InPlay Technologies granted $7.5 million claim against Delphi debtor

By Caroline Salls

Pittsburgh, Feb. 27 - InPlay Technologies Inc. obtained bankruptcy court approval of a settlement agreement with Delphi Corp. under which InPlay Technologies was granted a $7.5 million general unsecured claim against Delphi Automotive Systems LLC, according to an InPlay news release.

"With the claim stipulated, it becomes more marketable to firms purchasing Delphi debt," InPlay chief executive officer Bob Brilon said in the release.

"We anticipate pursuing opportunities to monetize the claim, which will strengthen our balance sheet and allow us to focus our attention on our growing MagicPoint and Duraswitch business opportunities."

According to the release, InPlay's claim stems from an agreement signed between Duraswitch and Delphi in 2000 under which Delphi paid a non-refundable payment of $4 million and committed $12 million minimum royalties to Duraswitch through 2007 for exclusive rights to use Duraswitch technologies in the automotive industry.

InPlay 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 filed a motion seeking rejection of this agreement, and the U.S. Bankruptcy Court for the Southern District of New York allowed the rejection subject to InPlay's right to claim damages for the breach of the agreement.

InPlay subsequently filed a damages claim for the remaining $9 million in minimum royalties.

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

Phoenix-based InPlay develops electronic switch technologies used in personal computers and peripherals.

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