This sure has been a goofy story to follow, and the latest twist is that the automaker might stay out of bankruptcy after all. Under a preliminary agreement, banks and other unsecured creditors would excuse about $7 billion in debt in exchange for $2 billion in cash. From the NYT:

The two sides had been far apart in negotiations ahead of a Thursday deadline, but they have significantly narrowed the gap in recent days. The most recent agreement was hammered out late on Monday night as the creditors waited for a response to their most recent proposal submitted on Friday.

Chrysler has reached a deal with the United Auto Workers in which the union would own a 55 percent stake in the newly reorganized automaker.