General Motors ( GM) bondholders want to keep talking.

In a letter sent Sunday to Obama administration officials, advisors to bondholders who hold about $27 billion in GM debt say they cannot accept an outstanding offer to convert two-thirds of that debt to GM stock, but they are open to other options. Bondholder acquiescence is a key to enabling GM to restructure outside of bankruptcy court.

In the letter, bondholders note that they presented an alternative plan to GM and the automotive task force in a March 5 meeting. They say that although their plan complies in many respects with terms under which the Treasury has loaned GM $13.4 billion, those terms in their entirety are unacceptable to a majority of the bondholders.

"Unless the framework we suggested is utilized, the restructuring currently contemplated will not achieve the required level of acceptance to succeed on an out-of-court basis," the advisors wrote. "The result of such a failed exchange would likely be a bankruptcy that would have dire consequences for the company, the tens of thousands of hard-working Americans that GM employs and the economy as a whole."

Advisors note that institutional investors hold 80% of GM's unsecured debt, while retail investors hold the remaining 20%. Their ideas apparently include government guarantees for the debt the bondholders would retain.

Regarding GM stock, its viability depends on the restructuring plan GM presented to the Treasury on Feb. 17. The bondholders fear that in the plan, GM "is putting too much faith in a near-term turnaround in the economy that would enable annual car and truck sales to reach previous levels," the letter said. It said the company could slide into bankruptcy, in which case the shares would be worthless.

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