WASHINGTON, May 26 (Reuters) - A member of a General Motors
Corp GM.N bondholder group resigned from the ad hoc committee
of bondholders negotiating with the U.S. government ahead of a
Tuesday night deadline to accept a debt-for-equity exchange.

Jim Graves, a former GM employee, said in a statement
issued by the Main Street Bondholders -- a coalition of small
investors -- that he could no longer serve on the panel that is
weighing an offer of 10 percent equity in a new GM.

The Main Street group, affiliated with a larger
organization of retail investors, also said it plans to seek
legal representation to form a creditor committee, assuming the
debt proposal fails and GM files for bankruptcy.
(Reporting by John Crawley, writing by Julie Vorman; Editing
by Tim Dobbyn)