8-KMaterial Agreements

General Motors Co 8-K Report, Agreement Terminated (Aug 14, 2009)

Filed August 14, 2009For Securities:GM

Summary

This Form 8-K filing by General Motors Company (GM) on August 14, 2009, primarily announces the termination of a prior Master Disposition Agreement (MDA) dated June 1, 2009. This termination occurred automatically on August 10, 2009, as per a letter agreement entered into on July 31, 2009. The MDA was initially established in connection with Delphi Corporation's bankruptcy proceedings and involved GM's acquisition of Delphi's global steering business and specific facilities, as well as the formation of a new company with Parnassus Holdings II, LLC to acquire remaining Delphi assets. The termination of the MDA is a procedural event stemming from the approval of a new Master Disposition Agreement (New MDA) on July 30, 2009, which was entered into with Delphi's debtor-in-possession (DIP) lenders. The New MDA, on similar terms, received Bankruptcy Court approval. Investors should note that this filing confirms the procedural completion of a prior agreement in favor of a new, court-approved agreement related to the acquisition of Delphi's assets.

Key Highlights

  • 1General Motors Company (GM) filed an 8-K on August 14, 2009, reporting an event on August 10, 2009.
  • 2The filing confirms the automatic termination of the Master Disposition Agreement (MDA) originally entered into on June 1, 2009, with Delphi Corporation in bankruptcy.
  • 3The MDA termination was triggered by the approval of a new Master Disposition Agreement (New MDA) on July 30, 2009.
  • 4The New MDA was entered into with the lenders of Delphi's debtor-in-possession (DIP) financing and contains similar terms to the original MDA.
  • 5The New MDA transaction received approval from the U.S. Bankruptcy Court for the Southern District of New York.
  • 6The termination of the MDA is a procedural step and was executed as per a letter agreement dated July 31, 2009.

Frequently Asked Questions

The primary purpose of this 8-K filing is to officially report the automatic termination of the Master Disposition Agreement (MDA) between General Motors Company (GM), Delphi Corporation, and other parties, which was a key component of the Delphi bankruptcy proceedings.

The MDA terminated automatically on August 10, 2009, as a consequence of a new Master Disposition Agreement (New MDA) being approved by the Bankruptcy Court on July 30, 2009. This termination was in accordance with a letter agreement dated July 31, 2009.

The New MDA is significant because it represents the court-approved agreement for the acquisition of Delphi's assets, specifically those related to Delphi's global steering business and certain facilities, as well as the formation of a new company to acquire remaining assets. It was entered into with Delphi's DIP lenders and contains similar terms to the original MDA.

No, this termination does not negatively impact GM's acquisition. Instead, it signifies the procedural completion of a prior agreement in favor of a new, court-approved agreement (the New MDA) that facilitates the same or similar asset acquisition under a revised structure involving Delphi's DIP lenders.