SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1996 Commission File No. 33-80055
Volkswagen Credit Auto Receivables Corporation
on behalf of
Volkswagen Credit Auto Master Trust
(Issuer of the Volkswagen Credit Auto Master Trust Floating Rate
Dealer Loan Backed Certificates, Series 1996-1 (the "Certificates"))
(Exact name of registrant as specified in its charter)
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State of Delaware 38-2748796
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3800 Hamlin Road
Auburn Hills, Michigan 48326
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (248) 340-4938
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Form 8-A was filed with the Securities and Exchange Commission
(the "Commission") registering the Series of Certificates pursuant
to Section 12(g) of the Securities Exchange Act of 1934 (the "Act").
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the "Act") during the preceding 12
months (or for such period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
YES x* NO
State the aggregate market value of the voting stock held by
non-affiliates of the registrant. The aggregate market value shall
be computed by reference to the price at which the stock was sold,
or the average bid and asked price of such stock, as of a specific
date within 60 days prior to the date of filing. (See definition of
affiliate in Rule 405, 17 C.F.R. 230.405):
NOT APPLICABLE
* On May 9, 1997, the registrant was issued a no-action letter
(the "No-Action Letter") by the commission with respect to certain
of the registrant's reporting requirements pursuant to Section 13 or
15(d) of the Act. This Form 10-K has been prepared in accordance
with the terms of such No-Action Letter.
<PAGE>
FORM 10-K (Pursuant to No Action Letter)
PART I
Item 1. Business.
Omitted pursuant to the No-Action Letter.
Item 2. Properties.
Pursuant to Section 3.06 of the Pooling and Servicing
Agreement (the "Pooling Agreement") dated as of February 29,
1996 relating to the Volkswagen Credit Auto Master Trust (the
"Trust") among Volkswagen Credit Auto Receivables Corporation,
VW Credit, Inc. and Citibank, N.A., as trustee (the "Trustee"),
Coopers & Lybrand L.L.P. has performed certain procedures in
connection with the Monthly Servicer's Certificates (the
"Monthly Certificates") for the months of March 1996 through
December 1996. The Monthly Certificates contain information
relating to the receivables (the "Receivables") and the
accounts from which the Receivables arise (the "Accounts") and
are prepared by the Servicer and delivered to the Trustee
pursuant to Section 3.04 of the Pooling Agreement. The report
issued by Coopers & Lybrand L.L.P. in connection with the
servicing activities of VW Credit, Inc., as servicer (in such
capacity, the "Servicer"), is attached hereto as Exhibit 99.2.
The Monthly Certificates containing information relating to the
Receivables and the Accounts for the Collection Periods from
and including March 1996 through December 1996 are incorporated
by reference from the registrant's Current Reports on Form 8-K
filed with the Commission on July 16, 1996, July 16, 1996, July
16, 1996, July 17, 1996, September 13, 1996, September 25,
1996, October 17, 1996, November 18, 1996, December 18, 1996
and January 21, 1997, respectively.
Item 3. Legal Proceedings.
The registrant knows of no material pending legal
proceedings involving the Trust, Volkswagen Credit Auto
Receivables Corporation, VW Credit, Inc. or the Trustee (in its
capacity as such), other than routine litigation incidental to
the business of the Trust, Volkswagen Credit Auto Receivables
Corporation, VW Credit, Inc. or the Trust (in its capacity as
such).
Item 4. Submission Of Matters To A Vote Of Security Holders.
None.
PART II
Item 5. Market for Registrant's Common Equity and Related
Stockholder Matters.
(a) To the best knowledge of the registrant, there is no
established public trading market for the Certificates.
(b) The Certificates are represented by one or more
certificates registered in the name of Cede & Co. ("Cede"), the
nominee of The Depository Trust Company ("DTC").
(c) Omitted pursuant to the No-Action Letter.
<PAGE>
Item 6. Selected Financial Data.
Omitted pursuant to the No-Action Letter.
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operation.
Omitted pursuant to the No-Action Letter.
Item 8. Financial Statements and Supplementary Data.
Omitted pursuant to the No-Action Letter.
Item 9. Changes in and Disagreements On Accounting And Financial
Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Omitted pursuant to the No-Action Letter.
Item 11. Executive Compensation.
Omitted pursuant to the No-Action Letter.
Item 12. Security Ownership Of Certain Beneficial Owners And Management.
(a) The Certificates are represented by one or more
certificates registered in the name of Cede, the nominee of
DTC, and an investor holding an interest in the Trust is not
entitled to receive a certificate representing such interest
except in limited circumstances set forth in the Pooling
Agreement. Accordingly, Cede is the sole holder of record of
Certificates, which it holds on behalf of brokers, dealers,
bank, and other direct participants in the DTC system. Such
direct participants may hold Certificates for their own
accounts or for the accounts of their customers. The name and
address of Cede is Cede & Co., c/o The Depository Trust
Company, Seven Hanover Square, New York, NY 10004.
Item 13. Certain Relationships And Related Transactions.
There have not been, and there are not currently proposed,
any transactions, to which either the Trust, Volkswagen Credit
Auto Receivables Corporation, as seller, VW Credit, Inc., as
Servicer, or the Trustee, on behalf of the Trust, is a party
with any Certificateholder who owns of record more than five
percent of the Certificates.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) Omitted pursuant to the No-Action Letter.
(b) The registrant has filed Current Reports on Form 8-K
containing certain financial information with regard to the
Trust, the Receivables and the Accounts, in accordance with the
No-Action Letter, on November 18, 1996, December 18, 1996 and
January 21, 1997.
(c) 3.1 The Articles of Incorporation and By-Laws of the
registrant are incorporated by reference from
Exhibits 3.1 and 3.2, respectively, of the
registrant's Registration Statement on Form S-3 (File
No. 33-80055).
4.1 The Pooling Agreement and the Series 1996-1
Supplement thereto are incorporated by reference from
Exhibits 2.2 and 2.3, respectively, of the
registrant's Form 8A filed with the Commission on
September 13, 1996.
<PAGE>
5.1 The opinion of Cravath, Swaine & Moore with respect
to certain matters involving the Certificates is
incorporated by reference from Exhibit 5.1 of the
registrant's Registration Statement on Form S-3 (File
No. 33-80055).
8.1 The opinion of Cravath, Swaine & Moore with respect
to federal tax matters is incorporated by reference
from Exhibit 8.1 of the registrant's Registration
Statement on Form S-3 (File No. 33-80055).
8.2 The opinion of Honigman, Miller, Schwartz & Cohn with
respect to Michigan state tax matters is incorporated
by reference from Exhibit 8.2 of the registrant's
Registration Statement on Form S-3 (File No.
33-80055).
23.1 The consent of Cravath, Swaine & Moore is
incorporated by reference from Exhibit 23.1 of the
registrant's Registration Statement on Form S-3 (File
33-80055).
23.2 The consent of Honigman, Miller, Schwartz & Cohn is
incorporated by reference from Exhibit 23.2 of the
registrant's Registration Statement on Form S-3 (File
No. 33-80055).
99.1 The Annual Certificate of VW Credit, Inc., as
Servicer is attached hereto as Exhibit 99.1.
99.2 The report on the activities of VW Credit, Inc., as
Servicer, prepared by Coopers & Lybrand L.L.P.,
pursuant to Section 3.06 of the Pooling Agreement is
attached hereto as Exhibit 99.2.
99.3 The Monthly Certificates containing information
relating to the Receivables and the Accounts for the
Collection Periods from and including March 1996
through December 1996 are incorporated by reference
from the registrant's Current Reports on Form 8-K
filed with the Commission on July 16, 1996, July 16,
1996, July 16, 1996, July 17, 1996, September 13,
1996, September 25, 1996, October 17, 1996, November
18, 1996, December 18, 1996 and January 21, 1997,
respectively.
EXHIBIT 99.1
FORM OF ANNUAL SERVICER'S CERTIFICATE
VW CREDIT, INC.
VOLKSWAGEN CREDIT AUTO MASTER TRUST
The undersigned, a duly authorized representative of VW
Credit, Inc. ("VWCI"), as Servicer, pursuant to the Pooling and
Servicing Agreement dated as of February 29, 1996 (as amended and
supplemented, the "Agreement"), by and among Volkswagen Auto
Receivables Corporation, as seller, VWCI, as Servicer, and Citibank,
N.A., as trustee, do hereby certify that:
1. VWCI is, as of the date hereof, the Servicer under the
Agreement.
2. The undersigned is a Servicing Officer and is duly
authorized pursuant to the Agreement to execute and deliver
this Certificate to the Trustee, any Agent and any Enhancement
Providers.
3. A review of the activities of the Servicer during the
period from the initial Closing Date through the calendar year
ended December 31, 1996 and of its performance under the
Agreement was conducted under my supervision.
4. Based on such review, the Servicer has, to the best of
my knowledge, performed in all material respects all of its
obligations under the agreement throughout such period and no
default in the performance of such obligations has occurred or
is continuing except as set forth in paragraph 5 below.
5. None.
<PAGE>
Capitalized terms used by not defined herein are used as
defined in the Agreement.
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 20th day of June, 1997.
/s/ Paul Sullivan
Name: Paul Sullivan
Title: Director
EXHIBIT 99.2
COOPERS
& Lybrand
Independent Accountant's Report
To VW Credit, Inc. as servicer under the
Pooling and Servicing Agreement
dated February 29, 1996:
We have examined management's assertion about VW Credit, Inc.'s
compliance with the minimum servicing standards identified in the
Mortgage Bankers Association of America's Uniform Single Attestation
Program for Mortgage Bankers ("USAP") for the ten month period ended
December 31, 1996 included in the accompanying management assertion to
the extent the procedures in such program are applicable. As Program
Step I., four relating to Escrow Accounts, Program Steps III., three
and four relating to Tax, Insurance and Late Payment Penalties,
Program Step V., two, three and four relating to Adjustable Rate
Mortgages and Program Step VII., one relating to Fidelity Bond and
Error and Omissions Policies are not applicable to the servicing
obligations set forth in the Pooling and Servicing Agreements, we did
not perform the related procedures. Management is responsible for VW
Credit, Inc.'s compliance with those minimum servicing standards. Our
responsibility is to express an opinion on management's assertion
about the entity's compliance based on our examination.
Our examination was made in accordance with the standards established
by the American Institute of Certified Public Accountants and,
accordingly, included examining, on a test basis, evidence about VW
Credit, Inc.'s compliance with the minimum servicing standards and
performing other such procedures as we considered necessary in the
circumstances. We believe that our examination provides a reasonable
basis for our opinion. Our examination does not provide a legal
determination on VW Credit, Inc.'s compliance with the minimum
servicing standards.
In our opinion, management's assertion that VW Credit, Inc. complied
with the aforementioned minimum servicing standards for the ten month
period ending December 31, 1996 is fairly stated, in all material
respects.
/s/ Coopers & Lybrand L.L.P.
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Detroit, Michigan
March 14, 1997
