Delphi enters eighth amendment to DIP loan accommodation agreement

By Caroline Salls

Pittsburgh, June 24 - Delphi Corp. has entered into an eighth amendment to the accommodation agreement with its debtor-in-possession facility lenders, according to an 8-K filed Wednesday with the Securities and Exchange Commission.

Under the eighth amendment, the accommodation period will terminate on June 27 if a majority of the tranche A and tranche B DIP lenders and a majority of all lenders who signed the accommodation agreement do not notify Delphi by June 26 that its term sheet outlining a resolution of issues related to General Motors Corp.'s contributions is satisfactory.

The agreement was previously set to expire on June 24 if the required lender consent was not received by June 23.

In addition, a $47 million repayment obligation will be triggered on June 26 if the term sheet is not delivered by June 25. Specifically, the repayment obligation requires Delphi to apply the $47 million currently held as cash collateral to pay down the tranche A and tranche B portions of the DIP loan if the term sheet is not delivered by the deadline.

As previously reported, the DIP lenders have agreed to allow Delphi to continue to use the proceeds of the DIP facility and to forbear from exercising their default-related rights until June 30.

Delphi, a Troy, Mich.-based automotive electronics manufacturer, filed for bankruptcy on Oct. 8, 2005 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 11 case number is 05-44481.

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