DELPHI 2015 Annual Report Download - page 47

Table of Contents
25
ITEM 1B. UNRESOLVED STAFF COMMENTS
We have no unresolved SEC staff comments to report.
ITEM 2. PROPERTIES
As of December 31, 2015, we owned or leased 126 major manufacturing sites and 14 major technical centers. A
manufacturing site may include multiple plants and may be wholly or partially owned or leased. We also have many smaller
manufacturing sites, sales offices, warehouses, engineering centers, joint ventures and other investments strategically located
throughout the world. We have a presence in 44 countries. The following table shows the regional distribution of our major
manufacturing sites by the operating segment that uses such facilities:
North America
Europe,
Middle East
& Africa Asia Pacific South America Total
Electrical/Electronic Architecture...................... 30 32 25 5 92
Powertrain Systems............................................ 4 10 5 2 21
Electronics and Safety........................................ 3 7 3 — 13
Total............................................................... 37 49 33 7 126
In addition to these manufacturing sites, we had 14 major technical centers: four in North America; five in Europe,
Middle East and Africa; four in Asia Pacific; and one in South America.
Of our 126 major manufacturing sites and 14 major technical centers, which include facilities owned or leased by our
consolidated subsidiaries, 77 are primarily owned and 63 are primarily leased.
We frequently review our real estate portfolio and develop footprint strategies to support our customers’ global plans,
while at the same time supporting our technical needs and controlling operating expenses. We believe our evolving portfolio
will meet current and anticipated future needs.
ITEM 3. LEGAL PROCEEDINGS
We are from time to time subject to various actions, claims, suits, government investigations, and other proceedings
incidental to our business, including those arising out of alleged defects, breach of contracts, competition and antitrust matters,
product warranties, intellectual property matters, personal injury claims and employment-related matters. It is our opinion that
the outcome of such matters will not have a material adverse impact on our consolidated financial position, results of
operations, or cash flows. With respect to warranty matters, although we cannot ensure that the future costs of warranty claims
by customers will not be material, we believe our established reserves are adequate to cover potential warranty settlements.
However, the final amounts required to resolve these matters could differ materially from our recorded estimates.
GM Ignition Switch Recall
In the first quarter of 2014, GM, Delphi’s largest customer, initiated a product recall related to ignition switches. Delphi
received requests for information from, and cooperated with, various government agencies related to this ignition switch recall.
In addition, Delphi was initially named as a co-defendant along with GM (and in certain cases other parties) in class action and
product liability lawsuits related to this matter. As of December 31, 2015, Delphi was not named as a defendant in any class
action complaints. Although no assurances can be made as to the ultimate outcome of these or any other future claims, Delphi
does not believe a loss is probable and, accordingly, no reserve has been made as of December 31, 2015.
Unsecured Creditors Litigation
The Fourth Amended and Restated Limited Liability Partnership Agreement of Delphi Automotive LLP (the “Fourth LLP
Agreement”) was entered into on July 12, 2011 by the members of Delphi Automotive LLP in order to position the Company
for its initial public offering. Under the terms of the Fourth LLP Agreement, if cumulative distributions to the members of
Delphi Automotive LLP under certain provisions of the Fourth LLP Agreement exceed $7.2 billion, Delphi, as disbursing agent
on behalf of DPHH, is required to pay to the holders of allowed general unsecured claims against DPHH $32.50 for every
$67.50 in excess of $7.2 billion distributed to the members, up to a maximum amount of $300 million. In December 2014, a
complaint was filed in the Bankruptcy Court alleging that the redemption by Delphi Automotive LLP of the membership
interests of GM and the PBGC, and the repurchase of shares and payment of dividends by Delphi Automotive PLC, constituted
distributions under the terms of the Fourth LLP Agreement approximating $7.2 billion. Delphi considers cumulative