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Delphi Announces Re-Launch of Exit Financing


Affiliate of GM To Participate In Up To $2 Billion First Lien Term Note In Accord With Bankruptcy Court Guidance Regarding Company’s Pursuit of Exit Financing

Delphi Corp. (PINKSHEETS: DPHIQ) announced today that it will be relaunching its exit financing structure, which will include participation from General Motors Corporation, as previously announced, as well as a new commitment from an affiliate of GM, to also support the company’s planned emergence from Chapter 11 reorganization. The company will host a conference call for potential lenders on Mar. 11, 2008 to discuss the company’s exit financing and related timetable. The proposed exit facilities are being arranged on a best efforts basis by J.P. Morgan Securities, Inc., and Citigroup Global Markets, Inc., in accordance with prior orders entered by the United States Bankruptcy Court for the Southern District of New York.

The company’s $6.1 billion exit financing package includes a $1.6 billion asset-backed revolving credit facility, at least $1.7 billion of first-lien term loan, an up to $2.0 billion first-lien term note to be issued to an affiliate of GM (junior to the $1.7 billion first-lien term loan), and an $825 million second-lien term loan, of which any unsold portion would be issued to GM and/or its affiliates consistent with the terms of the company’s Investment Agreement with its plan investors.

On Mar. 7, 2008, because certain of Delphi’s plan investors had advised the company that they believed the proposed exit financing, including GM’s increased participation, would not comply with the Investment Agreement, Delphi presented a motion in the Bankruptcy Court under section 1142 of the Bankruptcy Code which permits the Court to consider matters and issue orders in furtherance of a confirmed plan of reorganization. At the hearing, during which the Court did not grant the specific relief sought by the company, the Court said that while GM could not directly provide incremental exit financing to Delphi without the consent of the plan investors, the prohibition against additional agreements with GM did not extend to incremental financing provided through GM subsidiaries or pursuant to certain other structures. In its ruling, the Bankruptcy Court also observed that the company had been given sufficient guidance by the Court to proceed to seek exit financing on terms that are potentially achievable. Although certain of the Investors continue to object to the proposed exit financing, Delphi believes its proposed exit financing is consistent with the Court’s guidance and previously issued confirmation order and will be moving forward with the syndication efforts to raise $6.1 billion in financing.


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