TROY, Mich. -- Delphi announced today that as part of its efforts to facilitate further consensual discussions among representatives of General Motors Co. (GM), Platinum Equity, Delphi's DIP Lenders and other stakeholders, the Bankruptcy Court for the Southern District of New York has rescheduled the auction previously scheduled for July 21 to Friday, July 24, and will now commence the hearing on Delphi's Modified Plan on July 29.

Delphi also announced that agreements have been reached with its official unsecured creditors' committee and Wilmington Trust Corp., the indenture trustee for several series of unsecured notes, to withdraw their objections to, and support, Delphi’s Modified Plan of Reorganization, whether it involves an acquisition by Platinum and GM or the pure credit bid submitted by Delphi's DIP Lenders, JPMorgan Chase Bank.

In Delphi’s June 1 filing of modifications to its Confirmed Plan, the company noted that changed economic circumstances would no longer permit the company to continue to fund its defined benefit pension plans for plan participants, including retired, former and current hourly and salaried employees following emergence from Chapter 11 reorganization. Delphi also stated that it expected that the Pension Benefit Guaranty Corp. (PBGC) would initiate the plan termination process for Delphi's U.S. salaried pension plan and the other U.S. subsidiary plans, which would consequently be taken over by the PBGC. The June 1 announcement also included Delphi's expectation that, in connection with the Plan Modification Hearing, it would negotiate and execute a settlement agreement with the PBGC and GM, which would definitively address all of the PBGC's claims against Delphi and its global affiliates.

In connection with the Modified Plan and settlement discussions with the PBGC, GM has recently provided further information regarding the manner in which Delphi's U.S. hourly pension plan obligations will be addressed. GM has advised that it will not assume the hourly pension plan and will not complete the second step of the 414(l) pension transfer contemplated under the Global Settlement Agreement with Delphi. GM and the PBGC have negotiated a separate release and waiver agreement that contemplates a possible initiation by the PBGC of the plan termination process for Delphi's U.S. hourly pension plan and provides consideration to the PBGC for certain releases to be granted to, among others, GM, Delphi, and Delphi's global affiliates. As a result of these developments, the PBGC is now expected to make a determination whether or not to initiate the termination process for Delphi's U.S. hourly and salaried pension plans and the other U.S. subsidiary plans. Delphi said it does not believe that a termination by the PBGC of the U.S. hourly pension plan would violate Delphi's existing collective bargaining agreements or prior bankruptcy court orders. Nevertheless, Delphi has not agreed to a termination of the plan and will not enter into an agreement with the PBGC to take over the plan unless the bankruptcy court finds that doing so is not a violation of Delphi's collective bargaining agreements or a federal district court issues an order terminating the U.S. hourly plan.

On July 21, Delphi reached agreement with the PBGC to settle the PBGC's various claims against Delphi and its global affiliates. Pursuant to that settlement agreement, the PBGC will receive a $3 billion allowed general unsecured non-priority claim, which will receive the same treatment given to holders of General Unsecured Claims under the Modified Plan. The PBGC will receive additional consideration from GM which, together with the PBGC's allowed unsecured claim, is in consideration for, among other things, a full release of all causes of action, claims, and liens; the liability to be assumed by the PBGC related to the possible termination of the US salaried plan, U.S. hourly plan, and U.S. subsidiary plans; and the withdrawal of all notices of liens filed by the PBGC against Delphi's global non-U.S. affiliates. The settlement agreement, which is subject to bankruptcy court approval, is being filed with the bankruptcy court today.