UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) June 30, 2009
Delphi Corporation
(Exact Name of Registrant as Specified in Its Charter)
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| Delaware
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1-14787
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38-3430473 |
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| (State or Other Jurisdiction of
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(Commission File Number)
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(IRS Employer Identification No.) |
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| 5725 Delphi Drive, Troy, MI
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48098 |
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| (Address of Principal Executive Offices)
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(248) 813-2000
(Registrant’s Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On June 30, 2009, Delphi Corporation (“Delphi” or the “Company”) entered into a further amendment
(the “Tenth Amendment”), to its accommodation agreement (as previously amended and supplemented
through the date hereof, the “Accommodation Agreement”), with the lenders under its existing
debtor-in-possession financing agreement (the “Amended and Restated DIP Credit Facility”),
consisting of a $1.1 billion first priority revolving credit facility (the “Tranche A Facility”), a
$500 million first priority term loan (the “Tranche B Term Loan”) and a $2.75 billion second
priority term loan (the “Tranche C Term Loan”). The following description of the Tenth Amendment
is qualified in its entirety by the text of the Tenth Amendment, a copy of which is filed as
Exhibit 99(a) to this report and incorporated by reference herein. A description of the material
terms of the Accommodation Agreement prior to such modifications is set forth in Delphi’s Current
Reports on Form 8-K filed with the United States Securities and Exchange Commission on March 31,
2009, as amended on April 1, 2009 solely for the purposes of adding an exhibit, April 3, 2009, as
amended on April 7, 2009 solely for the purposes of adding another exhibit, April 23, 2009, May 8,
2009, June 2, 2009, June 9, 2009, June 18, 2009, June 22, 2009, June 24, 2009 and June 29, 2009
(the “Original Forms 8-K”), which descriptions are incorporated herein by reference.
Pursuant to the original Accommodation Agreement, the lenders agreed, among other things, to allow
Delphi to continue using the proceeds of the Amended and Restated DIP Credit Facility and to
forbear from the exercise of certain default-related remedies, in each case until June 30, 2009,
subject to the continued satisfaction by Delphi of a number of covenants and conditions, and as
described in more detail below, the Tenth Amendment extends that date to July 7, 2009. There
currently remains approximately $230 million outstanding under the Tranche A Facility, $311 million
outstanding under the Tranche B Term Loan and $2.75 billion outstanding under the Tranche C Term
Loan under the Amended and Restated DIP Credit Facility. The Accommodation Agreement contains
certain milestone dates, which if not met require Delphi to apply the $47 million currently held as
cash collateral to pay down a portion of the Tranche A Facility and Tranche B Term Loan extended
under the Amended and Restated DIP Credit Facility (the “Repayment Obligation”) and may result in
an event of default and termination of the accommodation period. One such milestone in the
Accommodation Agreement was that on or before June 29, 2009, Delphi was required to deliver to the
agent under the Amended and Restated DIP Credit Facility a term sheet setting forth the terms of a
global resolution of matters relating to General Motors Corporation’s (“GM”) contributions to the
resolution of Delphi’s chapter 11 cases, including without limitation, all material transactions
between Delphi and GM relevant to such resolution, which has been agreed to by GM and the United
States Treasury (the “Term Sheet”). The failure to deliver the Term Sheet on or prior to June 29,
2009 triggered the Repayment Obligation, and absent effectiveness of the Tenth Amendment, a failure
by Delphi to satisfy the Repayment Obligation on June 30, 2009, would have been an event of default
under the Accommodation Agreement (and absent a cure of such default, would have resulted in a
termination of the accommodation period). In addition, absent effectiveness of the Tenth
Amendment, had a majority of the Tranche A and Tranche B lenders who have signed the Accommodation
Agreement and a majority of all lenders who signed the Accommodation Agreement not notified Delphi
that the Term Sheet was satisfactory on or before June 30, 2009, the accommodation period would
have terminated on July 1, 2009.
Pursuant to the Tenth Amendment, the Repayment Obligation will be triggered on July 7, 2009 unless
on or prior to July 6, 2009 a satisfactory term sheet notice has been received and the
accommodation period under the Accommodation Agreement will terminate on July 8, 2009 in the event
that a majority of the Tranche A and Tranche B lenders who have signed the Accommodation Agreement
and a majority of all lenders who signed the Accommodation Agreement have not notified Delphi that
the Term Sheet is satisfactory on or before July 7, 2009. In addition, the Tenth Amendment
postpones until July 7, 2009 the date by which interest payments with respect to the Tranche C Term
Loan must be paid; which payments, in accordance with the terms of the Accommodation Agreement, are
to be applied ratably to repayments of principal amounts outstanding under the Tranche A Facility
and the Tranche B Term Loan. Finally, the Tenth Amendment provides that the requisite majority of
lenders under the Amended and Restated DIP Credit Facility have 30 business days (modified from 25
business days) to notify Delphi that the modified plan of reorganization filed on June 1, 2009 is
not satisfactory.
The remaining provisions in the Accommodation Agreement are materially unchanged. For information
regarding the current terms of the Accommodation Agreement, as modified, which is not otherwise set
forth in this Current Report on Form 8-K, including the covenants and conditions of the lenders’
continued forbearance from exercising remedies through the accommodation period and including the
ability to access certain cash collateral accounts, see Delphi’s Annual Report on Form 10-K for the
year ended December 31, 2008 (the “Annual Report”), including the exhibits to the Annual Report,
and the Original Forms 8-K.
Although Delphi is currently in compliance with the terms of the Accommodation Agreement (after
giving effect to the Tenth Amendment), Delphi’s continued compliance and access to sufficient
liquidity to fund its working capital requirements and operations is dependent on a number of
factors including Delphi remaining in compliance with the provisions of the amended interim
liquidity support agreement with GM and administrative creditors, including its suppliers,
continuing to provide services and goods on customary payment terms.
ITEM 2.04 TRIGGERING EVENTS THAT ACCELERATE OR INCREASE A DIRECT FINANCIAL OBLIGATION OR AN
OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT
The disclosure under Item 1.01 of this Current Report on Form 8-K is incorporated by reference into
this Item 2.04. The failure to deliver the Term Sheet on or prior to June 29, 2009 triggered a
Repayment Obligation and absent effectiveness of the Tenth Amendment, a failure by Delphi to
satisfy the Repayment Obligation on June 30, 2009 would have been events of default under the
Accommodation Agreement and could have resulted in a termination of the accommodation period. See
the terms of the Tenth Amendment described in Item 1.01 of this Current Report on Form 8-K.
FORWARD-LOOKING STATEMENTS
This Current Report on Form 8-K, including the exhibits being filed as part of this report, as well
as other statements made by Delphi may contain forward-looking statements that reflect, when made,
the Company’s current views with respect to current events and financial performance. Such
forward-looking statements are and will be, as the case may be, subject to many risks,
uncertainties and factors relating to the Company’s operations and business environment which may
cause the actual results of the Company to be materially different from any future results, express
or implied, by such forward-looking statements. In some cases, you can identify these statements by
forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and
other comparable terminology. Factors that could cause actual results to differ materially from
these forward-looking statements include, but are not limited to, the following: the ability of the
Company to continue as a going concern; the ability of the Company to operate pursuant to the terms
of its liquidity support agreements with GM, its debtor-in-possession financing facility and the
related accommodation agreement, and to obtain an extension of term or other amendments as
necessary to maintain access to such liquidity support agreements and facility; the Company’s
ability to obtain Court approval with respect to motions in the Chapter 11 cases prosecuted by it
from time to time, including final approval to further modify the Plan which was confirmed by the
Court on January 25, 2008, to confirm such further modified plan or any other subsequently filed
plan of reorganization and to consummate such plan or other consensual resolution of Delphi’s
Chapter 11 cases; risks associated with third parties seeking and obtaining Court approval to
terminate or shorten the exclusivity period for the Company to propose and confirm one or more
plans of reorganization, for the appointment of a Chapter 11 trustee or to convert the cases to
Chapter 7 cases; the ability of the Company to obtain and maintain normal terms with vendors and
service providers; the Company’s ability to maintain contracts that are critical to its operations;
the potential adverse impact of the Chapter 11 cases on the Company’s liquidity or results of
operations; the ability of the Company to fund and execute its business plan as described in the
proposed modifications to its Plan as filed with the Court and to do so in a timely manner; the
ability of the Company to attract, motivate and/or retain key executives and associates; the
ability of the Company to avoid or continue to operate during a strike, or partial work stoppage or
slow down by any of its unionized employees or those of its principal customers and the ability of
the Company to attract and retain customers. Additional factors that could affect future results
are identified in the Company’s Annual Report on Form 10-K for the year ended December 31, 2008
filed with the United States Securities and Exchange Commission, including the risk factors in
Part I. Item 1A. Risk Factors, contained therein and in Part II. Item 1A. Risk Factors in the
Quarterly Report on Form 10-Q for the quarter ended March 31, 2009. Delphi disclaims any intention
or obligation to update or revise any forward-looking statements, whether as a result of new
information, future events and/or otherwise. Similarly, these and other factors, including the
terms of any reorganization plan ultimately confirmed, can affect the value of the Company’s
various prepetition liabilities, common stock and/or other equity securities. It is possible that
Delphi’s common stock may have no value and claims relating to prepetition liabilities may receive
no value.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits. The following exhibit is being furnished as part of this report.
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Description |
| 99 (a)
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Tenth Amendment to the Accommodation Agreement, dated as of June 30, 2009 |