Delphi to allow $7.5 million claim under Duraswitch technology settlement

By Caroline Salls

Pittsburgh, Jan. 31 - Delphi Corp. has reached a settlement with InPlay Technologies, Inc. under which Delphi will allow InPlay a $7.5 million pre-bankruptcy general unsecured claim against debtor Delphi Automotive Systems LLC, according to an InPlay news release.

According to the release, InPlay's claim stems from an agreement signed between Delphi and Duraswitch, a division of InPlay, in 2000.

InPlay said Delphi made a $4 million non-refundable payment and committed $12 million in minimum royalties to Duraswitch through 2007 for exclusive rights to use Duraswitch technologies in the automotive industry.

The release said Delphi had paid $3 million of that $12 million commitment to InPlay, with an additional $3 million due in July 2006 and $6 million in July 2007.

As part of its bankruptcy filing, Delphi requested that this agreement be cancelled under bankruptcy law.

InPlay said it agreed to the cancellation, but retained the right to claim damages and subsequently filed a claim for the remaining $9 million in minimum royalties.

The settlement is subject to approval by the U.S. Bankruptcy Court for the Southern District of New York.

Delphi, a Troy, Mich.-based automotive electronics manufacturer, filed for bankruptcy on Oct. 8, 2005. Its Chapter 11 case number is 05-44481.

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