial statements in future periods; changes in the credit ratings of ResCap; changes in economic conditions, currency exchange rates or political stability in the markets in which we operate; and changes in the existing or the adoption of new laws, regulations, policies or other activities of governments, agencies and similar organizations. Investors are cautioned not to place undue reliance on forward-looking statements. ResCap does not undertake any obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events or other such factors that affect the subject of these statements, except where expressly required by law.

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Source: Residential Capital, LLC

CONTACT: Gina Proia, +1-917-369-2364, gina.proia@gmacfs.com, or Toni
Simonetti, +1-917-369-2360, toni.simonetti@gmacfs.com, both of GMAC Financial
Services

2008-05-21 22:49:53 0368349 PRNEWSWIRE