CONFORMED COPY
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
August 8, 1997
Date of Report ........................................................
(Date of earliest event reported)
CHRYSLER FINANCIAL CORPORATION
........................................................................
(Exact name of registrant as specified in its charter)
State of Michigan 333-31093 38-2997412
..........................................................................
(State or other jurisdiction (Commission) (IRS Employer
of incorporation) File No.) Identification No.)
27777 Franklin Rd., Southfield, Michigan 48034
..............................................
(Address of principal executive offices)
(248) 948-3067
Registrant's telephone number, including area code....................
This filing relates to Registration Statement Nos. 33-55795 and 333-31093.
- 1 -
<PAGE>
Item 5. Other Events.
In connection with the proposed offering of Premier Auto Trust
1997-2, Asset Backed Notes, Class A-2, Class A-3, Class A-4, Class A-5
and Class B, attached as Exhibit 99 are certain materials prepared by
Chrysler Financial Corporation that are required to be filed pursuant
to the no-action letter dated May 20, 1994 issued by the staff of the
Securities and Exchange Commission (the "Commission") to Kidder, Peabody
Acceptance Corporation-1 Kidder, Peabody & Co. Incorporated and Kidder
Structured Asset Corporation and the no-action letter dated February 15,
1995 issued by the staff of the Commission to the Public Securities
Association.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Listed below are the financial statements, pro forma financial
information and exhibits, if any, filed as a part of this Report:
(a) Financial statements of businesses acquired;
None
(b) Pro forma financial information:
None
(c) Exhibits:
Exhibit 99
- 2 -
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CHRYSLER FINANCIAL CORPORATION
Date: August 12, 1997 By:/s/ B.C. Babbish
-----------------
Assistant Secretary
- 3 -
<PAGE>
EXHIBIT INDEX
Exhibit
No. Description of Exhibit
- ------- ---------------------
99 Material prepared by Chrysler Financial Corporation in
connection with Premier Auto Trust 1997-2 pursuant to the
no-action letter dated May 20, 1994 issued by the staff of the
Securities and Exchange Commission (the "Commission") to
Kidder, Peabody Acceptance Corporation-1, Kidder, Peabody &
Co. Incorporated and Kidder Structured Asset Corporation and
the no-action letter dated February 15, 1995 issued by the
staff of the Commission to the Public Securities Association.
- 4 -
EXHIBIT 99
Premier Auto Trust 1997-2 Structural and
Collateral Materials
<PAGE>
The information contained in the attached materials is referred
to as the "Information".
The attached Term Sheet has been prepared by Chrysler Financial
Corporation ("CFC"). Neither [Underwriter] nor any of its affiliates makes
any representation as to the accuracy or completeness of the Information
herein. The Information contained herein is preliminary and will be
superseded by the applicable prospectus supplement and by any other
information subsequently filed with the Securities and Exchange Commission.
The Information contained herein will be superseded by the
description of the collateral pool contained in the prospectus supplement
relating to the securities.
The Information addresses only certain aspects of the applicable
security's characteristics and thus does not provide a complete assessment.
As such, the Information may not reflect the impact of the structural
characteristics of the security. The assumptions underlying the Information,
including structure and collateral, may be modified from time to time to
reflect changed circumstances.
Although a registration statement (including the prospectus) relating
to the securities discussed in this communication has been filed with the
Securities and Exchange Commission and is effective, the final prospectus
supplement relating to the securities discussed in this communication has not
been filed with the Securities and Exchange Commission. This communication
shall not constitute an offer to sell or the solicitation of an offer to buy
nor shall there be any sale of the securities discussed in this communication
in any state in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such
state. Prospective purchasers are referred to the final prospectus and
prospectus supplement relating to the securities discussed in this
communication for definitive Information on any matter discussed in this
communication. Any investment decision should be based only on the data in
the prospectus and the prospectus supplement ("Offering Documents") and the
then current version of the Information. Offering Documents contain data that
is current as of their publication dates and after publication may no longer
be complete or current. A final prospectus and prospectus supplement may be
obtained by contacting the [Underwriter's Trading Desk] at [telephone
number].
<PAGE>
Premier Auto Trust 1997-2
Chrysler Financial Corporation, Seller and Servicer
Subject to Revision
Term Sheet dated August 8, 1997
Issuer............................ Premier Auto Trust 1997-2 (the "Trust" or
the "Issuer").
The Notes......................... (i) Class A-1 _____% Asset Backed Notes
(the "Class A-1 Notes") in the aggregate
initial principal amount of $280,000,000.
The Class A-1 Notes are not being
offered;
(ii) Class A-2 ____% Asset Backed Notes
(the "Class A-2 Notes") in the aggregate
initial principal amount of $250,000,000;
(iii) Class A-3 _____% Asset Backed Notes
(the "Class A-3 Notes") in the aggregate
initial principal amount of $235,000,000;
(iv) Class A-4 _____% Asset Backed Notes
(the "Class A-4 Notes") in the aggregate
initial principal amount of $200,000,000;
and
(v) Class A-5 _____% Asset Backed Notes
(the "Class A-5 Notes" and, together,
with the Class A-1 Notes, Class A-2
Notes, Class A-3 Notes and Class A-4, the
"Class A Notes") in the aggregate initial
principal amount of $190,000,000; and
(vi) Class B __% Asset Backed Notes (the
"Class B Notes" and together with the
Class A Notes, the "Notes") in the
aggregate initial principal amount of
$45,000,000. The Class B Notes are
subordinated to the Class A Notes to the
extent described herein.
Terms of the Notes:
A. Distribution Dates.......... Payments of interest and principal on the
Notes will be made on the sixth day of
each month or, if any such day is not a
Business Day, on the next succeeding
Business Day (each, a "Distribution
Date"), commencing September 8, 1997.
B. Interest Rates.............. The Notes will have fixed interest rates.
C. Interest.................... Interest on the outstanding principal
amount of any Class of Notes, other than
the Class A-1 Notes, will accrue at the
applicable Interest Rate from the Closing
Date (in the case of the first
Distribution Date) or from the sixth day
of the month preceding the month of a
Distribution Date to and including the
fifth day of the month of such
Distribution Date (each, an "Interest
Accrual Period"). Interest on the
outstanding principal amount of the Class
A-1 Notes will accrue at the applicable
Interest Rate from the Closing Date (in
the case of the first Distribution Date)
or from the most recent Distribution Date
on which interest has been paid to but
excluding the following Distribution Date
(each, a "Class A-1 Interest Accrual
Period"). Interest on each class of
Notes, other than the Class A-1 Notes,
will be calculated on the basis of a
360-day year consisting of twelve 30-day
months. Interest on the Class A-1 Notes
will be calculated on the basis of the
actual number of days in the Class A-1
Interest Accrual Period
<PAGE>
divided by 360. The failure to pay
interest on the Class B Notes will not be
an Event of Default unless the Class A-5
Notes have been paid in full.
D. Principal................... Principal of the Notes will be payable on
each Distribution Date in an amount equal
to the Noteholders' Principal
Distributable Amount for the calendar
month (the "Collection Period") preceding
such Distribution Date to the extent of
funds available therefor. The
"Noteholders' Principal Distributable
Amount" will equal (i) the Regular
Principal Distribution Amount (less the
Cash Release Amount, if any, as described
below) plus ---- (ii) the Accelerated
Principal Distribution Amount. The
"Regular Principal Distribution Amount"
with respect to any Distribution Date
will generally equal the amount of
principal paid plus, in certain
circumstances, the principal balance of
defaulted Receivables. The "Accelerated
Principal Distribution Amount" with
respect to a Distribution Date will equal
the portion, if any, of the Total
Distribution Amount for the related
Collection Period that remains after
payment of (a) the Servicing Fee
(together with any portion of the
Servicing Fee that remains unpaid from
prior Distribution Dates), (b) the
interest due on the Notes, (c) the
Regular Principal Distribution Amount,
and (d) the amount, if any, required to
be deposited in the Reserve Account on
such Distribution Date.
No principal payments will be made (i) on
the Class A-2 Notes until the Class A-1
Notes have been paid in full; (ii) on the
Class A-3 Notes until the Class A-2 Notes
have been paid in full; (iii) on the
Class A-4 Notes until the Class A-3 Notes
have been paid in full; (iv) on the Class
A-5 Notes until the Class A-4 Notes have
been paid in full or; (v) on the Class B
Notes until the Class A-5 Notes have been
paid in full.
The outstanding principal amount of the
Class A-1 Notes, to the extent not
previously paid, will be payable on the
August 1998 Distribution Date (the "Class
A-1 Final Scheduled Distribution Date");
the outstanding principal amount of the
Class A-2 Notes, to the extent not
previously paid, will be payable on the
November 1999 Distribution Date (the
"Class A-2 Final Scheduled Distribution
Date"); the outstanding principal amount
of the Class A-3 Notes, to the extent not
previously paid, will be payable on the
September 2000 Distribution Date (the
"Class A-3 Final Scheduled Distribution
Date"); the outstanding principal amount
of the Class A-4 Notes, to the extent not
previously paid, will be payable on the
June 2001 Distribution Date (the "Class
A-4 Final Scheduled Distribution Date");
the outstanding principal amount of the
Class A-5 Notes, to the extent not
previously paid, will be payable on the
March 2002 Distribution Date (the "Class
A-5 Final Scheduled Distribution Date");
and the outstanding principal amount of
the Class B Notes, to the extent not
previously paid, will be payable on the
December 2003 Distribution Date (the
"Class B Final Scheduled Distribution
Date").
E. Optional Redemption......... The outstanding Class A-5 Notes and Class
B Notes will be subject to redemption in
whole, but not in part, on any
Distribution Date by the Servicer when
the Pool Balance shall have declined to
10% or less of the Initial Pool Balance.
2
<PAGE>
Overcollateralization and
Release of Collateral............ The initial aggregate principal balance
of the Receivables ($1,254,003,196.37)
(the "Initial Pool Balance") will exceed
the initial aggregate principal amount of
the Notes ($1,200,000,000.00) (the
"Initial Note Principal Balance") by an
amount equal to $54,003,196.37 (the
"Initial Overcollateralization Amount"),
which is approximately 4.5% of the
Initial Note Principal Balance. Unless
offset by losses on the Receivables and
except to the extent that Receivables are
released as described below, the
distribution of the Accelerated Principal
Distribution Amount, if any, on a
Distribution Date is expected to cause
the aggregate principal amount of the
Notes to decrease faster than the Pool
Balance decreases, thereby increasing the
Overcollateralization Amount and the
Overcollateralization Percentage.
The "Overcollateralization Amount" in
respect of a Distribution Date is equal
to (a) the Pool Balance as of the
beginning of the preceding Collection
Period (the "Related Pool Balance") minus
(b) the aggregate outstanding principal
amount of the Notes after giving effect
to payments made on the Notes on the
preceding Distribution Date (the "Note
Amount"). The "Overcollateralization
Percentage" in respect of a Distribution
Date is the percentage derived from a
fraction, the numerator of which is the
Overcollateralization Amount for such
Distribution Date and the denominator of
which is the Related Pool Balance.
Subject to the conditions set forth
below, on each Distribution Date,
commencing with the First Release
Distribution Date, certain amounts of
cash and Receivables will be released to
the Trust, free of the lien of the
Indenture, and thereupon paid or
transferred to a subsidiary of the Seller
(the "Company"). Any such cash and
Receivables released to the Company will
not be available to make payments on the
Notes.
The release of cash and Receivables to
the Trust (and then to the Company) is
subject to the satisfaction of the
following conditions:
(1) No release will be permitted
until the Distribution Date (the
"First Release Distribution Date") on
which the Overcollateralization
Amount is at least equal to:
3
<PAGE>
[Initial Overcollateralization Amount]
plus
[2% x (Related Pool Balance minus Initial
Overcollateralization Amount)]
(2) Subject to condition (4) below,
the aggregate principal balance of
Receivables released in respect of
such Distribution Date will equal:
Overcollateralization Amount
less Targeted
Overcollateralization Amount
The "Targeted Overcollateralization
Amount" for a Distribution Date is equal
to:
[Note Amount]
------------ minus ["Note Amount]
[94.5%]
(3) Subject to condition (4) below,
the amount of cash released on such
Distribution Date (the "Cash Release
Amount") shall not exceed 5.5% of the
Regular Principal Distribution Amount
for such Distribution Date.
(4) The amount in the Reserve Account
shall be equal to the applicable
Specified Reserve Account Amount and
the cumulative amount of cash and
principal balances of Receivables
released shall not exceed the Initial
Overcollateralization Amount.
Consequently, when such cumulative
amount has been released, there will
be no further release of cash or
Receivables to the Trust pursuant to
the release provisions described
above, and the full Regular Principal
Distribution Amount will thereafter
again be distributable as principal
to the Noteholders. The period during
which such releases are permitted is
the "Collateral Release Period".
Reserve Account................... The "Reserve Account" will be created
with an initial deposit by CFC on the
Closing Date of cash or Eligible
Investments having a value at least equal
to $12,000,000 (the "Specified Reserve
Account Amount"), which is 1% of the
Initial Note Principal Balance. If the
Overcollateralization Percentage at any
time on or after the First Release
Distribution Date equals at least 7.75%,
then after the Collateral Release Period
the Specified Reserve Account Balance
will be $9,000,000, which is 0.75% of the
Initial Note Principal Balance.
Funds will be withdrawn from the Reserve
Account to cover any shortfalls in the
amounts due to the Noteholders. On each
Distribution Date, the Reserve Account
will be reinstated up to the Specified
Reserve Account Balance to the extent of
the portion, if any, of the Total
Distribution Amount remaining after
payment of the Servicing Fee and the
amounts due to the Noteholders.
4
The "Pool Balance" at any time will
represent the aggregate principal balance
of the Receivables at the end of the
preceding Collection Period, after giving
effect to all payments received from
Obligors, Advances and Purchase Amounts
to be remitted by the Servicer or the
Seller, as the case may be, all for such
Collection Period, and all losses
realized on Receivables liquidated during
such Collection Period.
Priority of Payments;
Subordination of Class B Notes Collections in respect of the Receivables
for each Collection Period will be
applied in the following order of
priority: (i) the Servicing Fee, together
with any previously unpaid Servicing
Fees, (ii) amounts payable to the
Noteholders, which amounts will be
applied, first, to pay interest and
principal on the Class A Notes and,
second, to pay interest and principal on
the Class B Notes, (iii) amounts, if any,
to the Reserve Account up to the
Specified Reserve Account Balance, and
(iv) the remaining balance, if any, to
the Company. In addition, releases of
collateral to the Company will be made as
described above under
"Overcollateralization and Release of
Collateral".
Rating of the Notes............... The Class A Notes will be rated in the
highest investment rating category by at
least two nationally recognized rating
agencies. The Class B Notes will be rated
at least in the "A" category or its
equivalent by such rating agencies.
5
<PAGE>
The Receivables Pool
As of the Cutoff Date, each Receivable (i) had a principal balance
of at least $300 and (ii) was not more than 30 days past due (an account is
not considered past due if the amount past due is less than 10% of the
scheduled monthly payment). As of the Cutoff Date, no Obligor on any
Receivable was noted in the related records of the Seller as being the
subject of a bankruptcy proceeding, and no Obligor on any Receivable financed
a Financed Vehicle under the Seller's "New-Finance Buyer Plan" program. No
selection procedures believed by the Seller to be adverse to Noteholders were
used in selecting the Receivables.
Set forth in the following tables is information concerning the
composition, distribution by annual percentage rate ("APR") and the
geographic distribution of the Receivables Pool as of the Cutoff Date.
<TABLE>
<CAPTION>
Premier Auto Trust 1997-2
Composition of the Receivables Pool
Weighted
Average Weighted Average
Weighted Average Aggregate Principal Number of Remaining Average Principal
APR of Receivable Balance Receivables Term Original Term Balance
- ---------------- ------------------- ------------ --------- ------------- ----------
<S> <C> <C> <C> <C> <C>
9.91% $1,254,003,196.37 76,743 58.45 months 61.33 months $16,340.29
<FN>
Approximately 71.76% of the aggregate principal balance of the
Receivables, constituting 63.38% of the number of the Receivables, represent
new vehicles, and approximately 28.24% of the aggregate principal balance of
the Receivables, constituting 36.62% of the number of the Receivables,
represent used vehicles. Approximately 77.74% of the aggregate principal
balance of the Receivables represent vehicles manufactured or distributed by
Chrysler. All of the Receivables are Simple Interest Receivables.
</TABLE>
6
<PAGE>
<TABLE>
<CAPTION>
Premier Auto Trust 1997-2
Distribution by APR of the Receivables Pool
Number of Aggregate Percent of Aggregate
APR Range Receivables Principal Balance Principal Balance
- ------------------------------------ ------------ ---------------- -------------------
<S> <C> <C> <C>
0.00% to 5.00%...................... 12,708 $ 216,160,093.74 17.2%
5.01% to 6.00%...................... 32 419,809.49 0.0
6.01% to 7.00%...................... 148 2,864,697.97 0.2
7.01% to 8.00%...................... 3,014 48,914,924.76 3.9
8.01% to 9.00%...................... 10,817 183,620,500.01 14.6
9.01% to 10.00%..................... 12,721 221,816,219.48 17.7
10.01% to 11.00%.................... 9,939 175,618,303.75 14.0
11.01% to 12.00%.................... 7,558 127,571,647.81 10.2
12.01% to 13.00%.................... 5,960 91,137,907.16 7.3
13.01% to 14.00%.................... 4,096 58,839,847.69 4.7
14.01% to 15.00%.................... 2,517 33,692,214.47 2.7
15.01% to 16.00%.................... 1,656 22,107,462.40 1.8
16.01% to 17.00%.................... 1,317 18,192,311.75 1.5
17.01% to 18.00%.................... 2,302 31,429,429.59 2.5
Greater than 18.00%................. 1,958 21,617,826.30 1.7
------ ------------------ ------
TOTALS......................... 76,743 $ 1,254,003,196.37 100.0%
====== ================== ======
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
Premier Auto Trust 1997-2
Geographic Distribution of the Receivables Pool(1)
Percent of Percent of
Aggregate Aggregate
Principal Principal
State Balance(2) State Balance(2)
- ----- ---------- ----- ----------
<S> <C> <C>
Alabama........................ 0.0% Montana..................... 0.2%
Alaska......................... 0.4 Nebraska.................... 0.9
Arizona........................ 2.9 Nevada...................... 1.0
Arkansas....................... 0.0 New Hampshire............... 2.9
California..................... 3.0 New Jersey.................. 6.3
Colorado....................... 1.2 New Mexico.................. 1.1
Connecticut.................... 1.7 New York.................... 3.0
Delaware....................... 0.5 North Carolina.............. 4.9
District of Columbia........... 0.0 North Dakota................ 0.0
Florida........................ 0.0 Ohio........................ 0.6
Georgia........................ 0.0 Oklahoma.................... 1.5
Hawaii......................... 0.6 Oregon...................... 2.3
Idaho.......................... 0.3 Pennsylvania................ 6.9
Illinois....................... 9.4 Rhode Island................ 0.8
Indiana........................ 1.3 South Carolina.............. 1.7
Iowa........................... 1.2 South Dakota................ 0.1
Kansas......................... 1.8 Tennessee................... 0.0
Kentucky....................... 0.5 Texas....................... 10.7
Louisiana...................... 0.0 Utah........................ 0.5
Maine.......................... 1.1 Vermont..................... 0.9
Maryland....................... 6.6 Virginia.................... 4.4
Massachusetts.................. 5.4 Washington.................. 2.2
Michigan....................... 0.0 West Virginia............... 0.6
Minnesota...................... 0.0 Wisconsin................... 0.0
Mississippi.................... 0.0 Wyoming..................... 0.2
Missouri....................... 8.5
Totals...................... 100.1%
=====
<FN>
- ---------
(1) Based on physical addresses of the dealers originating the receivables.
(2) Percentages may not add to 100.0% because of rounding.
</TABLE>
Delinquencies, Repossessions and Net Losses
Set forth below is certain information concerning the experience of
CFC and its United States subsidiaries pertaining to retail new and used
automobile and light duty truck receivables, including those previously sold
which CFC continues to service. There can be no assurance that the
delinquency, repossession and net loss experience on the Receivables will be
comparable to that set forth below.
8
<PAGE>
<TABLE>
<CAPTION>
Delinquency Experience(1)
(Dollars in Millions)
At June 30, At December 31,
-------------------------------------- ----------------------------------------
1997 1996 1996 1995
------------------ ------------------ ------------------ ------------------
Number Number Number Number
of of of of
Contracts Amount Contracts Amount Contracts Amount Contracts Amount
--------- ------ --------- ------ --------- ------ --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Portfolio......... 1,689,018 $21,257 1,673,622 $21,138 1,679,880 $21,197 1,653,533 $20,913
Period of
Delinquency
31-60 Days....... 48,913 $ 619 48,199 $ 624 65,297 $ 843 55,507 $ 720
61 Days or More.. 9,050 132 4,899 72 8,175 118 6,792 100
--------- ------ --------- ------ --------- ------ --------- ------
Total Delinquencies 57,963 $ 751 53,098 $ 696 73,472 $ 961 62,299 $ 820
Total Delinquencies
a Percent of the
as Portfolio... 3.43% 3.53% 3.17% 3.29% 4.37% 4.53% 3.77% 3.92%
</TABLE>
<TABLE>
<CAPTION>
At December 31,
------------------------------------------------------------------------
1994 1993 1992
----------------------- ------------------------ --------------------
Number of Number of Number of
Contracts Amount Contracts Amount Contracts Amount
--------- ------ --------- ------ --------- ------
<S> <C> <C> <C> <C> <C> <C>
Portfolio......... 1,444,736 $16,977 1,352,218 $14,116 1,344,799 $12,082
Period of
Delinquency
31-60 Days...... 25,888 $ 293 16,350 $ 153 15,964 $ 134
61 Days or More. 2,085 27 1,383 15 1,376 13
---------- ----------- ----------- ----------- -------- ----------
Total Delinquencies 27,973 $ 320 17,733 $ 168 17,340 $ 147
Total Delinquencies
as a Percent of the
Portfolio....... 1.94% 1.88% 1.31% 1.19% 1.29% 1.22%
<FN>
- ---------
(1) All amounts and percentages are based on the gross amount scheduled
to be paid on each contract, including unearned finance and other
charges. The information in the table includes an immaterial amount
of retail installment sale contracts on vehicles other than
automobiles and light duty trucks and includes previously sold
contracts which CFC continues to service.
</TABLE>
9
<PAGE>
<TABLE>
<CAPTION>
Credit Loss/Repossession Experience(1)
(Dollars in Millions)
Six-Months Ended
June 30, Year Ended December 31,
-------------------------- ------------------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
------------- ---------- --------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Average Amount Outstanding
During the Period.................. $ 21,135 $ 20,888 $ 21,062 $ 19,486 $ 15,517 $ 12,882 $ 11,818
Average Number of Contracts
Outstanding During the Period...... 1,680,186 1,659,755 1,671,405 1,572,963 1,396,497 1,341,084 1,382,898
Percent of Contracts Acquired
During the Period with Recourse
to the Dealer...................... 9.72% 9.14% 9.05% 14.8% 17.0% 16.2% 15.8%
Repossessions as a Percent
Average Number of Contract of
Outstanding(2)..................... 3.06% 3.80% 3.82% 3.05% 2.36% 2.15% 2.31%
Net Losses as a Percent of
Liquidations(3)(4)................. 2.62% 3.12% 3.17% 2.25% 1.38% 1.34% 1.71%
Net Losses as a Percent of
Average Amount Outstanding(2)(3)... 1.48% 1.67% 1.68% 1.16% 0.73% 0.75% 0.97%
<FN>
- --------------------
(1) Except as indicated, all amounts and percentages are based on the
gross amount scheduled to be paid on each contract, including
unearned finance and other charges. The information in the table
includes an immaterial amount of retail installment sales contracts
on vehicles other than automobiles and light duty trucks and
includes previously sold contracts that CFC continues to service.
(2) Percentages have been annualized for the six months ended June 30,
1997 and 1996 and are not necessarily indicative of the experience
for the year.
(3) Net losses are equal to the aggregate of the balances of all
contracts which are determined to be uncollectible in the period,
less any recoveries on contracts charged off in the period or any
prior periods, including any losses resulting from disposition
expenses and any losses resulting from the failure to recover
commissions to dealers with respect to contracts that are prepaid or
charged off.
(4) Liquidations represent a reduction in the outstanding balances of
the contracts as a result of monthly cash payments and charge-offs.
Notwithstanding the improvement in credit loans for the first six months
of 1997, increased credit loss experience may continue while actions are
taken to improve the credit mix, collections and servicing of the Seller's
automotive retail receivables. No assurance can be given as to future
results.
</TABLE>
The net loss figures above reflect the fact that the Seller had recourse
to Dealers on a portion of its retail installment sale contracts. By
aggregate principal balance, approximately 1.67% of the Receivables represent
contracts with recourse to Dealers.
10
