FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE OF 1934.
For the quarterly period ended June 30, 1998
---------------------
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from __________ to __________
Commission file number 1-5966
-----------
Chrysler Financial Corporation
- -------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
State of Michigan 38-096143
- -------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
27777 Franklin Road, Southfield, Michigan 48034-8286
- -------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (248) 948-3067
----------------------
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 during the preceding 12 months (or for such shorter 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 _____
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court. Yes _____ No _____
APPLICABLE ONLY TO CORPORATE ISSUERS
The registrant had 250,000 shares of common stock outstanding as of June 30,
1998.
The registrant meets the conditions set forth in General Instruction H(1)(a)
and (b) of Form 10-Q and is therefore filing this Form with the reduced
disclosure format.
<PAGE>
Chrysler Financial Corporation and Subsidiaries
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The interim financial data presented herein are unaudited, but in the opinion
of management reflect all adjustments necessary for a fair presentation of
such information. Results for interim periods should not be considered
indicative of results for a full year. Reference should be made to the
financial statements contained in the registrant's Annual Report on Form 10-K
for the year ended December 31, 1997 (the "10-K Report").
2
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Chrysler Financial Corporation and Subsidiaries
Consolidated Statement of Net Earnings
(in millions of dollars)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
1998 1997 1998 1997
---- ---- ---- ----
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
Finance Revenue:
Automotive:
Retail (Note 2) $164 $169 $312 $336
Wholesale and other (Note 2) 146 118 275 272
Vehicles leased - rents and fees 168 86 277 157
Nonautomotive 1 31 39 52
---- ---- ---- ----
Total finance revenue 479 404 903 817
Interest expense 254 204 472 399
Depreciation on vehicles leased 93 40 164 68
---- ---- ---- ----
Net margin 132 160 267 350
Other Revenues:
Servicing fee income 87 82 172 162
Insurance premiums earned 30 29 61 59
Investment and other income (Note 2) 178 119 338 226
---- ---- ---- ----
Net margin and other revenues 427 390 838 797
---- ---- ---- ----
Costs and Expenses:
Operating and other expenses 131 125 259 268
Provision for credit losses 94 86 193 186
Insurance losses and loss
adjustment expenses 24 23 48 46
---- ---- ---- ----
Total costs and expenses 249 234 500 500
---- ---- ---- ----
Earnings before income taxes 178 156 338 297
Provision for income taxes 58 53 110 101
---- ---- ---- ----
Net Earnings $120 $103 $228 $196
==== ==== ==== ====
<CAPTION>
Consolidated Statement of Shareholder's Investment
(in millions of dollars)
Six Months Ended
June 30,
----------------
1998 1997
---- ----
(unaudited)
<C> <C>
Balance at beginning of period $3,297 $3,288
Net earnings 228 196
Common stock dividends (227) (194)
Net unrealized holding gains on securities 1 3
------ ------
Balance at end of period $3,299 $3,293
====== ======
<FN>
Prior period reclassified to conform to current classification
See Notes to Consolidated Financial Statements.
</TABLE>
3
<PAGE>
ITEM 1. FINANCIAL STATEMENTS - continued
<TABLE>
<CAPTION>
Chrysler Financial Corporation and Subsidiaries
Consolidated Balance Sheet
(in millions of dollars)
June 30, December 31, June 30,
1998 1997 1997
---------- ------------ -----------
(unaudited) (unaudited)
<S> <C> <C> <C>
Assets:
Finance receivables - net (Note 1) $14,307 $10,926 $12,175
Retained interests in sold
receivables - net (Note 1) 2,992 3,111 3,736
------- ------- -------
Total finance receivables and
retained interests - net 17,299 14,037 15,911
Cash and cash equivalents 777 380 583
Marketable securities 410 408 385
Vehicles leased - net 2,770 1,736 1,252
Dealership properties leased - net 267 281 303
Repossessed collateral 39 76 96
Loans and other amounts due from
affiliated companies 1,109 1,705 862
Other assets 771 698 611
------- ------- -------
Total Assets $23,442 $19,321 $20,003
======= ======= =======
Liabilities:
Debt (Note 3) $16,153 $12,718 $13,486
Accounts payable, accrued expenses
and other 2,054 1,474 1,551
Deferred income taxes 1,936 1,832 1,673
------- ------- -------
Total Liabilities 20,143 16,024 16,710
Shareholder's Investment 3,299 3,297 3,293
------- ------- -------
Total Liabilities and Shareholder's
Investment $23,442 $19,321 $20,003
======= ======= =======
<FN>
See Notes to Consolidated Financial Statements.
</TABLE>
4
<PAGE>
ITEM 1. FINANCIAL STATEMENTS - continued
<TABLE>
<CAPTION>
Chrysler Financial Corporation and Subsidiaries
Consolidated Statement of Cash Flows
(in millions of dollars)
Six Months Ended
June 30,
----------------------
1998 1997
---- ----
(unaudited)
<S> <C> <C>
Cash Flows From Operating Activities:
Net earnings $ 228 $ 196
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Gains from receivable sales net of
amortization (18) (12)
Provision for credit losses 193 186
Depreciation and amortization 171 79
Change in deferred income taxes and income
taxes payable 102 43
Change in amounts due to/from affiliated
companies (20) (15)
Change in accounts payable, accrued
expenses and other 530 124
-------- --------
Net cash provided by operating activities 1,186 601
-------- --------
Cash Flows From Investing Activities:
Acquisitions of finance receivables (40,272) (38,357)
Collections of finance receivables 14,926 13,419
Sales of finance receivables 21,893 23,583
Purchases of marketable securities (1,704) (1,169)
Sales and maturities of marketable securities 1,705 1,260
Change in loans to affiliated companies 616 12
Purchases of vehicles leased (1,339) (760)
Sales of vehicles leased 104 48
Change in cash and investments held by
securitization trust 81 (364)
Other (7) 33
-------- --------
Net cash used in investing activities (3,997) (2,295)
-------- --------
Cash Flows From Financing Activities:
Change in short-term notes 316 549
Issuance of term debt 4,764 3,087
Repayment of term debt (1,514) (1,479)
Change in bank borrowings - International (41) 54
Payment of dividends (227) (194)
Other (90) 30
-------- --------
Net cash provided by financing activities 3,208 2,047
-------- --------
Change in cash and cash equivalents 397 353
Cash and cash equivalents at beginning of year 380 230
-------- --------
Cash and Cash Equivalents at End of Period $ 777 $ 583
======== ========
<FN>
Prior period reclassified to conform to current classification
See Notes to Consolidated Financial Statements.
</TABLE>
5
<PAGE>
ITEM 1. FINANCIAL STATEMENTS - continued
- ------- --------------------------------
Chrysler Financial Corporation and Subsidiaries
Notes to Consolidated Financial Statements
Note 1 - Finance Receivables and Retained Interests - Net
- ---------------------------------------------------------
Outstanding balances of "Finance receivables - net" were as follows (in
millions of dollars):
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1998 1997 1997
-------- ------------ --------
(unaudited) (unaudited)
<S> <C> <C> <C>
Automotive:
Retail $ 4,909 $ 3,621 $ 6,073
Wholesale and other 3,787 3,252 2,922
Retained senior interests in sold wholesale receivables * 3,006 1,511 817
-------- -------- --------
Total automotive 11,702 8,384 9,812
-------- -------- --------
Nonautomotive:
Leveraged leases 2,709 2,572 2,384
Commercial 84 143 199
-------- -------- --------
Total nonautomotive 2,793 2,715 2,583
-------- -------- --------
Total finance receivables 14,495 11,099 12,395
Allowance for credit losses (188) (173) (220)
-------- -------- --------
Total finance receivables - net $ 14,307 $ 10,926 $ 12,175
======== ======== ========
<FN>
* Represents receivables held in trust eligible to be securitized or returned
to the Company.
</TABLE>
The Company's retained interests are generally restricted and subject to
credit risk. The following is a summary of amounts included in "Retained
interests in sold receivables - net" (in millions of dollars):
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1998 1997 1997
-------- ------------ --------
(unaudited) (unaudited)
<S> <C> <C> <C>
Cash and investments $ 280 $ 361 $ 870
Subordinated interests in receivables 2,753 2,843 2,726
Residual cash flows 318 284 221
Other -- -- 235
Allowance for credit losses (359) (377) (316)
------ ------ ------
Total retained interests in sold receivables - net $2,992 $3,111 $3,736
====== ====== ======
</TABLE>
The Company's total allowance for credit losses is as follows (in millions
of dollars):
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1998 1997 1997
-------- ------------ --------
(unaudited) (unaudited)
<S> <C> <C> <C>
Allowance for credit losses deducted from:
Finance receivables $ 188 $ 173 $ 220
Retained interests in sold receivables 359 377 316
Vehicles leased 15 9 8
----- ------- -----
Total $ 562 $ 559 $ 544
===== ======= =====
</TABLE>
6
<PAGE>
ITEM 1. FINANCIAL STATEMENTS - continued
- ------- --------------------------------
Chrysler Financial Corporation and Subsidiaries
Notes to Consolidated Financial Statements
Note 2 - Sales of Receivables
- -----------------------------
The Company sells receivables subject to limited credit risk. Outstanding
balances of sold finance receivables, excluding retained senior interests in
sold wholesale receivables, were as follows (in millions of dollars):
<TABLE>
<CAPTION>
June 30, December 31, June 30,
1998 1997 1997
-------- ------------ --------
(unaudited) (unaudited)
<S> <C> <C> <C>
Retail $16,904 $16,096 $14,136
Wholesale 5,741 7,187 8,009
------- ------- -------
Total $22,645 $23,283 $22,145
======= ======= =======
</TABLE>
Gains, net of related amortization, recognized from the sales of receivables
were as follows (in millions of dollars):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- ----------------------
1998 1997 1998 1997
-------- -------- ------- --------
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
Retail:
Gross gains on sales $ 55 $ 39 $ 122 $ 68
Amortization (52) (40) (102) (79)
----- ----- ------- ------
Net gains $ 3 $ (1) $ 20 $ (11)
===== ===== ======= ======
Wholesale:
Gross gains on sales $ 40 $ 39 $ 82 $ 76
Amortization (42) (39) (84) (53)
----- ----- ------- ------
Net gains $ (2) $ -- $ (2) $ 23
===== ===== ======= ======
Total:
Gross gains on sales $ 95 $ 78 $ 204 $ 144
Amortization (94) (79) (186) (132)
----- ----- ------- ------
Net gains $ 1 $ (1) $ 18 $ 12
===== ===== ======= ======
</TABLE>
Gains and losses from the sales of receivables are recognized in the period
in which such sales occur, and are included in "Investment and other income."
Discount rates based on current market conditions at the time of sale and
prepayment speed estimates based on historical data are used in the
calculation of the gains and losses. Amortization relating to these gains is
recognized as an adjustment to "Finance Revenue" over the life of the sold
receivables. Provisions for expected credit losses are generally provided
during the period in which such receivables are acquired. Since the allowance
for credit losses is separately provided prior to the receivable sales, gains
from receivable sales are not reduced for expected credit losses. The
provision for credit losses related to the sold receivables amounted to $146
million and $97 million for the six months ended June 30, 1998 and 1997,
respectively. The Company began recognizing gains and losses on wholesale
receivable sales pursuant to the implementation of the Statement of Financial
Accounting Standards ("SFAS") No. 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities," effective
January 1, 1997.
The Company is committed to sell all wholesale receivables related to certain
dealer accounts.
7
<PAGE>
ITEM 1. FINANCIAL STATEMENTS - continued
- ------- --------------------------------
Chrysler Financial Corporation and Subsidiaries
Notes to Consolidated Financial Statements
Note 3 - Debt
- -------------
Debt outstanding was as follows (in millions of dollars):
<TABLE>
<CAPTION>
Weighted Average
Interest Rates at June 30, December 31, June 30,
Maturity June 30, 1998 1998 1997 1997
- -------- ----------------- -------- ------------ --------
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
Short-term notes placed primarily in the
open market:
United States $ 2,578 $ 2,261 $ 2,442
Canada 708 709 723
------- ------- --------
Total short-term notes (primarily
commercial paper) 5.5% 3,286 2,970 3,165
------- ------- --------
Bank borrowings - International 4.1% 176 217 144
------- ------- --------
Senior term debt:
United States, due
1997 -- -- 1,534
1998 6.2% 1,045 2,309 2,309
1999 7.6% 2,769 2,719 2,530
2000 6.3% 2,672 1,845 1,669
2001 5.9% 1,644 401 391
2002 6.2% 840 465 339
Thereafter 5.8% 1,379 159 109
------- ------- --------
Total United States 10,349 7,898 8,881
Canada, due 1997-2003 5.6% 2,225 1,426 1,162
------- ------- --------
Total senior term debt 12,574 9,324 10,043
Other borrowings 8.6% 117 207 134
------- ------- --------
Total debt $16,153 $12,718 $ 13,486
======= ======= ========
</TABLE>
The Company has contractual debt maturities at June 30, 1998, as follows:
1998 - $4.7 billion (including $3.3 billion of short-term notes with an
average remaining term of 45 days); 1999 - $3.4 billion; 2000 - $3.6 billion;
2001 - $2.1 billion; 2002 - $0.9 billion; and thereafter - $1.5 billion.
Credit Facilities
The Company has revolving credit facilities, which total $8.0 billion,
consisting of a $2.0 billion facility expiring in April 1999 and a $6.0
billion facility expiring in April 2002. These facilities include $1.0
billion allocated to Chrysler Credit Canada Ltd. As of June 30, 1998, $5
million was outstanding under these facilities supporting international
operations.
8
<PAGE>
ITEM 1. FINANCIAL STATEMENTS - continued
Chrysler Financial Corporation and Subsidiaries
Notes to Consolidated Financial Statements
Note 4 - New Accounting Standard
Effective January 1, 1998, the Company adopted SFAS No. 130, "Reporting
Comprehensive Income." This Statement requires that all items recognized
under accounting standards as components of comprehensive earnings be
reported in an annual financial statement that is displayed with the same
prominence as other annual financial statements. This Statement also requires
that an entity classify items of other comprehensive earnings by their nature
in an annual financial statement. For example, other comprehensive earnings
may include foreign currency translation adjustments, minimum pension
liability adjustments, and unrealized gains and losses on marketable
securities classified as available-for-sale. Annual financial statements for
prior periods will be reclassified, as required. The Company's total
comprehensive earnings were as follows (in millions of dollars):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
1998 1997 1998 1997
---- ---- ---- ----
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
Net earnings $120 $103 $228 $196
Other comprehensive
earnings (loss) (5) 8 1 3
---- ---- ---- ----
Total comprehensive earnings $115 $111 $229 $199
==== ==== ==== ====
</TABLE>
In the second quarter of 1998, the Company adopted Statement of Position
("SOP") 98-1, "Accounting for the Costs of Computer Software Developed or
Obtained for Internal Use," effective January 1, 1998. This SOP provides
guidance on accounting for the costs of computer software developed or
obtained for internal use. This SOP requires that entities capitalize certain
internal-use software costs once certain criteria are met. Historically, the
Company generally expensed the costs of developing or obtaining internal-use
software as incurred. Adoption of the standard did not have a material effect
on the Company's consolidated financial statements.
Note 5 - Merger of Chrysler Corporation and Daimler-Benz Aktiengesellschaft
On May 7, 1998, the Company's parent, Chrysler Corporation ("Chrysler"),
Daimler-Benz Aktiengesellschaft ("Daimler") and DaimlerChrysler
Aktiengesellschaft ("DaimlerChrysler") entered into a Business Combination
Agreement providing for (i) the merger of a newly created Delaware
corporation with and into Chrysler ("the Chrysler Merger"); (ii) an offer by
DaimlerChrysler to exchange DaimlerChrysler ordinary shares for Daimler
ordinary shares; and (iii) the merger of Daimler with and into
DaimlerChrysler. In the Chrysler Merger, each share of outstanding Chrysler
common stock will be converted into the right to receive DaimlerChrysler
shares. As a result of these transactions, DaimlerChrysler will be owned by
the former shareholders of Chrysler and Daimler, and Chrysler will be a
wholly owned subsidiary of DaimlerChrysler. Consummation of the transactions
contemplated by the Business Combination Agreement is subject to the approval
of Chrysler's and Daimler's shareholders, regulatory approvals and the
satisfaction or waiver of various other conditions as more fully described in
the Agreement.
9
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Financial Review
Chrysler Financial Corporation and its consolidated subsidiaries' (the
"Company") net earnings were $120 million and $228 million for the three and
six months ended June 30, 1998, compared to $103 million and $196 million for
the three and six months ended June 30, 1997. The increase in net earnings
primarily reflects higher gains and servicing fees from sales of receivables.
Net earnings for the first six months of 1997 reflect a one-time benefit from
the adoption of Statement of Financial Accounting Standards No. 125 (See Note
2 of the Consolidated Financial Statements).
Automotive volume totaled $24.2 billion and $44.8 billion for the three and
six months ended June 30, 1998, compared with $19.4 billion and $41.1 billion
in the comparable periods of 1997. United States penetration and the number
of vehicles financed for the three and six months ended June 30, 1998 and
1997 were as follows:
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
United States Penetration:
Retail and lease 31% 28% 29% 27%
Wholesale 71% 71% 69% 70%
Number of New Chrysler Vehicles
Financed in the United States
(in thousands):
Retail and lease 223 174 372 323
Wholesale 487 402 932 856
</TABLE>
The increase in retail and lease penetration for the three and six months
ended June 30, 1998, compared to 1997 is primarily due to new marketing
programs to customers and dealers initiated during 1998.
Finance revenue totaled $479 million and $903 million for the three and six
months ended June 30, 1998, compared to $404 million and $817 million for the
comparable periods of 1997. The increase in finance revenue is primarily
attributable to higher levels of vehicles leased and automotive finance
receivables managed, partially offset by adjustments to the carrying value of
certain nonautomotive assets.
A comparison of the borrowing costs is shown in the following table (dollars
in millions):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Interest expense $ 254 $ 204 $ 472 $ 399
Average borrowings $16,040 $12,452 $14,825 $12,215
Average effective cost of borrowings 6.3% 6.5% 6.4% 6.5%
</TABLE>
The decline in the average effective borrowing costs for the three and six
months ended June 30, 1998 compared to 1997 primarily reflects lower market
interest rates in the United States.
10
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS - continued
Financial Review (continued)
Depreciation on vehicles leased for the three and six months ended June 30,
1998, totaled $93 million and $164 million, compared to $40 million and $68
million for the comparable periods of 1997. The increase in depreciation
expense was due to higher levels of vehicles leased in Canada and the United
States.
Investment and other income totaled $178 million and $338 million for the
three and six months ended June 30, 1998, compared to $119 million and $226
million for the comparable periods of 1997. The increase in Investment and
other income primarily reflects higher gains from sales of automotive
receivables, as well as gains from sales of certain nonautomotive assets.
Operating and other expenses totaled $131 million and $259 million for the
three and six months ended June 30, 1998, compared to $125 million and $268
million for the comparable periods of 1997. The decrease in Operating and
other expenses for the first six months of 1998 compared to the first six
months of 1997, reflects improvements in the Company's automotive and
nonautomotive businesses, as well as the adoption of Statement of Position
98-1, "Accounting for the Costs of Computer Software Developed or Obtained
for Internal Use" notwithstanding an increase in the quarter ended
June 30, 1998.
Provision for credit losses for the three and six months ended June 30, 1998,
totaled $94 million and $193 million, compared to $86 million and $186
million for the comparable periods of 1997.
Net credit loss experience, including net losses on receivables sold subject
to limited credit risk, for the three and six months ended June 30, 1998 and
1997, was as follows (dollars in millions):
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net Credit Losses (Recoveries)
- Finance Receivables:
Automotive $ 84 $ 76 $180 $ 161
Nonautomotive 2 4 * 6
---- ---- ---- -----
Total $ 86 $ 80 $180 $ 167
==== ==== ==== =====
<CAPTION>
* Rounds to less than $1 million
<S> <C> <C> <C> <C>
Net Credit Losses (Recoveries)
- Finance Receivables to
Average Gross Finance Receivables
Outstanding:
Automotive 0.91% 0.85% 1.00% 0.92%
Nonautomotive 0.09% 0.49% (0.03%) 0.39%
Total 0.82% 0.82% 0.89% 0.89%
</TABLE>
During the first six months of 1998, the Company experienced higher credit
losses on automotive retail receivables. Company management attributes the
higher credit losses primarily to the effect of the credit mix of retail
receivables originated in prior years.
11
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continued
Financial Review (continued)
The Company's allowance for credit losses totaled $562 million, $559 million
and $544 million at June 30, 1998, December 31, 1997, and June 30, 1997,
respectively. The allowance for credit losses as a percentage of related
finance receivables outstanding was 1.47 percent at June 30, 1998, 1.60
percent at December 31, 1997, 1.55 percent at June 30, 1997.
The Company's portfolio of receivables and leases managed, which includes
receivables owned and receivables serviced for others, totaled $46.6 billion
at June 30, 1998, $42.0 billion at December 31, 1997, and $41.5 billion at
June 30, 1997. Receivables and leases serviced for others totaled $29.3
billion at June 30, 1998, $29.1 billion at December 31, 1997, and $27.8
billion at June 30, 1997.
Total assets at June 30, 1998, were $23.4 billion compared to $19.3 billion
at December 31, 1997 and $20.0 billion at June 30, 1997. The increase in
total assets is primarily attributable to higher volume of finance
receivables and vehicles leased, and lower levels of wholesale
securitizations.
Total debt outstanding was $16.2 billion at June 30, 1998, $12.7 billion at
December 31, 1997, and $13.5 billion at June 30, 1997. The increase in total
debt is attributable to the need to fund higher levels of automotive volume.
The Company's debt-to-equity ratio was 4.9 to 1 at June 30, 1998, 3.9 to 1 at
December 31, 1997, and 4.1 to 1 at June 30, 1997.
Liquidity and Capital Resources
Receivable sales continued to be a significant source of funding in the first
six months of 1998 as the Company realized $5.1 billion of net proceeds from
the sale of automotive retail receivables, compared to $3.2 billion of net
proceeds in the same period of 1997. Securitization of revolving wholesale
account balances provided funding which aggregated $4.4 billion and $6.8
billion at June 30, 1998 and 1997, respectively.
At June 30, 1998, the Company had contractual debt maturities of $4.7 billion
during the remainder of 1998 (including $3.3 billion of short-term notes),
$3.4 billion in 1999, $3.6 billion in 2000, $2.1 billion in 2001, $0.9
billion in 2002 and $1.5 billion thereafter. The Company expects that 1998
debt maturities will be funded from continued access to term debt markets,
issuances of commercial paper, receivable sales, and operating cash flows. At
June 30, 1998, the Company had approximately $3.0 billion in eligible
wholesale receivables held by securitization trusts. On July 1, 1998, the
Company securitized $1.1 billion of wholesale receivables, which reduced the
amount of eligible wholesale receivables to approximately $1.9 billion.
The Company has revolving credit facilities, which total $8.0 billion,
consisting of a $2.0 billion facility expiring in April 1999 and a $6.0
billion facility expiring in April 2002. These facilities include $1.0
billion allocated to Chrysler Credit Canada Ltd. As of June 30, 1998, $5
million was outstanding under these facilities supporting international
operations.
The Company paid dividends to Chrysler Corporation totaling $227 million
during the first six months of 1998, compared to $194 million for the
comparable period of 1997.
The Company believes that cash provided by operations, receivable sales,
access to term debt markets and issuance of commercial paper will provide
sufficient liquidity to meet its funding requirements.
12
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS- continued
New Accounting Standards
In February 1998, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 132, "Employers' Disclosures about
Pensions and Other Postretirement Benefits." This Statement revises
employers' disclosures about pension and other postretirement benefit plans.
It does not change the measurement or recognition of those plans. This
Statement standardizes the disclosure requirements for pensions and other
postretirement benefits to the extent practicable, requires additional
information on changes in the benefit obligations and fair values of plan
assets that will facilitate financial analysis, and eliminates certain
disclosures. Restatement of disclosures for earlier periods is required. This
Statement is effective for the Company's financial statements for the year
ended December 31, 1998.
In June 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative
Instruments and Hedging Activities." This Statement requires companies to
record derivatives on the balance sheet as assets and liabilities, measured
at fair value. Gains or losses resulting from changes in the values of those
derivatives would be accounted for depending on the use of the derivative and
whether it qualifies for hedge accounting. This Statement is not expected to
have a material impact on the Company's financial statements. This Statement
is effective for fiscal years beginning after June 15, 1999, with earlier
adoption encouraged. The Company will adopt this accounting standard as
required by January 1, 2000.
Review by Independent Public Accountants
Deloitte & Touche LLP, the Company's independent public accountants,
performed a review of the financial statements for the six months ended June
30, 1998 and 1997 in accordance with the standards for such reviews
established by the American Institute of Certified Public Accountants. The
review did not constitute an audit, and accordingly, Deloitte & Touche LLP
did not express an opinion on the aforementioned data.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
(Omitted in accordance with general instruction H)
13
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Chrysler Financial Corporation and Subsidiaries
PART II OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES
(Omitted in accordance with General Instruction H.)
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
(Omitted in accordance with General Instruction H.)
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(Omitted in accordance with General Instruction H.)
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed as a part of this report:
Exhibits
- --------
3-A Copy of the Restated Articles of Incorporation of Chrysler
Financial Corporation as adopted and filed with the Corporation
Division of the Michigan Department of Treasury on October 1,
1971. Filed as Exhibit 3-A to Registration No. 2-43097 of
Chrysler Financial Corporation, and incorporated herein by
reference.
3-B Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on December 26, 1975, April 23,
1985 and June 21, 1985, respectively. Filed as Exhibit 3-B to the
Annual Report of Chrysler Financial Corporation on Form 10-K for
the year ended December 31, 1985, and incorporated herein by
reference.
3-C Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on August 12, 1987 and August
14, 1987, respectively. Filed as Exhibit 3 to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended September 30, 1987, and incorporated herein by
reference.
3-D Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on December 11, 1987 and
January 25, 1988, respectively. Filed as Exhibit 3-D to the
Annual Report of Chrysler Financial Corporation on Form 10-K for
the year ended December 31, 1987, and incorporated herein by
reference.
3-E Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on June 13, 1989 and June 23,
1989, respectively. Filed as Exhibit 3-E to the Quarterly Report
of Chrysler Financial Corporation on Form 10-Q for the quarter
ended June 30, 1989, and incorporated herein by reference.
3-F Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on September 13, 1989, January
31, 1990 and March 8, 1990, respectively. Filed as Exhibit 3-E to
the Annual Report of Chrysler Financial Corporation on Form 10-K
for the year ended December 31, 1989, and incorporated herein by
reference.
14
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Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
3-G Copy of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on March 29, 1990 and May 10,
1990. Filed as Exhibit 3-G to the Quarterly Report of Chrysler
Financial Corporation on Form 10-Q for the quarter ended March
31, 1990, and incorporated herein by reference.
3-H Copy of the By-Laws of Chrysler Financial Corporation as amended
to March 2, 1987. Filed as Exhibit 3-C to the Annual Report of
Chrysler Financial Corporation on Form 10-K for the year ended
December 31, 1986, and incorporated herein by reference.
3-I Copy of the By-Laws of Chrysler Financial Corporation as amended
to August 1, 1990. Filed as Exhibit 3-I to the Quarterly Report
of Chrysler Financial Corporation on Form 10-Q for the quarter
ended September 30, 1990, and incorporated herein by reference.
3-J Copy of By-Laws of Chrysler Financial Corporation as amended to
January 1, 1992, and presently in effect. Filed as Exhibit 3-H to
the Annual Report of Chrysler Financial Corporation on Form 10-K
for the year ended December 31, 1991, and incorporated herein by
reference.
4-A Copy of Indenture, dated as of June 15, 1984, between Chrysler
Financial Corporation and Manufacturers Hanover Trust Company, as
Trustee, United States Trust Company of New York, as successor
Trustee, related to Senior Debt Securities of Chrysler Financial
Corporation. Filed as Exhibit (1) to the Current Report of
Chrysler Financial Corporation on Form 8-K, dated June 26, 1984,
and incorporated herein by reference.
4-B Copy of Supplemental Indenture, dated as of August 24, 1995,
between Chrysler Financial Corporation and the United States
Trust Company of New York, as Trustee, to the Indenture, dated as
of June 15, 1984, related to Senior Debt Securities of Chrysler
Financial Corporation. Filed as Exhibit 4-K to the Current Report
of Chrysler Financial Corporation on Form 8-K, dated August 24,
1995, and incorporated herein by reference.
4-C Copy of Indenture, dated as of September 15, 1986, between
Chrysler Financial Corporation and Manufacturers Hanover Trust
Company, Trustee, United States Trust Company of New York, as
successor Trustee, related to Chrysler Financial Corporation
Senior Debt Securities. Filed as Exhibit 4-E to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended September 30, 1986, and incorporated herein by
reference.
4-D Copy of Indenture, dated as of February 15, 1988, between
Chrysler Financial Corporation and Manufacturers Hanover Trust
Company, Trustee, United States Trust Company of New York, as
successor Trustee, related to Chrysler Financial Corporation
Senior Debt Securities. Filed as Exhibit 4-A to Registration No.
33-23479 of Chrysler Financial Corporation, and incorporated
herein by reference.
4-E Copy of First Supplemental Indenture, dated as of March 1, 1988,
between Chrysler Financial Corporation and Manufacturers Hanover
Trust Company, Trustee, United States Trust Company of New York,
as successor Trustee, to the Indenture, dated as of February 15,
1988, between such parties, related to Chrysler Financial
Corporation Senior Debt Securities. Filed as Exhibit 4-L to the
Annual Report of Chrysler Financial Corporation on Form 10-K for
the year ended December 31, 1987, and incorporated herein by
reference.
15
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
4-F Copy of Second Supplemental Indenture, dated as of September 7,
1990, between Chrysler Financial Corporation and Manufacturers
Hanover Trust Company, Trustee, United States Trust Company of
New York, as successor Trustee, to the Indenture, dated as of
February 15, 1988, between such parties, related to Chrysler
Financial Corporation Senior Debt Securities. Filed as Exhibit
4-M to the Quarterly Report of Chrysler Financial Corporation on
Form 10-Q for the quarter ended September 30, 1990, and
incorporated herein by reference.
4-G Copy of Third Supplemental Indenture, dated as of May 4, 1992,
between Chrysler Financial Corporation and United States Trust
Company of New York, as successor Trustee, to the Indenture,
dated as of February 15, 1988 between such parties, relating to
Chrysler Financial Corporation Senior Debt Securities. Filed as
Exhibit 4-N to the Quarterly Report of Chrysler Financial
Corporation on Form 10-Q for the quarter ended June 30, 1992, and
incorporated herein by reference.
10-A Copy of Income Maintenance Agreement, made December 20, 1968,
among Chrysler Financial Corporation, Chrysler Corporation and
Chrysler Motors Corporation. Filed as Exhibit 13-D to
Registration Statement No. 2-32037 of Chrysler Financial
Corporation, and incorporated herein by reference.
10-B Copy of Agreement, made April 19, 1971, among Chrysler Financial
Corporation, Chrysler Corporation and Chrysler Motors
Corporation, amending the Income Maintenance Agreement among such
parties. Filed as Exhibit 13-B to Registration Statement No.
2-40110 of Chrysler Financial Corporation and Chrysler
Corporation, and incorporated herein by reference.
10-C Copy of Agreement, made May 29, 1973, among Chrysler Financial
Corporation, Chrysler Corporation and Chrysler Motors
Corporation, further amending the Income Maintenance Agreement
among such parties. Filed as Exhibit 5-C to Registration
Statement No. 2-49615 of Chrysler Financial Corporation, and
incorporated herein by reference.
10-D Copy of Agreement, made as of July 1, 1975, among Chrysler
Financial Corporation, Chrysler Corporation and Chrysler Motors
Corporation, further amending the Income Maintenance Agreement
among such parties. Filed as Exhibit D to the Annual Report of
Chrysler Financial Corporation on Form 10-K for the year ended
December 31, 1975, and incorporated herein by reference.
10-E Copy of Agreement, made June 4, 1976, between Chrysler Financial
Corporation and Chrysler Corporation further amending the Income
Maintenance Agreement between such parties. Filed as Exhibit 5-H
to Registration Statement No. 2-56398 of Chrysler Financial
Corporation, and incorporated herein by reference.
10-F Copy of Agreement, made March 27, 1986, between Chrysler
Financial Corporation, Chrysler Holding Corporation (now known as
Chrysler Corporation) and Chrysler Corporation (now known as
Chrysler Motors Corporation) further amending the Income
Maintenance Agreement among such parties. Filed as Exhibit 10-F
to the Annual Report of Chrysler Financial Corporation on Form
10-K for the year ended December 31, 1986, and incorporated
herein by reference.
10-G Copy of Short Term Revolving Credit Agreement, dated as of April
21, 1998, among Chrysler Financial Corporation, Chrysler Credit
Canada Ltd., the several commercial banks party thereto, as
Managing Agents, Royal Bank of Canada, as Canadian Administrative
Agent, and Chemical Bank, as Administrative Agent.
16
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-H Copy of Long Term Revolving Credit Agreement, dated as of April
24, 1997, among Chrysler Financial Corporation, Chrysler Credit
Canada Ltd., the several commercial banks party thereto, as
Managing Agents, Royal Bank of Canada, as Canadian Administrative
Agent, and Chemical Bank, as Administrative Agent. Filed as
Exhibit 10-H to the Quarterly Report of Chrysler Financial
Corporation on Form 10-Q for the quarter ended June 30, 1997, and
incorporated herein by reference.
10-I Copy of Origination and Servicing Agreement, dated as of June 4,
1993, among Chrysler Leaserve, Inc., General Electric Capital
Auto Lease, Inc., Chrysler Credit Corporation and Chrysler
Financial Corporation. Filed as Exhibit 10-ZZZZ to the Quarterly
Report on Form 10-Q of Chrysler Financial Corporation for the
quarter ended September 30, 1993, and incorporated herein by
reference.
10-J Copy of Amended and Restated Trust Agreement, dated as of
September 1, 1993, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Trustee, with respect to Premier Auto Trust 1993-5. Filed as
Exhibit 4.1 to the Quarterly Report of Premier Auto Trust 1993-5
on Form 10-Q for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-K Copy of Indenture, dated as of September 1, 1993, between Premier
Auto Trust 1993-5 and Bankers Trust Company, as Indenture
Trustee, with respect to Premier Auto Trust 1993-5. Filed as
Exhibit 4.2 to the Quarterly Report of Premier Auto Trust 1993-5
on Form 10-Q for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-L Copy of Amended and Restated Trust Agreement, dated as of
November 1, 1993, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Trust 1993-6. Filed
as Exhibit 4-A to the Annual Report on Form 10-K of Premier Auto
Trust 1993-6 for the year ended December 31, 1993, and
incorporated herein by reference.
10-M Copy of Indenture, dated as of November 1, 1993, between Premier
Auto Trust 1993-6 and The Fuji Bank and Trust Company, as
Indenture Trustee, with respect to Premier Auto Trust 1993-6.
Filed as Exhibit 4-B to the Annual Report on Form 10-K of Premier
Auto Trust 1993-6 for the year ended December 31, 1993, and
incorporated herein by reference.
10-N Copy of Amended and Restated Trust Agreement, dated as of
February 1, 1994, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Trust 1994-1. Filed
as Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier
Auto Trust 1994-1 for the quarter ended March 31, 1994, and
incorporated herein by reference.
10-O Copy of Indenture, dated as of February 1, 1994, between Premier
Auto Trust 1994-1 and The Fuji Bank and Trust Company, as
Indenture Trustee, with respect to Premier Auto Trust 1994-1.
Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q of
Premier Auto Trust 1994-1 for the quarter ended March 31, 1994,
and incorporated herein by reference.
10-P Copy of Amended and Restated Master Custodial and Servicing
Agreement, dated as of December 16, 1997 between Chrysler Credit
Canada Ltd. and The Royal Trust Company, as Custodian. Files as
Exhibit 10-CC to the Annual Report on Form 10-K of Chrysler
Financial Corporation for the year ended December 31, 1997, and
incorporated herein by reference.
17
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-Q Copy of Amended and Restated Series 1995-1 Supplement, dated as
of December 16, 1997, among Chrysler Credit Canada Ltd., The
Royal Trust Company, Prime Trust, Auto Receivables Corporation
and Chrysler Financial Corporation, to the Amended and Restated
Master Custodial and Servicing Agreement, dated as of December
16, 1997. Filed as Exhibit 10-DD to the Annual Report on Form
10-K of Chrysler Financial Corporation for the year ended
December 31, 1997, and incorporated herein by reference.
10-R Copy of Servicing Agreement, dated as of October 20, 1992,
between Chrysler Leaserve, Inc. (a subsidiary of General Electric
Capital Auto Lease, Inc.) and Chrysler Credit Corporation, with
respect to the sale of Gold Key Leases. Filed as Exhibit 10-YYYYY
to the Registration Statement on Form S-2 of Chrysler Financial
Corporation (Registration Statement No. 33-51302) on November 24,
1992, and incorporated herein by reference.
10-S Copy of Amended and Restated Trust Agreement, dated as of August
1, 1993, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1993-4. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1993-4 for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-T Copy of Indenture, dated as of August 1, 1993, between Premier
Auto Trust 1993-4 and Bankers Trust Company, as Indenture
Trustee, with respect to Premier Auto Trust 1993-4. Filed as
Exhibit 4.2 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1993-4 for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-U Copy of Amended and Restated Trust Agreement, dated as of August
1, 1994, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1994-4. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1994-4 for the quarter ended September 30, 1994, and
incorporated herein by reference.
10-V Copy of Indenture, dated as of August 1, 1994, between Premier
Auto Trust 1994-4 and Bankers Trust Company, as Indenture
Trustee. Filed as Exhibit 4.2 to the Quarterly Report on Form
10-Q of Premier Auto Trust 1994-4 for the quarter ended September
30, 1994, and incorporated herein by reference.
10-W Copy of Series 1994-1 Supplement, dated as of September 30, 1994,
among U.S. Auto Receivables Company, as Seller, Chrysler Credit
Corporation, as Servicer, and Manufacturers and Traders Trust
Company, as Trustee, with respect to CARCO Auto Loan Master
Trust, Series 1994-1. Filed as Exhibit 3 to the Registration
Statement on Form 8-A of CARCO Auto Loan Master Trust dated
November 23, 1994, and incorporated herein by reference.
10-X Copy of Series 1995-1 Supplement, dated as of December 31, 1994,
among U.S. Auto Receivables Company, as Seller, Chrysler Credit
Corporation, as Servicer, and Manufacturers and Traders Trust
Company, as Trustee, with respect to CARCO Auto Loan Master
Trust, Series 1995-1. Filed as Exhibit 3 to the Registration
Statement on Form 8-A of CARCO Auto Loan Master Trust dated
January 19, 1995, and incorporated herein by reference.
18
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-Y Copy of Series 1995-2 Supplement, dated as of February 28, 1995,
among U.S. Auto Receivables Company, as Seller, Chrysler Credit
Corporation, as Servicer, and Manufacturers and Traders Trust
Company, as Trustee, with respect to CARCO Auto Loan Master Trust
1995-2. Filed as Exhibit 3 to CARCO Auto Loan Master Trust's
Registration Statement on Form 8-A dated March 27, 1995, and
incorporated herein by reference.
10-Z Copy of Amended and Restated Trust Agreement, dated as of
February 1, 1995, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Trust 1995-1. Filed
as Exhibit 4.1 to the Quarterly Report on Form 10-Q for the
quarter ended March 31, 1995 of Premier Auto Trust 1995-1, and
incorporated herein by reference.
10-AA Copy of Indenture, dated as of February 1, 1995, between Premier
Auto Trust 1995-1 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1995-1. Filed as Exhibit 4.2
to the Quarterly Report on Form 10-Q for the quarter ended March
31, 1995 of Premier Auto Trust 1995-1, and incorporated herein by
reference.
10-BB Copy of Sale and Servicing Agreement, dated as of February 1,
1995, among Premier Auto Trust 1995-1, Chrysler Credit
Corporation and Chrysler Financial Corporation, with respect to
Premier Auto Trust 1995-1. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q for the quarter ended March 31, 1995 of
Premier Auto Trust 1995-1, and incorporated herein by reference.
10-CC Copy of Amended and Restated Trust Agreement, dated as of April
1, 1995, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1995-2. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995 of Premier Auto Trust 1995-2, and
incorporated herein by reference.
10-DD Copy of Indenture, dated as of April 1, 1995, between Premier
Auto Trust 1995-2 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1995-2. Filed as Exhibit 4.2
to the Quarterly report on Form 10-Q for the quarter ended June
30, 1995 of Premier Auto Trust 1995-2, and incorporated herein by
reference.
10-EE Copy of Sale and Servicing Agreement, dated as of April 1, 1995,
among Premier Auto Trust 1995-2, Chrysler Credit Corporation and
Chrysler Financial Corporation, with respect to Premier Auto
Trust 1995-2. Filed as Exhibit 4.3 to the Quarterly Report on
Form 10-Q for the quarter ended June 30, 1995 of Premier Auto
Trust 1995-2, and incorporated herein by reference.
10-FF Copy of Series 1995-4A Supplement, dated as of April 30, 1995,
among U.S. Auto Receivables Company, Chrysler Credit Corporation
and Manufacturers and Traders Trust Company, as Trustee, with
respect to CARCO Auto Loan Master Trust Series 1995-4A. Filed as
Exhibit 4-BB to the Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995 of CARCO Auto Loan Master Trust, and
incorporated herein by reference.
10-GG Copy of Receivables Purchase Agreement, dated as of December 14,
1995, among Chrysler Financial Corporation, Premier Auto
Receivables Company, Chrysler Credit Corporation, and ABN AMRO
Bank N.V., as Agent, with respect to the sale of retail
automotive receivables to Windmill Funding Corporation, Series
1995-2. Filed as Exhibit 10-KKKK to the Annual Report on Form
10-K of Chrysler Financial Corporation for the year ended
December 31, 1995, and incorporated herein by reference.
19
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-HH Copy of Certificate of Trust of Premier Auto Trust 1995-3. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1995-3 for the quarter ended September 30, 1995, and
incorporated herein by reference.
10-II Copy of Amended and Restated Trust Agreement, dated as of July 1,
1995, among Premier Auto Receivables Company, Chrysler Financial
Corporation and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1995-3. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1995-3 for
the quarter ended September 30, 1995, and incorporated herein by
reference.
10-JJ Copy of Indenture, dated as of July 1, 1995, between Premier Auto
Trust 1995-3 and The Bank of New York, as Indenture Trustee, with
respect to Premier Auto Trust 1995-3. Filed as Exhibit 4.2 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1995-3 for
the quarter ended September 30, 1995, and incorporated herein by
reference.
10-KK Copy of Sale and Servicing Agreement, dated as of July 1, 1995,
among Premier Auto Trust 1995-3, Chrysler Credit Corporation and
Chrysler Financial Corporation, with respect to Premier Auto
Trust 1995-3. Filed as Exhibit 4.3 to the Quarterly Report on
Form 10-Q of Premier Auto Trust 1995-3 for the quarter ended
September 30, 1995, and incorporated herein by reference.
10-LL Copy of Amended and Restated Trust Agreement, dated as of
November 1, 1995, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Receivables 1995-4.
Filed as Exhibit 4.1 to the Annual Report on Form 10-K of Premier
Auto Trust 1995-4 for the year ended December 31, 1995, and
incorporated herein by reference.
10-MM Copy of Certificate of Trust of Premier Auto Trust 1995-4. Filed
as Exhibit 3 to the Annual Report on Form 10-K of Premier Auto
Trust 1995-4 for the year ended December 31, 1995, and
incorporated herein by reference.
10-NN Copy of Indenture, dated as of November 1, 1995, between Premier
Auto Trust 1995-4 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1995-4. Filed as Exhibit 4.2
to the Annual Report on Form 10-K of Premier Auto Trust 1995-4
for the year ended December 31, 1995, and incorporated herein by
reference.
10-OO Copy of Sale and Servicing Agreement, dated as of November 1,
1995, among Premier Auto Trust 1995-4, Chrysler Credit
Corporation and Chrysler Financial Corporation, with respect to
Premier Auto Trust 1995-4. Filed as Exhibit 4.3 to the Annual
Report on Form 10-K of Premier Auto Trust 1995-4 for the year
ended December 31, 1995, and incorporated herein by reference.
10-PP Copy of Receivables Purchase Agreement, dated as of May 30, 1996,
among Premier Auto Receivables Company, Chrysler Financial
Corporation, and ABN AMRO Bank, N.V., as Agent, with respect to
the sale of retail automotive receivables to Windmill Funding
Corporation, Series 1996-1. Filed as Exhibit 10-OOOO to the
Quarterly Report on Form 10-Q of Chrysler Financial Corporation
for the quarter ended June 30, 1996, and incorporated herein by
reference.
10-QQ Copy of Certificate of Trust of Premier Auto Trust 1996-1. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-1 for the quarter ended March 31, 1996, and
incorporated herein by reference.
20
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Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-RR Copy of Amended and Restated Trust Agreement, dated as of March
1, 1996, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1996-1. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-1 for the quarter ended March 31, 1996, and
incorporated herein by reference.
10-SS Copy of Indenture, dated as of March 1, 1996, between Premier
Auto Trust 1996-1 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1996-1. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-1 for the quarter ended March 31,
1996, and incorporated herein by reference.
10-TT Copy of Sale and Servicing Agreement, dated as of March 1, 1996,
between Premier Auto Trust 1996-1 and Chrysler Financial
Corporation (excluding Schedules A and C), for Premier Auto Trust
1996-1. Filed as Exhibit 4.3 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-1 for the quarter ended March 31,
1996, and incorporated by reference.
10-UU Copy of Receivables Sale Agreement, dated as of June 27, 1996,
among Premier Receivables L.L.C., Chrysler Financial Corporation,
Asset Securitization Cooperative Corporation and Canadian
Imperial Bank of Commerce, as Administrative Agent. Filed as
Exhibit 10-TTTT to the Quarterly Report on Form 10-Q of Chrysler
Financial Corporation for the quarter ended June 30, 1996, and
incorporated herein by reference.
10-VV Copy of Asset Purchase Agreement, dated as of August 30, 1996,
between Chrysler First Business Credit Corporation and Berkeley
Federal Bank & Trust, F.S.B. Filed as Exhibit 10-IIII to the
Quarterly Report on Form 10-Q of Chrysler Financial Corporation
for the quarter ended September 30, 1996, and incorporated herein
by reference.
10-WW Copy of Asset Purchase Agreement, dated as of August 30, 1996,
between Chrysler First Business Credit Corporation and Blackrock
Capital Finance, L.P. Filed as Exhibit 10-JJJJ to the Quarterly
Report on Form 10-Q for the quarter ended September 30, 1996, and
incorporated herein by reference.
10-XX Copy of Certificate of Trust of Premier Auto Trust 1996-2. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-2 for the quarter ended June 30, 1996, and
incorporated herein by reference.
10-YY Copy of Amended and Restated Trust Agreement, dated as of May 1,
1996, among Premier Auto Receivables Company, Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1996-2. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1996-2 for
the quarter ended June 30, 1996, and incorporated herein by
reference.
10-ZZ Copy of Indenture, dated as of May 1, 1996, between Premier Auto
Trust 1996-2 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1996-2. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-2 for the quarter ended June 30, 1996,
and incorporated herein by reference.
21
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-AAA Copy of Sale and Servicing Agreement, dated as of May 1, 1996,
between Premier Auto Trust 1996-2 and Chrysler Financial
Corporation (excluding Schedules A and C), with respect to
Premier Auto Trust 1996-2. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q of Premier Auto Trust 1996-2 for the quarter
ended June 30, 1996, and incorporated herein by reference.
10-BBB Copy of Certificate of Trust of Premier Auto Trust 1996-3. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-3 for the quarter ended June 30, 1996, and
incorporated herein by reference.
10-CCC Copy of Amended and Restated Trust Agreement, dated as of June 1,
1996, among Premier Auto Receivables Company, Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1996-3. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1996-3 for
the quarter ended June 30, 1996, and incorporated herein by
reference.
10-DDD Copy of Indenture, dated as of June 1, 1996, between Premier Auto
Trust 1996-3 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1996-3. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-3 for the quarter ended June 30, 1996,
and incorporated herein by reference.
10-EEE Copy of Sale and Servicing Agreement, dated as of June 1, 1996,
between Premier Auto Trust 1996-3 and Chrysler Financial
Corporation (excluding Schedules A and C), with respect to
Premier Auto Trust 1996-3. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q of Premier Auto Trust 1996-3 for the quarter
ended June 30, 1996, and incorporated herein by reference.
10-FFF Copy of Receivables Sale Agreement, dated as of November 25,
1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Asset Securitization Cooperative Corporation, and
Canadian Imperial Bank of Commerce, as Administrative Agent.
Filed as Exhibit 10-OOOO to the Annual Report on Form 10-K of
Chrysler Financial Corporation for the year ended December 31,
1996, and incorporated herein by reference.
10-GGG Copy of Certificate of Trust of Premier Auto Trust 1996-4. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-4 for the quarter ended September 30, 1996, and
incorporated herein by reference. Filed as Exhibit 10-PPPP to the
Annual Report on Form 10-K of Chrysler Financial Corporation for
the year ended December 31, 1996, and incorporated herein by
reference.
10-HHH Copy of Amended and Restated Trust Agreement, dated as of August
1, 1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chase Manhattan Bank Delaware, as Owner Trustee,
with respect to Premier Auto Trust 1996-4. Filed as Exhibit 4.1
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1996-4
for the quarter ended September 30, 1996, and incorporated herein
by reference.
10-III Copy of Indenture, dated as of August 1, 1996, between Premier
Auto Trust 1996-4 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1996-4. Filed as Exhibit 4.2
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1996-4
for the quarter ended September 30, 1996, and incorporated herein
by reference.
22
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-JJJ Copy of Sale and Servicing Agreement, dated as of August 1, 1996,
between Premier Auto Trust 1996-4 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1996-4. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-4 for the quarter ended September 30, 1996, and
incorporated herein by reference.
10-KKK Copy of Receivables Sale Agreement, dated as of December 12,
1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Monte Rosa Capital Corporation, and Union Bank of
Switzerland, New York Branch, as Administrative Agent. Filed as
Exhibit 10-TTTT to the Annual Report on Form 10-K of Chrysler
Financial Corporation for the year ended December 31, 1996, and
incorporated herein by reference.
10-LLL Copy of Receivables Sale Agreement, dated as of December 12,
1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Old Line Funding Corp., and Royal Bank of Canada, as
Agent. Filed as Exhibit 10-UUUU to the Annual Report on Form 10-K
of Chrysler Financial Corporation for the year ended December 31,
1996, and incorporated herein by reference.
10-MMM Copy of Amended and Restated Receivables Sale Agreement, dated as
of December 18, 1996, among Chrysler Credit Canada Ltd., Chrysler
Financial Corporation, Canadian Master Trust, and Nesbitt Burns,
Inc. Filed as Exhibit 10-GGGG to the Annual Report on Form 10-K
of Chrysler Financial Corporation for the year ended December 31,
1997, and incorporated herein by reference.
10-NNN Copy of Loan Agreement, dated as of August 1, 1996, between
Chrysler Canada Ltd. and Chrysler Credit Canada Ltd., with
respect to Gold Key Leasing. Filed as Exhibit 10-WWWW to the
Annual Report on Form 10-K of Chrysler Financial Corporation for
the year ended December 31, 1996, and incorporated herein by
reference.
10-OOO Copy of Series 1996-1 Supplement, dated as of September 30, 1996,
among U.S. Auto Receivables Company, as Seller, Chrysler
Financial Corporation, as Servicer, and The Bank of New York, as
Trustee, with respect to CARCO Auto Loan Master Trust. Filed as
Exhibit 4-EE to the Annual Report on Form 10-K of CARCO Auto Loan
Master Trust for the year ended December 31, 1996, and
incorporated herein by reference.
10-PPP Copy of Series 1996-2 Supplement, dated as of November 30, 1996,
among U.S. Auto Receivables Company, as Seller, Chrysler
Financial Corporation, as Servicer, and The Bank of New York, as
Trustee, with respect to CARCO Auto Loan Master Trust. Filed as
Exhibit 4-FF to the Annual Report on Form 10-K of CARCO Auto Loan
Master Trust for the year ended December 31, 1996, and
incorporated herein by reference.
10-QQQ Copy of Certificate of Trust of Premier Auto Trust 1997-1. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-1 for the quarter ended March 31, 1997, and
incorporated herein by reference.
10-RRR Copy of Amended and Restated Trust Agreement, dated as of March
1, 1997, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chase Manhattan Bank Delaware, as Owner Trustee,
with respect to Premier Auto Trust 1997-1. Filed as Exhibit 4.1
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1997-1
for the quarter ended March 31, 1997, and incorporated herein by
reference.
23
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
10-SSS Copy of Indenture, dated as of March 1, 1997, between Premier
Auto Trust 1997-1 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1997-1. Filed as Exhibit 4.2
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1997-1
for the quarter ended March 31, 1997, and incorporated herein by
reference.
10-TTT Copy of Sale and Servicing Agreement, dated as of March 1, 1997,
between Premier Auto Trust 1997-1 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1997-1. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-1 for the quarter ended March 31, 1997, and
incorporated herein by reference.
10-UUU Copy of Receivables Sale Agreement, dated as of April 29, 1997,
among Premier Receivables L.L.C., Chrysler Financial Corporation,
Windmill Funding Corporation, and ABN AMRO Bank N.V., as
Administrative Agent. Filed as Exhibit 10-SSSS to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended June 30, 1997, and incorporated herein by
reference.
10-VVV Copy of Receivables Sale Agreement, dated as of June 16, 1997,
among Premier Receivables L.L.C., Chrysler Financial Corporation,
Park Avenue Receivables Corporation, and the Chase Manhattan
Bank, as Funding Agent. Filed as Exhibit 10-TTTT to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended June 30, 1997, and incorporated herein by
reference.
10-WWW Copy of Receivables Sale Agreement, dated as of September 29,
1997, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Thunder Bay Funding Inc., and Royal Bank of Canada,
as Agent. Filed as Exhibit 10-UUUU to the Quarterly Report of
Chrysler Financial Corporation on Form 10-Q for the quarter ended
September 30, 1997, and incorporated herein by reference.
10-XXX Copy of Certificate of Trust of Premier Auto Trust 1997-2. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-2 for the quarter ended September 30, 1997, and
incorporated herein by reference.
10-YYY Copy of Amended and Restated Trust Agreement, dated as of August
1, 1997, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1997-2. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1997-2 for
the quarter ended September 30, 1997, and incorporated herein by
reference.
10-ZZZ Copy of Indenture, dated as of August 1, 1997, between Premier
Auto Trust 1997-2 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1997-2. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1997-2 for the quarter ended September 30,
1997, and incorporated herein by reference.
10-AAAA Copy of Sale and Servicing Agreement, dated as of August 1, 1997,
between Premier Auto Trust 1997-2 and Chrysler Financial
Corporation (excluding Schedules A and C), with respect to
Premier Auto Trust 1997-2. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q of Premier Auto Trust 1997-2 for the quarter
ended September 30, 1997, and incorporated herein by reference.
10-BBBB Copy of Certificate of Trust of Premier Auto Trust 1997-3. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-3 for the quarter ended September 30, 1997, and
incorporated herein by reference.
24
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
- ------- --------------------------------------------
10-CCCC Copy of Amended and Restated Trust Agreement, dated as of
September 1, 1997, among Premier Receivables L.L.C., Chrysler
Financial Corporation, and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1997-3. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-3 for the quarter ended September 30, 1997, and
incorporated herein by reference.
10-DDDD Copy of Indenture, dated as of September 1, 1997, between Premier
Auto Trust 1997-3 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1997-3. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1997-3 for the quarter ended September 30,
1997, and incorporated herein by reference.
10-EEEE Copy of Sale and Servicing Agreement, dated as of September 1,
1997, between Premier Auto Trust 1997-3 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1997-3. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-3 for the quarter ended September 30, 1997, and
incorporated herein by reference.
10-FFFF Copy of Receivables Sale Agreement, dated as of November 6, 1997,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Preferred Receivables Funding
Corporation, as a Purchaser, Falcon Asset Securitization
Corporation, as a Purchaser and the First National Bank of
Chicago, as Administrative Agent. Filed as Exhibit 10-ZZZZ to the
Annual Report on Form 10-K of Chrysler Financial Corporation for
the year ended December 31, 1997, and incorporation herein by
reference.
10-GGGG Copy of Receivables Sale Agreement, dated as of November 20,
1997, among Premier Receivables L.L.C., as Seller, Chrysler
Financial Corporation, as Servicer, Receivables Capital
Corporation, as Purchaser and Bank of America National Trust and
Savings Association, as Administrative Agent. Filed as Exhibit
10-AAAAA to the Annual Report on Form 10-K of Chrysler Financial
Corporation for the year ended December 31, 1997, and
incorporated herein by reference.
10-HHHH Copy of Receivables Sale Agreement, dated as of December 3, 1997,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Old Line Funding Company, as Purchaser
and Royal Bank of Canada, as Agent. Filed as Exhibit 10-BBBBB to
the Annual Report on Form 10-K of Chrysler Financial Corporation
for the year ended December 31, 1997, and incorporated herein by
reference.
10-IIII Copy of Receivables Sale Agreement, dated as of December 22,
1997, among Premier Receivables L.L.C., as Seller, Chrysler
Financial Corporation, as Servicer, Windmill Funding Corporation,
as Purchaser and ABN AMRO Bank N.V., as Administrative Agent.
Filed as Exhibit 10-CCCCC to the Annual Report on Form 10-K of
Chrysler Financial Corporation for the year ended December 31,
1997, and incorporated herein by reference.
10-JJJJ Copy of Receivables Sale Agreement, dated as of June 22, 1998,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Preferred Receivables Funding
Corporation, as Purchaser, and the First National Bank of
Chicago, as Administrative Agent.
10-KKKK Copy of Receivables Sale Agreement, dated as of June 29, 1998,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Old Line Funding Company, as Purchaser,
and Royal Bank of Canada, as Agent.
25
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
- ------- --------------------------------------------
10-LLLL Copy of Certificate of Trust of Premier Auto Trust 1998-1. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-1 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-MMMM Copy of Amended and Restated Trust Agreement, dated as of
February 1, 1998, among Premier Receivables L.L.C., Chrysler
Financial Corporation, and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1998-1. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-1 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-NNNN Copy of Indenture, dated as of February 1, 1998, between Premier
Auto Trust 1998-1 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1998-1. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1998-1 for the quarter ended March 31,
1998, and incorporated herein by reference.
10-OOOO Copy of Sale and Servicing Agreement, dated as of February 1,
1998, between Premier Auto Trust 1998-1 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1998-1. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-1 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-PPPP Copy of Certificate of Trust of Premier Auto Trust 1998-2. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-2 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-QQQQ Copy of Amended and Restated Trust Agreement, dated as of March
1, 1998, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1998-2. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1998-2 for
the quarter ended March 31, 1998, and incorporated herein by
reference.
10-RRRR Copy of Indenture, dated as of March 1, 1998, between Premier
Auto Trust 1998-2 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1998-2. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1998-2 for the quarter ended March 31,
1998, and incorporated herein by reference.
10-SSSS Copy of Sale and Servicing Agreement, dated as of March 1, 1998,
between Premier Auto Trust 1998-2 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1998-2. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-2 for the quarter ended March 31, 1998, and
incorporated herein by reference.
12-A Chrysler Financial Corporation and Subsidiaries Computations of
Ratios of Earnings to Fixed Charges.
12-B Chrysler Corporation and Consolidated Subsidiaries Computations
of Ratios of Earnings to Fixed Charges and Preferred Stock
Dividend Requirements.
15-A Letter regarding unaudited interim financial information.
26
<PAGE>
Chrysler Financial Corporation and Subsidiaries
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K - continued
- ------- --------------------------------------------
15-B Independent Accountants' Letter in lieu of Consent.
27 Financial Data Schedule
Copies of instruments defining the rights of holders of long-term
debt of the registrant and its consolidated subsidiaries, other
than the instruments copies of which are filed with this report
as Exhibit 4-A, 4-B, 4-C, 4-D, 4-E, 4-F, and 4-G thereto, have
not been filed as exhibits to this report since the amount of
securities authorized under any one of such instruments does not
exceed 10% of the total assets of the registrant and its
subsidiaries on a consolidated basis. The registration agrees to
furnish to the Commission a copy of each such instrument upon
request.
(b) The registrant filed the following report on Form 8-K during the
quarter ended March 31, 1998:
Date of Report Date Filed Item Reported
-------------- ---------- -------------
May 7, 1998 May 12, 1998 5
May 19, 1998 May 21, 1998 5
Financial Statements Filed
--------------------------
None
27
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28
<PAGE>
Chrysler Financial Corporation and Subsidiaries
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 thereunto duly authorized.
Chrysler Financial Corporation
------------------------------
(Registrant)
Date: July 13, 1998 By: s/T. F. Gilman
--------------
T. F. Gilman
Vice President and Controller
Principal Accounting Officer
29
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30
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX
- -------------
Exhibit No.
- -----------
3-A Copy of the Restated Articles of Incorporation of Chrysler
Financial Corporation as adopted and filed with the Corporation
Division of the Michigan Department of Treasury on October 1,
1971. Filed as Exhibit 3-A to Registration No. 2-43097 of
Chrysler Financial Corporation, and incorporated herein by
reference.
3-B Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on December 26, 1975, April 23,
1985 and June 21, 1985, respectively. Filed as Exhibit 3-B to the
Annual Report of Chrysler Financial Corporation on Form 10-K for
the year ended December 31, 1985, and incorporated herein by
reference.
3-C Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on August 12, 1987 and August
14, 1987, respectively. Filed as Exhibit 3 to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended September 30, 1987, and incorporated herein by
reference.
3-D Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on December 11, 1987 and
January 25, 1988, respectively. Filed as Exhibit 3-D to the
Annual Report of Chrysler Financial Corporation on Form 10-K for
the year ended December 31, 1987, and incorporated herein by
reference.
3-E Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on June 13, 1989 and June 23,
1989, respectively. Filed as Exhibit 3-E to the Quarterly Report
of Chrysler Financial Corporation on Form 10-Q for the quarter
ended June 30, 1989, and incorporated herein by reference.
3-F Copies of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on September 13, 1989, January
31, 1990 and March 8, 1990, respectively. Filed as Exhibit 3-E to
the Annual Report of Chrysler Financial Corporation on Form 10-K
for the year ended December 31, 1989, and incorporated herein by
reference.
3-G Copy of amendments to the Restated Articles of Incorporation of
Chrysler Financial Corporation filed with the Department of
Commerce of the State of Michigan on March 29, 1990 and May 10,
1990. Filed as Exhibit 3-G to the Quarterly Report of Chrysler
Financial Corporation on Form 10-Q for the quarter ended March
31, 1990, and incorporated herein by reference.
3-H Copy of the By-Laws of Chrysler Financial Corporation as amended
to March 2, 1987. Filed as Exhibit 3-C to the Annual Report of
Chrysler Financial Corporation on Form 10-K for the year ended
December 31, 1986, and incorporated herein by reference.
3-I Copy of the By-Laws of Chrysler Financial Corporation as amended
to August 1, 1990. Filed as Exhibit 3-I to the Quarterly Report
of Chrysler Financial Corporation on Form 10-Q for the quarter
ended September 30, 1990, and incorporated herein by reference.
E-1
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
3-J Copy of By-Laws of Chrysler Financial Corporation as amended to
January 1, 1992, and presently in effect. Filed as Exhibit 3-H to
the Annual Report of Chrysler Financial Corporation on Form 10-K
for the year ended December 31, 1991, and incorporated herein by
reference.
4-A Copy of Indenture, dated as of June 15, 1984, between Chrysler
Financial Corporation and Manufacturers Hanover Trust Company, as
Trustee, United States Trust Company of New York, as successor
Trustee, related to Senior Debt Securities of Chrysler Financial
Corporation. Filed as Exhibit (1) to the Current Report of
Chrysler Financial Corporation on Form 8-K, dated June 26, 1984,
and incorporated herein by reference.
4-B Copy of Supplemental Indenture, dated as of August 24, 1995,
between Chrysler Financial Corporation and the United States
Trust Company of New York, as Trustee, to the Indenture, dated as
of June 15, 1984, related to Senior Debt Securities of Chrysler
Financial Corporation. Filed as Exhibit 4-K to the Current Report
of Chrysler Financial Corporation on Form 8-K, dated August 24,
1995, and incorporated herein by reference.
4-C Copy of Indenture, dated as of September 15, 1986, between
Chrysler Financial Corporation and Manufacturers Hanover Trust
Company, Trustee, United States Trust Company of New York, as
successor Trustee, related to Chrysler Financial Corporation
Senior Debt Securities. Filed as Exhibit 4-E to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended September 30, 1986, and incorporated herein by
reference.
4-D Copy of Indenture, dated as of February 15, 1988, between
Chrysler Financial Corporation and Manufacturers Hanover Trust
Company, Trustee, United States Trust Company of New York, as
successor Trustee, related to Chrysler Financial Corporation
Senior Debt Securities. Filed as Exhibit 4-A to Registration No.
33-23479 of Chrysler Financial Corporation, and incorporated
herein by reference.
4-E Copy of First Supplemental Indenture, dated as of March 1, 1988,
between Chrysler Financial Corporation and Manufacturers Hanover
Trust Company, Trustee, United States Trust Company of New York,
as successor Trustee, to the Indenture, dated as of February 15,
1988, between such parties, related to Chrysler Financial
Corporation Senior Debt Securities. Filed as Exhibit 4-L to the
Annual Report of Chrysler Financial Corporation on Form 10-K for
the year ended December 31, 1987, and incorporated herein by
reference.
4-F Copy of Second Supplemental Indenture, dated as of September 7,
1990, between Chrysler Financial Corporation and Manufacturers
Hanover Trust Company, Trustee, United States Trust Company of
New York, as successor Trustee, to the Indenture, dated as of
February 15, 1988, between such parties, related to Chrysler
Financial Corporation Senior Debt Securities. Filed as Exhibit
4-M to the Quarterly Report of Chrysler Financial Corporation on
Form 10-Q for the quarter ended September 30, 1990, and
incorporated herein by reference.
4-G Copy of Third Supplemental Indenture, dated as of May 4, 1992,
between Chrysler Financial Corporation and United States Trust
Company of New York, as successor Trustee, to the Indenture,
dated as of February 15, 1988 between such parties, relating to
Chrysler Financial Corporation Senior Debt Securities. Filed as
Exhibit 4-N to the Quarterly Report of Chrysler Financial
Corporation on Form 10-Q for the quarter ended June 30, 1992, and
incorporated herein by reference.
E-2
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-A Copy of Income Maintenance Agreement, made December 20, 1968,
among Chrysler Financial Corporation, Chrysler Corporation and
Chrysler Motors Corporation. Filed as Exhibit 13-D to
Registration Statement No. 2-32037 of Chrysler Financial
Corporation, and incorporated herein by reference.
10-B Copy of Agreement, made April 19, 1971, among Chrysler Financial
Corporation, Chrysler Corporation and Chrysler Motors
Corporation, amending the Income Maintenance Agreement among such
parties. Filed as Exhibit 13-B to Registration Statement No.
2-40110 of Chrysler Financial Corporation and Chrysler
Corporation, and incorporated herein by reference.
10-C Copy of Agreement, made May 29, 1973, among Chrysler Financial
Corporation, Chrysler Corporation and Chrysler Motors
Corporation, further amending the Income Maintenance Agreement
among such parties. Filed as Exhibit 5-C to Registration
Statement No. 2-49615 of Chrysler Financial Corporation, and
incorporated herein by reference.
10-D Copy of Agreement, made as of July 1, 1975, among Chrysler
Financial Corporation, Chrysler Corporation and Chrysler Motors
Corporation, further amending the Income Maintenance Agreement
among such parties. Filed as Exhibit D to the Annual Report of
Chrysler Financial Corporation on Form 10-K for the year ended
December 31, 1975, and incorporated herein by reference.
10-E Copy of Agreement, made June 4, 1976, between Chrysler Financial
Corporation and Chrysler Corporation further amending the Income
Maintenance Agreement between such parties. Filed as Exhibit 5-H
to Registration Statement No. 2-56398 of Chrysler Financial
Corporation, and incorporated herein by reference.
10-F Copy of Agreement, made March 27, 1986, between Chrysler
Financial Corporation, Chrysler Holding Corporation (now known as
Chrysler Corporation) and Chrysler Corporation (now known as
Chrysler Motors Corporation) further amending the Income
Maintenance Agreement among such parties. Filed as Exhibit 10-F
to the Annual Report of Chrysler Financial Corporation on Form
10-K for the year ended December 31, 1986, and incorporated
herein by reference.
10-G Copy of Short Term Revolving Credit Agreement, dated as of April
21, 1998, among Chrysler Financial Corporation, Chrysler Credit
Canada Ltd., the several commercial banks party thereto, as
Managing Agents, Royal Bank of Canada, as Canadian Administrative
Agent, and Chemical Bank, as Administrative Agent.
10-H Copy of Long Term Revolving Credit Agreement, dated as of April
24, 1997, among Chrysler Financial Corporation, Chrysler Credit
Canada Ltd., the several commercial banks party thereto, as
Managing Agents, Royal Bank of Canada, as Canadian Administrative
Agent, and Chemical Bank, as Administrative Agent. Filed as
Exhibit 10-H to the Quarterly Report of Chrysler Financial
Corporation on Form 10-Q for the quarter ended June 30, 1997, and
incorporated herein by reference.
10-I Copy of Origination and Servicing Agreement, dated as of June 4,
1993, among Chrysler Leaserve, Inc., General Electric Capital
Auto Lease, Inc., Chrysler Credit Corporation and Chrysler
Financial Corporation. Filed as Exhibit 10-ZZZZ to the Quarterly
Report on Form 10-Q of Chrysler Financial Corporation for the
quarter ended September 30, 1993, and incorporated herein by
reference.
E-3
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-J Copy of Amended and Restated Trust Agreement, dated as of
September 1, 1993, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Trustee, with respect to Premier Auto Trust 1993-5. Filed as
Exhibit 4.1 to the Quarterly Report of Premier Auto Trust 1993-5
on Form 10-Q for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-K Copy of Indenture, dated as of September 1, 1993, between Premier
Auto Trust 1993-5 and Bankers Trust Company, as Indenture
Trustee, with respect to Premier Auto Trust 1993-5. Filed as
Exhibit 4.2 to the Quarterly Report of Premier Auto Trust 1993-5
on Form 10-Q for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-L Copy of Amended and Restated Trust Agreement, dated as of
November 1, 1993, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Trust 1993-6. Filed
as Exhibit 4-A to the Annual Report on Form 10-K of Premier Auto
Trust 1993-6 for the year ended December 31, 1993, and
incorporated herein by reference.
10-M Copy of Indenture, dated as of November 1, 1993, between Premier
Auto Trust 1993-6 and The Fuji Bank and Trust Company, as
Indenture Trustee, with respect to Premier Auto Trust 1993-6.
Filed as Exhibit 4-B to the Annual Report on Form 10-K of Premier
Auto Trust 1993-6 for the year ended December 31, 1993, and
incorporated herein by reference.
10-N Copy of Amended and Restated Trust Agreement, dated as of
February 1, 1994, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Trust 1994-1. Filed
as Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier
Auto Trust 1994-1 for the quarter ended March 31, 1994, and
incorporated herein by reference.
10-O Copy of Indenture, dated as of February 1, 1994, between Premier
Auto Trust 1994-1 and The Fuji Bank and Trust Company, as
Indenture Trustee, with respect to Premier Auto Trust 1994-1.
Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q of
Premier Auto Trust 1994-1 for the quarter ended March 31, 1994,
and incorporated herein by reference.
10-P Copy of Amended and Restated Master Custodial and Servicing
Agreement, dated as of December 16, 1997, between Chrysler Credit
Canada Ltd. and The Royal Trust Company, as Custodian. Filed as
Exhibit 10-CC to the Annual Report on Form 10-K of Chrysler
Financial Corporation for the year ended December 31, 1997, and
incorporated herein by reference.
10-Q Copy of Amended and Restated Series 1995-1 Supplement, dated as
of December 16, 1997, among Chrysler Credit Canada Ltd., The
Royal Trust Company, Prime Trust, Auto Receivables Corporation
and Chrysler Financial Corporation, to the Master Custodial and
Servicing Agreement, dated as of December 16, 1997. Filed as
Exhibit 10-DD to the Annual Report on Form 10-K of Chrysler
Financial Corporation for the year ended December 31, 1997, and
incorporated herein by reference.
10-R Copy of Servicing Agreement, dated as of October 20, 1992,
between Chrysler Leaserve, Inc. (a subsidiary of General Electric
Capital Auto Lease, Inc.) and Chrysler Credit Corporation, with
respect to the sale of Gold Key Leases. Filed as Exhibit 10-YYYYY
to the Registration Statement on Form S-2 of Chrysler Financial
Corporation (Registration Statement No. 33-51302) on November 24,
1992, and incorporated herein by reference.
E-4
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-S Copy of Amended and Restated Trust Agreement, dated as of August
1, 1993, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1993-4. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1993-4 for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-T Copy of Indenture, dated as of August 1, 1993, between Premier
Auto Trust 1993-4 and Bankers Trust Company, as Indenture
Trustee, with respect to Premier Auto Trust 1993-4. Filed as
Exhibit 4.2 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1993-4 for the quarter ended September 30, 1993, and
incorporated herein by reference.
10-U Copy of Amended and Restated Trust Agreement, dated as of August
1, 1994, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1994-4. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1994-4 for the quarter ended September 30, 1994, and
incorporated herein by reference.
10-V Copy of Indenture, dated as of August 1, 1994, between Premier
Auto Trust 1994-4 and Bankers Trust Company, as Indenture
Trustee. Filed as Exhibit 4.2 to the Quarterly Report on Form
10-Q of Premier Auto Trust 1994-4 for the quarter ended September
30, 1994, and incorporated herein by reference.
10-W Copy of Series 1994-1 Supplement, dated as of September 30, 1994,
among U.S. Auto Receivables Company, as Seller, Chrysler Credit
Corporation, as Servicer, and Manufacturers and Traders Trust
Company, as Trustee, with respect to CARCO Auto Loan Master
Trust, Series 1994-1. Filed as Exhibit 3 to the Registration
Statement on Form 8-A of CARCO Auto Loan Master Trust dated
November 23, 1994, and incorporated herein by reference.
10-X Copy of Series 1995-1 Supplement, dated as of December 31, 1994,
among U.S. Auto Receivables Company, as Seller, Chrysler Credit
Corporation, as Servicer, and Manufacturers and Traders Trust
Company, as Trustee, with respect to CARCO Auto Loan Master
Trust, Series 1995-1. Filed as Exhibit 3 to the Registration
Statement on Form 8-A of CARCO Auto Loan Master Trust dated
January 19, 1995, and incorporated herein by reference.
10-Y Copy of Series 1995-2 Supplement, dated as of February 28, 1995,
among U.S. Auto Receivables Company, as Seller, Chrysler Credit
Corporation, as Servicer, and Manufacturers and Traders Trust
Company, as Trustee, with respect to CARCO Auto Loan Master Trust
1995-2. Filed as Exhibit 3 to CARCO Auto Loan Master Trust's
Registration Statement on Form 8-A dated March 27, 1995, and
incorporated herein by reference.
10-Z Copy of Amended and Restated Trust Agreement, dated as of
February 1, 1995, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Trust 1995-1. Filed
as Exhibit 4.1 to the Quarterly Report on Form 10-Q for the
quarter ended March 31, 1995 of Premier Auto Trust 1995-1, and
incorporated herein by reference.
10-AA Copy of Indenture, dated as of February 1, 1995, between Premier
Auto Trust 1995-1 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1995-1. Filed as Exhibit 4.2
to the Quarterly Report on Form 10-Q for the quarter ended March
31, 1995 of Premier Auto Trust 1995-1, and incorporated herein by
reference.
E-5
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-BB Copy of Sale and Servicing Agreement, dated as of February 1,
1995, among Premier Auto Trust 1995-1, Chrysler Credit
Corporation and Chrysler Financial Corporation, with respect to
Premier Auto Trust 1995-1. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q for the quarter ended March 31, 1995 of
Premier Auto Trust 1995-1, and incorporated herein by reference.
10-CC Copy of Amended and Restated Trust Agreement, dated as of April
1, 1995, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1995-2. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995 of Premier Auto Trust 1995-2, and
incorporated herein by reference.
10-DD Copy of Indenture, dated as of April 1, 1995, between Premier
Auto Trust 1995-2 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1995-2. Filed as Exhibit 4.2
to the Quarterly report on Form 10-Q for the quarter ended June
30, 1995 of Premier Auto Trust 1995-2, and incorporated herein by
reference.
10-EE Copy of Sale and Servicing Agreement, dated as of April 1, 1995,
among Premier Auto Trust 1995-2, Chrysler Credit Corporation and
Chrysler Financial Corporation, with respect to Premier Auto
Trust 1995-2. Filed as Exhibit 4.3 to the Quarterly Report on
Form 10-Q for the quarter ended June 30, 1995 of Premier Auto
Trust 1995-2, and incorporated herein by reference.
10-FF Copy of Series 1995-4A Supplement, dated as of April 30, 1995,
among U.S. Auto Receivables Company, Chrysler Credit Corporation
and Manufacturers and Traders Trust Company, as Trustee, with
respect to CARCO Auto Loan Master Trust Series 1995-4A. Filed as
Exhibit 4-BB to the Quarterly Report on Form 10-Q for the quarter
ended June 30, 1995 of CARCO Auto Loan Master Trust, and
incorporated herein by reference.
10-GG Copy of Receivables Purchase Agreement, dated as of December 14,
1995, among Chrysler Financial Corporation, Premier Auto
Receivables Company, Chrysler Credit Corporation, and ABN AMRO
Bank N.V., as Agent, with respect to the sale of retail
automotive receivables to Windmill Funding Corporation, Series
1995-2. Filed as Exhibit 10-KKKK to the Annual Report on Form
10-K of Chrysler Financial Corporation for the year ended
December 31, 1995, and incorporated herein by reference.
10-HH Copy of Certificate of Trust of Premier Auto Trust 1995-3. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1995-3 for the quarter ended September 30, 1995, and
incorporated herein by reference.
10-II Copy of Amended and Restated Trust Agreement, dated as of July 1,
1995, among Premier Auto Receivables Company, Chrysler Financial
Corporation and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1995-3. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1995-3 for
the quarter ended September 30, 1995, and incorporated herein by
reference.
10-JJ Copy of Indenture, dated as of July 1, 1995, between Premier Auto
Trust 1995-3 and The Bank of New York, as Indenture Trustee, with
respect to Premier Auto Trust 1995-3. Filed as Exhibit 4.2 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1995-3 for
the quarter ended September 30, 1995, and incorporated herein by
reference.
E-6
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-KK Copy of Sale and Servicing Agreement, dated as of July 1, 1995,
among Premier Auto Trust 1995-3, Chrysler Credit Corporation and
Chrysler Financial Corporation, with respect to Premier Auto
Trust 1995-3. Filed as Exhibit 4.3 to the Quarterly Report on
Form 10-Q of Premier Auto Trust 1995-3 for the quarter ended
September 30, 1995, and incorporated herein by reference.
10-LL Copy of Amended and Restated Trust Agreement, dated as of
November 1, 1995, among Premier Auto Receivables Company,
Chrysler Financial Corporation and Chemical Bank Delaware, as
Owner Trustee, with respect to Premier Auto Receivables 1995-4.
Filed as Exhibit 4.1 to the Annual Report on Form 10-K of Premier
Auto Trust 1995-4 for the year ended December 31, 1995, and
incorporated herein by reference.
10-MM Copy of Certificate of Trust of Premier Auto Trust 1995-4. Filed
as Exhibit 3 to the Annual Report on Form 10-K of Premier Auto
Trust 1995-4 for the year ended December 31, 1995, and
incorporated herein by reference.
10-NN Copy of Indenture, dated as of November 1, 1995, between Premier
Auto Trust 1995-4 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1995-4. Filed as Exhibit 4.2
to the Annual Report on Form 10-K of Premier Auto Trust 1995-4
for the year ended December 31, 1995, and incorporated herein by
reference.
10-OO Copy of Sale and Servicing Agreement, dated as of November 1,
1995, among Premier Auto Trust 1995-4, Chrysler Credit
Corporation and Chrysler Financial Corporation, with respect to
Premier Auto Trust 1995-4. Filed as Exhibit 4.3 to the Annual
Report on Form 10-K of Premier Auto Trust 1995-4 for the year
ended December 31, 1995, and incorporated herein by reference.
10-PP Copy of Receivables Purchase Agreement, dated as of May 30, 1996,
among Premier Auto Receivables Company, Chrysler Financial
Corporation, and ABN AMRO Bank, N.V., as Agent, with respect to
the sale of retail automotive receivables to Windmill Funding
Corporation, Series 1996-1. Filed as Exhibit 10-OOOO to the
Quarterly Report on Form 10-Q of Chrysler Financial Corporation
for the quarter ended June 30, 1996, and incorporated herein by
reference.
10-QQ Copy of Certificate of Trust of Premier Auto Trust 1996-1. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-1 for the quarter ended March 31, 1996, and
incorporated herein by reference.
10-RR Copy of Amended and Restated Trust Agreement, dated as of March
1, 1996, among Premier Auto Receivables Company, Chrysler
Financial Corporation and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1996-1. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-1 for the quarter ended March 31, 1996, and
incorporated herein by reference.
10-SS Copy of Indenture, dated as of March 1, 1996, between Premier
Auto Trust 1996-1 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1996-1. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-1 for the quarter ended March 31,
1996, and incorporated herein by reference.
10-TT Copy of Sale and Servicing Agreement, dated as of March 1, 1996,
between Premier Auto Trust 1996-1 and Chrysler Financial
Corporation (excluding Schedules A and C), for Premier Auto Trust
1996-1. Filed as Exhibit 4.3 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-1 for the quarter ended March 31,
1996, and incorporated by reference.
E-7
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-UU Copy of Receivables Sale Agreement, dated as of June 27, 1996,
among Premier Receivables L.L.C., Chrysler Financial Corporation,
Asset Securitization Cooperative Corporation and Canadian
Imperial Bank of Commerce, as Administrative Agent. Filed as
Exhibit 10-TTTT to the Quarterly Report on Form 10-Q of Chrysler
Financial Corporation for the quarter ended June 30, 1996, and
incorporated herein by reference.
10-VV Copy of Asset Purchase Agreement, dated as of August 30, 1996,
between Chrysler First Business Credit Corporation and Berkeley
Federal Bank & Trust, F.S.B. Filed as Exhibit 10-IIII to the
Quarterly Report on Form 10-Q of Chrysler Financial Corporation
for the quarter ended September 30, 1996, and incorporated herein
by reference.
10-WW Copy of Asset Purchase Agreement, dated as of August 30, 1996,
between Chrysler First Business Credit Corporation and Blackrock
Capital Finance, L.P. Filed as Exhibit 10-JJJJ to the Quarterly
Report on Form 10-Q for the quarter ended September 30, 1996, and
incorporated herein by reference.
10-XX Copy of Certificate of Trust of Premier Auto Trust 1996-2. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-2 for the quarter ended June 30, 1996, and
incorporated herein by reference.
10-YY Copy of Amended and Restated Trust Agreement, dated as of May 1,
1996, among Premier Auto Receivables Company, Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1996-2. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1996-2 for
the quarter ended June 30, 1996, and incorporated herein by
reference.
10-ZZ Copy of Indenture, dated as of May 1, 1996, between Premier Auto
Trust 1996-2 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1996-2. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-2 for the quarter ended June 30, 1996,
and incorporated herein by reference.
10-AAA Copy of Sale and Servicing Agreement, dated as of May 1, 1996,
between Premier Auto Trust 1996-2 and Chrysler Financial
Corporation (excluding Schedules A and C), with respect to
Premier Auto Trust 1996-2. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q of Premier Auto Trust 1996-2 for the quarter
ended June 30, 1996, and incorporated herein by reference.
10-BBB Copy of Certificate of Trust of Premier Auto Trust 1996-3. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-3 for the quarter ended June 30, 1996, and
incorporated herein by reference.
10-CCC Copy of Amended and Restated Trust Agreement, dated as of June 1,
1996, among Premier Auto Receivables Company, Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1996-3. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1996-3 for
the quarter ended June 30, 1996, and incorporated herein by
reference.
10-DDD Copy of Indenture, dated as of June 1, 1996, between Premier Auto
Trust 1996-3 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1996-3. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1996-3 for the quarter ended June 30, 1996,
and incorporated herein by reference.
E-8
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-EEE Copy of Sale and Servicing Agreement, dated as of June 1, 1996,
between Premier Auto Trust 1996-3 and Chrysler Financial
Corporation (excluding Schedules A and C), with respect to
Premier Auto Trust 1996-3. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q of Premier Auto Trust 1996-3 for the quarter
ended June 30, 1996, and incorporated herein by reference.
10-FFF Copy of Receivables Sale Agreement, dated as of November 25,
1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Asset Securitization Cooperative Corporation, and
Canadian Imperial Bank of Commerce, as Administrative Agent.
Filed as Exhibit 10-OOOO to the Annual Report on Form 10-K of
Chrysler Financial Corporation for the year ended December 31,
1996, and incorporated herein by reference.
10-GGG Copy of Certificate of Trust of Premier Auto Trust 1996-4. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-4 for the quarter ended September 30, 1996, and
incorporated herein by reference. Filed as Exhibit 10-PPPP to the
Annual Report on Form 10-K of Chrysler Financial Corporation for
the year ended December 31, 1996, and incorporated herein by
reference.
10-HHH Copy of Amended and Restated Trust Agreement, dated as of August
1, 1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chase Manhattan Bank Delaware, as Owner Trustee,
with respect to Premier Auto Trust 1996-4. Filed as Exhibit 4.1
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1996-4
for the quarter ended September 30, 1996, and incorporated herein
by reference.
10-III Copy of Indenture, dated as of August 1, 1996, between Premier
Auto Trust 1996-4 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1996-4. Filed as Exhibit 4.2
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1996-4
for the quarter ended September 30, 1996, and incorporated herein
by reference
10-JJJ Copy of Sale and Servicing Agreement, dated as of August 1, 1996,
between Premier Auto Trust 1996-4 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1996-4. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1996-4 for the quarter ended September 30, 1996, and
incorporated herein by reference.
10-KKK Copy of Receivables Sale Agreement, dated as of December 12,
1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Monte Rosa Capital Corporation, and Union Bank of
Switzerland, New York Branch, as Administrative Agent. Filed as
Exhibit 10-TTTT to the Annual Report on Form 10-K of Chrysler
Financial Corporation for the year ended December 31, 1996, and
incorporated herein by reference.
10-LLL Copy of Receivables Sale Agreement, dated as of December 12,
1996, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Old Line Funding Corp., and Royal Bank of Canada, as
Agent. Filed as Exhibit 10-UUUU to the Annual Report on Form 10-K
of Chrysler Financial Corporation for the year ended December 31,
1996, and incorporated herein by reference.
10-MMM Copy of Amended and Restated Receivables Sale Agreement, dated as
of December 18, 1996, among Chrysler Credit Canada Ltd., Chrysler
Financial Corporation, Canadian Master Trust, and Nesbitt Burns,
Inc. Filed as Exhibit 10-GGGG to the Annual Report on Form 10-K
of Chrysler Financial Corporation for the year ended December 31,
1997, and incorporated herein by reference.
E-9
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-NNN Copy of Loan Agreement, dated as of August 1, 1996, between
Chrysler Canada Ltd. and Chrysler Credit Canada Ltd., with
respect to Gold Key Leasing. Filed as Exhibit 10-WWWW to the
Annual Report on Form 10-K of Chrysler Financial Corporation for
the year ended December 31, 1996, and incorporated herein by
reference.
10-OOO Copy of Series 1996-1 Supplement, dated as of September 30, 1996,
among U.S. Auto Receivables Company, as Seller, Chrysler
Financial Corporation, as Servicer, and The Bank of New York, as
Trustee, with respect to CARCO Auto Loan Master Trust. Filed as
Exhibit 4-EE to the Annual Report on Form 10-K of CARCO Auto Loan
Master Trust for the year ended December 31, 1996, and
incorporated herein by reference.
10-PPP Copy of Series 1996-2 Supplement, dated as of November 30, 1996,
among U.S. Auto Receivables Company, as Seller, Chrysler
Financial Corporation, as Servicer, and The Bank of New York, as
Trustee, with respect to CARCO Auto Loan Master Trust. Filed as
Exhibit 4-FF to the Annual Report on Form 10-K of CARCO Auto Loan
Master Trust for the year ended December 31, 1996, and
incorporated herein by reference.
10-QQQ Copy of Certificate of Trust of Premier Auto Trust 1997-1. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-1 for the quarter ended March 31, 1997, and
incorporated herein by reference.
10-RRR Copy of Amended and Restated Trust Agreement, dated as of March
1, 1997, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chase Manhattan Bank Delaware, as Owner Trustee,
with respect to Premier Auto Trust 1997-1. Filed as Exhibit 4.1
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1997-1
for the quarter ended March 31, 1997, and incorporated herein by
reference.
10-SSS Copy of Indenture, dated as of March 1, 1997, between Premier
Auto Trust 1997-1 and The Bank of New York, as Indenture Trustee,
with respect to Premier Auto Trust 1997-1. Filed as Exhibit 4.2
to the Quarterly Report on Form 10-Q of Premier Auto Trust 1997-1
for the quarter ended March 31, 1997, and incorporated herein by
reference.
10-TTT Copy of Sale and Servicing Agreement, dated as of March 1, 1997,
between Premier Auto Trust 1997-1 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1997-1. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-1 for the quarter ended March 31, 1997, and
incorporated herein by reference.
10-UUU Copy of Receivables Sale Agreement, dated as of April 29, 1997,
among Premier Receivables L.L.C., Chrysler Financial Corporation,
Windmill Funding Corporation, and ABN AMRO Bank N.V., as
Administrative Agent. Filed as Exhibit 10-SSSS to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended June 30, 1997, and incorporated herein by
reference.
10-VVV Copy of Receivables Sale Agreement, dated as of June 16, 1997,
among Premier Receivables L.L.C., Chrysler Financial Corporation,
Park Avenue Receivables Corporation, and the Chase Manhattan
Bank, as Funding Agent. Filed as Exhibit 10-TTTT to the Quarterly
Report of Chrysler Financial Corporation on Form 10-Q for the
quarter ended June 30, 1997, and incorporated herein by
reference.
E-10
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-WWW Copy of Receivables Sale Agreement, dated as of September 29,
1997, among Premier Receivables L.L.C., Chrysler Financial
Corporation, Thunder Bay Funding Inc., and Royal Bank of Canada,
as Agent. Filed as Exhibit 10-UUUU to the Quarterly Report of
Chrysler Financial Corporation on Form 10-Q for the quarter ended
September 30, 1997, and incorporated herein by reference.
10-XXX Copy of Certificate of Trust of Premier Auto Trust 1997-2. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-2 for the quarter ended September 30, 1997, and
incorporated herein by reference.
10-YYY Copy of Amended and Restated Trust Agreement, dated as of August
1, 1997, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1997-2. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1997-2 for
the quarter ended September 30, 1997, and incorporated herein by
reference.
10-ZZZ Copy of Indenture, dated as of August 1, 1997, between Premier
Auto Trust 1997-2 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1997-2. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1997-2 for the quarter ended September 30,
1997, and incorporated herein by reference.
10-AAAA Copy of Sale and Servicing Agreement, dated as of August 1, 1997,
between Premier Auto Trust 1997-2 and Chrysler Financial
Corporation (excluding Schedules A and C), with respect to
Premier Auto Trust 1997-2. Filed as Exhibit 4.3 to the Quarterly
Report on Form 10-Q of Premier Auto Trust 1997-2 for the quarter
ended September 30, 1997, and incorporated herein by reference.
10-BBBB Copy of Certificate of Trust of Premier Auto Trust 1997-3. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-3 for the quarter ended September 30, 1997, and
incorporated herein by reference.
10-CCCC Copy of Amended and Restated Trust Agreement, dated as of
September 1, 1997, among Premier Receivables L.L.C., Chrysler
Financial Corporation, and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1997-3. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-3 for the quarter ended September 30, 1997, and
incorporated herein by reference.
10-DDDD Copy of Indenture, dated as of September 1, 1997, between Premier
Auto Trust 1997-3 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1997-3. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1997-3 for the quarter ended September 30,
1997, and incorporated herein by reference.
10-EEEE Copy of Sale and Servicing Agreement, dated as of September 1,
1997, between Premier Auto Trust 1997-3 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1997-3. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1997-3 for the quarter ended September 30, 1997, and
incorporated herein by reference.
E-11
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-FFFF Copy of Receivables Sale Agreement, dated as of November 6, 1997,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Preferred Receivables Funding
Corporation, as a Purchaser, Falcon Asset Securitization
Corporation, as a Purchaser and the First National Bank of
Chicago, as Administrative Agent. Filed as Exhibit 10-ZZZZ to the
Annual Report on Form 10-K of Chrysler Financial Corporation for
the year ended December 31, 1997, and incorporated herein by
reference.
10-GGGG Copy of Receivables Sale Agreement, dated as of November 20,
1997, among Premier Receivables L.L.C., as Seller, Chrysler
Financial Corporation, as Servicer, Receivables Capital
Corporation, as Purchaser and Bank of America National Trust and
Savings Association, as Administrative Agent. Filed as Exhibit
10-AAAAA to the Annual Report on Form 10-K of Chrysler Financial
Corporation for the year ended December 31, 1997, and
incorporated herein by reference.
10-HHHH Copy of Receivables Sale Agreement, dated as of December 3, 1997,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Old Line Funding Company, as Purchaser
and Royal Bank of Canada, as Agent. Filed as Exhibit 10-BBBBB to
the Annual Report on Form 10-K of Chrysler Financial Corporation
for the year ended December 31, 1997, and incorporated herein by
reference.
10-IIII Copy of Receivables Sale Agreement, dated as of December 22,
1997, among Premier Receivables L.L.C., as Seller, Chrysler
Financial Corporation, as Servicer, Windmill Funding Corporation,
as Purchaser and ABN AMRO Bank N.V., as Administrative Agent.
Filed as Exhibit 10-CCCCC to the Annual Report on Form 10-K of
Chrysler Financial Corporation for the year ended December 31,
1997, and incorporated herein by reference.
10-JJJJ Copy of Receivables Sale Agreement, dated as of June 22, 1998,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Preferred Receivables Funding
Corporation, as Purchaser, and the First National Bank of
Chicago, as Administrative Agent.
10-KKKK Copy of Receivables Sale Agreement, dated as of June 29, 1998,
among Premier Receivables L.L.C., as Seller, Chrysler Financial
Corporation, as Servicer, Old Line Funding Company, as Purchaser,
and Royal Bank of Canada, as Agent.
10-LLLL Copy of Certificate of Trust of Premier Auto Trust 1998-1. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-1 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-MMMM Copy of Amended and Restated Trust Agreement, dated as of
February 1, 1998, among Premier Receivables L.L.C., Chrysler
Financial Corporation, and Chemical Bank Delaware, as Owner
Trustee, with respect to Premier Auto Trust 1998-1. Filed as
Exhibit 4.1 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-1 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-NNNN Copy of Indenture, dated as of February 1, 1998, between Premier
Auto Trust 1998-1 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1998-1. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1998-1 for the quarter ended March 31,
1998, and incorporated herein by reference.
E-12
<PAGE>
Chrysler Financial Corporation and Subsidiaries
EXHIBIT INDEX- continued
- ------------------------
10-OOOO Copy of Sale and Servicing Agreement, dated as of February 1,
1998, between Premier Auto Trust 1998-1 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1998-1. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-1 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-PPPP Copy of Certificate of Trust of Premier Auto Trust 1998-2. Filed
as Exhibit 3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-2 for the quarter ended March 31, 1998, and
incorporated herein by reference.
10-QQQQ Copy of Amended and Restated Trust Agreement, dated as of March
1, 1998, among Premier Receivables L.L.C., Chrysler Financial
Corporation, and Chemical Bank Delaware, as Owner Trustee, with
respect to Premier Auto Trust 1998-2. Filed as Exhibit 4.1 to the
Quarterly Report on Form 10-Q of Premier Auto Trust 1998-2 for
the quarter ended March 31, 1998, and incorporated herein by
reference.
10-RRRR Copy of Indenture, dated as of March 1, 1998, between Premier
Auto Trust 1998-2 and The Bank of New York, as Indenture Trustee
(excluding Schedule A), with respect to Premier Auto Trust
1998-2. Filed as Exhibit 4.2 to the Quarterly Report on Form 10-Q
of Premier Auto Trust 1998-2 for the quarter ended March 31,
1998, and incorporated herein by reference.
10-SSSS Copy of Sale and Servicing Agreement, dated as of March 1, 1998,
between Premier Auto Trust 1998-2 and Chrysler Financial
Corporation, with respect to Premier Auto Trust 1998-2. Filed as
Exhibit 4.3 to the Quarterly Report on Form 10-Q of Premier Auto
Trust 1998-2 for the quarter ended March 31, 1998, and
incorporated herein by reference.
12-A Chrysler Financial Corporation and Subsidiaries Computations of
Ratios of Earnings to Fixed Charges.
12-B Chrysler Corporation and Consolidated Subsidiaries Computations
of Ratios of Earnings to Fixed Charges and Preferred Stock
Dividend Requirements.
15-A Letter regarding unaudited interim financial information.
15-B Independent Accountants' Letter in lieu of Consent.
27 Financial Data Schedule.
E-13
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK
Exhibit 10-G
CONFORMED COPY
================================================================
$2,000,000,000
SHORT TERM REVOLVING CREDIT AGREEMENT
Dated as of April 21, 1998
CHRYSLER FINANCIAL CORPORATION and
CHRYSLER CREDIT CANADA LTD.,
as BORROWERS
ABN AMRO BANK, N.V.,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
THE BANK OF NEW YORK, THE BANK OF NOVA SCOTIA,
BANQUE NATIONALE DE PARIS, CANADIAN IMPERIAL BANK OF COMMERCE,
CREDIT SUISSE FIRST BOSTON, FIRST CHICAGO NBD CORPORATION,
THE LONG TERM CREDIT BANK OF JAPAN, LIMITED,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK, NATIONSBANK, N.A.,
SOCIETE GENERALE, CHICAGO BRANCH and THE TORONTO DOMINION BANK,
as MANAGING AGENTS
ROYAL BANK OF CANADA,
as CANADIAN ADMINISTRATIVE AGENT
THE CHASE MANHATTAN BANK,
as ADMINISTRATIVE AGENT
================================================================
<PAGE>
TABLE OF CONTENTS
Page
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SECTION 1. DEFINITIONS......................................... 1
1.1 Defined Terms......................................... 1
1.2 Other Definitional Provisions......................... 17
SECTION 2. THE U.S. COMMITMENTS................................ 17
2.1 The U.S. Commitments.................................. 17
2.2 Procedure for Borrowing............................... 17
2.3 Conversion and Continuation Options................... 18
2.4 Minimum Amount of Eurodollar Tranches................. 18
2.5 Certain Matters Relating to Eurodollar Loans ......... 18
SECTION 3. THE CANADIAN COMMITMENTS............................ 20
3.1 The Canadian Commitments.............................. 20
3.2 Procedure for C$ R/C Loan Borrowing................... 20
3.3 Bankers' Acceptances.................................. 20
3.4 Conversion Option..................................... 23
3.5 Currency Fluctuations, etc............................ 24
SECTION 4. GENERAL PROVISIONS.................................. 24
4.1 Evidence of Debt...................................... 24
4.2 Repayment of Loans.................................... 25
4.3 Interest Rate and Payment Dates....................... 25
4.4 Lending Procedures.................................... 26
4.5 Facility Fees......................................... 26
4.6 Termination or Reduction of Commitments............... 27
4.7 Optional Prepayments.................................. 27
4.8 Pro Rata Treatment and Payments....................... 27
4.9 Computation of Interest and Fees...................... 28
4.10 Increased Costs...................................... 29
4.11 Changes in Capital Requirements...................... 29
4.12 Indemnity............................................ 31
4.13 Taxes................................................ 31
4.14 Use of Proceeds...................................... 33
4.15 Replacement of Banks................................. 33
SECTION 5. REPRESENTATIONS AND WARRANTIES...................... 33
5.1 Financial Condition................................... 33
5.2 No Change............................................. 34
5.3 Corporate Existence................................... 34
5.4 Corporate Authorization; No Violation................. 34
5.5 Government Authorization.............................. 34
5.6 Federal Regulations................................... 34
5.7 Enforceable Obligations............................... 34
5.8 No Material Litigation................................ 35
5.9 ERISA................................................. 35
5.10 Investment Company Act; Other Regulations............ 35
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5.11 Existing Financial Covenants......................... 35
SECTION 6. CONDITIONS PRECEDENT................................ 35
6.1 Conditions to Effectiveness........................... 35
6.2 Conditions to Each Loan............................... 37
SECTION 7. AFFIRMATIVE COVENANTS............................... 37
7.1 Financial Statements, etc............................. 37
7.2 Maintenance of Existence.............................. 38
7.3 Notices............................................... 38
SECTION 8. NEGATIVE COVENANTS.................................. 39
8.1 Debt to Equity Ratio.................................. 39
8.2 Limitation on Fundamental Change...................... 39
8.3 Limitation on Liens................................... 39
8.4 Additional Covenants.................................. 41
SECTION 9. EVENTS OF DEFAULT................................... 42
SECTION 10. THE AGENTS......................................... 44
10.1 Appointment.......................................... 44
10.2 Delegation of Duties................................. 44
10.3 Exculpatory Provisions............................... 44
10.4 Reliance by Agents and CASG.......................... 45
10.5 Notice of Default.................................... 45
10.6 Non-Reliance on Agents, Other Banks and CASG......... 45
10.7 Indemnification...................................... 46
10.8 Agents in their Individual Capacity.................. 46
10.9 Successor Agents..................................... 46
10.10 The Managing Agents................................. 47
SECTION 11. GUARANTEE.......................................... 47
11.1 Guarantee............................................ 47
11.2 No Subrogation, Contribution, Reimbursement or
Indemnity 47
11.3 Amendments, etc. with respect to the CCCL Obligations 48
11.4 Guarantee Absolute and Unconditional................. 48
11.5 Reinstatement........................................ 49
11.6 Payments............................................. 49
11.7 Judgments Relating to Guarantee...................... 49
11.8 Independent Obligations.............................. 50
SECTION 12. MISCELLANEOUS...................................... 50
12.1 Amendments and Waivers............................... 50
12.2 Notices.............................................. 51
12.3 Clearing Accounts.................................... 52
12.4 No Waiver; Cumulative Remedies....................... 52
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12.5 Survival of Representations and Warranties........... 52
12.6 Payment of Expenses.................................. 52
12.7 Successors and Assigns............................... 53
12.8 Right of Set-off..................................... 54
12.9 Adjustments.......................................... 55
12.10 New Banks; Commitment Increases; Commitment
Reallocations....................................... 55
12.11 Tax Forms........................................... 56
12.12 Counterparts........................................ 57
12.13 Governing Law....................................... 57
12.14 Submission to Jurisdiction; Waivers................. 57
12.15 Integration......................................... 57
12.16 Judgments Relating to CCCL.......................... 57
12.17 WAIVERS OF JURY TRIAL............................... 58
SCHEDULES
---------
SCHEDULE I Commitments
SCHEDULE II Existing Financial Covenants
EXHIBITS
--------
EXHIBIT A Addendum
EXHIBIT B Closing Certificate
EXHIBIT C-1 Opinion of Simpson Thacher & Bartlett
EXHIBIT C-2 Opinion of General Counsel of CFC
EXHIBIT C-3 Opinion of Canadian Counsel to CCCL
EXHIBIT D-1 Assignment and Acceptance
EXHIBIT D-2 New Bank Supplement
EXHIBIT D-3 Commitment Increase Supplement
EXHIBIT D-4 Commitment Reallocation Supplement
EXHIBIT E Promissory Note
<PAGE>
SHORT TERM REVOLVING CREDIT AGREEMENT dated as of April 21, 1998
among CHRYSLER FINANCIAL CORPORATION, a Michigan corporation ("CFC"),
CHRYSLER CREDIT CANADA LTD. ("CCCL"), a Canadian corporation, the several
commercial banks from time to time parties to this Agreement (as more
specifically defined below, the "Banks"), ABN AMRO BANK, N.V., BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, THE BANK OF NEW YORK, THE
BANK OF NOVA SCOTIA, BANQUE NATIONALE DE PARIS, CANADIAN IMPERIAL BANK OF
COMMERCE, CREDIT SUISSE FIRST BOSTON, FIRST CHICAGO NBD CORPORATION, THE LONG
TERM CREDIT BANK OF JAPAN, LIMITED, MORGAN GUARANTY TRUST COMPANY OF NEW
YORK, NATIONSBANK, N.A., SOCIETE GENERALE, CHICAGO BRANCH and THE TORONTO
DOMINION BANK, as Managing Agents (in such capacity, the "Managing Agents"),
ROYAL BANK OF CANADA, a Canadian chartered bank ("Royal"), as Canadian
administrative agent for the C$ Banks (as defined below) hereunder, and THE
CHASE MANHATTAN BANK, a New York banking corporation ("Chase"), as
administrative agent for the Banks hereunder.
The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the terms defined in
the caption to this Agreement shall have the meanings set forth therein, and
the following terms have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Acceptance Fee": the fee payable in C$ to each C$ Bank
in respect of Bankers' Acceptances computed in accordance with
Section 3.3.
"Accumulated Funding Deficiency": any "accumulated
funding deficiency" as defined in Section 302 of ERISA.
"ACH": an Automated Clearing House.
"Addendum": an instrument, substantially in the form of
Exhibit A, by which a Bank becomes a party to this Agreement.
"Administrative Agent": The Chase Manhattan Bank and its
affiliates, in their respective capacities as administrative
agent for the Banks under this Agreement and arranger of the
Commitments, together with any of their respective successors.
"Affected Bank": as defined in Section 2.5(b).
"Agents": the collective reference to the Administrative
Agent and the Canadian Administrative Agent.
"Aggregate Canadian Extensions of Credit": with respect
to any C$ Bank, at any time, the aggregate principal amount of
all C$ Loans (US$ Equivalent) made by such Bank then outstanding.
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2
"Aggregate U.S. Extensions of Credit": with respect to
any US$ Bank, at any time, the aggregate principal amount of
all U.S. R/C Loans made by such Bank then outstanding.
"Agreement": this Short Term Revolving Credit Agreement,
as the same may be amended, modified or supplemented from time
to time.
"Applicable BA Discount Rate":
(a) with respect to any Schedule I C$ Bank, as applicable to a
Bankers' Acceptance being purchased by such Schedule I C$ Bank on any
day, the average (as determined by the Canadian Administrative Agent) of
the respective percentage discount rates (expressed to two decimal
places and rounded upward, if necessary, to the nearest 1/100th of 1%)
quoted to the Canadian Administrative Agent by each Schedule I C$
Reference Bank as the percentage discount rate at which such Schedule I
C$ Reference Bank would, in accordance with its normal practices, at or
about 10:00 A.M., Toronto time, on such day, be prepared to purchase
bankers' acceptances accepted by such Schedule I Reference C$ Bank
having a maturity date comparable to the maturity date of such Bankers'
Acceptance; and
(b) with respect to any Schedule II C$ Bank, as applicable to a
Bankers' Acceptance being purchased by such Schedule II C$ Bank on any
day, the average (as determined by the Canadian Administrative Agent) of
the respective percentage discount rates (expressed to two decimal
places and rounded upward, if necessary, to the nearest 1/100th of 1%)
quoted to the Canadian Administrative Agent by each Schedule II C$
Reference Bank as the percentage discount rate at which such Schedule II
C$ Reference Bank would, in accordance with its normal practices, at or
about 10:00 A.M., Toronto time, on such day, be prepared to purchase
bankers' acceptances accepted by such Schedule II Reference C$ Bank
having a maturity date comparable to the maturity date of such Bankers'
Acceptance.
"Applicable Margin": with respect to each Eurodollar Loan or
Bankers' Acceptance at any date, the applicable percentage per annum set
forth below based upon the Status and U.S. Utilization or Canadian
Utilization, as applicable, on such date (provided that if the
Commitments have been terminated prior to such date, the U.S.
Utilization and Canadian Utilization for such date shall be deemed to be
greater than 50%):
<TABLE>
<CAPTION>
Level I Level II Level III Level IV Level V
U.S./Canadian Status Status Status Status Status
- ------------- ------- -------- --------- -------- -------
<S> <C> <C> <C> <C> <C>
Less than or equal
to 50%: 0.1500% 0.1700% 0.2450% 0.3000% 0.4750%
Greater than 50%: 0.2750% 0.2950% 0.3700% 0.4250% 0.6000%
</TABLE>
"Assessment Rate": for any date the annual rate (rounded upwards,
if necessary, to the next 1/100 of 1%) most recently estimated by the
Administrative Agent as the then current net annual assessment rate that
will be employed in determining amounts payable by Chase to the Federal
Deposit Insurance Corporation (or any successor) for insurance by such
Corporation (or any successor) of time deposits made in Dollars at
Chase's domestic offices.
<PAGE>
3
"Available Canadian Commitment": as to any C$ Bank, at a particular
time, an amount equal to the excess, if any, of (a) the amount of such
Bank's Canadian Commitment at such time over (b) the Aggregate Canadian
Extensions of Credit of such Bank at such time.
"Available U.S. Commitment": as to any US$ Bank, at a particular
time, an amount equal to the excess, if any, of (a) the amount of such
Bank's U.S. Commitment at such time over (b) the Aggregate U.S.
Extensions of Credit of such Bank at such time.
"BA Discount Proceeds": in respect of any Bankers' Acceptance to be
purchased by a C$ Bank on any day under Section 3.3, an amount (rounded
to the nearest whole Canadian cent, and with one-half of one Canadian
cent being rounded up) calculated on such day by dividing:
(A) the face amount of such Bankers' Acceptance; by
(B) the sum of one plus the product of:
(i) the Applicable BA Discount Rate (expressed as a
decimal) applicable to such Bankers' Acceptance; and
(ii) a fraction, the numerator of which is the number of
days remaining in the term of such Bankers' Acceptance
and the denominator of which is 365;
with such product being rounded up or down to the
fifth decimal place and .000005 being rounded up.
"Bankers' Acceptance": a bill of exchange denominated in C$ drawn
by CCCL and accepted by a C$ Bank pursuant to Section 3.3.
"Banking Day": in respect of any city, any day on which commercial
banks are open for business (including dealings in foreign exchange and
foreign currency deposits) in that city.
"Bank Rate": the upper limit of the Bank of Canada operating band
for overnight loans as announced from time to time.
"Banks": as defined in the caption to this Agreement; provided,
that each reference herein to any Bank shall be deemed to be a reference
to each US$ Bank and to each C$ Bank unless the context otherwise
requires (in which case such reference shall be deemed to be a reference
only to each US$ Bank or to each C$ Bank, as applicable).
"Base Rate": for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/100th of 1%) equal to the greatest of (a) the
Prime Rate in effect on such day, (b) the Base CD Rate in effect on such
day plus 1% and (c) the Effective Federal Funds Rate in effect on such
day plus 1/2 of 1%. For purposes hereof, "Prime Rate" shall mean the
rate of interest per annum publicly announced from time to time by Chase
as its prime rate in effect at its principal office in New York City;
each change in the Prime Rate shall be effective on the date such change
is publicly announced; "Base CD Rate" shall mean the sum of (a) the
product of (i) the Three-Month Secondary CD Rate and (ii) Statutory
Reserves and (b) the Assessment Rate; and "Three-Month Secondary CD
Rate" shall mean, for any day, the secondary market rate for three-
<PAGE>
4
month certificates of deposit reported as being in effect on such day
(or, if such day shall not be a Business Day, the next preceding
Business Day) by the Federal Reserve Board through the public
information telephone line of the Federal Reserve Bank of New York
(which rate will, under the current practices of the Federal Reserve
Board, be published in Federal Reserve Statistical Release H.15(519)
during the week following such day), or, if such rate shall not be so
reported for such day or such next preceding Business Day, the average
of the secondary market quotations for three-month certificates of
deposit of major money center banks in New York City received at
approximately 10:00 A.M., New York City time, on such day (or, if such
day shall not be a Business Day, on the next preceding Business Day) by
the Administrative Agent from three New York City negotiable certificate
of deposit dealers of recognized standing selected by it. If for any
reason the Administrative Agent shall have determined (which
determination shall be conclusive absent clearly demonstrable error)
that it is unable to ascertain the Base CD Rate or the Effective Federal
Funds Rate or both for any reason, including the inability or failure of
the Administrative Agent to obtain sufficient quotations in accordance
with the terms thereof, the Base Rate shall be determined without regard
to clause (b) or (c), or both, of the first sentence of this definition,
as appropriate, until the circumstances giving rise to such inability no
longer exist. Any change in the Base Rate due to a change in the Prime
Rate, the Three-Month Secondary CD Rate or the Effective Federal Funds
Rate shall be effective on the effective date of such change in the
Prime Rate, the Three-Month Secondary CD Rate or the Effective Federal
Funds Rate, respectively.
"Base Rate Loans": U.S. R/C Loans at such time as they bear
interest at a rate based upon the Base Rate.
"Borrowing Date": any Business Day prior to the Termination Date
specified in a notice pursuant to Section 2.2, 3.2 or 3.3 as a date on
which a Facility Borrower requests Loans to be made hereunder.
"Business Day": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by
law to close, except that, (a) when used in connection with a Eurodollar
Loan with respect to which the Eurodollar Rate is determined based upon
the Telerate screen in accordance with the definition of Eurodollar
Rate, "Business Day" shall mean any Business Day on which dealings in
foreign currencies and exchange between banks may be carried on in
London, England and New York, New York and (b) when used in connection
with a C$ Loan, "Business Day" shall mean a day on which banks are open
for business in Toronto, Ontario, Canada but excludes Saturday, Sunday
and any other day which is a legal holiday in Toronto, Ontario, Canada.
"C$ Bank": each Bank designated as a "C$ Bank" on Schedule I, as
such Schedule may be modified from time to time pursuant to Section 12.7
or 12.10.
"C$ Commitment Percentage": as to any C$ Bank at any time, the
percentage of the aggregate Canadian Commitments then constituted by
such Bank's Canadian Commitment.
"C$ Loans": the collective reference to C$ R/C Loans and Bankers'
Acceptances. For the purposes of this Agreement, the principal amount of
any C$ Loan constituting a Bankers' Acceptance shall be deemed to be the
face amount of such Bankers' Acceptance.
<PAGE>
5
"C$ Prime Loans": C$ Loans at such time as they bear interest at a
rate based upon the Canadian Prime Rate.
"C$ R/C Loans": as defined in Section 3.1.
"Canadian Administrative Agent": Royal, in its capacity as Canadian
administrative agent for the C$ Banks under this Agreement, together
with any of its successors.
"Canadian Calculation Date": the Business Day immediately preceding
the Effective Date and the last Business Day of each calendar month.
"Canadian Commitment": as to any C$ Bank, its obligation to make C$
R/C Loans and purchase Bankers' Acceptances to or from CCCL hereunder in
an aggregate principal amount (US$ Equivalent) at any one time
outstanding not to exceed the amount (expressed in Dollars) set forth
opposite such Bank's name on Schedule I, as such amount may be changed
from time to time as provided herein.
"Canadian Dollars" or "C$": lawful currency of Canada.
"Canadian Exchange Rate": on a particular date, the rate at which
C$ may be exchanged into Dollars, determined by reference to the Bank of
Canada noon rate as published on the Reuters Screen page BOFC. In the
event that such rate does not appear on such Reuters page, the "Canadian
Exchange Rate" shall be determined by reference to any other means (as
selected by the Canadian Administrative Agent) by which such rate is
quoted or published from time to time by the Bank of Canada; provided,
that if at the time of any such determination, for any reason, no such
exchange rate is being quoted or published, the Canadian Administrative
Agent may use any reasonable method as it deems applicable to determine
such rate, and such determination shall be conclusive absent manifest
error.
"Canadian Facility Fee": as defined in Section 4.5(b).
"Canadian Prime Rate": with respect to a C$ Prime Loan, on any day,
the greater of (a) the annual rate of interest announced from time to
time by Royal as its reference rate then in effect for determining
interest rates on C$ denominated commercial loans in Canada and (b) the
annual rate of interest equal to the sum of (i) the CDOR Rate and (ii)
0.75% per annum.
"Canadian Register": as defined in Section 12.7(c).
"Canadian Reset Date" as defined in Section 3.5(a).
"Canadian Utilization": with respect to any Utilization Period, the
percentage equivalent of a fraction (a) the numerator of which is the
average daily principal amount of C$ Loans (US$ Equivalent) outstanding
during such Utilization Period and (b) the denominator of which is the
average daily amount of the aggregate Canadian Commitments of all C$
Banks during such Utilization Period.
"Capital Stock": any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests
<PAGE>
6
in a Person (other than a corporation) and any and all warrants or
options to purchase any of the foregoing.
"CASG": The Chase Manhattan Bank Loan and Agency Services Group
(and any successor).
"CCCL Obligations": the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of
the C$ Loans and interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to CCCL, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) the
C$ Loans and all other obligations and liabilities of CCCL to any Agent
or to any Bank, whether direct or indirect, absolute or contingent, due
or to become due, or now existing or hereafter incurred, which may arise
under, out of, or in connection with, this Agreement or any other
document made, delivered or given in connection herewith or therewith,
whether on account of principal, interest, reimbursement obligations,
fees, indemnities, costs, expenses (including, without limitation, all
fees, charges and disbursements of counsel to any Agent or to any Bank
that are required to be paid by CCCL pursuant to this Agreement) or
otherwise.
"CDOR Rate": on any day, the annual rate of interest which is the
rate based on an average 30 day rate applicable to C$ bankers'
acceptances appearing on the "Reuters Screen CDOR Page" (as defined in
the 1991 Definitions published by the International Swaps and
Derivatives Association, Inc., as modified and amended from time to
time) as of 10:00 A.M., Toronto time, on such day, or if such day is not
a Business Day, then on the immediately preceding Business Day;
provided, however, if such rate does not appear on the Reuters Screen
CDOR Page as contemplated, then the CDOR Rate on any day shall be
calculated as the arithmetic mean of the 30 day rates applicable to C$
bankers' acceptances quoted by the Schedule I C$ Reference Banks as of
10:00 A.M., Toronto time, on such day, or if such day is not a Business
Day, then on the immediately preceding Business Day. If less than all of
the Schedule I C$ Reference Banks quote the aforementioned rate on the
days and at the times described above, the "CDOR Rate" shall be such
other rate or rates as the Canadian Administrative Agent and CCCL may
agree.
"CFC Affiliate": any Person that, directly or indirectly, controls
or is controlled by or is under common control with CFC (including,
without limitation, Chrysler and its subsidiaries, but excluding any
Subsidiary). For the purposes of this definition, "control" (including,
with correlative meanings, the terms "controlled by" and "under common
control with"), as used with respect to any Person, shall mean the
power, directly or indirectly, either to (a) vote 20% or more of the
securities (or other equity interests) of such Person having ordinary
voting power or (b) direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting
securities (or other equity interests) or by contract or otherwise.
"Change of Control": any of the following events or circumstances:
(a) any Person or "group" (within the meaning of Section 13(d) or 14(d)
of the Securities Exchange Act of 1934, as amended) shall either (i)
acquire beneficial ownership of more than 50% of any outstanding class
of common stock of Chrysler having ordinary voting power in the election
of directors of Chrysler or (ii) obtain the power (whether or not
exercised) to elect a majority of Chrysler's directors or (b) the Board
of Directors of Chrysler shall not consist of a majority of Continuing
Directors. As used in this definition, "Continuing Directors" shall mean
the directors of
<PAGE>
7
Chrysler on the Effective Date and each other director of Chrysler, if
such other director's nomination for election to the Board of Directors
of Chrysler is recommended by a majority of the then Continuing
Directors.
"Chartered Bank": a bank named on Schedule I or Schedule II to the
Bank Act (Canada).
"Chrysler": Chrysler Corporation, a Delaware corporation.
"Clearing Account": as to any US$ Bank, the bank account designated
in its Addendum, or such other bank account as such Bank shall designate
in writing to the Administrative Agent from time to time, provided that
such other bank account shall be maintained at the office of an ACH
member.
"Code": the Internal Revenue Code of 1986, as amended from time to
time.
"Commercial Bank": (a) with respect to the U.S. Commitments and the
U.S. R/C Loans thereunder, any Person (i) licensed to engage in
commercial banking business and (ii) which on the date it becomes a Bank
(or purchases a participation) hereunder (x) is entitled to receive
payments under this Agreement without deduction or withholding of any
United States federal income taxes and (y) is entitled to an exemption
from, or is not subject to, United States backup withholding tax and (b)
with respect to the Canadian Commitments and the C$ Loans thereunder,
any Chartered Bank which (except in the case of participations) has a
Related US$ Bank.
"Commitment": with respect to any Bank, the sum of such Bank's U.S.
Commitment and Canadian Commitment.
"Commitment Percentage": as to any Bank at any time, the percentage
of the aggregate Commitments then constituted by such Bank's Commitment.
"Commitment Period": as to the Commitment of any Bank, the period
from and including the Effective Date (or, in the case of an assignee
that is not already a Bank and any New Bank, from the date that such
Person becomes party to this Agreement as provided in Section 12.7 or
12.10, as applicable) to but not including the Termination Date or such
earlier date as the Commitments shall terminate as provided herein.
"Commonly Controlled Entity": an entity, whether or not
incorporated, which is under common control with CFC within the meaning
of Section 4001 of ERISA or is part of a group which includes CFC and is
treated as a single employer under Section 414 of the Code.
"Contractual Obligation": as to any Person, any enforceable
provision of any security issued by such Person or of any agreement,
instrument or undertaking to which such Person is a party or by which it
or any of its property is bound.
"D&P": Duff & Phelps Credit Rating Company and its successors.
"Debt": at any date, the amount which would appear in accordance
with GAAP on a consolidated balance sheet of CFC and its Subsidiaries on
such date opposite the heading "debt" (or any similar item).
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8
"Default": any of the events specified in Section 9, whether or not
any requirement for the giving of notice, lapse of time, or both, or the
happening of any other condition, has been satisfied.
"Defease" or "Defeasance": with respect to any Bankers' Acceptance
accepted by a C$ Bank, the payment by CCCL to such C$ Bank of an amount
equal to the aggregate face amount of CCCL's obligations pursuant to
such Bankers' Acceptance which amount shall be (a) held by such C$ Bank
for application, at the maturity of such Bankers' Acceptance, to the
payment of such C$ Bank's obligations with respect to such Bankers'
Acceptance and (b) invested by such C$ Bank in bankers' acceptances or
cash equivalents reasonably acceptable to such C$ Bank as directed by
CCCL, provided that in the case of investments in bankers' acceptances,
(i) such investments shall be available to such C$ Bank on customary
terms and (ii) the amounts and maturities thereof shall be no greater or
longer than the amount and maturity of such Bankers' Acceptance. Each of
CCCL and each C$ Bank hereby agrees that, upon CCCL effecting the
Defeasance of any Bankers' Acceptance accepted by such C$ Bank, CCCL
shall be released from all obligations to such C$ Bank in any way
relating to such Bankers' Acceptance. In addition, each such C$ Bank
agrees that it will, at the maturity of the applicable Bankers'
Acceptance, pay to CCCL an amount equal to the income earned by such C$
Bank on any investments made pursuant to clause (b) of this definition.
"Designated Canadian Commitment Amount": with respect to each C$
Bank at a particular time, the Designated Canadian Percentage of such C$
Bank's Canadian Commitment then in effect; provided, that in the event
that C$ Loans shall be outstanding after the Canadian Commitments shall
have been terminated, the "Designated Canadian Commitment Amount" of
such C$ Bank, on any day, shall be deemed to equal the Designated
Canadian Percentage of the aggregate principal amount of the C$ Loans
(US$ Equivalent) made by such C$ Bank outstanding on such day.
"Designated Canadian Percentage": a percentage which may be
specified by each C$ Bank, and may be changed from time to time, by
written notice to each Facility Borrower and each Agent; provided, that
if no such percentage has been so specified, such percentage shall be
deemed to be zero. Each such notice shall, unless otherwise agreed by
each Facility Borrower, be furnished within a 30-day period commencing
on the Effective Date or commencing on an anniversary of the Effective
Date.
"Dollars" or "$": lawful currency of the United States of America.
"Domestic Subsidiary": any Subsidiary other than a Foreign
Subsidiary.
"E-mail Bank": any Bank that has authorized use of an electronic
mail address as its notice address for purposes of this Agreement, as
specified in an administrative questionnaire (or other written notice)
delivered to the Administrative Agent and CFC, provided that such
authorization has not subsequently been rescinded pursuant to a written
notice submitted by such Bank to the Administrative Agent and CFC.
"Effective Date": subject to satisfaction of the conditions
specified in Section 6.1, April 21, 1998.
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9
"Effective Federal Funds Rate": for any day, the weighted average
of the rates on overnight Federal funds transactions between members of
the Federal Reserve System arranged by Federal funds brokers, as
published on the next succeeding Business Day by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average quotations for the day of such
transactions received by the Administrative Agent from three Federal
funds brokers of recognized standing selected by it.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"Equity": at any date, the amount which would appear in accordance
with GAAP on a consolidated balance sheet of CFC and its Subsidiaries on
such date opposite the heading "total shareholders' investment" (or any
similar item).
"Eurodollar Loan": any U.S. Loan bearing interest at a rate
determined by reference to the Eurodollar Rate.
"Eurodollar Rate": in the case of any Eurodollar Loan, with respect
to each day during each Interest Period (other than any seven-day
Interest Period) pertaining to such Eurodollar Loan, the rate of
interest determined on the basis of the rate for deposits in Dollars for
a period equal to such Interest Period commencing on the first day of
such Interest Period appearing on Page 3750 of the Telerate screen as of
11:00 A.M., London time, two Business Days prior to the beginning of
such Interest Period, provided, that in the event that such rate does
not appear on Page 3750 of the Telerate Service (or otherwise on such
service), the "Eurodollar Rate" shall be determined by reference to such
other publicly available service for displaying eurodollar rates as may
be agreed upon by the Administrative Agent and CFC. In the absence of
such agreement, and in the case of any seven-day Interest Period
pertaining to such Eurodollar Loan, the "Eurodollar Rate" shall instead
be the rate per annum equal to the average (rounded upward, if
necessary, to the nearest 1/100th of 1%) of the respective rates
notified to the Administrative Agent by each of the Eurodollar Reference
Banks as the rate at which such Eurodollar Reference Bank is offered
Dollar deposits at or about 10:00 A.M., New York City time, two Business
Days prior to the beginning of the relevant Interest Period, in the
interbank eurodollar market where the eurodollar and foreign currency
and exchange operations in respect of its Eurodollar Loans are then
being conducted for delivery on the first day of such Interest Period
for the number of days comprised therein and in an amount comparable to
the amount of its Eurodollar Loan to be outstanding during such Interest
Period.
"Eurodollar Reference Banks": Chase, Royal and Credit Suisse First
Boston; provided, that, for the purposes of determining the Eurodollar
Rate with respect to any seven-day Interest Period, Chase shall be the
sole Eurodollar Reference Bank.
"Eurodollar Tranche": the collective reference to Eurodollar Loans
having the same Interest Period, whether or not originally made on the
same day.
"Event of Default": any of the events specified in Section 9,
provided that any requirement for the giving of notice, the lapse of
time, or both, or the happening of any other condition, has been
satisfied.
<PAGE>
10
"Excess U.S. Utilization Period": any Utilization Period with
respect to which the U.S. Utilization exceeds 50%.
"Existing Agreement": the Short Term Revolving Credit Agreement
dated as of April 24, 1997 among CFC, CCCL, the banks parties thereto,
Royal, as Canadian Administrative Agent, and Chase, as Administrative
Agent.
"Facility Borrowers": the collective reference to CFC and CCCL.
"Facility Fee": any U.S. Facility Fee or Canadian Facility Fee.
"Facility Fee Rate": for any day, the rate per annum set forth
below opposite the Status in effect on such day:
<TABLE>
<CAPTION>
Facility Fee
Status Rate
------ ------------
<S> <C>
Level I Status 0.0500%
Level II Status 0.0550%
Level III Status 0.0800%
Level IV Status 0.1000%
Level V Status 0.1500%
</TABLE>
"Federal Reserve Board": the Board of Governors of the Federal
Reserve System of the United States.
"Final Date": the later of (a) the Termination Date and (b) the
date on which all of the Loans shall have been paid in full.
"Finance Business": (a) the small loan, personal finance, consumer
finance or installment credit business (including the business of making
collateral loans secured by credit obligations or personal property),
(b) the sales finance business and the business of purchasing and
selling notes and accounts receivable (whether or not repayable in
installments) and interests therein, (c) the commercial financing and
factoring business as generally conducted, including the leasing of
tangible personal property, and (d) any business (including, without
limitation, securitization and other receivables-based transactions)
related to or conducted in connection with any business of the character
referred to in the foregoing clauses (a), (b) and (c) other than
insurance underwriting.
"Finance-Related Insurance Business": the business of (a) insuring
articles and merchandise the sale or leasing of which is financed in the
ordinary course of the Finance Business, (b) insuring the lives of
individuals who are liable for the payment of the amounts owing on such
sales or leases and writing accident and health insurance on such
individuals, (c) automobile dealership property, liability, workers
compensation and related insurance, (d) motor
<PAGE>
11
vehicle physical damage and liability insurance, and such other
insurance business that is not described in clause (a), (b), (c) or (d)
above to the extent that such insurance business does not produce at any
time aggregate premiums written (net of reinsurance ceded) by all
Subsidiaries in an amount greater than 50% of the aggregate amount of
all premiums written (net of reinsurance ceded) at such time in all of
the insurance business of such Subsidiaries.
"Finance Subsidiary": any Domestic Subsidiary that is engaged
primarily in the Finance Business.
"Financial Covenant": a covenant on the part of CFC or any
Significant Subsidiary to the general effect that such party shall
maintain as of a specified date or dates or for a specified period or
periods, (a) a specified minimum net worth, (b) a ratio of debt to net
worth, earnings or cash flow not in excess of a specified maximum, (c)
current assets in an amount not less than a specified amount in excess
of current liabilities, (d) a specified minimum amount of earnings or
cash flow, (e) a ratio of earnings or cash flow to interest expense or
fixed charges not less than a specified minimum, or (f) any other
specified ratio, amount or measure for the purpose of requiring
maintenance of a specified financial condition or financial performance;
provided, however, that any covenant requiring specified conditions to
be satisfied before dividends may be made shall not constitute a
"Financial Covenant".
"Fitch": Fitch Investors Service, Inc. and its successors.
"Foreign Subsidiary": any Subsidiary that (a) is organized under
the laws of any jurisdiction outside the United States of America,
Puerto Rico and Canada, or (b) conducts the major portion of its
business outside the United States of America, Puerto Rico and Canada.
"GAAP": generally accepted accounting principles in the United
States of America (and, to the extent applicable, Canada) in effect from
time to time, except that for the purposes of determining compliance
with the covenants set forth in Section 8, "GAAP" shall mean generally
accepted accounting principles in the United States of America (and, to
the extent applicable, Canada) in effect on December 31, 1997 applied
consistently with those used in compiling the financial statements
included in the 1997 Annual Report.
"Governmental Authority": any nation or government, any state or
other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions
of or pertaining to government.
"Indebtedness": as applied to any Person at any date, (a)
indebtedness of such Person for borrowed money or for the deferred
purchase price of property or services which would appear on a
consolidated balance sheet of such Person (or, in the case of CFC and
its Subsidiaries, CFC) prepared in accordance with GAAP, (b) obligations
of such Person under leases which appear as capital leases on a
consolidated balance sheet of such Person prepared in accordance with
GAAP and (c) any withdrawal obligation of such Person or any Commonly
Controlled Entity thereof to a Multiemployer Plan.
"Initial Offered Canadian Commitment Amount": with respect to each
C$ Bank, the amount specified opposite such Bank's name on Schedule I in
the column captioned "Initial Offered Canadian Commitment Amount", which
amount shall equal 25% of the aggregate Canadian commitment amount
offered by such Bank in connection with the initial syndication of
<PAGE>
12
the Canadian Commitments and the initial syndication of the "Canadian
Commitments" under the Long Term Revolving Credit Agreement.
"Interest Period": with respect to any Eurodollar Tranche:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such
Eurodollar Tranche and ending seven days or one, two, three or six
months thereafter, as selected by CFC in its notice of borrowing or
notice of conversion, as the case may be, given with respect
thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar
Tranche and ending seven days or one, two, three or six months
thereafter, as selected by CFC by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the
last day of the then current Interest Period with respect thereto
(or, if no such period is specified, ending one month thereafter);
provided that, the foregoing provisions are subject to the
following:
(A) if any Interest Period would otherwise end on a day which
is not a Business Day, such Interest Period shall be extended to
the next succeeding Business Day unless the result of such
extension would be to carry such Interest Period into another
calendar month, in which event such Interest Period shall end on
the immediately preceding Business Day;
(B) no Interest Period may be selected by CFC if such Interest
Period would end after the Maturity Date; and
(C) any Interest Period of at least one month's duration that
begins on the last Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last
Business Day of the relevant calendar month.
"Level": any of Level I, Level II, Level III, Level IV or Level V.
"Level I": any of the following long-term senior unsecured debt
ratings: A or better by S&P, A2 or better by Moody's, A or better by D&P
or A or better by Fitch.
"Level II": any of the following long-term senior unsecured debt
ratings: A- by S&P, A3 by Moody's, A- by D&P or A- by Fitch.
"Level III": any of the following long-term senior unsecured debt
ratings: BBB+ or BBB by S&P, Baa1 or Baa2 by Moody's, BBB+ or BBB by D&P
or BBB+ or BBB by Fitch.
"Level IV": any of the following long-term senior unsecured debt
ratings: BBB- by S&P, Baa3 by Moody's, BBB- by D&P or BBB- by Fitch.
<PAGE>
13
"Level V": any of the following long-term senior unsecured debt
ratings: BB+ or lower (or unrated) by S&P, Ba1 or lower (or unrated) by
Moody's, BB+ or lower (or unrated) by D&P or BB+ or lower (or unrated)
by Fitch.
"Lien": with respect to any property of any Person, any mortgage,
pledge, hypothecation, encumbrance, lien (statutory or other), charge or
other security interest of any kind in or with respect to such property
(including, without limitation, any conditional sale or other title
retention agreement, and any financing lease under which such Person is
lessee having substantially the same economic effects as any of the
foregoing).
"Loans": the collective reference to the U.S. R/C Loans and the C$
Loans.
"Local Time": (a) in the case of matters relating to U.S. R/C
Loans, New York City time, and (b) in the case of matters relating to C$
Loans, Toronto time.
"Long Term Revolving Credit Agreement": (a) the Long Term Revolving
Credit Agreement, dated as of April 24, 1997, among CFC, CCCL, the
financial institutions from time to time parties thereto, the Managing
Agents parties thereto, Royal Bank of Canada, as Canadian administrative
agent, and The Chase Manhattan Bank, as administrative agent, as
amended, supplemented, or otherwise modified from time to time, or (b)
if such Revolving Credit Agreement is refinanced, refunded or otherwise
replaced by another bank revolving credit agreement, such agreement, as
amended, supplemented or otherwise modified from time to time.
"Material Indebtedness": any item or related items of Indebtedness
(or, in the case of any revolving credit facility, any commitments)
having an aggregate principal amount of at least $100,000,000 (or the
equivalent thereof in any other currency).
"Maturity Date": the date which is the second anniversary of the
Termination Date.
"Moody's": Moody's Investors Service, Inc. and its successors.
"Multiemployer Plan": a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"New Bank": as defined in Section 12.10(a).
"1997 Annual Report": CFC's annual report on Form 10-K to
stockholders for the fiscal year ended December 31, 1997.
"Other Taxes": as defined in Section 4.13(a).
"PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA or any successor
corporation.
"Person": an individual, a partnership, a corporation (including a
business trust), a joint stock company, a trust, an unincorporated
association, a joint venture or other entity or a government or any
agency or political subdivision thereof.
<PAGE>
14
"Plan": any pension plan which is covered by Title IV of ERISA and
in respect of which CFC or a Commonly Controlled Entity is an "employer"
as defined in Section 3(5) of ERISA.
"Prohibited Transaction": any "prohibited transaction" as defined
in Section 406 of ERISA or Section 4975 of the Code.
"Rating Agencies": the collective reference to D&P, Fitch, Moody's
and S&P.
"Real Estate Business": the acquisition, development, leasing,
financing, management, maintenance and disposition of real property,
including, without limitation, automotive dealership facilities and
dealership site control arrangements.
"Reference Banks": the collective reference to the Eurodollar
Reference Banks, the Schedule I C$ Reference Banks and the Schedule II
C$ Reference Banks.
"Registers": the collective reference to the U.S. Register and the
Canadian Register.
"Related C$ Bank": as defined in the definition of "US$ Bank
Combined Commitment".
"Related US$ Bank": as defined in the definition of "US$ Bank
Combined Commitment".
"Reportable Event": any of the events set forth in Section 4043(b)
of ERISA or the regulations thereunder.
"Required Banks": at any date, Banks having at least 51% of the
aggregate amount of the Commitments at such date or, if the Commitments
have been terminated or for the purposes of determining whether to
accelerate the Loans pursuant to Section 9, the holders of at least 51%
of the outstanding principal amount of the Loans (US$ Equivalent).
"Required Canadian Banks": at any date, C$ Banks having at least
51% of the aggregate amount of the Canadian Commitments at such date.
"Required U.S. Banks": at any date, US$ Banks having at least 51%
of the aggregate amount of the U.S. Commitments at such date.
"Requirement of Law": as to any Person, the Certificate of
Incorporation and By-laws or other organizational or governing documents
of such Person, and any law, treaty, rule or regulation, or
determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any
of its property or to which such Person or any of its property is
subject.
"Responsible Officer": at any particular time, the Chairman of the
Board of Directors, the President, the Treasurer or the Controller of
CFC or CCCL, as the case may be.
"S&P": Standard & Poor's Ratings Services, and its successors.
"Schedule I C$ Bank": any C$ Bank named on Schedule I to the Bank
Act (Canada).
<PAGE>
15
"Schedule I Reference C$ Banks": the collective reference to Royal,
Canadian Imperial Bank of Commerce and The Bank of Nova Scotia.
"Schedule II C$ Bank": any C$ Bank named on Schedule II to the Bank
Act (Canada).
"Schedule II Reference C$ Banks": the collective reference to The
Chase Manhattan Bank of Canada, Credit Suisse First Boston Canada,
Banque Nationale de Paris (Canada) and The Dai-Ichi Kangyo Bank
(Canada).
"Significant Subsidiary": at the time of any determination thereof,
(a) CCCL, (b) any other Finance Subsidiary and (c) any other Subsidiary
of CFC the assets of which constitute at least 5% of the consolidated
assets of CFC and its Subsidiaries as stated on the consolidated
financial statements of CFC and its Subsidiaries for the most recently
ended fiscal quarter of CFC, provided, that the term "Significant
Subsidiary" shall not include any Special Purpose Subsidiary.
"Single Employer Plan": any Plan which is not a Multiemployer Plan.
"Special Purpose Subsidiary": any Subsidiary created for the sole
purpose of purchasing assets from CFC or any Finance Subsidiary with the
intention and for the purpose of using such assets in a securitization
transaction.
"Status": the existence of Level I Status, Level II Status, Level
III Status, Level IV Status or Level V Status, as the case may be. For
the purposes of this definition, "Status" will be set at the lowest
Level assigned to CFC by any Rating Agency, unless only one Rating
Agency has assigned such Level to CFC, in which case CFC's Status will
be set at the second lowest Level assigned to CFC by any Rating Agency.
"Statutory Reserves": a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum applicable reserve
percentages (including any marginal, special, emergency or supplemental
reserves) expressed as a decimal established by the Federal Reserve
Board and any other banking authority to which Chase is subject with
respect to the Base CD Rate (as such term is used in the definition of
"Base Rate"), for new negotiable nonpersonal time deposits in Dollars of
over $100,000 with maturities approximately equal to three months.
Statutory Reserves shall be adjusted automatically on and as of the
effective date of any change in any reserve percentage.
"Subsidiary": any corporation of which CFC or one or more
Subsidiaries or CFC and one or more Subsidiaries shall at the time own
shares of any class or classes (however designated) having voting power
for the election of at least a majority of the members of the board of
directors (or other governing body) of such corporation.
"Taxes": as defined in Section 4.13(a).
"Termination Date": the date which is 364 days after the Effective
Date, or, if such day is not a Business Day, the next preceding Business
Day.
"Type": as to any U.S. R/C Loan, its nature as a Base Rate Loan or
a Eurodollar Loan.
<PAGE>
16
"US$ Bank": each Bank designated as a "US$ Bank" on Schedule I, as
such Schedule may be modified from time to time pursuant to Section 12.7
or 12.10.
"US$ Bank Combined Commitment": as to any US$ Bank, the sum of (a)
such Bank's U.S. Commitment and (b) if such Bank has a Related C$ Bank,
such Related C$ Bank's Canadian Commitment; provided, that in the event
that Loans shall be outstanding after the Commitments shall have been
terminated, the "US$ Bank Combined Commitment" of each US$ Bank, on any
day, shall be deemed to equal the aggregate principal amount of the
Loans (US$ Equivalent) made by such Bank (or, if applicable, such Bank's
Related C$ Bank), outstanding on such day. For the purposes of this
Agreement, (i) "Related C$ Bank" means, with respect to any US$ Bank, as
applicable, either (x) such Bank in its capacity as a C$ Bank or (y) any
subsidiary, affiliate, branch or agency of such Bank which is a C$ Bank
and (ii) "Related US$ Bank" means, with respect to any C$ Bank, as
applicable, either (x) such Bank in its capacity as a US$ Bank or (y)
any subsidiary, affiliate, branch or agency of such Bank which is a US$
Bank.
"US$ Bank Net Combined Commitment": with respect to each US$ Bank,
an amount equal to such US$ Bank's US$ Bank Combined Commitment minus,
in the case of each US$ Bank that has a Related C$ Bank, such Related C$
Bank's Designated Canadian Commitment Amount.
"US$ Equivalent": on any date of determination, with respect to any
amount in Canadian Dollars, the equivalent in Dollars of such amount,
determined by the relevant Agent using the Canadian Exchange Rate then
in effect with respect thereto as determined pursuant to Section 3.5.
"U.S. Commitment": as to any US$ Bank, its obligation to make U.S.
R/C Loans to CFC hereunder in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Bank's
name on Schedule I, as such amount may be changed from time to time as
provided herein.
"U.S. Commitment Percentage": as to any US$ Bank at any time, the
percentage of the aggregate U.S. Commitments then constituted by such
Bank's U.S. Commitment.
"U.S. Facility Fee": as defined in Section 4.5(a).
"U.S. R/C Loans": as defined in Section 2.1(a).
"U.S. Register": as defined in Section 12.7(c).
"U.S. Utilization": for any Utilization Period, with respect to the
U.S. Commitments, the percentage equivalent of a fraction (a) the
numerator of which is the average daily principal amount of U.S. R/C
Loans outstanding during such Utilization Period and (b) the denominator
of which is the average daily amount of the aggregate U.S. Commitments
of all US$ Banks during such Utilization Period.
"Utilization Period": (a) each fiscal quarter of CFC and (b) any
portion of a fiscal quarter of CFC ending on the Final Date.
<PAGE>
17
1.2 Other Definitional Provisions. (a) Unless otherwise specified, all terms
defined in this Agreement shall have the defined meanings when used in any
certificate or other document made or delivered pursuant hereto.
(b) As used herein and in any certificate or other document made or
delivered pursuant hereto, accounting terms relating to CFC and its
Subsidiaries not defined in Section 1.1, and accounting terms partly defined
in Section 1.1 to the extent not defined, shall have the respective meanings
given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole
and not to any particular provision of this Agreement, and Section, schedule
and exhibit references are to this Agreement unless otherwise specified.
SECTION 2. THE U.S. COMMITMENTS
2.1 The U.S. Commitments. (a) Subject to the terms and conditions
hereof, each US$ Bank severally agrees to make revolving credit loans ("U.S.
R/C Loans") to CFC from time to time during the Commitment Period. During the
Commitment Period, CFC may use the U.S. Commitment of each US$ Bank by
borrowing, prepaying or repaying the U.S. R/C Loans of such Bank, in whole or
in part, and reborrowing, all in accordance with the terms and conditions
hereof; provided that no U.S. R/C Loans may be made on or after the
Termination Date (it being understood that continuations and conversions of
outstanding U.S. R/C Loans shall be permitted on and after the Termination
Date in accordance with Section 2.3). Notwithstanding anything to the
contrary contained in this Agreement, in no event may U.S. R/C Loans be
borrowed under this Section 2.1 if, after giving effect thereto and the
application of the proceeds thereof, the aggregate principal amount of U.S.
R/C Loans made by any US$ Bank then outstanding would exceed such Bank's U.S.
Commitment.
(b) U.S. R/C Loans may be Base Rate Loans or Eurodollar Loans, as
determined by CFC and notified to the Administrative Agent in accordance with
Section 2.2.
2.2 Procedure for Borrowing. CFC may borrow under Section 2.1 during
the Commitment Period on any Business Day, provided that CFC shall give the
Administrative Agent irrevocable notice (which notice must be received by the
Administrative Agent prior to 10:00 A.M., New York City time, (i) three
Business Days prior to the requested Borrowing Date, in the case of
Eurodollar Loans, and (ii) one Business Day prior to the requested Borrowing
Date, in the case of Base Rate Loans) specifying (A) the amount to be
borrowed, (B) the requested Borrowing Date, (C) the Type(s) of U.S. R/C Loans
to be borrowed, and (D) the length of the Interest Period for any Eurodollar
Loan. Upon receipt of such notice, the Administrative Agent shall promptly
notify each US$ Bank thereof. Not later than 2:00 P.M., New York City time,
on the Borrowing Date specified in such notice, each US$ Bank shall (subject
to Section 12.3(b)) deposit in its Clearing Account an amount in immediately
available funds equal to the amount of the U.S. R/C Loan to be made by such
Bank pursuant to Section 2.1. The Administrative Agent shall, pursuant to
Section 12.3(a), cause such amount to be withdrawn from each such Clearing
Account and shall make the aggregate amount so withdrawn available to CFC by
depositing the proceeds thereof in the account of CFC with the Administrative
Agent on the date such Loans are made for transmittal by the Administrative
Agent upon CFC's request. Each borrowing pursuant to Section 2.1 shall be in
an aggregate principal amount of the lesser of (i) $50,000,000 or an integral
multiple of $1,000,000 in excess thereof or (ii) the then aggregate Available
U.S. Commitments.
<PAGE>
18
2.3 Conversion and Continuation Options. (a) CFC may elect from time to
time to convert Eurodollar Loans to Base Rate Loans, by giving the
Administrative Agent at least two Business Days' prior irrevocable notice of
such election, provided that any such conversion of Eurodollar Loans may only
be made on the last day of an Interest Period with respect thereto. CFC may
elect from time to time to convert Base Rate Loans to Eurodollar Loans by
giving the Administrative Agent at least three Business Days' prior
irrevocable notice of such election. Any such notice of conversion to
Eurodollar Loans shall specify the length of the initial Interest Period or
Interest Periods therefor. Upon receipt of any such notice the Administrative
Agent shall promptly notify each US$ Bank thereof. All or any part of
outstanding Eurodollar Loans and Base Rate Loans may be converted as provided
herein, provided that (i) no Base Rate Loan may be converted into a
Eurodollar Loan when any Event of Default has occurred and is continuing and
the Administrative Agent has or the Required U.S. Banks have determined in
its or their sole discretion that such conversion is not appropriate and (ii)
no Base Rate Loan may be converted into a Eurodollar Loan after the date that
is seven days prior to the Maturity Date.
(b) Any Eurodollar Loans may be continued as such upon the expiration
of the then current Interest Period with respect thereto by CFC giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in Section 1.1,
of the length of the next Interest Period to be applicable to such Loans,
provided that no Eurodollar Loan may be continued as such (i) when any Event
of Default has occurred and is continuing and the Administrative Agent has or
the Required U.S. Banks have determined in its or their sole discretion that
such continuation is not appropriate or (ii) after the date that is seven
days prior to the Maturity Date and provided, further, that if CFC shall fail
to give any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to the preceding proviso such Loans
shall be automatically converted to Base Rate Loans on the last day of such
then expiring Interest Period. Upon receipt of any notice given by CFC
pursuant to this Section 2.3(b), the Administrative Agent shall promptly
notify each US$ Bank thereof.
2.4 Minimum Amount of Eurodollar Tranches. Notwithstanding anything to
the contrary in this Agreement, all borrowings, payments, prepayments,
continuations and conversions of U.S. R/C Loans shall be in such amounts and
be made pursuant to such elections so that, after giving effect thereto, the
aggregate principal amount of the Eurodollar Loans comprising any Eurodollar
Tranche shall not be less than $50,000,000.
2.5 Certain Matters Relating to Eurodollar Loans. (a) In the event that
(i) the Administrative Agent determines (which determination shall be
conclusive and binding upon CFC) that by reason of circumstances affecting
the relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate in respect of any Eurodollar Loans, or (ii)
the Required U.S. Banks determine (which determination shall be conclusive
and binding upon CFC) and shall notify the Administrative Agent that the
rates of interest referred to in the definition of "Eurodollar Rate" as the
basis upon which the rate of interest for Eurodollar Loans is to be
determined do not adequately cover the cost to the US$ Banks of making or
maintaining Eurodollar Loans, in each case with respect to any proposed U.S.
R/C Loan that CFC has requested be made as a Eurodollar Loan, the
Administrative Agent shall forthwith give facsimile transmission or other
written notice of such determination to CFC and the US$ Banks at least one
Business Day prior to the requested Borrowing Date for such Eurodollar Loan.
If such notice is given, any requested borrowing of a Eurodollar Loan shall
be made as a Base Rate Loan. Until such notice has been withdrawn by the
Administrative Agent, no further Eurodollar Loans shall be made.
<PAGE>
19
(b) Upon notice from any Affected Bank (as hereinafter defined), CFC
shall pay to the Administrative Agent for the account of such Affected Bank
an additional amount for each Eurodollar Loan of such Affected Bank, payable
on the last day of the Interest Period with respect thereto, equal to
P X [[R / (1.00 - r)] - R] X [T / 360]
Where P = the principal amount of such Eurodollar Loan of
such Bank;
R = the Eurodollar Rate (expressed as a decimal) for such
Interest Period;
T = the number of days in such Interest Period during which
such Bank was an "Affected Bank"; and
r = the aggregate of rates (expressed as a decimal) of
reserve requirements ("Reserve Requirements")
current on the date two Business Days prior to the
beginning of such Interest Period (including,
without limitation, basic, supplemental, marginal
and emergency reserves) under any regulations of
the Federal Reserve Board or other Governmental
Authority having jurisdiction with respect thereto,
as now and from time to time hereafter in effect,
dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as
"Eurocurrency liabilities" in Regulation D of the
Federal Reserve Board) maintained by a member bank
of the Federal Reserve System.
The term "Affected Bank" shall mean any US$ Bank party to this
Agreement that (i) is (x) organized under the laws of the United States or
any State thereof or (y) a bank organized under laws other than those of the
United States of America or a State thereof that is funding its Eurodollar
Loans through a branch or agency located in the United States of America and
(ii) is subject to actual Reserve Requirements in respect of its Eurodollar
Loans. Each US$ Bank agrees to notify the Administrative Agent promptly upon
becoming an Affected Bank, and of any subsequent change of status, disclosing
the effective date of such change.
(c) Upon the occurrence of any of the events specified in Section
2.5(a), each US$ Bank whose Eurodollar Loans are affected by any such event
agrees that it will transfer its Eurodollar Loans affected by any such event
to another branch office (or, if such Bank so elects, to an affiliate) of
such Bank, provided that such transfer shall be made only if such Bank shall
have determined in good faith (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) that, (i) on the
basis of existing circumstances, such transfer will avoid such events and
will not result in any additional costs, liabilities or expenses to such Bank
or to CFC and (ii) such transfer is otherwise consistent with the interests
of such Bank.
SECTION 3. THE CANADIAN COMMITMENTS
3.1 The Canadian Commitments. Subject to the terms and conditions
hereof, each C$ Bank severally agrees to make revolving credit loans ("C$ R/C
Loans") (which shall be C$ Prime Loans) to, and to accept Bankers'
Acceptances from, CCCL from time to time during the Commitment Period. During
the Commitment Period, CCCL may use the Canadian Commitment of each C$ Bank
by borrowing, prepaying or repaying the C$ R/C Loans or Bankers' Acceptances
of such Bank, in whole or in part, and reborrowing, all in accordance with
the terms and conditions hereof; provided that no C$ R/C
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20
Loans or Bankers' Acceptances may be made or accepted on or after the
Termination Date (it being understood that continuations and conversions of
outstanding C$ R/C Loans and Bankers' Acceptances shall be permitted on and
after the Termination Date in accordance with Section 3.4). Notwithstanding
anything to the contrary contained in this Agreement, in no event may C$ R/C
Loans or Bankers' Acceptances be borrowed or issued under this Section 3.1
if, after giving effect thereto and the application of the proceeds thereof,
the Aggregate Canadian Extensions of Credit of any C$ Bank then outstanding
would exceed such C$ Bank's Canadian Commitment.
3.2 Procedure for C$ R/C Loan Borrowing. CCCL may borrow C$ R/C Loans
during the Commitment Period on any Business Day, provided that CCCL shall
give the Canadian Administrative Agent irrevocable notice (which notice must
be received by the Canadian Administrative Agent prior to 12:00 noon, Toronto
time, one Business Day prior to the requested Borrowing Date, specifying (a)
the amount to be borrowed and (b) the requested Borrowing Date. Upon receipt
of such notice, the Canadian Administrative Agent shall promptly notify each
C$ Bank thereof. Not later than 2:00 P.M., Toronto time, on the Borrowing
Date specified in such notice, each C$ Bank shall make the amount of its
share of such borrowing available to the Canadian Administrative Agent for
the account of CCCL at the office of the Canadian Administrative Agent
specified in Section 12.2 and in funds immediately available to the Canadian
Administrative Agent. Each borrowing pursuant to this Section 3.2 shall be in
an aggregate principal amount of the lesser of (i) C$5,000,000 or an integral
multiple of C$100,000 in excess thereof or (ii) the amount in C$ which has a
US$ Equivalent equal to the then aggregate Available Canadian Commitments.
3.3 Bankers' Acceptances. (a) CCCL may issue Bankers' Acceptances
denominated in C$, for purchase by the C$ Banks, each in accordance with the
provisions of this Section 3.3.
(b) Procedures.
(i) Notice. CCCL shall notify the Canadian Administrative Agent by
irrevocable written notice by 10:00 A.M., Toronto time, one Business Day
prior to the Borrowing Date in respect of any borrowing by way of Bankers'
Acceptances.
(ii) Minimum Borrowing Amount. Each borrowing by way of Bankers'
Acceptances shall be in a minimum aggregate face amount of C$10,000,000.
(iii) Face Amounts. The face amount of each Bankers' Acceptance shall
be C$100,000 or any integral multiple thereof.
(iv) Term. Bankers' Acceptances shall be issued and shall mature on a
Business Day. Each Bankers' Acceptance shall have a term of at least 30
days and not more than 365 days excluding days of grace and shall mature
on or before the Maturity Date and shall be in form and substance
reasonably satisfactory to each C$ Bank. Notwithstanding the foregoing
sentence, Bankers' Acceptances may from time to time be issued for a term
of seven days if each C$ Bank agrees at such time to accept Bankers'
Acceptances with such term in the amount determined by the Canadian
Administrative Agent in respect of such Bank in accordance with Section
3.3(b)(vii).
(v) Bankers' Acceptances in Blank. To facilitate the acceptance of
Bankers' Acceptances under this Agreement, CCCL shall, upon execution of
this Agreement and from time to time as required, provide to the Canadian
Administrative Agent drafts, in form
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21
satisfactory to the Canadian Administrative Agent, duly executed and
endorsed in blank by CCCL in quantities sufficient for each C$ Bank to
fulfill its obligations hereunder. In addition, CCCL hereby appoints each
C$ Bank as its attorney to sign and endorse on its behalf, in handwriting
or by facsimile or mechanical signature as and when deemed necessary by
such C$ Bank, blank forms of Bankers' Acceptances. CCCL recognizes and
agrees that all Bankers' Acceptances signed and/or endorsed on its behalf
by a C$ Bank shall bind CCCL as fully and effectually as if signed in the
handwriting of and duly issued by the proper signing officers of CCCL.
Each C$ Bank is hereby authorized to issue such Bankers' Acceptances
endorsed in blank in such face amounts as may be determined by such Bank
provided that the aggregate amount thereof is equal to the aggregate
amount of Bankers' Acceptances required to be accepted by such Bank. No C$
Bank shall be responsible or liable for its failure to accept a Bankers'
Acceptance if the cause of such failure is, in whole or in part, due to
the failure of CCCL to provide duly executed and endorsed drafts to the
Canadian Administrative Agent on a timely basis nor shall any C$ Bank be
liable for any damage, loss or other claim arising by reason of any loss
or improper use of any such instrument except loss or improper use arising
by reason of the gross negligence or willful misconduct of such Bank, its
officers, employees, agents or representatives. Each C$ Bank shall
maintain a record with respect to Bankers' Acceptances (i) received by it
from the Canadian Administrative Agent in blank hereunder, (ii) voided by
it for any reason, (iii) accepted by it hereunder, (iv) purchased by it
hereunder and (v) cancelled at their respective maturities. Each C$ Bank
further agrees to retain such records in the manner and for the statutory
periods provided in the various Canadian provincial or federal statutes
and regulations which apply to such Bank.
(vi) Execution of Bankers' Acceptances. Drafts of CCCL to be accepted
as Bankers' Acceptances hereunder shall be duly executed on behalf of
CCCL. Notwithstanding that any person whose signature appears on any
Bankers' Acceptance as a signatory for CCCL may no longer be an authorized
signatory for CCCL at the date of issuance of a Bankers' Acceptance, such
signature shall nevertheless be valid and sufficient for all purposes as
if such authority had remained in force at the time of such issuance and
any such Bankers' Acceptance so signed shall be binding on CCCL.
(vii) Issuance of Bankers' Acceptances. Promptly following receipt of a
notice of borrowing by way of Bankers' Acceptances, the Canadian
Administrative Agent shall so advise the C$ Banks and shall advise each C$
Bank of the face amount of each Bankers' Acceptance to be accepted by it
and the term thereof. The aggregate face amount of Bankers' Acceptances to
be accepted by a C$ Bank shall be determined by the Canadian
Administrative Agent by reference to the respective Canadian Commitments
of the C$ Banks, except that, if the face amount of a Bankers' Acceptance,
which would otherwise be accepted by a C$ Bank, would not be C$100,000 or
an integral multiple thereof, such face amount shall be increased or
reduced by the Canadian Administrative Agent in its sole and unfettered
discretion to the nearest integral multiple of C$100,000.
(viii) Acceptance of Bankers' Acceptances. Each Bankers' Acceptance to
be accepted by a C$ Bank shall be accepted at such Bank's office referred
to in its Addendum.
(ix) Purchase of Bankers' Acceptances. On the relevant Borrowing Date,
each C$ Bank shall purchase from CCCL, at the Applicable BA Discount Rate,
any Bankers' Acceptance accepted by it and provide to the Canadian
Administrative Agent the BA Discount Proceeds for the account of CCCL. The
Acceptance Fee payable by CCCL to such Bank under Section 3.3(d)
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22
in respect of each Bankers' Acceptance accepted and purchased by such Bank
shall be set off against the BA Discount Proceeds payable by such Bank
under this Section 3.3(b)(ix).
(x) Sale of Bankers' Acceptances. Each C$ Bank may at any time and from
time to time hold, sell, rediscount or otherwise dispose of any or all
Bankers' Acceptances accepted and purchased by it.
(xi) Waiver of Presentment and Other Conditions. CCCL waives
presentment for payment and any other defense to payment of any amounts
due to a C$ Bank in respect of a Bankers' Acceptance accepted by it
pursuant to this Agreement which might exist solely by reason of such
Bankers' Acceptance being held, at the maturity thereof, by such Bank in
its own right and CCCL agrees not to claim any days of grace if such Bank
as holder sues CCCL on the Bankers' Acceptances for payment of the amount
payable by CCCL thereunder.
(c) With respect to each Bankers' Acceptance, CCCL shall give
irrevocable telephone or written notice (or such other method of notification
as may be agreed upon between the Canadian Administrative Agent and CCCL) to
the Canadian Administrative Agent at or before 2:00 P.M., Toronto time, two
Business Days prior to the maturity date of such Bankers' Acceptance followed
by written confirmation electronically transmitted to the Canadian
Administrative Agent on the same day, of CCCL's intention to issue a Bankers'
Acceptance on such maturity date (a "Refunding Bankers' Acceptance") to
provide for the payment of such maturing Bankers' Acceptance (it being
understood that payments by CCCL and fundings by the C$ Banks in respect of
each maturing Bankers' Acceptance and the related Refunding Bankers'
Acceptance shall be made on a net basis reflecting the difference between the
face amount of such maturing Bankers' Acceptance and the BA Discount Proceeds
(net of the applicable Acceptance Fee) of such Refunding Bankers'
Acceptance). Any repayment of Bankers' Acceptances must be made at or before
12:00 noon, Toronto time, on the respective maturity dates of such Bankers'
Acceptances. If CCCL fails to give such notice, CCCL shall be deemed to have
repaid such maturing Bankers' Acceptances with funds obtained by way of C$
R/C Loans commencing on the maturity date of such maturing Bankers'
Acceptances.
(d) An Acceptance Fee shall be payable by CCCL to each C$ Bank in
advance (in the manner specified in Section 3.3(b)(ix)) upon the issuance of
a Bankers' Acceptance to be accepted by such Bank calculated at the rate per
annum equal to the Applicable Margin, such Acceptance Fee to be calculated on
the face amount of such Bankers' Acceptance and to be computed on the basis
of the number of days in the term of such Bankers' Acceptance. Subject to the
additional amounts payable under Section 3.3(e), the amount of Acceptance
Fees to be paid as specified above shall be the amount which would be due and
payable if the Canadian Utilization for the term of the relevant Bankers'
Acceptance was less than 50%.
(e) On the first Business Day following the last day of each
Utilization Period, CCCL shall pay to the Canadian Administrative Agent, for
the ratable benefit of the C$ Banks an additional amount on account of
Acceptance Fees in respect of each Bankers' Acceptance outstanding during
such Utilization Period equal to an amount calculated by multiplying:
(A) a fraction, the numerator of which is the number of days in the term
of the Bankers' Acceptance in such Utilization Period and the
denominator of which is the number of days in the term of the Bankers'
Acceptance; by
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23
(B) the excess (if any) of (A) the amount of Acceptance Fees which would
have been payable in respect of such Bankers' Acceptance had the
Canadian Utilization at the time of the issuance of such Bankers'
Acceptance been the same as the actual Canadian Utilization during such
Utilization Period, over (B) the amount of Acceptance Fees which
actually were paid in respect of such Bankers' Acceptance.
(f) Upon the occurrence of any Event of Default which is continuing,
and in addition to any other rights or remedies of any C$ Bank and the
Canadian Administrative Agent hereunder, any C$ Bank or the Canadian
Administrative Agent as and by way of collateral security (or such alternate
arrangement as may be agreed upon by CCCL and such Bank or the Canadian
Administrative Agent, as applicable) shall be entitled to deposit and retain
in an account to be maintained by the Canadian Administrative Agent (bearing
interest at the Canadian Administrative Agent's rates as may be applicable in
respect of other deposits of similar amounts for similar terms) amounts which
are received by such Bank or the Canadian Administrative Agent from CCCL
hereunder or as proceeds of the exercise of any rights or remedies of any C$
Bank or the Canadian Administrative Agent hereunder against CCCL, to the
extent such amounts may be required to satisfy any contingent or unmatured
obligations or liabilities of CCCL to the C$ Banks or the Canadian
Administrative Agent, or any of them hereunder.
3.4 Conversion Option. Subject to the provisions of this Agreement,
CCCL may, prior to the Maturity Date, effective on any Business Day, convert,
in whole or in part, C$ R/C Loans into Bankers' Acceptances or vice versa
upon giving to the Canadian Administrative Agent prior irrevocable telephone
or written notice within the notice period and in the form which would be
required to be given to the Canadian Administrative Agent in respect of the
category of C$ Loan into which the outstanding C$ Loan is to be converted in
accordance with the provisions of Section 3.2 or 3.3, as applicable, followed
by written confirmation on the same day, provided that:
(A) no C$ R/C Loan may be converted into a Bankers' Acceptance when any
Event of Default has occurred and is continuing and the Canadian
Administrative Agent has or the Required C$ Banks have determined in
its or their sole discretion that such conversion is not appropriate;
(B) each conversion to Bankers' Acceptances shall be for a minimum
aggregate amount of C$10,000,000 (and whole multiples of C$100,000 in
excess thereof) and each conversion to C$ R/C Loans shall be in a
minimum aggregate amount of C$5,000,000; and
(C) Bankers' Acceptances may be converted only on the maturity date of such
Bankers' Acceptances and, provided that, if less than all Bankers'
Acceptances are converted, then after such conversion not less than
C$10,000,000 (and whole multiples of C$100,000 in excess thereof) shall
remain as Bankers' Acceptances.
3.5 Currency Fluctuations, etc. (a) No later than 2:00 P.M., Toronto
time, on each Canadian Calculation Date, the Canadian Administrative Agent
shall (i) determine the Canadian Exchange Rate as of such date and (ii) give
notice thereof to CFC and CCCL. The Canadian Exchange Rate so determined
shall become effective on the first Business Day immediately following the
relevant Canadian Calculation Date (a "Canadian Reset Date") and shall remain
effective until the next succeeding Canadian Reset Date.
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24
(b) No later than 2:00 P.M., New York City time, on each Canadian Reset
Date and each Borrowing Date in respect of C$ Loans, the Canadian
Administrative Agent shall (i) determine the US$ Equivalent of the C$ Loans
then outstanding (after giving effect to any C$ Loans to be made or repaid on
such date) and (ii) notify CFC and CCCL of the results of such determination.
(c) If, on any Canadian Reset Date (after giving effect to (i) any C$
Loans to be made or repaid on such date and (ii) any increase or decrease in
any Canadian Commitment pursuant to Section 12.10 effective on such date of
which the Canadian Administrative Agent has received notice), the Aggregate
Canadian Extensions of Credit of any C$ Bank exceed the Canadian Commitment
of such Bank, then, within ten Business Days after notice thereof from the
Canadian Administrative Agent, (i) CCCL shall reduce the aggregate C$ Loans
(which reduction, in the case of Bankers' Acceptances, may be effected by
Defeasance thereof) and/or (ii) CFC shall increase the Canadian Commitments
pursuant to Section 12.10 in an amount such that, after giving effect
thereto, the Aggregate Canadian Extensions of Credit of each C$ Bank shall be
equal to or less than the Canadian Commitment of such Bank.
(d) The Canadian Administrative Agent shall promptly furnish the
Administrative Agent and each affected C$ Bank with a copy of any notice
delivered to CFC or CCCL pursuant to this Section 3.5.
(e) Notwithstanding the foregoing provisions of this Section 3.5, after
the initial Canadian Calculation Date, the Canadian Administrative Agent may
at its option suspend the resetting of the Canadian Exchange Rate pursuant to
Section 3.5(a) and the making of the determinations referred to in Sections
3.5(b) and 3.5(c) during any period when the sum of the Aggregate Canadian
Extensions of Credit of all C$ Banks, calculated using the Canadian Exchange
Rate effective as of the last Canadian Reset Date prior to such suspension,
is less than 50% of the aggregate Canadian Commitments then in effect.
SECTION 4. GENERAL PROVISIONS
4.1 Evidence of Debt. (a) Each Bank shall maintain in accordance with
its usual practice an account or accounts evidencing the indebtedness of each
Facility Borrower to the appropriate lending office of such Bank resulting
from each Loan made by such lending office of such Bank from time to time,
including the amounts of principal and interest payable and paid to such
lending office of such Bank from time to time under this Agreement.
(b) Each Agent shall maintain a Register pursuant to Section 12.7(c),
and a subaccount for each relevant Bank, in which Register and subaccounts
(taken together) shall be recorded (i) the amount of each relevant Loan made
hereunder, whether such Loan is, as applicable, a U.S. R/C Loan, a C$ R/C
Loan or a Bankers' Acceptance, the Type of each U.S. R/C Loan made and the
Interest Period applicable to any Eurodollar Loan, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
relevant Facility Borrower to each relevant Bank hereunder and (iii) the
amount of any sum received by such Agent hereunder from the relevant Facility
Borrower and each relevant Bank's share thereof.
(c) The entries made in the Registers and accounts maintained pursuant
to paragraphs (a) and (b) of this Section 4.1 shall, to the extent permitted
by applicable law, be prima facie evidence of the existence and amounts of
the obligations of the relevant Facility Borrower therein recorded; provided,
that the failure of any Bank or either Agent to maintain such account, such
Register or such
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25
subaccount, as applicable, or any error therein, shall not in any manner
affect the obligation of each Facility Borrower to repay the Loans (and all
other amounts owing with respect thereto) made to such Facility Borrower in
accordance with the terms of this Agreement.
4.2 Repayment of Loans. The relevant Facility Borrower shall repay all
outstanding Loans (together with all accrued unpaid interest thereon) on the
Maturity Date (or such earlier date as may be established pursuant to Section
9).
4.3 Interest Rate and Payment Dates. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period therefor on the unpaid
principal amount thereof at a rate per annum equal to the Eurodollar Rate
determined for such Interest Period plus the Applicable Margin.
(b) Each Base Rate Loan shall bear interest for each day on the unpaid
principal amount thereof, at a rate per annum equal to the Base Rate
determined for such day.
(c) Each C$ Prime Loan shall bear interest for each day on the unpaid
principal amount thereof, at a rate per annum equal to the Canadian Prime
Rate determined for such day.
(d) If all or a portion of (i) the principal amount of any Loan, (ii)
any interest payable thereon or (iii) any Facility Fee, Acceptance Fee or
other amount payable hereunder shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall
bear interest at a rate per annum which is (x) in the case of overdue
principal, the rate that would otherwise be applicable thereto pursuant to
the foregoing provisions of this Section 4.3 plus 1% or (y) in the case of
any overdue interest, Facility Fee, Acceptance Fee or other amount, the rate
described in Section 4.3(b) (in the case of amounts payable in Dollars) or
4.3(c) (in the case of amounts payable in C$) plus 1%, in each case from the
date of such non-payment to (but excluding) the date on which such amount is
paid in full (as well after as before judgment).
(e) Interest shall be payable in arrears (i) with respect to Eurodollar
Loans having an Interest Period of three months or less, on the last day of
such Interest Period, (ii) with respect to Eurodollar Loans having an
Interest Period longer than three months, on each day which is three months,
or a whole multiple thereof, after the first day of such Interest Period and
the last day of such Interest Period, (iii) with respect to Base Rate Loans
and C$ Prime Loans, on the last day of each March, June, September and
December, and (iv) with respect to all Loans, upon each repayment, prepayment
or conversion thereof; provided that interest accruing pursuant to Section
4.3(d) shall be payable on demand. Interest payable in respect of U.S. R/C
Loans shall be payable in Dollars by CFC and interest payable in respect of
C$ Loans shall be payable in C$ by CCCL (subject to Section 12).
(f) The amount of interest on any Eurodollar Loans to be paid on any
date as specified in paragraph (e) above shall in each case be determined
under the assumption that the U.S. Utilization for the Utilization Period(s)
during which such interest accrued was less than 50%. On the first Business
Day following the last day of each Excess U.S. Utilization Period, CFC shall
pay to the Administrative Agent, for the benefit of the US$ Banks, an
additional amount of interest equal to the excess (if any) of (i) the amount
of interest which accrued during such Excess U.S. Utilization Period after
giving effect to the actual U.S. Utilization for such Utilization Period
(whether or not such accrued interest was actually payable during such
Utilization Period) over (ii) the amount of interest which would have accrued
during such Utilization Period if the U.S. Utilization during such
Utilization Period had been less than 50%.
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26
4.4 Lending Procedures. (a) Unless the relevant Agent shall have
received notice from a Bank prior to a Borrowing Date that such Bank will not
make available to such Agent such Bank's share of the borrowing requested to
be made on such Borrowing Date, such Agent may assume that such Bank has made
its share of such borrowing available to such Agent on such Borrowing Date,
and such Agent may, in reliance upon such assumption, make available to the
relevant Facility Borrower on such Borrowing Date a corresponding amount. If
such Agent does, in such circumstances, make available to such Facility
Borrower such amount, such Bank shall make its share of such borrowing
available to such Agent forthwith on demand, together with interest thereon
for each day from and including such Borrowing Date that its share of such
borrowing was not made available, to but excluding the date such Bank makes
its share of such borrowing available to such Agent, at the Effective Federal
Funds Rate (in the case of U.S. R/C Loans) or at the then effective Bank Rate
(in the case of C$ Loans). If such amount is so made available, such payment
to such Agent shall constitute such Bank's Loan on such Borrowing Date for
all purposes of this Agreement. If such amount is not so made available to
the relevant Agent, then such Agent shall notify such Facility Borrower of
such failure, and, on the fourth Business Day following such Borrowing Date,
such Facility Borrower shall pay to such Agent such amount, together with
interest thereon for each day that such Facility Borrower had the use of such
ratable portion at the Effective Federal Funds Rate (in the case of U.S. R/C
Loans) or at the then effective Bank Rate (in the case of C$ Loans). Nothing
contained in this Section 4.4(a) shall relieve any Bank which has failed to
make available its share of any borrowing hereunder from its obligation to do
so in accordance with the terms hereof.
(b) The failure of any Bank to make the Loan to be made by it on any
Borrowing Date shall not relieve any other Bank of its obligation, if any,
hereunder to make its Loan on such Borrowing Date, but no Bank shall be
responsible for the failure of any other Bank to make the Loan to be made by
such other Bank on such Borrowing Date.
4.5 Facility Fees. (a) CFC agrees to pay to the Administrative Agent,
for the account of each US$ Bank, in Dollars, a facility fee (the "U.S.
Facility Fee") for each day from and including the Effective Date to but
excluding the Final Date. Such fee shall be payable quarterly in arrears on
(i) the first Business Day of each January, April, July and October (for the
three-month period (or portion thereof) ended on the last day of the
immediately preceding month) and (ii) on the Final Date (for the period ended
on such date for which no payment has been received pursuant to clause (i)
above) and shall be computed for each day during such period at a rate per
annum equal to the Facility Fee Rate in effect on such day on the US$ Bank
Net Combined Commitment of such US$ Bank in effect on such day.
(b) CCCL agrees to pay to the Canadian Administrative Agent, for the
account of each relevant C$ Bank, in Dollars, a facility fee (the "Canadian
Facility Fee") for each day from and including the Effective Date to but
excluding the Final Date. Such fee shall be payable quarterly in arrears on
(i) the first Business Day of each January, April, July and October (for the
three-month period (or portion thereof) ended on the last day of the
immediately preceding month) and (ii) on the Final Date (for the period ended
on such date for which no payment has been received pursuant to clause (i)
above) and shall be computed for each day during such period at a rate per
annum equal to the Facility Fee Rate in effect on such day on the Designated
Canadian Commitment Amount of such C$ Bank in effect on such day.
4.6 Termination or Reduction of Commitments. (a) Prior to the
Termination Date, CFC shall have the right, upon not less than five Business
Days' notice to each Agent, to terminate the Commitments or, from time to
time, to reduce the amount of the U.S. Commitments (so long as, after
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27
giving effect thereto and any contemporaneous prepayment of the Loans, the
Aggregate U.S. Extensions of Credit of each US$ Bank shall be no greater than
such Bank's U.S. Commitment) or reduce the amount of the Canadian Commitments
(so long as, after giving effect thereto and any contemporaneous prepayment
of the C$ Loans, the Aggregate Canadian Extensions of Credit of each C$ Bank
shall be no greater than such Bank's Canadian Commitment). Upon receipt of
such notice the Administrative Agent shall promptly notify each relevant Bank
thereof. Any such reduction shall be in an amount of at least $100,000,000
(in the case of the U.S. Commitments) or $10,000,000 (in the case of the
Canadian Commitments) and shall reduce permanently the amount of the affected
Commitments then in effect. Any termination of the Commitments pursuant to
this Section 4.6(a) shall be accompanied by prepayment in full of the Loans,
together with accrued interest thereon to the date of such prepayment.
(b) The Commitments shall automatically terminate on the Termination
Date.
4.7 Optional Prepayments. Each Facility Borrower may at any time and
from time to time prepay the Loans made to it hereunder, in whole or in part,
without premium or penalty, upon prior notice to the relevant Agent (which
notice must be received by the relevant Agent prior to 10:00 A.M., Local
Time, (i) three Business Days prior to the repayment date in the case of
Eurodollar Loans and (ii) one Business Day prior to the repayment date
otherwise) specifying the date and amount of prepayment, and the category or
categories of Loan to be prepaid; provided, that each prepayment of
Eurodollar Loans on a day other than the last day of the related Interest
Period shall require the payment of any amounts payable by CFC pursuant to
Section 4.12. Upon receipt of any such notice, the relevant Agent shall
promptly notify each relevant Bank thereof. Any such notice shall be
irrevocable, and the payment amount specified in such notice shall be due and
payable on the date specified, together with accrued interest to such date on
the amount prepaid. Partial prepayments shall be in an aggregate principal
amount of $25,000,000 or a multiple of $1,000,000 in excess thereof (in the
case of U.S. R/C Loans) and C$5,000,000 or a multiple of C$1,000,000 in
excess thereof (in the case of C$ Prime Loans). Notwithstanding anything to
the contrary above, Loans consisting of Bankers' Acceptances may not be
prepaid pursuant to this Section 4.7.
4.8 Pro Rata Treatment and Payments. (a) Each borrowing of U.S. R/C
Loans shall be made pro rata according to the then existing U.S. Commitments
of the US$ Banks. Each borrowing of C$ R/C Loans shall be made pro rata
according to the then existing Canadian Commitments of the C$ Banks. Any
reduction of the amount of the Commitments of the Banks hereunder (except for
the termination or reduction of a particular Bank's Commitment pursuant to
Section 4.11(a)) shall be made pro rata according to the amounts of the then
existing relevant Commitments. Each payment (including each prepayment) by a
Facility Borrower on account of principal of and interest on (except for
payments to a particular Bank pursuant to Section 2.5, 4.10, 4.11, 4.12 or
4.13) any category of Loan (other than Eurodollar Loans) shall be made on a
pro rata basis according to the amounts of the then outstanding Loans of such
type of the relevant Banks. Each payment (including each prepayment) by CFC
on account of principal of and interest on Eurodollar Loans designated by CFC
to be applied to a particular Eurodollar Tranche shall be made pro rata
according to the respective outstanding principal amounts of such Eurodollar
Loans then held by the US$ Banks. All payments (including prepayments) by the
relevant Facility Borrower hereunder on account of principal, interest, fees
and other amounts shall be made without setoff or counterclaim to the
relevant Agent for the account of the relevant Banks at the office of the
relevant Agent referred to in Section 12.2 in Dollars or C$, as applicable,
in immediately available funds. The relevant Agent shall promptly distribute
such payments to each Bank entitled to receive a portion thereof in like
funds as received. If any payment hereunder (other than a payment in respect
of a Eurodollar Loan) becomes due and payable on a day other than a Business
Day, the maturity thereof shall be extended to the next succeeding Business
Day. If any payment on a Eurodollar Loan
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28
becomes due and payable on a day other than a Business Day, the maturity
thereof shall be extended to the next succeeding Business Day unless the
result of such extension would be to extend such payment into another
calendar month in which event such payment shall be made on the immediately
preceding Business Day. In the case of any extension of any payment of
principal pursuant to the preceding two sentences, interest thereon shall be
payable at the then applicable rate during such extension. The provisions of
the first five sentences of this Section 4.8(a) shall not apply to any
borrowing or prepayment made pursuant to Section 12.10.
(b) Unless the relevant Agent shall have received notice from the
relevant Facility Borrower prior to the date on which any payment is due to
the relevant Banks hereunder that such Facility Borrower will not make such
payment in full, such Agent may assume that such Facility Borrower has made
such payment in full to such Agent on such date, and such Agent may, in
reliance upon such assumption, cause to be distributed to each such Bank on
such due date an amount equal to the amount then due to such Bank. If and to
the extent such Facility Borrower shall not have so made such payment in full
to such Agent, each such Bank shall repay to such Agent forthwith on demand
such amount distributed to such Bank together with interest thereon, for each
day from and including the date such amount is distributed to such Bank to
but excluding the date such Bank repays such amount to such Agent at the
Effective Federal Funds Rate (in the case of U.S. R/C Loans) or the then
effective Bank Rate (in the case of C$ Loans) for each such day. Nothing
contained in this Section 4.8(b) shall relieve either Facility Borrower from
its obligations to make payments on all amounts due hereunder in accordance
with the terms hereof.
4.9 Computation of Interest and Fees. (a) Interest (other than interest
calculated on the basis of the Prime Rate or the Canadian Prime Rate) shall
be calculated on the basis of a 360-day year for the actual days elapsed.
Facility Fees, Acceptance Fees and interest calculated on the basis of the
Prime Rate or the Canadian Prime Rate is expressed herein and shall be
calculated on the basis of a 365- (or 366-, as the case may be) day year for
the actual days elapsed. The relevant Agent shall, as soon as practicable,
notify the relevant Facility Borrower and the relevant Banks of each
determination of the Eurodollar Rate or the Applicable BA Discount Rate. Any
change in the interest rate in respect of a Loan or in any Facility Fee or
Acceptance Fee resulting from a change in the Base Rate, the Canadian Prime
Rate, the Applicable Margin or Status shall become effective as of the
opening of business on the day on which a change in the Base Rate or Canadian
Prime Rate shall become effective or such Applicable Margin or Status changes
as provided herein, as the case may be. The relevant Agent shall notify the
relevant Facility Borrower and the relevant Banks of the effective date and
the amount of each such change in the Base Rate or Canadian Prime Rate.
(b) Each determination, pursuant to and in accordance with any
provision of this Agreement, of the Eurodollar Rate or the Applicable BA
Discount Rate by the relevant Agent, and each determination by a Reference
Bank of a rate with respect to a Eurodollar Loan or a Bankers' Acceptance to
be notified to the relevant Agent pursuant to the definition of "Eurodollar
Rate" or "Applicable BA Discount Rate", as the case may be, shall be
conclusive and binding on the Facility Borrowers and the Banks in the absence
of manifest error. The relevant Agent shall, at the request of the relevant
Facility Borrower, deliver to such Facility Borrower a statement showing any
quotations given by the relevant Reference Banks and the computations used by
such Agent in determining any Eurodollar Rate or Applicable BA Discount Rate.
(c) If any Reference Bank's relevant Commitment shall terminate
(otherwise than on termination of all the Commitments) or, as the case may
be, the relevant Loans made by it hereunder are assigned, or prepaid or
repaid (otherwise than on the prepayment or repayment of the relevant Loans
<PAGE>
29
among the Banks) for any reason whatsoever, such Reference Bank shall
thereupon cease to be a Reference Bank, and if, as a result of the foregoing,
there shall be only one Reference Bank of a particular category remaining,
then the relevant Agent (after consultation with the relevant Facility
Borrower and the relevant Banks) shall, as soon as practicable thereafter, by
notice to the Facility Borrowers and the relevant Banks, designate another
Bank that is willing to act as a Reference Bank so that there shall at all
times be at least two Reference Banks of each category. In acting so to
designate another Bank to serve as a Eurodollar Reference Bank, the
Administrative Agent will use its best efforts to ensure that one Eurodollar
Reference Bank will, at all times, be a US$ Bank that has its headquarters
office located outside the United States.
(d) If any of the Reference Banks shall be unable or shall otherwise
fail to provide notice of a rate to the relevant Agent upon its request, the
Eurodollar Rate or Applicable BA Discount Rate, as applicable, shall be
determined on the basis of rates provided in notices of the remaining
relevant Reference Banks.
4.10 Increased Costs. In the event that any law, regulation, treaty or
directive or any change therein or in the interpretation or application
thereof or compliance by any Bank with any request or directive (whether or
not having the force of law) from any central bank or other Governmental
Authority enacted or made subsequent to the date hereof:
(a) does or shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, or deposits or other liabilities in or for the account of,
advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of such Bank; or
(b) does or shall impose on such Bank any other condition;
and the result of any of the foregoing is to increase the cost to such Bank
of making or maintaining advances or extensions of credit hereunder to either
Facility Borrower or to reduce any amounts receivable hereunder from either
Facility Borrower (such increase in cost or reduction in amounts receivable,
"Increased Costs") then, in any such case, such Facility Borrower shall
promptly pay to the relevant Agent for the account of such Bank, upon the
written demand of such Bank to such Facility Borrower (with a copy to the
relevant Agent), so long as such Increased Costs are not otherwise included
in the amounts required to be paid to such Bank pursuant to Section 2.5(b),
4.11, 4.12 or 4.13, any additional amounts necessary to compensate such Bank
for such Increased Costs which such Bank deems to be material as determined
by such Bank with respect to its Eurodollar Loans or Bankers' Acceptances, as
the case may be. If a Bank becomes entitled to claim any additional amounts
pursuant to this Section 4.10, it shall promptly notify the relevant Facility
Borrower, through the relevant Agent, of the event by reason of which it has
become so entitled. A certificate as to any additional amounts payable
pursuant to the foregoing sentence submitted by a Bank, through the relevant
Agent, to the relevant Facility Borrower shall be conclusive in the absence
of manifest error.
4.11 Changes in Capital Requirements. (a) In the event that, in the
written opinion of counsel for any Bank (which may, in the discretion of such
Bank, be such Bank's internal counsel), compliance with any law, rule,
regulation or guideline, or any change therein or in the interpretation or
application thereof or compliance by any Bank with any request or directive
(whether or not having the force of law) from any central bank or
Governmental Authority, in each case enacted or made subsequent to the date
hereof shall affect the amount of capital required or expected to be
maintained by such Bank or any corporation controlling such Bank and the
amount of such capital that is required or expected to
<PAGE>
30
be maintained is increased by or based upon the Commitment of such Bank under
this Agreement or any participation agreement entered into pursuant to
Section 12.7, as applicable (such event, a "Change in Law"), such affected
Bank shall notify CFC and the Administrative Agent within 180 days after such
affected Bank shall have obtained actual knowledge of the costs associated
with its compliance with such Change in Law (but in no event later than 365
days after such Bank is first required to comply with such Change in Law). At
the time of such notification such affected Bank shall provide CFC with (i) a
written statement, certified by a senior officer of such affected Bank
responsible for assessing costs associated with its compliance with capital
adequacy requirements, (x) setting forth in reasonable detail the amount that
would adequately compensate such affected Bank for the costs associated with
its compliance with such Change in Law and the assumptions upon which such
affected Bank calculated such amount and (y) certifying that such
calculations comply with the requirements of the next succeeding sentence,
and (ii) a copy of the opinion of counsel referred to in the preceding
sentence. Such affected Bank shall allocate to the Facility Borrowers the
costs associated with such Change in Law in such a way that the proportion of
(i) such costs that are allocated to the Facility Borrowers to (ii) the total
of such costs of such affected Bank associated with such Change in Law as it
relates to all commitments of such Bank to its customers of similar
creditworthiness as the Facility Borrowers, is substantially the same as the
proportion of (i) the Commitment of such affected Bank under this Agreement
or such participation agreement to (ii) the total of all commitments by such
affected Bank to its customers of similar creditworthiness as the Facility
Borrowers. CFC and such affected Bank shall thereafter negotiate in good
faith an agreement to increase that portion of the Facility Fee payable to
such affected Bank under Section 4.5 to a level, which, in the opinion of
such affected Bank, will adequately compensate such affected Bank for such
costs. If such increase is approved in writing by CFC within 90 days from the
date of the notice to CFC from such affected Bank, the Facility Fee payable
by CFC shall, effective from the date of such Change in Law (but subject to
the last sentence of this Section 4.11(a)) include the amount of such agreed
increase, and CFC will so notify the Administrative Agent. If CFC and such
affected Bank are unable to agree on such an increase within 90 days from the
date of the notice to CFC from such affected Bank, CFC shall by written
notice to such affected Bank within 120 days from the date of the aforesaid
notice to CFC from such affected Bank, elect either to (a) terminate the
Commitment of such affected Bank (each such Bank, a "Terminated Bank")
(subject to the last sentence of this Section 4.11(a)) or (b) (subject to the
next to last sentence of this Section 4.11(a)) increase the Facility Fee
payable to such affected Bank by the amount requested by such affected Bank.
Without limiting the foregoing, if CFC elects to take the action described in
clause (b) of the preceding sentence, it may simultaneously therewith reduce
the Commitment of such affected Bank by an amount chosen by CFC. If CFC fails
to provide notice to such affected Bank as described in the second preceding
sentence by such 120th day, CFC shall be deemed to have taken the action
described in clause (b) of such second preceding sentence. CFC (A) may from
time to time after such 120th day reduce the compensation to be received
pursuant to this Section 4.11(a) by any affected Bank as a result of any
Change in Law, to the average compensation (the "Average Compensation") CFC
has agreed, as provided above, to pay the affected Banks as a result of such
Change in Law (such average compensation to be measured by a percentage of
the aggregate Commitments of such affected Banks) and (B) shall pay to each
Terminated Bank, on the date the Commitment of such Bank is terminated, an
amount equal to the excess, if any, of (i) the lesser of (x) the aggregate
Facility Fee that would have been payable to such Bank, from the date of such
Terminated Bank's notice to CFC pursuant to this Section 4.11(a) to the date
the Commitment of such Terminated Bank is terminated, had such Facility Fee
been determined by reference to the Average Compensation and (y) the
aggregate Facility Fee that would have been payable to such Bank during such
period had such Facility Fee been increased by an amount necessary to
adequately compensate such Bank (as determined by such Bank in accordance
with the applicable provisions of this Section 4.11(a)) for the costs
attributable to the relevant Change in Law over (ii) the aggregate Facility
Fee actually paid to such Bank during such period.
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31
(b) On the day the Commitment of a Terminated Bank is terminated
pursuant to Section 4.11(a), CFC or CCCL, as applicable, shall (i) repay all
Loans and other amounts (including accrued interest and Facility Fees) owing
to such Terminated Bank, (ii) be liable to such Terminated Bank under Section
4.12 if any Eurodollar Loans owing to such Terminated Bank shall be repaid
other than on the last day of the Interest Period relating to such Eurodollar
Loan, and (iii) in the case of CCCL, Defease all Bankers' Acceptances
accepted by such Terminated Bank.
(c) Upon the occurrence of any Change in Law each Bank whose Commitment
hereunder is affected by such Change in Law shall transfer its Commitment to
another branch office (or, if such Bank so elects, to an affiliate) of such
Bank, provided that such transfer shall be made only if such Bank shall have
determined in good faith (which determination shall, absent manifest error,
be final, conclusive and binding upon all parties) that (i) on the basis of
existing circumstances, such transfer will avoid the increased costs
resulting from such Change in Law and will not result in any additional
costs, liabilities or expenses to such Bank (unless CFC agrees to pay such
additional costs, liabilities or expenses of such Bank) and (ii) such
transfer is otherwise consistent with the interests of such Bank.
4.12 Indemnity. Each of CFC and CCCL, as applicable, agrees to
indemnify each Bank and to hold such Bank harmless from any loss or expense
(including, but not limited to, any such loss or expense arising from
interest or fees payable by such Bank to lenders of funds obtained by it in
order to maintain its Eurodollar Loans hereunder, but excluding loss of the
Applicable Margin), which such Bank may sustain or incur as a consequence of
(a) failure by either Facility Borrower in making any payment when due
(whether by acceleration or otherwise) of the principal amount of or interest
on the Eurodollar Loans or Bankers' Acceptances of such Bank, (b) failure by
either Facility Borrower to make a borrowing consisting of Eurodollar Loans
or Bankers' Acceptances, or a conversion into or continuation of Eurodollar
Loans or Bankers' Acceptances, after such Facility Borrower has given a
notice requesting or accepting the same in accordance with the provisions of
this Agreement, (c) failure by either Facility Borrower in making any
prepayment after such Facility Borrower has given a notice in accordance with
this Agreement and (d) a payment or prepayment of a Eurodollar Loan on a day
that is not the last day of the Interest Period with respect thereto. In the
case of Eurodollar Loans, such indemnification may include an amount equal to
the excess, if any, of (i) the amount of interest which would have accrued on
the amount so prepaid, or not so borrowed, converted or continued, for the
period from the date of such payment, prepayment or of such failure to
borrow, convert or continue to the last day of the relevant Interest Period
(or proposed Interest Period), in each case at the applicable rate of
interest for such Loans provided for herein (excluding, however, the
Applicable Margin) over (ii) the amount of interest (as reasonably determined
by such Bank) which would have accrued to such Bank on such amount by placing
such amount on deposit for a comparable period with leading banks in the
interbank eurodollar market. The agreements in this Section 4.12 shall
survive the payment of the Loans and all other amounts payable hereunder.
4.13 Taxes. (a) In the event that the adoption of any law, regulation,
treaty or directive or any change therein or in the interpretation or
application thereof, in each case after the date hereof, shall require any
Taxes (as hereinafter defined) to be withheld or deducted from any amount
payable to any Bank under this Agreement, upon notice by such Bank to the
relevant Facility Borrower (with a copy to the relevant Agent) to the effect
that (i) as a result of the adoption of such law, rule, regulation, treaty or
directive or a change therein or in the interpretation thereof, Taxes are
being withheld or deducted from amounts payable to such Bank under this
Agreement and (ii) such Bank has taken all action required to be taken by it
to avoid the imposition of such Taxes pursuant to paragraph (c) of this
Section 4.13 prior to demanding indemnification under this paragraph (a),
such Facility Borrower will pay to the
<PAGE>
32
relevant Agent for the account of such Bank additional amounts so that such
additional amounts, together with amounts otherwise payable under this
Agreement, will yield to such Bank, after deduction from such increased
amount of all Taxes required to be withheld or deducted therefrom, the amount
stated to be payable under this Agreement. The term "Taxes" shall mean all
net income, stamp or other taxes, levies, imposts, duties, charges, fees,
deductions or withholdings, imposed, levied, collected, withheld or assessed
by any country (or by any political subdivision or taxing authority thereof
or therein), excluding, with respect to any Bank, net income and franchise
taxes imposed with respect to net income by any country (or any political
subdivision or taxing authority thereof or therein) where such Bank is
organized or, in respect of such Bank's Eurodollar Loans, by the country (or
any political subdivision or tax authority thereof or therein) where such
Bank's Eurodollar Loans are booked and, in respect of such Bank's Base Rate
Loans, by the country (or any political subdivision or tax authority thereof
or therein) where such Bank's Base Rate Loans are booked (such excluded
taxes, "Other Taxes"). If the relevant Facility Borrower fails to pay any
Taxes when due following notification by any Bank as provided above, such
Facility Borrower shall indemnify such Bank for any incremental taxes,
interest or penalties that may become payable by any Bank as a result of any
such failure by such Facility Borrower to make such payment. Either Facility
Borrower may, upon payment by such Facility Borrower to any Bank claiming
indemnification under this paragraph (a) of any amount payable by such
Facility Borrower to such Bank, elect by not less than four Business Days'
prior written notice to such Bank to terminate the Commitment of such Bank
and prepay or Defease (in the case of Bankers' Acceptances) the outstanding
Loans of such Bank.
(b) Each Bank that is not incorporated under the laws of the United
States of America or a state thereof agrees that it will deliver to CFC and
the Administrative Agent (i) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224 or any successor applicable form,
as the case may be, and (ii) an Internal Revenue Service Form W-8 or W-9 or
any successor form. Each such Bank also agrees to deliver to CFC and the
Administrative Agent two further copies of the said Form 1001 or 4224 and
Form W-8 or W-9, or successor applicable forms or other manner of
certification, as the case may be, on or before the date that any such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form previously delivered by it to CFC, and such
extensions or renewals thereof as may reasonably be requested by CFC or the
Administrative Agent, unless in any such case an event (including, without
limitation, any change in treaty, law or regulation) has occurred prior to
the date on which any such delivery would otherwise be required which renders
all such forms inapplicable or which would prevent such Bank from duly
completing and delivering any such form with respect to it and such Bank so
advises CFC and the Administrative Agent. Such Bank shall certify (i) in the
case of Form 1001 or 4224, that it is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal
income taxes and (ii) in the case of a Form W-8 or W-9, that it is entitled
to an exemption from United States backup withholding tax.
(c) No Bank may request indemnification for any Taxes from either
Facility Borrower under paragraph (a) of this Section 4.13 to the extent that
such Taxes would have been avoided or reduced by such Bank's transfer of its
Loans affected by such event to another office of such Bank (or to an
affiliate of such Bank), by such Bank's properly claiming the benefit of any
exemption from or reduction of such Taxes (whether provided by statute,
treaty or otherwise), including, without limitation, by delivering the forms
required by paragraph (b) of this Section 4.13, or by such Bank's taking any
other action which in its judgment is reasonable to avoid or reduce such
Taxes, provided that such Bank shall not be required to (i) take any action
which in the reasonable judgment of such Bank could directly or indirectly
result in any increased cost or expense or in any loss of opportunity to such
Bank unless the relevant Facility Borrower shall have provided to such Bank
indemnity or reimbursement therefor in
<PAGE>
33
form and substance reasonably satisfactory to such Bank or (ii) claim or
apply any tax credit against such Taxes.
(d) Within 30 days after the payment by either Facility Borrower of any
Taxes withheld or deducted from any amount payable to any Bank under this
Agreement, and irrespective of whether such Bank is entitled to demand
indemnification in respect thereof under paragraph (a) above, such Facility
Borrower will furnish to such Bank (with a copy to the relevant Agent), the
original or a certified copy of a receipt evidencing payment thereof.
4.14 Use of Proceeds. The proceeds of the Loans shall be used by each
Facility Borrower for general corporate purposes.
4.15 Replacement of Banks. CFC shall be permitted to replace any Bank
which (a) requests reimbursement for amounts owing pursuant to Section 2.5,
4.10, 4.11 or 4.13 or (b) defaults in its obligation to make Loans, with a
replacement Commercial Bank; provided that (i) such replacement does not
conflict with any Requirement of Law, (ii) no Event of Default shall have
occurred and be continuing at the time of such replacement, (iii) the
relevant Facility Borrower shall repay (or the replacement Commercial Bank
shall purchase, at par) all Loans (other than Bankers' Acceptances) and other
amounts (including accrued interest) owing to such replaced Bank concurrently
with such replacement, (iv) in the case of any replaced C$ Banks, (x) CCCL
shall Defease all Bankers' Acceptances accepted by such replaced Bank and (y)
CCCL shall give the Canadian Administrative Agent notice of such Defeasance,
(v) CFC shall be liable to such replaced Bank under Section 4.12 if any
Eurodollar Loan owing to such replaced Bank shall be prepaid (or purchased)
other than on the last day of the Interest Period relating thereto, (vi) the
replacement Commercial Bank, if not already a Bank, and the terms and
conditions of such replacement, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Bank shall be obligated to make such
replacement in accordance with the provisions of Section 12.7 (provided that
CFC shall be obligated to pay the registration and processing fee referred to
therein), (viii) until such time as such replacement shall be consummated,
the Facility Borrowers shall pay all additional amounts (if any) required
pursuant to Section 2.5, 4.10, 4.11 or 4.13, as the case may be, and (ix) any
such replacement shall not be deemed to be a waiver of any rights which the
Facility Borrowers, any Agent or any other Bank shall have against the
replaced Bank.
SECTION 5. REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Agreement and to make
the Loans herein provided for, CFC and, to the extent applicable, CCCL,
hereby represents and warrants to each Bank that:
5.1 Financial Condition. The consolidated balance sheet of CFC and its
Subsidiaries as at December 31, 1997, and the related consolidated statements
of net earnings and cash flows for the fiscal year ended on such date,
certified by Deloitte & Touche, copies of which have been delivered to each
Bank, present fairly the consolidated financial position of CFC and its
Subsidiaries as at such date, and the consolidated results of their
operations and cash flows for the fiscal year then ended. The unaudited
consolidated balance sheet of CFC and its Subsidiaries as at March 31, 1998,
and the related consolidated statements of net earnings and cash flows for
the three-month period ended on such date, certified by a Responsible
Officer, copies of which have been delivered to each Bank, present fairly the
consolidated financial condition of CFC and its Subsidiaries as at such date,
and the consolidated results of their operations for the three-month period
then ended (subject to normal year-end audit adjustments).
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34
Such financial statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP. As at March 31, 1998, neither CFC
nor any of its Subsidiaries had any asset, liability, contingent obligation,
liability for taxes, long-term lease or unusual forward or long-term
commitment material to the financial condition of CFC and its Subsidiaries
taken as a whole, which was not reflected in the foregoing statements or in
the notes thereto.
5.2 No Change. Between December 31, 1997 and the Effective Date there
has been no material adverse change in the business, operations or financial
condition of CFC and its Subsidiaries taken as a whole.
5.3 Corporate Existence. Each Facility Borrower (a) is a corporation
duly incorporated, validly existing and in good standing under the laws of
the jurisdiction of its organization, and (b) is duly qualified as a foreign
corporation to do business and is in good standing in each of the
jurisdictions in which the character of the properties owned or held under
lease by it or the nature of business transacted by it makes such
qualification necessary, except in the case of this clause (b) to the extent
that the failure to be so qualified or in good standing would not have a
material adverse effect on the business, operations or financial condition of
CFC and its Subsidiaries taken as a whole.
5.4 Corporate Authorization; No Violation. The execution, delivery and
performance by each Facility Borrower of this Agreement are within the
corporate powers of such Facility Borrower, have been duly authorized by all
necessary corporate action, and do not contravene any Requirement of Law or
Contractual Obligation of CFC or any of its Subsidiaries, except to the
extent that such contravention would not have a material adverse effect on
the business, operations or financial condition of CFC and its Subsidiaries
taken as a whole or on the ability of such Facility Borrower to fulfill its
obligations under this Agreement or on the rights and remedies of the Agents
and the Banks hereunder.
5.5 Government Authorization. No authorization or approval or other
action by, and no notice to or filing with, any Governmental Authority is
required to be obtained or made by CFC or any of its Subsidiaries for the due
execution, delivery and performance by each Facility Borrower of this
Agreement.
5.6 Federal Regulations. Neither CFC nor any of its Subsidiaries is
principally engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulation U, T or
X issued by the Federal Reserve Board), and no proceeds of any borrowing
hereunder will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.
5.7 Enforceable Obligations. This Agreement has been duly executed and
delivered on behalf of each Facility Borrower, and this Agreement constitutes
a legal, valid and binding obligation of each Facility Borrower enforceable
against such Facility Borrower in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by principles of equity, whether considered
in a proceeding in equity or at law.
5.8 No Material Litigation. No litigation, investigation or proceeding
of or before any arbitrator or Governmental Authority is pending or, to the
knowledge of either Facility Borrower, threatened by or against CFC or any of
its Subsidiaries or against any of its or their respective properties or
revenues, in which there is a reasonable likelihood of an adverse
determination (a) with respect to this Agreement or any of the transactions
contemplated hereby, if such adverse determination would have a
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35
material adverse effect on the ability of either Facility Borrower to fulfill
its obligations under this Agreement or on the rights and remedies of the
Administrative Agent and the Banks hereunder or (b) which would, if adversely
determined, have a material adverse effect on the business, operations,
property or financial condition of CFC and its Subsidiaries taken as a whole.
5.9 ERISA. No Prohibited Transaction or Accumulated Funding Deficiency
(other than those that have been waived by the Internal Revenue Service) has
occurred since July 1, 1974 with respect to any Plan and no Reportable Event
has occurred since July 1, 1974 with respect to any Plan which could in
either case subject CFC or any of its Subsidiaries to any tax, penalty or
other liabilities in the aggregate material in relation to the business,
operations, property or financial or other condition of CFC and its
Subsidiaries taken as a whole. The projected benefit obligations with respect
to all benefits, both vested and nonvested, under all Single Employer Plans
(based on the most recently available actuarial information and computed in
accordance with Statement of Accounting Standards No. 87) maintained by CFC
or a Commonly Controlled Entity did not exceed, at December 31, 1997, the
fair value of the assets of such Plans.
5.10 Investment Company Act; Other Regulations. No Facility Borrower is
an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as
amended. No Facility Borrower is subject to regulation under any statute or
regulation of the United States or Canada (or any governmental unit thereof)
which limits its ability to incur Indebtedness.
5.11 Existing Financial Covenants. Schedule II hereto sets forth a list
of all Material Indebtedness of CFC or any Significant Subsidiary the
documentation with respect to which includes a Financial Covenant which is
more onerous than, or materially different from (it being understood that a
quarterly Debt to Equity Ratio with respect to CFC shall not under any
circumstances be deemed to be "materially different from" the Financial
Covenant contained in Section 8.1), the Financial Covenant contained in
Section 8.1, together with a complete and correct transcription of the text
of each such Financial Covenant.
SECTION 6. CONDITIONS PRECEDENT
6.1 Conditions to Effectiveness. The effectiveness of this Agreement is
subject to the satisfaction of the following conditions precedent:
(a) Execution of Agreement and Addenda. (i) This Agreement shall have
been executed and delivered by a duly authorized officer of each Facility
Borrower and each Agent and (ii) the Administrative Agent shall have
received an executed Addendum (or a copy thereof by facsimile
transmission) from each Person listed on Schedule I, provided, that,
notwithstanding the foregoing, in the event that an Addendum has not been
duly executed and delivered by each Person listed on Schedule I on the
date (which shall be no earlier than the date hereof) on which this
Agreement shall have been executed and delivered by each of CFC and the
Administrative Agent, this Agreement shall, subject to satisfaction of the
other conditions precedent set forth in this Section 6.1, nevertheless
become effective on such date with respect to those Persons which have
executed and delivered an Addendum on or before such date if on such date
CFC and the Administrative Agent shall have designated one or more
Commercial Banks (the "Designated Banks") to assume, in the aggregate, all
of the Commitments which would have been held by the Persons listed on
Schedule I (the "Non-Executing Persons") which have not so executed an
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36
Addendum (subject to each such Designated Bank's prior written consent in
its sole discretion and its execution of an Addendum). Schedule I shall
automatically be deemed to be amended to reflect the respective
Commitments of the Designated Banks and the omission of the Non-Executing
Persons as Banks hereunder.
(b) Closing Certificate. The Administrative Agent shall have received a
certificate of each Facility Borrower, dated the Effective Date,
substantially in the form of Exhibit B, with appropriate insertions,
satisfactory in form and substance to the Administrative Agent, executed
by the President or any Vice President and the Secretary or any Assistant
Secretary of such Facility Borrower, and attaching the documents referred
to in Section 6.1(c) and (d).
(c) Corporate Proceedings of the Facility Borrowers. The Administrative
Agent shall have received a copy of the resolutions, in form and substance
satisfactory to the Administrative Agent, of the Board of Directors of
each Facility Borrower (or a duly authorized committee thereof)
authorizing (i) the execution, delivery and performance of this Agreement
and (ii) the borrowings by such Facility Borrower contemplated hereunder.
(d) Corporate Documents. The Administrative Agent shall have received
true and complete copies of the certificate of incorporation or
amalgamation and by-laws of each Facility Borrower.
(e) Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions, with a copy for each Bank:
(i) the executed legal opinion of Simpson Thacher & Bartlett,
counsel to the Administrative Agent, substantially in the form of
Exhibit C-1;
(ii) the executed legal opinion of Christopher A. Taravella, Esq.,
Vice President and General Counsel of CFC, substantially in the form of
Exhibit C-2; and
(iii) the executed legal opinion of Gowling, Strathy & Henderson,
Canadian Counsel to CCCL, substantially in the form of Exhibit C-3.
(f) Existing Agreement. The Administrative Agent shall have received
satisfactory evidence that the Existing Agreement shall have been
terminated pursuant to an irrevocable notice of termination and that any
amounts owing thereunder (including, without limitation, accrued unpaid
commitment fees thereunder through the Effective Date) by the relevant
Facility Borrower shall have been (or shall upon the occurrence of the
Effective Date be) paid in full. Without affecting any terms of the
Existing Agreement which expressly survive the termination of the Existing
Agreement, each Bank party to the Existing Agreement hereby waives any
requirement of advance notice of such termination contained in the
Existing Agreement and hereby agrees that the Existing Agreement and the
commitments thereunder (subject to receipt of any other required consents
of any other Person) shall terminate simultaneously with the satisfaction
of the conditions to effectiveness set forth in this Section 6.1.
The Administrative Agent shall notify the Banks of the Effective Date
promptly after the occurrence thereof, which notice shall be accompanied, if
applicable, with a copy of Schedule I revised to give effect to any deemed
amendments thereto made pursuant to Section 6.1(a).
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37
6.2 Conditions to Each Loan. The obligation of each Bank to make any
Loan on or after the Effective Date to be made by it hereunder is subject to
the satisfaction (or waiver by the Required U.S. Banks (in the case of U.S.
R/C Loans) or the Required C$ Banks (in the case of C$ Loans)) of the
following conditions precedent:
(a) Representations and Warranties. The representations and warranties
made by CFC and, in the case of C$ Loans, CCCL, shall be correct in all
material respects on and as of the Borrowing Date for such Loan as if made
on and as of such date, except for any such representations or warranties
which relate solely to an earlier date.
(b) No Default or Event of Default. No Default or Event of Default
shall have occurred and be continuing on such Borrowing Date or after
giving effect to the Loans to be made on such Borrowing Date.
Each borrowing by either Facility Borrower hereunder shall constitute a
representation and warranty by such Facility Borrower as of the date of each
such borrowing that the conditions in this Section 6.2 have been satisfied.
SECTION 7. AFFIRMATIVE COVENANTS
Each of CFC and, to the extent applicable, CCCL hereby covenants and
agrees that so long as the Commitments remain in effect, any Loan remains
outstanding and unpaid or any other amount is owing to any Bank or either
Agent hereunder:
7.1 Financial Statements, etc. (a) Each Facility Borrower will furnish
(a) in the case of CFC, to the Administrative Agent and each Bank or (b) in
the case of CCCL, to the Canadian Administrative Agent and each C$ Bank:
(i) as soon as available and in any event within 60 days after
the end of the first, second and third quarterly accounting periods in
each fiscal year of such Facility Borrower, copies of financial
statements of such Facility Borrower and its Subsidiaries consisting
of, at a minimum, balance sheets of such Facility Borrower and its
Subsidiaries on a consolidated basis as of the end of such quarterly
accounting period, and related statements of net earnings and cash
flows for the portion of such fiscal year ended with the last day of
such quarterly accounting period, all in reasonable detail and prepared
and certified (subject to year-end audit adjustments) by a Responsible
Officer (which certification may be included in the certificate
referred to in Section 7.1(a)(iii)) and stating in comparative form the
respective figures for the corresponding date and period in the
previous fiscal year;
(ii) as soon as available and in any event within 90 days after
the end of each fiscal year of such Facility Borrower, copies of
financial statements of such Facility Borrower and its Subsidiaries
consisting of, at a minimum, balance sheets of such Facility Borrower
and its Subsidiaries on a consolidated basis as of the end of such
fiscal year, and related statements of net earnings and cash flows for
such fiscal year, all in reasonable detail and certified by independent
public accountants of nationally recognized standing selected by such
Facility Borrower and stating in comparative form the respective
figures as of the end of and for the previous fiscal year;
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38
(iii) concurrently with the financial statements for each
quarterly accounting period and for each fiscal year of such Facility
Borrower furnished pursuant to paragraphs (a)(i) and (a)(ii) of this
Section 7.1, a certificate of a Responsible Officer stating that, based
on an examination which in the opinion of the signer is sufficient to
enable him to make an informed statement, such Facility Borrower and
its Subsidiaries have performed and observed all of, and neither such
Facility Borrower nor any of its Subsidiaries is in default in the
performance or observance of any of, the terms, covenants, agreements
and conditions of this Agreement or, if such Facility Borrower or any
of its Subsidiaries shall be in default, specifying all such defaults
and the nature thereof, of which the signer of such certificate may
have knowledge; and
(iv) such other information relating to the affairs of such
Facility Borrower and its Subsidiaries as any Bank through the
Administrative Agent may from time to time reasonably request.
The reports referred to in this Section 7.1(a) may, at the option of the
relevant Facility Borrower, be delivered via electronic mail to any E-mail
Bank.
(b) (i) Upon written request by any Bank through the Administrative
Agent, each Facility Borrower will furnish to such Bank copies of all such
reports of the type a publicly held corporation would generally make
available to its stockholders as such Facility Borrower shall make available
to its parent company and (ii) upon written request of the Administrative
Agent, each Facility Borrower will furnish to the Administrative Agent all
regular and periodic reports which CFC or any Subsidiary may be required to
file with the Securities and Exchange Commission, the Ontario Securities
Commission or any similar or corresponding government department, commission,
board, bureau or agency, domestic or foreign, or with any securities
exchange.
7.2 Maintenance of Existence. Each Facility Borrower will preserve,
renew and keep in full force and effect its corporate existence and take all
reasonable action to maintain all rights, privileges and franchises necessary
or desirable in the normal conduct of its business, except for rights,
privileges and franchises the loss of which would not in the aggregate in the
reasonable business judgment of such Facility Borrower have a material
adverse effect on the business, operations, property or financial or other
condition of such Facility Borrower and its Subsidiaries taken as a whole,
and except as otherwise permitted by Section 8.2.
7.3 Notices. Each Facility Borrower will promptly give notice to the
Administrative Agent (which shall notify the Banks) of (a) the occurrence of
any Default or Event of Default (accompanied by a certificate of a
Responsible Officer specifying the nature of such event, the period of
existence thereof, and the action that the relevant Facility Borrower
proposes to take with respect thereto) and (b) the execution and delivery of
any documentation with respect to any Material Indebtedness of CFC or any
Significant Subsidiary if such documentation includes a Financial Covenant
which is more onerous than, or materially different from (it being understood
that a quarterly Debt to Equity Ratio with respect to CFC shall not under any
circumstances be deemed to be "materially different from" the Financial
Covenant contained in Section 8.1), the Financial Covenant contained in
Section 8.1, accompanied by a complete and correct transcription of the text
of such Financial Covenant. The delivery of any such notice shall be deemed
to automatically amend Schedule II to reflect the existence of such Financial
Covenant and the text thereof.
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39
SECTION 8. NEGATIVE COVENANTS
Each of CFC and, to the extent applicable, CCCL, hereby covenants and
agrees that so long as the Commitments remain in effect, any Loan remains
outstanding and unpaid or any other amount is owing to any Bank or either
Agent hereunder:
8.1 Debt to Equity Ratio. CFC will not permit the ratio of Debt on the
last day of any fiscal quarter of CFC to Equity on such day to be greater
than 11.0 to 1.0.
8.2 Limitation on Fundamental Change. (a) CFC will not (i) merge or
consolidate with any other Person (unless (x) CFC shall be the continuing
corporation and (y) immediately before and immediately after giving effect to
such merger or consolidation, no Default or Event of Default shall have
occurred and be continuing) or (ii) sell or convey all or substantially all
of its assets to any Person.
(b) CCCL will not (i) amalgamate with any other Person (unless (x) the
amalgamated Person shall, if requested by the Administrative Agent, execute
and deliver a confirmation that it is a resident of Canada for purposes of
the Income Tax Act (Canada), a ratification of any outstanding C$ Loans and a
confirmation of its assumption of the CCCL Obligations and (y) immediately
before and immediately after giving effect to such amalgamation, no Default
or Event of Default shall have occurred and be continuing) or (ii) sell or
convey all or substantially all of its assets to any Person (other than CFC).
8.3 Limitation on Liens. (a) CFC will not, and will not permit any
Finance Subsidiary to, create, assume or incur, or suffer to be created,
assumed or incurred or to exist, any Lien in respect of any property of any
character of CFC or such Finance Subsidiary, whether heretofore or hereafter
acquired; excluding, however, from the operation of this covenant:
(i) any deposit of assets of CFC or any of its Finance Subsidiaries
with any surety company or clerk of any court, or in escrow, as
collateral in connection with, or in lieu of, any bond on appeal by CFC
or any of its Finance Subsidiaries, from any judgment or decree, or in
connection with other proceedings or actions at law or in equity by or
against CFC or any of its Finance Subsidiaries;
(ii) Liens created by any Finance Subsidiary in favor of CFC or a
wholly-owned Subsidiary securing indebtedness of such Finance Subsidiary
to CFC or a wholly-owned Subsidiary (which Liens cannot be transferred
except to CFC or to another wholly-owned Subsidiary);
(iii) any deposits to secure public or statutory obligations of CFC or
any of its Finance Subsidiaries, other than any such deposit made as a
result of or in connection with the occurrence of any of the events
described in clause (i), (ii), (iii) or (iv) of Section 9(g);
(iv) any purchase money Liens in respect of fixed assets or other
physical or real properties heretofore or hereafter acquired by CFC or
any of its Finance Subsidiaries, or any Liens existing in respect of
such property at the time of acquisition thereof; provided, however,
that no such Lien shall extend to or cover any other property of CFC or
such Finance Subsidiary, as the case may be;
<PAGE>
40
(v) any Liens which are (A) in respect of fixed assets or other
physical properties of a corporation which is not a Finance Subsidiary
as of the date hereof, and (B) in existence at the time such corporation
becomes a Finance Subsidiary;
(vi) the extension, renewal or replacement of any Lien permitted by
paragraphs (i) through (v) above in respect of the same property
theretofore subject thereto or the extension, renewal or replacement
(without increase of principal amount) of the indebtedness secured
thereby;
(vii) Liens for taxes not yet due or which are being contested in good
faith and by appropriate proceedings if adequate reserves with respect
thereto are maintained on the books of CFC or such Finance Subsidiary,
as the case may be, in accordance with GAAP;
(viii) carriers', warehousemen's, mechanics', landlords', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business (A) which are not overdue for a period of more than 60 days or
(B) which are being contested in good faith and by appropriate
proceedings if adequate reserves with respect thereto are maintained on
the books of CFC or such Finance Subsidiary, as the case may be, in
accordance with GAAP;
(ix) easements, rights-of-way, zoning and similar restrictions and
other similar encumbrances or title defects incurred in the ordinary
course of business which, in the aggregate, are not substantial in
amount, and which do not in any case materially detract from the value
of the property subject thereto or interfere with the ordinary conduct
of the business of CFC or its Finance Subsidiaries;
(x) any attachment or judgment lien, unless the judgment it secures
shall not, within 30 days after the entry thereof, have been discharged
or execution thereof stayed pending appeal, or shall not have been
discharged within 30 days after the expiration of any such stay;
(xi) Liens granted on assets in connection with leveraged leases and
project financings entered into in the ordinary course of the Finance
Business;
(xii) Liens on receivables payable in foreign currencies (other than
C$) to secure borrowings in foreign countries (other than Canada); and
(xiii) Liens to secure Indebtedness and other obligations of CFC or any
of its Finance Subsidiaries not otherwise permitted by this Section 8.3,
but only to the extent that the aggregate amount of Indebtedness and
other obligations secured thereby does not at any time exceed
$100,000,000 (or the equivalent thereof in any other currency).
(b) CFC will not permit any Domestic Subsidiary that is not a Finance
Subsidiary to create, assume or incur, or suffer to be created, assumed or
incurred or to exist, any Lien in respect of any property of any character of
such Domestic Subsidiary, whether heretofore or hereafter acquired,
excluding, however, from the operation of this covenant:
(i) Liens on property of such Domestic Subsidiary that would be
permitted under Section 8.3(a) if such Domestic Subsidiary were a
Finance Subsidiary;
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41
(ii) Liens on property of such Domestic Subsidiary that are incurred in
the ordinary course of the Finance Business or the Real Estate Business
of such Domestic Subsidiary; and
(iii) Liens on any property of such Domestic Subsidiary if such
Domestic Subsidiary is a "single purpose" entity formed for the purpose
of holding title to such property and engages in no activities other
than those related to holding title to such property.
8.4 Additional Covenants. At any time after the occurrence of a Change
of Control:
(a) Limitation on Dividends, Investments, etc. CFC shall not (i)
declare or pay any dividend (other than dividends payable solely in
common stock of CFC) on, or make any payment on account of, or set apart
assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any shares
of any class of Capital Stock of CFC, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either
directly or indirectly, whether in cash or property or in obligations of
CFC or any Subsidiary or (ii) make, or permit any Subsidiary to make,
any investment, loan, advance, capital contribution or extension of
credit (including by way of guaranty in favor of third party creditors),
whether in cash or property or otherwise, in or to or for the benefit of
any CFC Affiliate, except that (x) so long as no Event of Default has
occurred and is continuing (or would occur after giving effect thereto),
CFC may declare and pay any scheduled dividend on, and make redemptions
of, preferred stock issued by CFC to any Person (other than a CFC
Affiliate) to the extent permitted by the terms thereof and (y) CFC and
its Subsidiaries may make investments, loans, advances and extensions of
credit in or to or for the benefit of any CFC Affiliate in the ordinary
course of its Finance Business consistent with historical practices (in
each case determined as of the date of such Change of Control) and in
accordance with Section 8.4(c).
(b) Minimum Equity. CFC shall not permit Equity (determined
without giving effect to any redemption of preferred stock of CFC made
pursuant to Section 8.4(a) after the date of such Change of Control) to
be less than an amount equal to Equity as of the day immediately
preceding the occurrence of such Change of Control minus $250,000,000.
(c) Limitation on Amendments to Intercompany Agreements; CFC
Affiliate Transactions. CFC shall not, and shall not permit any
Subsidiary to, (i) amend or modify, or agree to amend or modify, any of
the provisions of any Intercompany Agreement in a manner materially
adverse to the interests of either (x) CFC and its Subsidiaries taken as
a whole or (y) the Banks, or (ii) enter into, or agree to enter into,
any Intercompany Agreement which is materially adverse to the interests
of either (x) CFC and its Subsidiaries taken as a whole or (y) the
Banks. In addition, CFC shall not, and shall not permit any Subsidiary
to, engage in any transaction with any CFC Affiliate (other than CFC and
its Subsidiaries) on terms substantially less favorable to CFC or such
Subsidiary than would be obtainable at the time in comparable
transactions of CFC or such Subsidiary with Persons not CFC Affiliates.
As used in this Section 8.4(c), "Intercompany Agreement" means any
agreement between CFC or any Subsidiary and any CFC Affiliate, any
instrument issued by CFC or any Subsidiary to any CFC Affiliate and any
instrument issued by any CFC Affiliate to CFC or any Subsidiary.
(d) Limitation on Lines of Business. CFC shall not, and shall not
permit any Subsidiary to, engage in any business other than the Finance
Business, the Finance-Related Insurance Business and the other
businesses in which CFC and its Subsidiaries are engaged as of
<PAGE>
42
the date of such Change of Control, and other than businesses in which
CFC or any of its Subsidiaries may be involved in connection with or
related to any workout, liquidation, foreclosure or other realization
on or disposition of assets in which it has a security interest, or any
other exercise of rights or remedies pursuant to a workout in
connection with any financing (whether equity or debt) provided by CFC
or any of its Subsidiaries to any Person.
SECTION 9. EVENTS OF DEFAULT
Upon the occurrence of any of the following events:
(a) CFC or CCCL shall fail to pay any principal of any Loan when due in
accordance with the terms hereof; or to pay any interest on any Loan or
any fee or other amount owing hereunder within five Business Days after
any such interest, fee or other amount becomes due in accordance with
the terms hereof; or
(b) any representation or warranty made by either Facility Borrower
herein, or deemed made by either Facility Borrower pursuant to Section 5
or 6, or which is contained in any certificate, document or financial or
other statement furnished at any time under or in connection with this
Agreement shall prove to have been incorrect in any material respect on
or as of the date made, or deemed made; or
(c) either Facility Borrower shall default in the observance or
performance of any agreement contained in Section 8.1, 8.2 or 8.4; or
(d) either Facility Borrower shall default in the observance or
performance of any other agreement, covenant or term contained in this
Agreement (including any failure to make any payment required hereunder
other than as described in paragraph (a) above), and such default shall
continue unremedied for a period of 30 days after receipt by such
Facility Borrower of notice of such default from the Administrative
Agent; or
(e) CFC or any Significant Subsidiary shall default in any payment of
$25,000,000 (or the equivalent thereof in any other currency) or more of
principal of or interest on any Indebtedness or in the payment of
$25,000,000 (or the equivalent thereof in any other currency) or more on
account of any guarantee in respect of Indebtedness, beyond the period
of grace, if any, provided in the instrument or agreement under which
such Indebtedness or guarantee was created; or
(f) (i) CFC or any of its Significant Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it
a bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or (B) seeking appointment of a
receiver, trustee, custodian or other similar official for it or for all
or any substantial part of its assets, or CFC or any of its Significant
Subsidiaries shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against CFC or any of its
Significant Subsidiaries any case, proceeding or other action of a
nature referred to in clause (i) above which (A) results in the entry of
an order for relief or any such adjudication or appointment or (B)
remains undismissed,
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43
undischarged or unbonded for a period of 60 days; or (iii) there shall
be commenced against CFC or any of its Significant Subsidiaries any
case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of its assets which results in the entry of an order
for any such relief which shall not have been vacated, discharged, or
stayed or bonded pending appeal within 60 days from the entry thereof;
or (iv) CFC or any of its Significant Subsidiaries shall take any
action in furtherance of, or indicating its consent to, approval of, or
acquiescence in, any of the acts set forth in clause (i), (ii) or (iii)
above; or (v) CFC or any of its Significant Subsidiaries shall admit in
writing its inability to pay its debts generally as they become due; or
(g) (i) any Person shall engage in any Prohibited Transaction involving
any Plan, (ii) any Accumulated Funding Deficiency, whether or not
waived, shall exist with respect to any Plan, (iii) a Reportable Event
shall occur with respect to, or proceedings shall commence to have a
trustee appointed, or a trustee shall be appointed, to administer or to
terminate, any Single Employer Plan, which Reportable Event or
institution of proceedings is, in the reasonable opinion of the Required
Banks, likely to result in the termination of such Plan for purposes of
Title IV of ERISA, and, in the case of a Reportable Event, the
continuance of such Reportable Event unremedied for ten days after
notice of such Reportable Event pursuant to Section 4043(a), (c) or (d)
of ERISA is given or the continuance of such proceedings for ten days
after commencement thereof, as the case may be, (iv) any Single Employer
Plan shall terminate for purposes of Title IV of ERISA, or (v) any other
event or condition shall occur or exist with respect to a Single
Employer Plan; and in each case in clauses (i) through (v) above, the
Administrative Agent shall have notified CFC that, in the opinion of the
Required Banks, such event or condition, together with all other such
events or conditions, if any, could reasonably be expected to subject
CFC or any of its Subsidiaries to any tax, penalty or other liabilities
in the aggregate material in relation to the business, operations,
property or financial or other condition of CFC and its Subsidiaries
taken as a whole; or
(h) one or more final judgments or decrees shall be entered against CFC
or any of its Significant Subsidiaries involving in the aggregate a
liability (not paid or fully covered by insurance) of $100,000,000 (or
the equivalent thereof in any other currency) or more, shall have been
unpaid for a period of 60 days and shall not have been stayed; or
(i) Chrysler shall at any time fail to own at least 51% of the issued
and outstanding shares of the common stock of CFC; or
(j) CFC or any of its Significant Subsidiaries shall default in the
observance or performance of any Financial Covenant contained in any
instrument or agreement evidencing, securing or relating to any of its
Material Indebtedness, the effect of which default is to cause, or to
permit the holder or holders of such Material Indebtedness (or a trustee
or agent on behalf of such holder or holders) to cause, such Material
Indebtedness to become due prior to its stated maturity;
then, and in any such event, (a) if such event is an Event of Default
specified in clause (i) or (ii) of paragraph (f) above with respect to CFC,
automatically the Commitments shall immediately terminate and the Loans
(including the face amount of all Bankers' Acceptances accepted by any C$
Bank), with accrued interest thereon, and all other amounts owing under this
Agreement shall immediately become due and payable, and (b) if such event is
any other Event of Default, either or both of the following actions may be
taken: (i) with the consent of the Required Banks, the Administrative Agent
may, or upon
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44
the request of the Required Banks, the Administrative Agent shall, by notice
to CFC, declare the Commitments to be terminated forthwith, whereupon the
Commitments shall immediately terminate; and (ii) with the consent of the
Required Banks, the Administrative Agent may, or upon the request of the
Required Banks, the Administrative Agent shall, by notice of default to CFC,
declare the Loans (including the face amount of all Bankers' Acceptances
accepted by any C$ Bank), with accrued interest thereon, and all other
amounts owing under this Agreement to be due and payable forthwith, whereupon
the same shall immediately become due and payable. Except as expressly
provided above in this Section 9, presentment, demand, protest and all other
notices of any kind are hereby expressly waived.
SECTION 10. THE AGENTS
10.1 Appointment. Each Bank hereby irrevocably designates and appoints
the Administrative Agent as the administrative agent of such Bank under this
Agreement, and each Bank hereby irrevocably authorizes the Administrative
Agent as administrative agent for such Bank to take such action on its behalf
under the provisions of this Agreement and to exercise such powers and
perform such duties as are expressly delegated to the Administrative Agent by
the terms of this Agreement, together with such other powers as are
reasonably incidental thereto. Each C$ Bank hereby irrevocably designates and
appoints the Canadian Administrative Agent as the Canadian administrative
agent of such Bank under this Agreement, and each C$ Bank hereby irrevocably
authorizes the Canadian Administrative Agent as Canadian administrative agent
for such Bank to take such action on its behalf under the provisions of this
Agreement and to exercise such powers and perform such duties as are
expressly delegated to the Canadian Administrative Agent by the terms of this
Agreement, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, neither Agent shall have any duties or responsibilities, except
those expressly set forth herein, or any fiduciary relationship with any
Bank, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise
exist against either Agent.
10.2 Delegation of Duties. Each Agent may execute any of its duties
under this Agreement by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such
duties. Without limiting the foregoing, the Administrative Agent may appoint
CASG as its agent to perform the functions of the Administrative Agent
hereunder relating to the advancing of funds to CFC and distribution of funds
to the Banks and to perform such other related functions of the
Administrative Agent hereunder as are reasonably incidental to such
functions.
10.3 Exculpatory Provisions. Neither Agent nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates
(including, without limitation, CASG) shall be (a) liable for any action
lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement (except for its or such Person's own gross
negligence or willful misconduct), or (b) responsible in any manner to any of
the Banks for any recitals, statements, representations or warranties made by
either Facility Borrower or any Subsidiary or any officer thereof contained
in this Agreement or in any certificate, report, statement or other document
referred to or provided for in, or received by either Agent under or in
connection with, this Agreement or for any failure of either Facility
Borrower or any Subsidiary to perform its obligations hereunder or
thereunder. Neither Agent shall be under any obligation to any Bank to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement, or to inspect the
properties, books or records of either Facility Borrower or any Subsidiary.
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10.4 Reliance by Agents and CASG. Each Agent and CASG shall be entitled
to rely, and shall be fully protected in relying, upon any writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, facsimile transmission, telex or teletype message, statement, order
or other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and
upon advice and statements of legal counsel (including, without limitation,
counsel to CFC), independent accountants and other experts selected by the
relevant Agent. Each Agent and CASG may deem and treat the Bank specified in
the relevant Register with respect to any amount owing hereunder as the owner
thereof for all purposes unless a written notice of assignment, negotiation
or transfer thereof shall have been filed with the Administrative Agent in
accordance with Section 12.7. Each Agent shall be fully justified in failing
or refusing to take any action under this Agreement unless it shall first
receive such advice or concurrence of the Required Banks (or, if so specified
in this Agreement, all of the Banks) as it deems appropriate or it shall
first be indemnified to its satisfaction by the Banks against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Each Agent shall, in all cases, be fully
protected in acting, or in refraining from acting, under this Agreement in
accordance with a request of the Required Banks (or, if so specified in this
Agreement, all of the Banks), and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Banks and all
future holders of the obligations owing by the Facility Borrowers hereunder.
10.5 Notice of Default. Neither Agent shall be deemed to have knowledge
or notice of the occurrence of any Default or Event of Default hereunder
unless such Agent has received notice from a Bank or either Facility Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that either
Agent receives such a notice, such Agent shall give notice thereof to the
Banks, and, if such notice is received from a Bank, such Agent shall give
notice thereof to each Facility Borrower and each other Bank. Subject to the
proviso contained in Section 12.1, the Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Banks (or, if so specified in this
Agreement, all of the Banks); provided that, unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it
shall deem advisable in the best interests of the Banks.
10.6 Non-Reliance on Agents, Other Banks and CASG. Each Bank expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, attorneys-in-fact or affiliates (including,
without limitation, CASG) has made any representations or warranties to it
and that no act by either Agent hereafter taken, including any review of the
affairs of either Facility Borrower, shall be deemed to constitute any
representation or warranty by either Agent to any Bank. Each Bank represents
to each Agent and CASG that it has, independently and without reliance upon
either Agent, any other Bank or CASG, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Facility Borrowers and made its own
decision to make its Loans under, and enter into, this Agreement. Each Bank
also represents that it will, independently and without reliance upon either
Agent, any other Bank or CASG, and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit
analysis, appraisals and decisions in taking or not taking action under this
Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other
condition and creditworthiness of the Facility Borrowers. Except for notices,
reports and other documents expressly required to be furnished to the Banks
by the relevant Agent hereunder, neither Agent shall have any duty or
responsibility to provide any Bank with any credit or other information
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46
concerning the business, operations, property, financial and other condition
or creditworthiness of either Facility Borrower which may come into the
possession of such Agent or any of its officers, directors, employees,
agents, attorneys-in-fact or affiliates.
10.7 Indemnification. The Banks (or, in the case of the indemnity in
favor of the Canadian Administrative Agent, the C$ Banks) agree to indemnify
each Agent and CASG (to the extent not reimbursed by either Facility Borrower
and without limiting the obligation of each Facility Borrower to do so),
ratably according to the respective amounts of their respective Commitment
Percentages (or, in the case of the indemnity in favor of the Canadian
Administrative Agent, the C$ Banks' respective C$ Commitment Percentages) in
effect on the date on which indemnification is sought under this Section 10.7
(or, if indemnification is sought after the date upon which the Commitments
shall have terminated, ratably in accordance with such Commitment Percentages
(or C$ Commitment Percentages) immediately prior to such date), from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including, without limitation, at any time
following the payment of the Loans) be imposed on, incurred by or asserted
against such Agent or CASG in any way relating to or arising out of this
Agreement or any other documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action
taken or omitted by such Agent or CASG under or in connection with any of the
foregoing, provided that no Bank shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting from
such Agent's or CASG's, as the case may be, gross negligence or willful
misconduct. The agreements in this Section 10.7 shall survive the payment of
the Loans and all other amounts payable hereunder.
10.8 Agents in their Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with each Facility Borrower as though such Agent was not an Agent
hereunder. With respect to its Loans made or renewed by it, each Agent shall
have the same rights and powers under this Agreement as any Bank and may
exercise the same as though it were not an Agent, and the terms "Bank" and
"Banks" shall include such Agent in its individual capacity.
10.9 Successor Agents. Each Agent may resign as Agent upon 30 days'
notice to the Banks and the Facility Borrowers, and may be removed at any
time with or without cause by the Required Banks. If an Agent shall resign or
be removed as Agent under this Agreement, then either (a) the Required Banks
shall appoint from among the Banks a successor administrative agent or
Canadian administrative agent, as applicable, which successor agent shall be
approved by CFC, or (b) if a successor agent shall not have been so appointed
and approved within the 30-day period following such Agent's notice to the
Banks or its removal as Agent, such Agent shall then, with the consent of
CFC, appoint a successor agent who shall serve as Administrative Agent or
Canadian Administrative Agent, as applicable, until such time, if any, as the
Required Banks appoint, and CFC approves, a successor agent as provided in
(a) above. Upon its appointment pursuant to either clause (a) or (b) above,
such successor agent shall succeed to the rights, powers and duties of the
Administrative Agent or the Canadian Administrative Agent, as applicable, and
the terms "Administrative Agent", "Canadian Administrative Agent" and
"Agent", as applicable, shall mean such successor agent effective upon its
appointment, and the former Agent's rights, powers and duties as Agent shall
be terminated, without any other or further act or deed on the part of such
former Agent or any of the parties to this Agreement or any holders of the
obligations owing by the Facility Borrowers hereunder. After any retiring
Agent's resignation hereunder as Agent, the provisions of this Section 10
shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Agent under this Agreement.
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47
10.10 The Managing Agents. No Managing Agent in its capacity as such
shall have any rights, duties or responsibilities hereunder, or any fiduciary
relationship with any Bank, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against any Managing Agent in its capacity as
Managing Agent.
SECTION 11. GUARANTEE
11.1 Guarantee. In order to induce the Agents and the Banks to execute
and deliver this Agreement and to make or maintain the C$ Loans, and in
consideration thereof, CFC hereby unconditionally and irrevocably guarantees,
as primary obligor and not merely as surety, to the Administrative Agent, for
the ratable benefit of the Agents and the Banks, the prompt and complete
payment and performance by CCCL when due (whether at stated maturity, by
acceleration or otherwise) of the CCCL Obligations. The guarantee contained
in this Section 11, subject to Section 11.5, shall remain in full force and
effect until the CCCL Obligations are paid in full and the Commitments are
terminated, notwithstanding that from time to time prior thereto CCCL may be
free from any CCCL Obligations.
CFC agrees that whenever, at any time, or from time to time, it shall
make any payment to either Agent or any Bank on account of its liability
under this Section 11, it will notify the Administrative Agent (and, in the
cases of payments to it, the Canadian Administrative Agent) and such Bank in
writing that such payment is made under the guarantee contained in this
Section 11 for such purpose. No payment or payments made by CCCL or any other
Person or received or collected by either Agent or any Bank from CCCL or any
other Person by virtue of any action or proceeding or any setoff or
appropriation or application, at any time or from time to time, in reduction
of or in payment of the CCCL Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of CFC under this Section 11 which,
notwithstanding any such payment or payments, shall remain liable for the
unpaid and outstanding CCCL Obligations until, subject to Section 11.5, the
CCCL Obligations are paid in full and the Commitments are terminated.
11.2 No Subrogation, Contribution, Reimbursement or Indemnity.
Notwithstanding anything to the contrary in this Section 11, CFC hereby
irrevocably waives (a) all rights which may have arisen in connection with
the guarantee contained in this Section 11 to be subrogated to any of the
rights (whether contractual, under the Bankruptcy Code, including Section 509
thereof, under common law or otherwise) of either Agent or any Bank against
CCCL or against either Agent or any Bank for the payment of the CCCL
Obligations and (b) all contractual, common law, statutory and other rights
of reimbursement, contribution, exoneration or indemnity (or any similar
right) from or against CCCL or any other Person which may have arisen in
connection with the guarantee of the CCCL Obligations contained in this
Section 11, in each case until all CCCL Obligations have been paid in full.
So long as the CCCL Obligations remain outstanding, if any amount shall be
paid by or on behalf of CCCL or any other Person to CFC on account of any of
the rights waived in this Section 11.2, such amount shall be held by CFC in
trust, segregated from other funds of CFC, and shall, forthwith upon receipt
by CFC, be turned over to the Administrative Agent in the exact form received
by CFC (duly indorsed by CFC to the Administrative Agent, if required), to be
applied against the CCCL Obligations, whether matured or unmatured, in such
order as the Administrative Agent may determine. The provisions of this
Section 11.2 shall survive the term of the guarantee contained in this
Section 11 and the payment in full of the CCCL Obligations and the
termination of the Commitments.
11.3 Amendments, etc. with respect to the CCCL Obligations. CFC shall
remain obligated under this Section 11 notwithstanding that, without any
reservation of rights against CFC, and
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48
without notice to or further assent by CFC, any demand for payment of or
reduction in the principal amount of any of the CCCL Obligations made by
either Agent or any Bank may be rescinded by such Agent or such Bank, and any
of the CCCL Obligations continued, and the CCCL Obligations, or the liability
of any other party upon or for any part thereof, or any collateral security
or guarantee therefor or right of offset with respect thereto, may, from time
to time, in whole or in part, be renewed, extended, amended, modified,
accelerated, compromised, waived, surrendered or released by either Agent or
any Bank, and this Agreement and any other documents executed and delivered
in connection herewith may be amended, modified, supplemented or terminated,
in whole or in part, as may be deemed advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by either
Agent or any Bank for the payment of the CCCL Obligations may be sold,
exchanged, waived, surrendered or released. No Agent or Bank shall have any
obligation to protect, secure, perfect or insure any lien at any time held by
it as security for the CCCL Obligations or for the guarantee contained in
this Section 11 or any property subject thereto.
11.4 Guarantee Absolute and Unconditional. CFC waives any and all
notice of the creation, renewal, extension or accrual of any of the CCCL
Obligations and notice of or proof of reliance by either Agent or any Bank
upon the guarantee contained in this Section 11 or acceptance of the
guarantee contained in this Section 11; the CCCL Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or
incurred, or renewed, extended, amended or waived, in reliance upon the
guarantee contained in this Section 11; and all dealings between CFC or CCCL,
on the one hand, and the Agents and the Banks, on the other, shall likewise
be conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 11. CFC waives diligence, presentment,
protest, demand for payment and notice of default or nonpayment to or upon
CFC or CCCL with respect to the CCCL Obligations. The guarantee contained in
this Section 11 shall be construed as a continuing, absolute and
unconditional guarantee of payment without regard to (a) the validity or
enforceability of this Agreement, any of the CCCL Obligations or any
collateral security therefor or guarantee or right of offset with respect
thereto at any time or from time to time held by either Agent or any Bank,
(b) the legality under applicable Requirements of Law of repayment by CCCL of
any CCCL Obligations or the adoption of any Requirement of Law purporting to
render any CCCL Obligations null and void, (c) any defense, setoff or
counterclaim (other than a defense of payment or performance by CCCL) which
may at any time be available to or be asserted by CFC or CCCL against either
Agent or any Bank, or (d) any other circumstance whatsoever (with or without
notice to or knowledge of CFC or CCCL) which constitutes, or might be
construed to constitute, an equitable or legal discharge of CCCL for any CCCL
Obligations, or of CFC under the guarantee contained in this Section 11, in
bankruptcy or in any other instance. When either Agent or any Bank is
pursuing its rights and remedies under this Section 11 against CFC, such
Agent or Bank may, but shall be under no obligation to, pursue such rights
and remedies as it may have against any CCCL or any other Person or against
any collateral security or guarantee for the CCCL Obligations or any right of
offset with respect thereto, and any failure by either Agent or any Bank to
pursue such other rights or remedies or to collect any payments from CCCL or
any such other Person or to realize upon any such collateral security or
guarantee or to exercise any such right of offset, or any release of CCCL or
any such other Person or of any such collateral security, guarantee or right
of offset, shall not relieve CFC of any liability under this Section 11, and
shall not impair or affect the rights and remedies, whether express, implied
or available as a matter of law, of the Agents and the Banks against CFC.
11.5 Reinstatement. The guarantee contained in this Section 11 shall
continue to be effective, or be reinstated, as the case may be, if at any
time payment, or any part thereof, of any of the CCCL Obligations is
rescinded or must otherwise be restored or returned by either Agent or any
Bank upon the insolvency, bankruptcy, dissolution, liquidation or
reorganization of CCCL or upon or as a
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49
result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, CCCL or any substantial part of its property,
or otherwise, all as though such payments had not been made.
11.6 Payments. (a) CFC hereby agrees that any payments in respect of
the CCCL Obligations pursuant to this Section 11 will be paid without setoff
or counterclaim in C$ to (unless otherwise specified by the Administrative
Agent) the Canadian Administrative Agent at the office of the Canadian
Administrative Agent specified in Section 12.2.
(b) In the event that any law, regulation, treaty or directive (whether
or not in effect on the date hereof), shall require any Taxes to be withheld
or deducted from any amount payable to any Bank under the guarantee contained
in this Section 11, upon notice by such Bank to CFC (with a copy to the
Administrative Agent) to the effect that as a result of such law, rule,
regulation, treaty or directive, Taxes are being withheld or deducted from
amounts payable to such Bank under the guarantee contained in this Section
11, CFC will pay to such Bank (or, if applicable, the relevant Agent or any
other agent acting on such Bank's behalf) additional amounts (in the relevant
currency) so that such additional amounts, together with amounts otherwise
payable under the guarantee contained in this Section 11, will yield to such
Bank, after deduction from such increased amount of all Taxes required to be
withheld or deducted therefrom, an amount that would be equal to the amount
that such Bank would have received under the guarantee contained in this
Section 11 had no such withholding or deduction been required calculated
after taking into account all applicable Taxes and Other Taxes. If CFC fails
to pay any Taxes when due following notification by any Bank as provided
above, CFC shall indemnify such Bank for any incremental taxes, interest or
penalties that may become payable by any Bank as a result of any such failure
by CFC to make such payment. Within 30 days after the payment by CFC of any
Taxes withheld or deducted from any amount payable to any Bank under the
guarantee contained in this Section 11, CFC will furnish to such Bank (with a
copy to the Administrative Agent), the original or a certified copy of a
receipt evidencing payment thereof.
11.7 Judgments Relating to Guarantee. (a) If, for the purpose of
obtaining judgment in any court, it is necessary to convert a sum due under
the guarantee contained in this Section 11 in one currency into another
currency, CFC agrees, to the fullest extent that it may effectively do so,
that the rate of exchange used shall be that at which in accordance with
normal banking procedures in the relevant jurisdiction the relevant Bank (or
agent acting on its behalf) could purchase the first currency with such other
currency for the first currency on the Banking Day immediately preceding the
day on which final judgment is given.
(b) The obligations of CFC in respect of any sum due under the
guarantee contained in this Section 11 shall, notwithstanding any judgment in
a currency (the "Judgment Currency") other than that in which such sum is
denominated in accordance with this Section 11 (the "Agreement Currency"), be
discharged only to the extent that, on the Banking Day following receipt by
any Bank (or agent acting on its behalf) (the "Applicable Creditor") of any
sum adjudged to be so due in the Judgment Currency, the Applicable Creditor
may in accordance with normal banking procedures in the relevant jurisdiction
purchase the Agreement Currency with the Judgment Currency; if the amount of
the Agreement Currency so purchased is less than the sum originally due to
the Applicable Creditor in the Agreement Currency, CFC agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify the Applicable
Creditor against such loss, provided, that if the amount of the Agreement
Currency so purchased exceeds the sum originally due to the Applicable
Creditor, the Applicable Creditor agrees to remit such excess to CFC. The
obligations of CFC contained in this Section 11.7 shall survive the
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50
termination of the guarantee contained in this Section 11 and the payment of
all amounts owing hereunder.
11.8 Independent Obligations. The obligations of CFC under the guarantee
contained in this Section 11 are independent of the obligations of CCCL, and
a separate action or actions may be brought and prosecuted against CFC
whether or not CCCL be joined in any such action or actions. CFC waives, to
the full extent permitted by law, the benefit of any statute of limitations
affecting its liability hereunder or the enforcement thereof.
SECTION 12. MISCELLANEOUS
12.1 Amendments and Waivers. With the written consent of the Required
Banks, the Administrative Agent and the Facility Borrowers may, from time to
time, enter into written amendments, supplements or modifications hereto for
the purpose of adding any provisions to this Agreement or changing in any
manner the rights of the Banks or of either Facility Borrower hereunder, and
with the written consent of the Required Banks the Administrative Agent on
behalf of the Banks may execute and deliver to the Facility Borrowers a
written instrument waiving, on such terms and conditions as the
Administrative Agent may specify (with such consent) in such instrument, any
of the requirements of this Agreement or any Default or Event of Default and
its consequences; provided, however, that no such waiver and no such
amendment, supplement or modification shall (a) extend the maturity of any
Loan, or reduce the rate or extend the time of payment of interest thereon,
or reduce the principal amount thereof, or reduce the amount or extend the
time of payment of any Facility Fee or Acceptance Fee hereunder, or change
the amount or terms of any Bank's Commitment, or amend, modify or waive any
provision of this Section 12.1 or reduce the percentages specified in the
definition of Required Banks, Required U.S. Banks or Required Canadian Banks,
or consent to the assignment or transfer by either Facility Borrower of any
of its rights and obligations under this Agreement or amend, modify or waive
the provisions of Section 12.8, in each case without the prior written
consent of each Bank directly affected thereby; (b) extend the Termination
Date without the prior written consent of each Bank; or (c) release CFC from
its obligations under the guarantee contained in Section 11 without the prior
written consent of each C$ Bank; or (d) amend, modify or waive any provision
of Section 10 without the prior written consent of each Agent directly
affected thereby; or (e) amend, modify or waive any provision of Section
10.10 without the prior written consent of each Managing Agent. Any such
waiver and any such amendment, supplement or modification shall apply equally
to each of the Banks and shall be binding upon each Facility Borrower, the
Banks, each Agent and all future holders of the obligations owing by the
Facility Borrowers hereunder. In the case of any waiver, each Facility
Borrower, the Banks and each Agent shall be restored to their former position
and rights hereunder, and any Default or Event of Default waived shall be
deemed to be cured and not continuing; but no such waiver shall extend to any
subsequent or other Default or Event of Default, or impair any right
consequent thereon. The Administrative Agent shall give the Canadian
Administrative Agent prompt written notice of any waiver, amendment,
supplement or modification entered into pursuant to this Section 12.1.
12.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing, by facsimile
transmission or telex or, in the case of any E-mail Bank, by electronic mail,
and, unless otherwise expressly provided herein, shall be deemed to have been
duly given or made when delivered by hand or when deposited in the mail,
first class or air postage prepaid, or, in the case of facsimile
transmission, when transmitted, receipt acknowledged, or, in the case of
telex notice, when sent, answerback received, or, in the case of electronic
mail, when sent, electronic confirmation of receipt received; addressed as
follows in the case of the Facility Borrowers, the Canadian
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51
Administrative Agent and the Administrative Agent, and as set forth in an
administrative questionnaire delivered to the Administrative Agent in the
case of the other parties hereto, or to such other address as may be
hereafter notified by the respective parties hereto and any future holders of
the obligations owing by the Facility Borrowers hereunder:
CFC: Chrysler Financial Corporation
27777 Franklin Road
Southfield, Michigan 48034-8286
Attention: Vice President and Treasurer
Telex: 230663
Answerback: CHRYFINCL TRMI
Facsimile: 810-948-3801
CCCL: Chrysler Credit Canada Ltd.
27777 Franklin Road
Southfield, Michigan 48034-8286
Attention: Vice President and Treasurer
Telex: 230663
Answerback: CHRYFINCL TRMI
Facsimile: 810-948-3801
The Administrative Agent: The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Attention: Andris Kalnins
Facsimile: 212-270-5127
With copies to: The Chase Manhattan Bank Loan
and Agency Services Group
One Chase Manhattan Plaza
New York, New York 10081
Attention: Sandra Miklave
Telex: 353-006
Answerback: ABSC NYK
Facsimile: 212-622-0002
The Canadian
Administrative Agent: Royal Bank of Canada
Loan Structuring and Syndications
Royal Bank Plaza, South Tower
200 Bay Street
Toronto, Ontario
Canada M5J 2J5
Attention: Manager, Business Operations
Facsimile: 416-974-2407
provided that any notice, request or demand to or upon an Agent pursuant to
Section 2.2, 2.3, 3.2, 3.3, 3.4, 4.6 or 4.7 shall not be effective until
received.
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51
12.3 Clearing Accounts. (a) Each US$ Bank irrevocably authorizes the
Administrative Agent and CASG to cause such Bank's Clearing Account to be
debited as contemplated in Section 2.2 and to cause to be created an
overdraft in such account if the balance in such Bank's Clearing Account on a
particular Borrowing Date is less than the amount of the U.S. Loan to be made
by such Bank on such day. In addition each US$ Bank irrevocably authorizes
the Administrative Agent and CASG to cause such Bank's Clearing Account to be
credited with its ratable share of payments received by the Administrative
Agent from CFC. The Clearing Account of each US$ Bank shall be maintained at
its own expense and free of charge to the Administrative Agent, CASG and CFC.
(b) The Administrative Agent may at any time in its sole discretion,
upon prior notice to CFC and the US$ Banks, discontinue the use of ACH
procedures in connection with U.S. R/C Loans made pursuant hereto, and the
US$ Banks shall thereafter fund each U.S. Loan required to be made by them
hereunder by making available the amount thereof to the Administrative Agent
for the account of CFC at the office of the Administrative Agent set forth in
Section 12.2 in funds immediately available to the Administrative Agent.
12.4 No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of either Agent or any Bank, any right,
remedy, power or privilege hereunder, shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or of the exercise
of any other right, remedy, power or privilege. The rights, remedies, powers
and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.
12.5 Survival of Representations and Warranties. All representations
and warranties made hereunder and in any document, certificate or statement
delivered pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement.
12.6 Payment of Expenses. Each of CFC and, as applicable, CCCL, agrees:
(a) to pay or reimburse the Administrative Agent for all reasonable
out-of-pocket costs and expenses incurred in connection with the
preparation and execution of, and any amendment, supplement or
modification to or waiver under, this Agreement and any other documents
prepared in connection herewith, and the consummation of the
transactions contemplated hereby and the administration of this
Agreement, including, without limitation, the reasonable fees and
disbursements of Simpson Thacher & Bartlett, special counsel to the
Administrative Agent and the Banks;
(b) to pay or reimburse each Bank and each Agent for all costs and
expenses (other than legal fees and disbursements) incurred in
connection with the enforcement or preservation of any rights under this
Agreement and any such other documents, and the reasonable fees and
disbursements of one firm of special counsel in each of the United
States and Canada to the Agents and the Banks; and
(c) to (i) indemnify each Bank from and against liabilities,
obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements (other than legal fees and
disbursements) of any kind whatsoever (and, with respect to any
proceeding or related proceedings, the reasonable fees and disbursements
of one firm of special counsel to the relevant Banks in connection with
such proceeding(s)) which may at any time (including, without
limitation, at any time following the payment of the Loans) be imposed
on, incurred by or
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53
asserted against such Bank in any way relating to or arising out of this
Agreement or any other documents contemplated by or referred to herein
or the transactions contemplated hereby or any action taken or omitted
by such Bank under or in connection with any of the foregoing, provided
that no Borrower shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from (x)
the ordinary course of administration of this Agreement or such other
documents by any Bank or (y) any Bank's gross negligence or willful
misconduct or bad faith; and (ii) pay or reimburse (x) each Bank for any
payments made by such Bank to either Agent or CASG pursuant to the
provisions of Section 10.7 and (y) each Agent and CASG for any and all
liabilities, expenses or disbursements incurred by any of them which
pursuant to the provisions of Section 10.7 are the subject of
indemnification payments from the Banks to the extent that such Agent or
CASG, as the case may be, for whatever reason, did not receive such
indemnification payments from any Bank or Banks.
The agreements in this Section 12.6 shall survive repayment of the Loans and
all other amounts payable hereunder.
12.7 Successors and Assigns. (a) This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and assigns except that (x) no Borrower may assign its rights or
obligations hereunder without the prior consent of all of the Banks (in the
case of CFC) or all of the C$ Banks (in the case of CCCL), and (y) no
assignment by a Bank of any of its rights or obligations hereunder shall be
effective unless (i) the assignee is a Commercial Bank (unless otherwise
agreed by CFC in its sole discretion), (ii) the assignee shall have
designated in writing to the Administrative Agent an account at the office of
a bank that is an ACH member to serve as such assignee's "Clearing Account"
hereunder, (iii) in the event of an assignment of less than all of such
Bank's obligations, (A) the principal amount of such Bank's obligations
(which may constitute U.S. Commitments and/or Canadian Commitments) so
assigned shall be in an aggregate amount of $8,000,000 or greater and (B)
after giving effect to any such assignment, the transferor Bank and the
assignee (in each case together with any Bank which is a subsidiary,
affiliate, branch or agency of such transferor Bank or assignee,
respectively) shall each have obligations hereunder (which may constitute
U.S. Commitments and/or Canadian Commitments) aggregating not less than
$8,750,000 (unless, in each case, at CFC's discretion, a lesser amount is
mutually agreed upon between CFC and such Bank or assignee, as applicable),
(iv) CFC and the Administrative Agent shall have consented to the making of
such assignment (which consent in each case shall not be unreasonably
withheld or delayed), (v) the transferor Bank, the assignee, the
Administrative Agent and CFC (if its consent to such assignment is required
hereunder) shall have executed and delivered an Assignment and Acceptance
substantially in the form of Exhibit D-1, and (vi) the transferor Bank shall
have paid to the Administrative Agent a registration and processing fee of
$2,500 (or such lesser amount as may be agreed to by the Administrative
Agent); provided, however, that no consent by CFC shall be required in the
case of assignments to a Commercial Bank controlled by, controlling or under
common control with an assignor Bank or pursuant to a merger or consolidation
of such Bank with another entity or a similar transaction involving such
Bank. Upon the effectiveness of any assignment pursuant to this Section 12.7,
Schedule I shall be deemed to be amended to reflect such assignment.
Each Bank may sell participations in its Commitment or in all or any part of
any Loan made by it hereunder to a Commercial Bank, in which event the
participant shall not have any rights under this Agreement (the participant's
rights against such Bank in respect of such participation to be those set
forth in the participation agreement executed by such Bank in favor of the
participant thereto) and all amounts payable by the Facility Borrowers under
Sections 2, 3 and 4 shall be determined as if such Bank had not sold such
participations; provided that (1) the terms of any participation agreement or
certificate relating to any such participation shall prohibit
<PAGE>
54
any subparticipations by such participant; (2) any such participation
agreement or certificate shall permit the Bank granting such participations
the right to consent to waivers, amendments or supplements to this Agreement
without the consent of such participant except in the case of (x) waivers of
any Default or Event of Default described in Section 9(a), and (y) any
amendment or modification extending the maturity of any Loan, or reducing the
interest rate in respect of any Loan, or reducing any Facility Fee, or
extending the time of payment of interest on any Loan or of any Facility Fee,
or reducing the principal amount of any Loan, in each case to the extent such
waiver, amendment or supplement directly affects such participant and (3) a
participating interest of at least $8,000,000 shall be sold pursuant to any
such participation (unless, at CFC's discretion, a lesser amount is mutually
agreed upon between CFC and such Bank).
(b) Nothing herein shall prohibit any US$ Bank from pledging or
assigning all or any portion of its U.S. R/C Loans to any Federal Reserve
Bank in accordance with applicable law. In order to facilitate such pledge or
assignment, CFC hereby agrees that, upon request of any US$ Bank at any time
and from time to time after CFC has made its initial borrowing hereunder, CFC
shall provide to such Bank, at CFC's own expense, a promissory note,
substantially in the form of Exhibit E, evidencing the U.S. R/C Loans owing
to such Bank.
(c) (i) The Administrative Agent shall maintain at its address referred
to in Section 12.2 a copy of each Assignment and Acceptance delivered to it
and a register (the "U.S. Register") for the recordation of the names and
addresses of the US$ Banks, the U.S. Commitments of such Banks, and the
principal amount of each category of U.S. Loan owing to each such Bank from
time to time. The entries in the U.S. Register shall be conclusive, in the
absence of clearly demonstrable error, and CFC, the Administrative Agent and
the Banks may treat each Person whose name is recorded in the U.S. Register
as the owner of the U.S. R/C Loans recorded therein for all purposes of this
Agreement. The U.S. Register shall be available for inspection by CFC or any
US$ Bank at any reasonable time and from time to time upon reasonable prior
notice. The Administrative Agent shall give prompt written notice to CFC of
the making of any entry in the U.S. Register or any change in any such entry.
(ii) The Canadian Administrative Agent shall maintain at its address
referred to in Section 12.2 a register (the "Canadian Register") for the
recordation of the names and addresses of the C$ Banks, the Canadian
Commitments of such Banks, and the principal amount of each category of C$
Loan owing to each such Bank from time to time. The entries in the Canadian
Register shall be conclusive, in the absence of clearly demonstrable error,
and CCCL, the Canadian Administrative Agent and the Banks may treat each
Person whose name is recorded in the Canadian Register as the owner of the C$
Loans recorded therein for all purposes of this Agreement. The Canadian
Register shall be available for inspection by CFC, CCCL or any C$ Bank at any
reasonable time and from time to time upon reasonable prior notice. The
Canadian Administrative Agent shall give prompt written notice to CCCL of the
making of any entry in the Canadian Register or any change in any such entry.
12.8 Right of Set-off. Upon (a) the occurrence and during the
continuance of an Event of Default and (b) with the consent of the Required
Banks, each Bank is hereby authorized at any time and from time to time, to
the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by such Bank (including,
without limitation, its branches) to or for the credit or the account of
either Facility Borrower against any and all of the obligations of such
Facility Borrower now or hereafter existing under this Agreement,
irrespective of whether or not such Bank shall have made any demand under
this Agreement and although such obligations may be unmatured. Each Bank
agrees promptly to notify the relevant Facility Borrower after any such
set-off and application made by such
<PAGE>
55
Bank, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Bank under this
Section 12.8 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which such Bank may have.
12.9 Adjustments. If any Bank (a "benefitted Bank") shall at any time,
except in connection with any termination, replacement or assignment of or by
such Bank pursuant to this Agreement, receive any payment of all or part of
its U.S. R/C Loans or C$ Loans, or interest thereon, or receive any
collateral in respect thereof (whether voluntarily or involuntarily, by
set-off, pursuant to events or proceedings of the nature referred to in
clause (f) of Section 9, or otherwise) in a greater proportion than any such
payment to, or any collateral received by, any other Bank, if any, in respect
of such other Bank's U.S. R/C Loans or C$ Loans, as the case may be, or
interest thereon, such benefitted Bank shall purchase for cash from the other
US$ Banks or C$ Banks, as the case may be, such portion of each such other
Bank's U.S. R/C Loans or C$ Loans, as the case may be, or shall provide such
other relevant Banks with the benefits of any such collateral, or the
proceeds thereof, as shall be necessary to cause such benefitted Bank to
share the excess payment or benefits of such collateral or proceeds ratably
with each of the other relevant Banks; provided, however, that if all or any
portion of such excess payment or benefits is thereafter recovered from such
benefitted Bank, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest. Each
Facility Borrower agrees that each Bank so purchasing a portion of another
Bank's U.S. R/C Loans or C$ Loans, as the case may be, may exercise all
rights of payment (including, without limitation, rights of set-off) with
respect to such portion as fully as if such Bank were the direct holder of
such portion.
12.10 New Banks; Commitment Increases; Commitment Reallocations. (a)
With the consent of CFC and upon notification to the Administrative Agent,
one or more additional Commercial Banks may become a party to this Agreement
by executing a New Bank Supplement hereto with CFC and the Administrative
Agent, substantially in the form of Exhibit D-2, whereupon such Commercial
Bank (herein called a "New Bank") shall become a Bank for all purposes and to
the same extent as if originally a party hereto and shall be bound by and
entitled to the benefits of this Agreement, and Schedule I hereto shall be
deemed to be amended to add the name and Commitment of such New Bank. Each
New Bank shall be designated as a US$ Bank with a U.S. Commitment and/or a C$
Bank with a Canadian Commitment, as specified in such New Bank Supplement.
(b) With the consent of CFC and upon notification to the Administrative
Agent, any Bank may increase the amount of its Commitment by executing a
Commitment Increase Supplement hereto with CFC and the Administrative Agent,
substantially in the form of Exhibit D-3, whereupon such Bank shall be bound
by and entitled to the benefits of this Agreement with respect to the full
amount of its Commitment as so increased (which increase shall be allocated
to its U.S. Commitment and/or its Canadian Commitment, as specified in such
Commitment Increase Supplement), and Schedule I hereto shall be deemed to be
amended to add the increased Commitment of such Bank.
(c) With the consent of the Administrative Agent (which shall not be
unreasonably withheld), so long as no Default or Event of Default shall have
occurred and be continuing, CFC may reallocate all or any portion of the
Canadian Commitment of any C$ Bank to the U.S. Commitment of such C$ Bank's
Related US$ Bank or reallocate all or any portion of the U.S. Commitment of
any US$ Bank to the Canadian Commitment of such US$ Bank's Related C$ Bank by
executing a Commitment Reallocation Supplement hereto with the Administrative
Agent, substantially in the form of Exhibit D-4, whereupon the affected US$
Bank and C$ Bank shall be bound by and entitled to the benefits of this
Agreement with respect to the full amount of the U.S. Commitment or Canadian
Commitment of such Bank after giving effect to such reallocation, and
Schedule I hereto shall be deemed to be amended to
<PAGE>
56
reflect such reallocation. Each reallocation pursuant to this Section
12.10(c) shall be subject to the prior written consent of the affected US$
Bank and C$ Bank, provided, that each C$ Bank and its Related US$ Bank
confirm that, as of the date hereof, such C$ Bank and its Related US$ Bank
are willing to consider any reallocation of such Related US$ Bank's U.S.
Commitment to such C$ Bank's Canadian Commitment which does not increase such
C$ Bank's Canadian Commitment above its Initial Offered Canadian Commitment
Amount.
(d) (i) If on the date upon which a Commercial Bank becomes a New Bank
(designated as a US$ Bank), upon which a Bank obtains a U.S. Commitment or
upon which a US$ Bank's U.S. Commitment is changed pursuant to Section 12.10,
there is an unpaid principal amount of U.S. R/C Loans, CFC shall borrow U.S.
R/C Loans from, or prepay U.S. R/C Loans of, such Bank, as applicable, in an
amount such that, after giving effect thereto, the quotient of (x) the U.S.
R/C Loans of such Bank of each Type (and, in the case of Eurodollar Loans, of
each Eurodollar Tranche) and (y) such Bank's U.S. Commitment is equal to the
comparable quotient of each other US$ Bank. Any Eurodollar Loan borrowed
pursuant to the preceding sentence shall bear interest at a rate equal to the
respective interest rates then applicable to the Eurodollar Loans of the
other US$ Banks in the same Eurodollar Tranche.
(ii) If on the date upon which a Commercial Bank becomes a New Bank
(designated as a C$ Bank), upon which a Bank obtains a Canadian Commitment or
upon which a C$ Bank's Canadian Commitment is changed pursuant to Section
12.10, there is an unpaid principal amount of C$ Loans, CCCL shall borrow C$
Loans from, or prepay or Defease (in the case of Bankers' Acceptances) C$
Loans of, such Bank, as applicable, in an amount such that, after giving
effect thereto, the quotient of (x) the C$ Loans of such Bank of each
category (and, in the case of Bankers' Acceptances, of each maturity) and (y)
such Bank's Canadian Commitment is equal to the comparable quotient of each
other C$ Bank. Any Bankers' Acceptance borrowed pursuant to the preceding
sentence shall yield an Acceptance Fee at a rate equal to the respective
Acceptance Fee rates then applicable to the Bankers' Acceptances of the other
C$ Banks having comparable maturities.
(e) The Administrative Agent shall advise the Canadian Administrative
Agent and the Banks of each addition of a New Bank and of each change in a
Bank's U.S. Commitment or Canadian Commitment pursuant to this Section 12.10
and of the amount of any borrowing or prepayment required to be made from or
to any such Bank pursuant to this Section 12.10 upon such addition or change.
12.11 Tax Forms. If any Bank which becomes a party to this Agreement on
any day after the date hereof pursuant to Section 12.7 or 12.10 is organized
under the laws of any jurisdiction other than the United States or any state
thereof, such Bank shall, on the date such Person becomes a Bank, (i)
represent to the transferor Bank (if applicable), the Administrative Agent
and the Facility Borrowers that under applicable law and treaties no taxes
will be required to be withheld by the Administrative Agent, the Facility
Borrowers or the transferor Bank (if applicable) with respect to any payments
to be made to such Bank in respect of the Loans hereunder, (ii) furnish to
the transferor Bank (if applicable), the Administrative Agent and CFC either
U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 (wherein such Bank claims entitlement to complete exemption from U.S.
federal withholding tax on all interest payments hereunder) and (iii) agree
(for the benefit of the transferor Bank (if applicable), the Administrative
Agent and the Facility Borrowers) to provide the transferor Bank (if
applicable), the Administrative Agent and CFC a new Form 4224 or Form 1001
upon the expiration or obsolescence of any previously delivered form and
comparable statements in accordance with applicable U.S. laws and regulations
and amendments duly executed and completed by such Bank, and to comply from
time to time with all applicable U.S. laws and regulations with regard to
such withholding tax exemption.
<PAGE>
57
12.12 Counterparts. This Agreement may be executed by one or more of
the parties hereto on any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. A set of the copies of this Agreement signed by all the parties
shall be lodged with CFC and the Administrative Agent.
12.13 Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
12.14 Submission to Jurisdiction; Waivers. Each Facility
Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding commenced by any party hereto relating to this Agreement, or
for recognition and enforcement of any judgment in respect thereof, to
the non-exclusive general jurisdiction of the courts of the State of New
York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in such
courts, and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;
(c) agrees that services of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to
CFC at its address set forth in Section 12.2 or at such other address of
which the Administrative Agent shall have been notified with copies
addressed as set forth in Section 12.2; and
(d) agrees that nothing herein shall affect the right to effect service
of process in any other manner permitted by law or shall limit the right
to sue in any other jurisdiction.
12.15 Integration. This Agreement represents the agreement of each
party with respect to the subject matter hereof and there are no promises or
representations by either Agent or any Bank relative to the subject matter
hereof not reflected herein.
12.16 Judgments Relating to CCCL. (a) If, for the purpose of obtaining
judgment in any court, it is necessary to convert a sum owing hereunder by
CCCL in one currency into another currency, CCCL agrees, to the fullest
extent that it may effectively do so, that the rate of exchange used shall be
that at which in accordance with normal banking procedures in the relevant
jurisdiction the relevant Bank could purchase the first currency with such
other currency for the first currency on the Banking Day immediately
preceding the day on which final judgment is given.
(b) The obligations of CCCL in respect of any sum due in C$ to any
party hereto or any holder of the obligations owing hereunder (the
"Applicable Creditor") shall, notwithstanding any judgment in a currency (the
"Judgment Currency") other than C$, be discharged only to the extent that, on
the Banking Day following receipt by the Applicable Creditor of any sum
adjudged to be so due in the Judgment Currency, the Applicable Creditor may
in accordance with normal banking procedures in the relevant jurisdiction
purchase C$ with the Judgment Currency; if the amount of C$ so purchased is
less
<PAGE>
58
than the sum originally due to the Applicable Creditor in C$, CCCL agrees, as
a separate obligation and notwithstanding any such judgment, to indemnify the
Applicable Creditor against such loss, provided, that if the amount of C$ so
purchased exceeds the sum originally due to the Applicable Creditor, the
Applicable Creditor agrees to remit such excess to CCCL. The obligations of
the CCCL contained in this Section 12.16 shall survive the termination of
this Agreement and the payment of all other amounts owing hereunder.
12.17 WAIVERS OF JURY TRIAL. THE FACILITY BORROWERS, THE ADMINISTRATIVE
AGENT, THE CANADIAN ADMINISTRATIVE AGENT AND THE BANKS HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.
<PAGE>
59
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
CHRYSLER FINANCIAL CORPORATION
By: /s/ D.M. Cantwell
---------------------------
Title: Vice President and
Treasurer
CHRYSLER CREDIT CANADA LTD.
By: /s/ D.M. Cantwell
---------------------------
Title: Vice President and
Treasurer
THE CHASE MANHATTAN BANK,
as Administrative Agent
By: /s/ Marian N. Schulman
---------------------------
Title: Vice President
ROYAL BANK OF CANADA,
as Canadian Administrative Agent
By: /s/ David W. Cox
---------------------------
Title: Senior Manager
Exhibit 10-JJJJ
CONFORMED COPY
RECEIVABLES SALE AGREEMENT
among
PREMIER RECEIVABLES L.L.C.
as Seller,
CHRYSLER FINANCIAL CORPORATION
as Servicer,
PREFERRED RECEIVABLES FUNDING CORPORATION
as Purchaser
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent
Dated as of June 22, 1998
<PAGE>
i
TABLE OF CONTENTS
Page
ARTICLE I: DEFINITIONS 1
ARTICLE II: SALE AND PURCHASE 10
Section 2.1. Sale and Purchase 10
Section 2.2. Purchase Price 10
Section 2.3. CFC's Optional Termination 10
ARTICLE III: FEES AND EXPENSES 11
Section 3.1. Determination of Carrying Costs 11
Section 3.2. Purchase Discount 11
Section 3.3. Carrying Cost True-Up Amount 11
Section 3.4. Program Fee 12
Section 3.5. Servicer Fee 12
Section 3.6. Interest on Unpaid Amounts 12
ARTICLE IV: CONDITIONS PRECEDENT TO PURCHASE 12
Section 4.1. Conditions Precedent to Purchase 12
Section 4.2. Absence of Liens 13
Section 4.3. Financing Statements 13
Section 4.4. Schedule of Contracts 13
Section 4.5. Seller Resolutions 13
Section 4.6. Servicer Resolutions 13
Section 4.7. Legal Opinion of Counsel to the Seller
and the Servicer 13
Section 4.8. Good Standing Certificates 14
Section 4.9. Representations and Covenants 14
Section 4.10. Other Documents 14
Section 4.11. Up-Front Fee 14
Section 4.12. Hedging 14
Section 4.13 Insolvency 14
ARTICLE V: SETTLEMENT PROCEDURES 14
<PAGE>
ii
Section 5.1. Collections 14
Section 5.2. Application of Collections 14
Section 5.3. Application of Collections on Settlement Dates 15
Section 5.4. Servicer Report 15
ARTICLE VI: SERVICING OF RECEIVABLES 15
Section 6.1. Appointment and Duties of the Servicer 15
Section 6.2. Replacement of the Servicer 16
Section 6.3. Custody of Receivable Files 17
Section 6.4. Duties of the Servicer as Custodian 17
Section 6.5. Effective Period and Termination 18
ARTICLE VII: REPRESENTATIONS AND WARRANTIES 18
Section 7.1. Representations and Warranties of the Seller
and the Servicer 18
ARTICLE VIII: COVENANTS 20
Section 8.1. Affirmative Covenants of the Seller
and the Servicer 20
Section 8.2. Reporting Requirements of the Servicer 20
Section 8.3. Negative Covenants of the Seller and the Servicer 21
Section 8.4. Protection of the Purchaser?s Interest 21
ARTICLE IX INDEMNIFICATION 22
Section 9.1 Indemnification 22
ARTICLE X: ADMINISTRATIVE AGENT 22
Section 10.1. Appointment of the Administrative Agent 22
Section 10.2. Replacement of the Administrative Agent 23
ARTICLE XI: MISCELLANEOUS 23
Section 11.1. Amendments 23
Section 11.2. Notices 23
Section 11.3. No Waiver; Remedies 23
Section 11.4. Binding Effect; Assignability 23
Section 11.5. Governing Law 24
<PAGE>
iii
Section 11.6. Construction of the Agreement 24
Section 11.7. No Proceedings 24
Section 11.8. Confidentiality 24
Section 11.9. Execution in Counterparts 24
EXHIBITS
EXHIBIT A - Form of Servicer Report
EXHIBIT B - Form of Opinion of Counsel
<PAGE>
page 1
RECEIVABLES SALE AGREEMENT dated as of June 22, 1998 among PREMIER
RECEIVABLES L.L.C., a Michigan limited liability company, as the "Seller,"
CHRYSLER FINANCIAL CORPORATION, a Michigan corporation, as the initial
"Servicer," Preferred Receivables Funding Corporation, as the "Purchaser" and
The First National Bank of Chicago, as the "Administrative Agent" for the
Purchaser.
ARTICLE I: DEFINITIONS
"Administrative Agent" means The First National Bank of Chicago, or
any replacement thereof under Section 10.2.
"Adverse Claim" means any mortgage, pledge, security interest,
hypothecation, assignment, deposit arrangement, encumbrance, lien
(consensual, statutory or other), charge, security arrangement, or any other
encumbrance or other right or claim in, of or on any Person's assets or
properties in favor of any other Person, of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, and any financing lease having substantially the same economic
effect as any of the foregoing).
"Agreement" means this Receivables Sale Agreement, as it may be
amended from time to time.
"Aggregate Principal Balance" means, at any time, the aggregate
Principal Balance of all Purchased Receivables at such time.
"Amount Financed" means (i) with respect to any Receivable that is
not a Balloon Payment Receivable, the amount advanced under such Receivable
toward the purchase price of the Financed Vehicle and any related costs,
exclusive of any amount allocable to the premium of force-placed physical
damage insurance covering the Financed Vehicle; and (ii) with respect to a
Balloon Payment Receivable, an amount equal to the present value of the fixed
level payment monthly installments (not including the amount designated as
the Balloon Payment) under the Balloon Payment Receivable, assuming that each
payment is made on the due date in the month in which such payment is due,
discounted at the APR for such Balloon Payment Receivable.
"Annual Percentage Rate" or "APR" of a Receivable means the annual
rate of finance charges stated in the related Contract.
"Balloon Payment" means, for any Receivable, the dollar amount of any
payment which is not a level monthly payment (other than the first or last
payment made on the Receivable which is minimally different from the other
level payments).
<PAGE>
page 2
"Balloon Payment Receivable" means any Contract listed on the
Schedule of Contracts that provides for amortization of the loan over a
series of fixed level payment monthly installments in accordance with the
actuarial method, the simple interest method or the Rule of 78s, but also
requires a final payment that is greater than the scheduled monthly payments
and is due after payment of such scheduled monthly payments and that may be
made by (i) payment in full in cash of a Balloon Payment, (ii) return of the
Financed Vehicle to the Servicer provided certain conditions are satisfied or
(iii) refinancing the Balloon Payment in accordance with certain conditions.
"Business Day" means any day other than a day on which banks are not
authorized to be open or required to be closed in New York City.
"Carrying Costs" means, for each Settlement Period, an amount equal
to the sum of:
(i) (PD + PF) x DSP x AI
---
360
plus
(ii) SF x DP x APB
---
360
where PD = Purchase Discount
PF = Program Fee
DSP = the number of days in such Settlement
Period
AI = the average daily Investment for such
Settlement Period
SF = Servicer Fee
DP = 30 days, except for the initial
Settlement Period when it shall be the
number of days from the Cut-Off Date to
June 30, 1998.
APB = the Aggregate Principal Balance on the
first day of such Settlement Period.
"Carrying Costs True-Up Amount" has the meaning assigned to that term
in Section 3.3.
<PAGE>
page 3
"Certificate of Title" means any certificate, instrument or other
document issued by a state or other governmental authority in respect of any
motor vehicle for the purpose of evidencing the ownership of, or any Adverse
Claim in or against, such motor vehicle.
"CFC" means Chrysler Financial Corporation, a Michigan corporation.
"Collection" means any amount paid by an Obligor or any other party
with respect to a Purchased Receivable, including Liquidation Proceeds.
"Contract" means, with respect to any Receivable, any and all
instruments, agreements, invoices, or other writings pursuant to which such
Receivable arises or which evidence such Receivable.
"Credit and Collection Policy" means the credit and collection
policies and practices of the Servicer and any successor Servicer relating to
Receivables and Contracts, such policies being subject to unilateral revision
or modification at any time by the Servicer or successor Servicer, so long as
the revision or modification is not expected to have a material adverse
effect on Collections, and so long as such revised or modified policies and
practices are not different from those collections policies and practices
used by the Servicer in servicing similar portfolios of retail automotive
receivables, whether owned by the Servicer, the Seller or any third party.
"Credit Facilities" means each of the committed loan facilities,
lines of credit, letters of credit and other forms of credit enhancement
available to a Purchaser which are not Liquidity Facilities.
"Cut-Off Date" means June 17, 1998.
"Dealer" means an automobile or light-duty truck dealership located
within the United States at or through which a Financed Vehicle shall have
been purchased or is proposed to be purchased.
"Delinquency Ratio" means, as of the last calendar day of any
Settlement Period, a fraction, expressed as a percentage, the numerator of
which is the sum of the Principal Balances of all Receivables which were
Delinquent Receivables as of the last calendar day of such Settlement Period
and the last calendar day of each of the two immediately preceding Settlement
Periods, to the extent such preceding Settlement Periods exist, and the
denominator of which is the sum of the Aggregate Principal Balance on such
last calendar day of such Settlement Period and on the last calendar day of
each of the two immediately preceding Settlement Periods, to the extent such
preceding Settlement Periods exist.
<PAGE>
page 4
"Delinquent Receivable" means any Receivable which has 10% or more of
a scheduled payment past due for more than 60 days.
"Eligible Receivable" means, as of the Cut-Off Date, any Receivable:
(i) the Obligor of which (a) is a resident of the United States and
(b) is not an affiliate of the originating Dealer or any of the parties
hereto,
(ii) the Obligor of which (a) is not the Obligor of any Receivable
which has 10% or more of a scheduled payment past due for more than 60
days and (b) is not the subject of any bankruptcy, insolvency or
reorganization proceeding or any other proceeding seeking the entry of an
order for relief or the appointment of a receiver, trustee or other
similar official for it or any substantial part of its property,
(iii) which is "chattel paper" within the meaning of Section 9-105 of
the UCC of all applicable jurisdictions,
(iv) which is denominated and payable only in United States dollars
in the United States,
(v) which (a) has been originated in the United States by a Dealer
for the retail sale of a Financed Vehicle in the ordinary course of such
Dealer's business and (b) satisfies all applicable requirements of the
Credit and Collection Policy,
(vi) which arises under a Contract (a) which, together with such
Receivable, is (1) in full force and effect and constitutes the legal,
valid and binding obligation of the related Obligor, enforceable against
such Obligor in accordance with its terms, and (2) subject to no dispute,
offset, counterclaim or other defense, and (b) with respect to which (1)
no default, breach, violation, or event permitting acceleration under the
terms thereof has occurred and (2) there has not arisen any condition
that, with notice or lapse of time or both, would constitute a default,
breach, violation or event permitting acceleration under the terms
thereof,
(vii) which, together with the related Contract, (a) is secured by a
perfected, valid, subsisting and enforceable first priority security
interest in favor of CFC in the related Financed Vehicle, (b) contains
customary and enforceable provisions such that the rights and remedies of
the holder of such security interest are adequate for realization against
the collateral of the benefits of the security, and (c) was originated
and transferred to the Seller without any conduct constituting fraud or
misrepresentation on the part of the applicable Dealer, CFC or the
Seller,
(viii) which, together with the related Contract, immediately
following the execution of such Contract, was purchased by (and the
originating Dealer has validly assigned all of its right, title and
interest therein to) CFC, which, in turn, has sold such Receivable to the
Seller,
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and such purchase and assignment of such Receivable, such Contract and
the Related Security to CFC is expressly contemplated in such Contract,
(ix) which, together with the Contract related thereto, does not
contravene any laws, rules or regulations applicable thereto (including,
without limitation, laws, rules and regulations relating to usury, truth
in lending, fair credit billing, fair credit reporting, equal credit
opportunity, fair debt collection practices and privacy) and with respect
to which no part of the Contract related thereto is in violation of any
such law, rule or regulation,
(x) the Financed Vehicle securing which (a) is free and clear of any
Adverse Claim other than the security interest therein then being
assigned by the Seller to the Administrative Agent for the benefit of the
Purchaser, and no enforcement action, whether by repossession or
otherwise, has been taken with respect to such Financed Vehicle, and (b)
is covered by the Required Insurance in respect of such Financed Vehicle,
and such Required Insurance is in full force and effect, and the proceeds
of the Required Insurance has been assigned to the Seller and such
proceeds are fully assignable to the Administrative Agent, for the
benefit of the Purchaser,
(xi) as to which the Administrative Agent has not notified the Seller
that such Receivable or class of Receivables is not acceptable as an
Eligible Receivable, including, without limitation, because such
Receivable arises under a Contract that is not acceptable,
(xii) with respect to the outstanding balance thereof, (a) the
related Contract requires that payment in full of such outstanding
balance is scheduled to be made not later than 72 months after the date
any interest therein is purportedly transferred to the Purchaser
hereunder and (b) such Outstanding Balance is scheduled to be paid in
equal consecutive monthly installments, unless such Receivable is a
Balloon Payment Receivable, and
(xiii) which Receivable bears interest at the per annum rate stated
on the face of the related Contract, which per annum rate remains fixed
during the term of such Receivable and accrued interest on such
Receivable is payable monthly, in arrears.
"Fee Letter" means the letter agreement of even date herewith between
the Seller and the Administrative Agent, for itself and for the benefit of
the Purchaser.
"Finance Charges" means, with respect to any Receivable and its
related Contract, any finance, interest or similar charges owing by an
Obligor pursuant to such Contract, including, without limitation, any charge
payable in connection with any extension or adjustment under such Contract
(without regard to whether any such extension or adjustment is permitted
under the terms of this Agreement).
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"Financed Vehicle" means an automobile or light-duty truck, together
with all accessions thereto, securing an Obligor's indebtedness under the
applicable Contract.
"Hedging Proceeds" means any amount payable by CFC to the
Administrative Agent under a swap confirmation.
"Insolvency Event" means, with respect to a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in
an involuntary case under any applicable federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person's affairs, and such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or (b) the commencement by such Person of a voluntary case
under any applicable federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by such Person to the entry of
an order for relief in an involuntary case under any such law, or the consent
by such Person to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official
for such Person or for any substantial part of its property, or the making by
such Person of any general assignment for the benefit of creditors, or the
failure by such Person generally to pay its debts as such debts become due,
or the taking of action by such Person in furtherance of any of the
foregoing.
"Insurance Policy" means (i) any comprehensive and collision, fire,
theft or other insurance policy maintained by an Obligor in which the
Servicer is named as loss payee with respect to one or more Financed
Vehicles, and (ii) any credit, life or disability insurance maintained by an
Obligor in connection with any Contract.
"Investment" means the aggregate amount of cash paid by the Purchaser
to the Seller for the Purchase, less the amount of all Collections received
and applied as reductions of Investment pursuant to Article V.
"Liquidated Receivable" means any Receivable liquidated by the
Servicer through the sale of a Financed Vehicle or otherwise.
"Liquidation Proceeds" means, with respect to any Liquidated
Receivable, the monies collected in respect thereof, from whatever source,
net of the sum of any amounts expended by the Servicer in connection with
such liquidation and any amounts required by law to be remitted to the
Obligor on such Liquidated Receivable.
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"Liquidity Facilities" means each of the committed loan facilities,
lines of credit, standby asset purchase agreements and other financial
accommodations available to the Purchaser to support the liquidity of the
Purchaser's commercial paper notes and medium term notes.
"Net Loss" for a Settlement Period means the sum of the Aggregate
Principal Balance of all Purchased Receivables which are deemed to be
uncollectible for such Settlement Period, minus any Liquidation Proceeds
received during such Settlement Period, plus any losses resulting from
disposition expenses paid during such Settlement Period.
"Net Loss Ratio" means, as of the last day of any Settlement Period,
a fraction, expressed as a percentage, the numerator of which is the product
of (i) the sum of the Net Loss for such Settlement Period and the two
immediately preceding Settlement Periods, to the extent such Settlement
Periods exist, and (ii) a factor of 12 divided by the number of Settlement
Periods included in the sum in clause (i), and the denominator of which is
the average of the Aggregate Principal Balance on the first day of the
Settlement Period and the first day of the two immediately preceding
Settlement Periods, to the extent such Settlement Periods exist.
"Obligor" means any Person which is obligated to make payment on a
Receivable.
"Person" means any corporation, natural person, firm, joint venture,
partnership, limited liability company, trust, unincorporated organization,
enterprise, government or any department or agency of any government.
"Principal Balance" means with respect to any Receivable the
outstanding principal balance thereof determined in accordance with the
Credit and Collection Policy and the Servicer's customary calculation
methods, provided, that with respect to a Receivable identified as a Balloon
Payment Receivable, the Principal Balance shall not include the Balloon
Payment.
"Program Fee" has the meaning assigned to that term in Section 3.4.
"Purchase" has the meaning assigned to that term in Section 2.1.
"Purchase Amount" means the amount, as of the close of business on
the last day of a Settlement Period, required to prepay in full a Receivable
under the terms thereof including interest to the end of the month of
purchase.
"Purchase Date" means June 22, 1998, the date on which the conditions
precedent to the Purchase described in Section 4.1 have been satisfied or
waived.
"Purchase Discount" has the meaning assigned to that term in Section
3.2.
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"Purchased Receivable" means an Eligible Receivable arising under a
Contract listed on the Schedule of Contracts delivered to the Administrative
Agent prior to the Purchase Date being sold to the Purchaser under this
Agreement.
"Purchaser" means Preferred Funding Receivables Corporation and its
successors and assigns ("PREFCO").
"Receivable" means the indebtedness and other obligations of an
Obligor arising under a Contract, whether such indebtedness or other
obligations constitute accounts, chattel paper, instruments or general
intangibles, and including, without limitation, the obligation to pay any
Finance Charges with respect thereto.
"Receivables Files" means the documents specified in Section 6.3.
"Related Security" means, with respect to any Receivable:
(i) all of the Seller's interest in the Financed Vehicle, the
financing of the purchase of which gave rise to such Receivable,
including, without limitation, all of the Seller's right, title and
interest in and to the proceeds of the Insurance Policies, and all
warranties, indemnities, service obligations and other contract rights
issued or granted by, or otherwise existing under applicable law against,
the manufacturer or Dealer in respect of such Financed Vehicle,
(ii) all other security interests or liens and property subject
thereto from time to time, if any, purporting to secure payment of such
Receivable, whether pursuant to the Contract related to such Receivable,
or otherwise, together with all financing statements signed by an Obligor
describing any collateral securing such Receivable, and including,
without limitation, all security interests or liens, and property subject
thereto, granted by any Person (whether or not the primary Obligor on
such Receivable) under or in connection therewith,
(iii) all books, records and other information relating to such
Receivable, including, without limitation, all Contracts,
(iv) all service contracts and other contracts and agreements
relating to such Receivable, and
(v) all proceeds of any of the foregoing.
"Required Insurance" means an Insurance Policy with respect to a
Financed Vehicle (i) that has been issued to the Obligor by an insurance
company acceptable to the Servicer, (ii) that provides comprehensive,
collision, fire, theft and other physical damage coverage, (iii) that is in
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an amount not less than the market value of the applicable Financed Vehicle,
and (iv) that has the Servicer noted as the loss payee thereon.
"Reserve" means the amount designated as such in the Fee Letter.
"Sale Documents" means this Agreement, the Exhibits hereto to which
the Seller is a party and all other certificates, instruments, agreements and
documents executed from time to time by the Seller in connection with the
transactions contemplated in this Agreement.
"Schedule of Contracts" means the list of Contracts delivered to the
Administrative Agent, such list being in microfiche, paper or electronic
format.
"Seller" means Premier Receivables L.L.C., a Michigan limited
liability company, and its successors and permitted assigns.
"Servicer" means CFC or any replacement thereof under Article VI.
"Servicer Default" has the meaning assigned to that term in Section
6.2.
"Servicer Fee" has the meaning assigned to the term in Section 3.5.
"Servicer Report" means the report in the form of Exhibit A hereto to
be provided by the Servicer in accordance with Section 5.4 of this Agreement,
which report shall include a calculation of the Delinquency Ratio and the Net
Loss Ratio for the applicable month.
"Settlement Date" means the 10th day of each month following each
Settlement Period, or if such day is not a Business Day, the next succeeding
Business Day.
"Settlement Period" means a calendar month, provided, that, for
purposes of the initial Settlement Period, such period shall commence as of
the Purchase Date and end on June 30, 1998.
"Simple Interest Method" means the method of allocating a fixed level
payment to principal and interest, pursuant to which the portion of such
payment that is allocated to interest is equal to the product of (a) the
fixed rate of interest, (b) the unpaid principal balance, and (c) a fraction,
the numerator of which is the number of days elapsed since the preceding
payment of interest was made and the denominator of which is 365, and the
remainder of such payment is allocable to principal.
"Up-front Fee" has the meaning assigned to that term in Section 4.11.
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ARTICLE II: SALE AND PURCHASE
SECTION 2.1. Sale and Purchase. Upon the terms and subject to the
conditions set forth herein, effective as of the Purchase Date, (i) the
Seller hereby sells, transfers and assigns to the Purchaser all of the
Seller's right, title and interest to and in the Purchased Receivables,
together with the Related Security and Collections from and after the Cut-Off
Date relating to such Purchased Receivables and (ii) the Purchaser hereby
purchases and accepts the transfer and assignment of all of the Seller's
right, title and interest to and in the Purchased Receivables, together with
the Related Security and Collections relating to such Purchased Receivables
(the foregoing sale, transfer and assignment being referred to as the
"Purchase") and (iii) the Purchaser hereby, without any further action
hereunder, does sell, transfer, assign, set over and otherwise convey to the
Seller, effective as of the Purchase Date, without recourse, representation
or warranty of any kind, all right, title and interest of the Purchaser in
and to the Balloon Payments, all monies due and to become due and all amounts
received with respect thereto and all proceeds thereof.
SECTION 2.2. Purchase Price. The aggregate purchase price payable by
the Purchaser for the Purchase shall equal the Aggregate Principal Balance as
of the Cut-Off Date. Such purchase price shall be comprised of a cash
component and a deferred payment component. The cash component of the
purchase price shall be paid by the Purchaser to the Seller on the Purchase
Date and shall equal the Aggregate Principal Balance of the Purchased
Receivables as of the Cut-Off Date minus the Reserve calculated as of such
Purchase Date. Upon and after the reduction of the Investment to zero and the
payment in full of all other amounts due to the Purchaser hereunder, all
Collections or other cash received by the Purchaser on account of Receivables
and the interest of the Purchaser therein and all Receivables held by or on
behalf of the Purchaser will be transmitted in the form received by the
Purchaser to the Seller. The transmission of such amount by the Purchaser
shall be deemed to satisfy the payment of the deferred payment component of
the purchase price under this Section 2.2.
SECTION 2.3. CFC's Optional Termination. The CFC shall have the
right, on five (5) Business Days' written notice to the Administrative Agent,
at any time following the reduction of the Aggregate Principal Balance
hereunder to a level that is less than ten percent (10%) of the Aggregate
Principal Balance on the Purchase Date, to repurchase from the Purchaser on
any subsequent Settlement Date all, and not part, of the then outstanding
Purchased Receivables, together with the Related Security and Collections
relating to such Purchased Receivables. The purchase price in respect thereof
shall be an amount equal to the Investment outstanding at such time plus all
other amounts payable (whether due or accrued) hereunder or under any other
Sale Document to the Purchaser or the Administrative Agent at such time. Such
repurchase shall be without representation, warranty or recourse of any kind
by, on the part of or against the Purchaser or the Administrative Agent.
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ARTICLE III: FEES AND EXPENSES
SECTION 3.1. Determination of Carrying Costs. The following items as
outlined in Section 3.2 through Section 3.6 shall be utilized in calculating
the amount of Carrying Costs to be distributed each Settlement Period out of
Collections of Purchased Receivables.
SECTION 3.2. Purchase Discount. A Purchase Discount equal to the
weighted average of the following:
(a) the weighted average of the discount rates on all commercial
paper notes issued at a discount and outstanding during the related
Settlement Period (other than commercial paper notes the proceeds of
which are used by the Purchaser to (x) purchase receivables, or extend
financing secured thereby, at a fixed interest rate or (y) conduct any
arbitrage activities of the Purchaser), converted to an annual
yield-equivalent rate on the basis of a 360-day year;
(b) the weighted average of the annual interest rates payable on all
interest-bearing commercial paper notes outstanding during the related
Settlement Period (other than the commercial paper notes described in
clauses (x) and (y) of paragraph (a) above), on the basis of a 360-day
year; and
(c) the weighted average of the annual interest rates applicable to
any Liquidity Facilities under which the Purchaser has borrowed loans
during the related Settlement Period (which loans shall be borrowed only
after a determination by the Purchaser that financing its activities
during such period by issuing commercial paper notes would not be
practicable or cost-efficient);
provided that, to the extent that the Investment is funded by a specific
issuance of commercial paper notes and/or by a specific funding under a
Liquidity Facility or a Credit Facility, the Purchase Discount shall
equal the rate or weighted average of the rates applicable to such
issuance or borrowing, provided, further, that, for purposes of the
foregoing, the interest rates applicable under any Liquidity Facility and
or any Credit Facility shall not exceed the reserve adjusted "LIBO Rate"
quoted by the Administrative Agent plus 0.50 % (50 basis points) per
annum.
SECTION 3.3. Carrying Cost True-Up Amount. Two Business Days prior to
the end of each Settlement Period, the Administrative Agent shall determine
the Purchase Discount pursuant to (a) above by using the actual Purchase
Discount for each day elapsed in such month and estimating the Purchase
Discount for each remaining day in such month. In addition, the
Administrative Agent shall concurrently notify the Servicer of the actual
Purchase Discount for
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any days during the immediately preceding Settlement Period with respect to
which the Purchase Discount was estimated, and the difference, if any,
between the Carrying Costs actually paid using the estimated Purchase
Discount and the Carrying Costs which would have been paid had the actual
Purchase Discount been available (such differential being the "Carrying Costs
True-Up Amount"). If the amount of Carrying Costs paid for such immediately
preceding Settlement Period based upon an estimated Purchase Discount was
less than the amount of Carrying Costs for such Settlement Period based upon
the actual Purchase Discount, the amount of Collections remitted to the
Administrative Agent pursuant to Section 5.3(i) shall be increased by an
amount equal to the Carrying Costs True-Up Amount, or, if the amount of
Carrying Costs paid for such immediately preceding Settlement Period based
upon an estimated Purchase Discount was greater than the amount of Carrying
Costs for such Settlement Period based upon the actual Purchase Discount, the
amount of Collections remitted to the Administrative Agent pursuant to
Section 5.3(i) shall be decreased by an amount equal to the Carrying Costs
True-Up Amount.
SECTION 3.4. Program Fee. A Program Fee equal to the amount
designated as such in the Fee Letter, which amount shall include all annual
expenses, including but not limited to legal fees, audit fees, filing and
administrative fees, liquidity and credit enhancement fees, and dealer
commissions.
SECTION 3.5. Servicer Fee. A Servicer Fee in respect of each
Settlement Period, equal to 1.0% per annum (assuming a 30/360 day basis) of
the Principal Balance of Purchased Receivables on the first day of such
Settlement Period, shall be remitted by the Purchaser to the Servicer,
provided, however, that, for purposes of the initial Settlement Period such
period shall commence as of the Cut-off Date and end on June 30, 1998 . If
CFC is acting as the Servicer, then the Servicer shall retain an amount equal
to the Servicer Fee (in full satisfaction of the payment of such fee to the
Servicer) out of amounts required to be remitted by the Servicer in
accordance with Section 5.3.
SECTION 3.6. Interest on Unpaid Amounts. To the extent that the
Seller or Servicer fails to pay when due to the Purchaser or the
Administrative Agent any fee, expense or other amount payable hereunder or
under any Sale Document, interest shall be due and payable on such unpaid
amount, for each day until paid in full, at the rate of 2.00% (200 basis
points) in excess of the rate of interest per annum published on such day
(or, if not then published, on the most recently preceding day) in The Wall
Street Journal as the "Prime Rate". Changes in the rate payable hereunder
shall be effective on each date on which a change in the "Prime Rate" is so
published.
ARTICLE IV: CONDITIONS PRECEDENT TO PURCHASE
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SECTION 4.1. Conditions Precedent to Purchase. The following
conditions as outlined in Section 4.2 through Section 4.11 must be satisfied
before the Purchaser will make the Purchase:
SECTION 4.2. Absence of Liens. The Seller shall certify that all
Purchased Receivables, Related Security and all proceeds thereof are free and
clear of any Adverse Claim.
SECTION 4.3. Financing Statements. The Administrative Agent will have
received acknowledgment copies of UCC-1 financing statements, and all other
documents reasonably requested by the Administrative Agent, to evidence the
perfection of the Purchaser's interest in the Purchased Receivables, the
Related Security and the Collections.
SECTION 4.4. Schedule of Contracts. The Administrative Agent will
have received and approved the Schedule of Contracts.
SECTION 4.5. Seller Resolutions. The Administrative Agent will have
received a certificate of the Seller attesting to:
(a) the resolutions of the majority interest of the Seller's members
authorizing the execution by the Seller of the Sale Documents to be
executed by the Seller;
(b) the names and signatures of the officers of the Seller?s members
authorized to execute the Sale Documents to be executed by the Seller;
and
(c) the completeness and correctness of the attached articles of
organization and operating agreement of the Seller.
SECTION 4.6. Servicer Resolutions. The Administrative Agent will have
received a certificate of the Servicer's Secretary or Assistant Secretary
attesting to:
(a) the resolutions of the Servicer's Board of Directors (or an
executive committee thereof) authorizing the execution by the Servicer of
the Sale Documents to be executed by the Servicer;
(b) the names and signatures of the officers of the Servicer
authorized to execute the Sale Documents to be executed by the Servicer;
and
(c) the completeness and correctness of the attached restated
articles of incorporation and by-laws of the Servicer.
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SECTION 4.7. Legal Opinion of Counsel to the Seller and the Servicer.
The Administrative Agent will have received an opinion from counsel to the
Seller and the Servicer, such counsel being "in-house" counsel unless
otherwise required by any agencies providing a credit rating to the
transaction contemplated hereby, substantially in the form attached hereto as
Exhibit B, together with such other matters as the Administrative Agent or a
Purchaser may reasonably request.
SECTION 4.8. Good Standing Certificates. The Administrative Agent
will have received certificates of recent date issued by the Secretary of
State of the State of Michigan, as to the legal existence and good standing
of the Seller and the Servicer.
SECTION 4.9. Representations and Covenants. On and as of the Purchase
Date (i) the representations and warranties of the Seller and the Servicer in
Article VII shall be true and correct with the same effect as if made on such
date and (ii) the Seller and the Servicer shall be in compliance with the
covenants set forth in Article VIII. The Seller and the Servicer, by
accepting the proceeds of such Purchase, shall be deemed to have certified as
to the truth and accuracy of each of the matters described in the foregoing
clauses (i) and (ii), both before and after giving effect to such Purchase.
SECTION 4.10. Other Documents. The Administrative Agent and the
Purchaser will have received all other documents that either of them had
reasonably requested from the Seller or the Servicer.
SECTION 4.11. Up-Front Fee. The Seller shall have paid a fee to the
Administrative Agent at Closing in the amount designated in the Fee Letter as
the "Up-Front Fee," which amount shall include all up-front expenses,
including but not limited to legal fees, filing and administrative fees,
rating agency fees, liquidity and credit enhancement fees incurred with
respect to the Purchase.
SECTION 4.12. Hedging. The Agent shall have received one or more duly
executed, valid and enforceable interest rate protection agreement in form
and substance satisfactory to the Administrative Agent.
SECTION 4.13 Insolvency: No Insolvency Event has occurred and is
continuing with respect to the Seller or the Servicer.
ARTICLE V: SETTLEMENT PROCEDURES
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SECTION 5.1. Collections. The Servicer shall remit Collections with
respect to each Settlement Period to the Administrative Agent on the
Settlement Date relating to such Settlement Period.
SECTION 5.2. Application of Collections. All Collections for the
Settlement Period shall be applied by the Servicer as follows:
(a) with respect to each payment by or on behalf of the Obligor shall
be applied to interest and principal in accordance with the Simple
Interest Method with excess payments applied to principal; and
(b) all Liquidation Proceeds with respect to any Balloon Payment
Receivable shall be applied first to the related Receivable and only
after the payment in full of the Principal Balance thereof plus accrued
but unpaid interest thereon shall any such Liquidation Proceeds be
applied to, or constitute, the related Balloon Payment.
SECTION 5.3. Application of Collections on Settlement Dates. The
Servicer will, by 3:00 P.M. (New York time) on each Settlement Date, from
Collections received during the preceding Settlement Period, pay to the
Administrative Agent and the Administrative Agent shall distribute such
Collections, together with any Hedging Proceeds received by the
Administrative Agent with respect to such Settlement Period, to the Purchaser
or their respective assigns (i) first, an amount equal to the Carrying Costs
for the Settlement Period (as such amount shall be increased or decreased by
the Carrying Costs True-Up Amount, if any, for the immediately preceding
Settlement Period as determined pursuant to Section 3.3) and (ii) second, all
remaining Collections as a reduction to the Investment.
SECTION 5.4. Servicer Report. The Servicer will provide the
Purchaser, either in writing or electronically, with a Servicer Report with
respect to each Settlement Period no later than three Business Days before
the Settlement Date.
ARTICLE VI: SERVICING OF RECEIVABLES
SECTION 6.1. Appointment and Duties of the Servicer. The Purchaser
and the Seller each hereby appoint CFC as the Servicer and CFC accepts such
appointment. The Servicer, for the benefit of the Purchaser (to the extent
provided herein), shall manage, service, administer, make collections and
discharge liens on the Purchased Receivables with reasonable care, using that
degree of skill and attention that the Servicer exercises with respect to all
comparable automotive receivables that it services for itself or others. If
the Servicer shall commence a legal proceeding to enforce a Purchased
Receivable, the Purchaser shall thereupon be deemed to have automatically
assigned, solely for the purpose of collection, such Purchased Receivables to
the
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Servicer. If in any enforcement suit or legal proceeding it shall be held
that the Servicer may not enforce a Purchased Receivable on the ground that
it shall not be a real party in interest or a holder entitled to enforce such
Purchased Receivable, the Administrative Agent shall, at the Servicer's
expense and direction, take steps to enforce such Receivable, including
bringing suit in its name or the name of the Purchaser. The Purchaser shall
upon the written request of the Servicer furnish the Servicer with any powers
of attorney and other documents reasonably necessary or appropriate to enable
the Servicer to carry out its servicing and administrative duties hereunder.
SECTION 6.2. Replacement of the Servicer. (a) If any of the following
events has occurred, a Servicer Default, shall occur and be continuing:
(i) any failure by the Servicer to make any payment or deposit
required to be made hereunder and the continuance of such failure for a
period of five Business Days;
(ii) any representation or warranty made by the Servicer in Section
7.1, or any information set forth in a Servicer Report or other
certificate delivered to the Administrative Agent, shall prove to have
been incorrect in any material respect when made, which continues to be
incorrect in any material respect for a period of sixty days after the
earlier of the date on which an officer of the Servicer has actual
knowledge thereof and the date on which written notice thereof has been
given to the Servicer requiring the same to be remedied, by the Purchaser
or the Administrative Agent;
(iii) failure on the part of the Servicer to observe or perform in
any material respect any other term, covenant or agreement in this
Agreement or any other Sale Document which continues unremedied for sixty
days after the earlier of the date on which an officer of the Servicer
has actual knowledge of such failure and the date on which written notice
of such failure has been given to the Servicer requiring the same to be
remedied, by the Purchaser or the Administrative Agent; or
(iv) an Insolvency Event with respect to the Seller or the Servicer,
then, so long as such Servicer Default shall not have been remedied, the
Purchaser shall have the right to remove CFC (or any successor Servicer) as
Servicer by giving written notice thereof to the Servicer. On and after
receipt of such written notice, all authority and power of the Servicer under
this Agreement shall, without further action, pass to and be vested in such
successor Servicer as may be appointed by the Purchaser, provided, however,
that Servicer cannot be removed until a successor Servicer is selected and
appointed and such successor Servicer meets industry-wide standards for being
a Servicer of retail automotive receivables.
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(b) If CFC is removed as Servicer, CFC shall transfer to any
successor Servicer designated by the Purchaser all records,
correspondence and documents requested by the Purchaser or such successor
Servicer and permit such Persons to have access to, and to copy, all
software used by the Servicer in the collection, administration or
monitoring of the Purchased Receivables. In the case of software that is
then licensed by, or otherwise made available to, the Servicer from or by
any third party, the Servicer shall use its best efforts to obtain such
consents and otherwise take all actions necessary in order to enable any
Servicer hereunder to succeed to all rights of CFC to the quiet use and
enjoyment of such software for the purpose of discharging the obligations
of the Servicer under or in connection with the Sale Documents.
(c) Following the removal of CFC as Servicer, (i) the Purchaser and
the Administrative Agent may (a) notify Obligors of the ownership
interest of the Purchaser hereunder in the Purchased Receivables and the
Related Security, (b) notify each issuer of an Insurance Policy of the
ownership interest of the Purchaser hereunder in the Purchased
Receivables and in the Related Security (including the applicable
Financed Vehicle and Insurance Policy thereon), and (c) direct the Seller
to, whereupon the Seller immediately shall, note the interest of the
Purchaser hereunder on each Certificate of Title relating to each
Financed Vehicle and (ii) the Purchaser and the Administrative Agent
shall have, in addition to all other rights and remedies under this
Agreement or otherwise, all other rights and remedies provided under the
Uniform Commercial Code of the applicable jurisdiction and other
applicable laws, which rights shall be cumulative.
SECTION 6.3. Custody of Receivable Files. To assure uniform quality
in servicing the Receivables and to reduce administrative costs, the
Purchaser and the Seller hereby irrevocably appoint the Servicer, and the
Servicer hereby accepts such appointment, to act for the benefit of the
Purchaser and the Seller as custodian of the following documents or
instruments which are hereby or will hereby be constructively delivered to
the Administrative Agent, as pledgee of the Seller, as of the Closing Date
with respect to each Purchased Receivable (the "Receivable Files"):
(a) the fully executed original of the Contract related to such
Purchased Receivable;
(b) the original credit application fully executed by the Obligor;
(c) the original Certificate of Title or such documents that the
Servicer or the Seller shall keep on file, in accordance with its
customary procedures, evidencing the security interest of the Seller in
the Financed Vehicle; and
<PAGE>
page 18
(d) any and all other documents that the Servicer or the Seller shall
keep on file, in accordance with its customary procedures, relating to a
Purchased Receivable, an Obligor or a Financed Vehicle.
SECTION 6.4. Duties of the Servicer as Custodian. The Servicer shall
hold the Receivable Files as custodian for the benefit of the Seller and the
Purchaser and maintain such accurate and complete accounts, records and
computer systems pertaining to each Receivable File as shall enable the
Seller to comply with this Agreement. In performing its duties as custodian
the Servicer shall act with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to receivable files
relating to all comparable automotive receivables that the Servicer services
for itself or others.
SECTION 6.5. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Cut-Off Date and
shall continue in full force and effect until terminated pursuant to this
Section. If CFC shall cease to be Servicer in accordance with the provisions
of this Agreement, the appointment of such Servicer as custodian shall be
terminated by the Purchaser. The Purchaser may terminate the Servicer's
appointment as custodian at any time following the occurrence of a Servicer
Default under Section 6.2(a) upon thirty days written notification to the
Servicer. As soon as practicable after any termination of such appointment,
the Servicer shall deliver the Receivable Files to the Administrative Agent
or to a Person designated by the Administrative Agent at a place or places as
the Administrative Agent may reasonably designate.
ARTICLE VII: REPRESENTATIONS AND WARRANTIES
SECTIION 7.1. Representations and Warranties of the Seller and
Servicer. Each of the Seller and the Servicer makes, with respect to itself,
the following representations and warranties to the Purchaser and its
assigns:
(a) it is a limited liability company or corporation, as applicable,
duly organized or incorporated, validly existing and in good standing
under the laws of the jurisdiction of its organization or incorporation
and is duly qualified in good standing as a foreign corporation or
limited liability company in each jurisdiction where the failure to be so
qualified could materially adversely affect its ability to perform its
obligations hereunder;
(b) the execution, delivery and performance by the Seller and the
Servicer of the Sale Documents, and the Seller's use of the proceeds of
the Purchases, are within the Seller's and the Servicer's respective
corporate or other powers, have been duly authorized by all necessary
corporate or other action, do not contravene (i) the Seller's or the
Servicer's respective articles of organization or charter, as applicable,
or operating agreement or by-
<PAGE>
page 19
laws, as applicable, or (ii) law or any contractual restriction binding
on or affecting the Seller or the Servicer, and do not result in or
require the creation of any Adverse Claim (other than pursuant hereto)
upon or with respect to any of its properties; and no transaction
contemplated hereby requires compliance with any bulk sales act or
similar law;
(c) no authorization or approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body is required
for the due execution, delivery and performance by the Seller or the
Servicer of the Sale Documents, or for the perfection of or the exercise
by the Purchaser of its rights and remedies under the Sale Documents,
except for the filing of the financing statements referred to in Section
4.3;
(d) each Sale Document constitutes the legal, valid and binding
obligation of the Seller and the Servicer, respectively, enforceable in
accordance with its terms;
(e) there is no pending or threatened action or proceeding affecting
the Seller or the Servicer or any of its subsidiaries before any court,
governmental agency or arbitrator which may materially adversely affect
(i) its financial condition or operations or (ii) its ability to perform
its obligations under the Sale Documents, or which could affect the
legality, validity or enforceability of any Sale Document or of the
interest of the Purchaser in the Purchased Receivables;
(f) immediately prior to the transfer and assignment herein
contemplated, the Seller had good and marketable title to the
Receivables, the Related Security and Collections, free and clear of any
Adverse Claim, except as created by this Agreement; upon consummation of
the Purchase, the Purchaser will acquire good and marketable title to the
Purchased Receivables and to the Related Security and the Collections
with respect thereto, free and clear of any Adverse Claim, except as
created by this Agreement, and such transfer has been perfected under the
Uniform Commercial Code enacted in the State of Michigan;
(g) the information provided by the Seller to the Servicer for use in
each Servicer Report prepared under Section 5.4 and all information
(including, but not limited to, the Schedule of Contracts) and Sale
Documents furnished or to be furnished at any time by the Seller to the
Administrative Agent in connection with this Agreement is or will be
accurate in all material respects as of its date, and no such document
will contain any untrue statement of a material fact or will omit to
state a material fact which is necessary to make the facts stated therein
not misleading;
(h) the Seller is treating the conveyance of the interest in the
Purchased Receivables and the Collections under this Agreement to the
Purchaser as a sale for purposes of generally accepted accounting
principles;
<PAGE>
page 20
(i) no selection procedures believed by the Seller to be adverse to
the Purchaser and of which the Purchaser had no actual knowledge were or will
be used in selecting the Receivables for purchase hereunder,
(j) each of the Contracts on the Schedule of Contracts gives rise to
an Eligible Receivable, and
(k) there has been no material change in any Credit and Collection
Policy that would have a material adverse effect on the performance of the
Receivables.
ARTICLE VIII: COVENANTS
SECTION 8.1. Affirmative Covenants of the Seller and the Servicer.
Until the Investment is reduced to zero and all other amounts due to the
Purchaser hereunder have been paid in full, each of the Seller and the
Servicer (with respect to itself) will, unless the Purchaser has otherwise
consented in writing:
(a) maintain its existence in the jurisdiction of its organization or
incorporation, and qualify and remain qualified in good standing as a
foreign corporation or limited liability company in each jurisdiction
where the failure to be so qualified could materially adversely affect
its ability to perform its obligations hereunder;
(b) maintain and implement administrative and operating procedures,
and keep and maintain all records and other information, reasonably
necessary or advisable for the collection of the Purchased Receivables
(including, without limitation, records adequate to permit the daily
identification of Purchased Receivables and all Collections and
adjustments to Purchased Receivables);
(c) at its expense timely and fully perform and comply with all
material provisions and covenants required to be observed by CFC or the
Seller under the Contracts related to the Purchased Receivables;
(d) comply in all material respects with the Credit and Collection
Policy and with all applicable laws with regard to each Purchased
Receivable and any Contract related to such Receivable; and
(e) treat the conveyance of the interest in the Purchased Receivables
and the Collections under this Agreement as a sale for purposes of
generally accepted accounting principles.
<PAGE>
page 21
SECTION 8.2. Reporting Requirements of the Servicer. Until the
Investment is reduced to zero and all amounts due to the Purchaser hereunder
have been paid in full, the Servicer will, unless the Purchaser shall
otherwise consent in writing, furnish to the Purchaser:
(a) the Servicer Report as required under Section 5.4;
(b) as soon as possible, and in any event within thirty days shall
describe such event or condition and, if applicable, the steps being
taken with respect thereto by the Person(s) affected thereby of: (i) the
occurrence of any Servicer Default or event which with the passage of
time or the giving of notice or both would constitute a Servicer Default
or (ii) the institution of any litigation, arbitration proceeding or
governmental proceeding which could be reasonably likely to have a
material adverse effect on the performance by the Servicer of its
obligations under this Agreement or the other Sale Documents or the
collectibility of the Purchased Receivables; and
(c) such other information, documents, records or reports respecting
the Purchased Receivables or the condition or operations, financial or
otherwise, of the Servicer or the Seller as the Purchaser may from time
to time reasonably request.
SECTION 8.3 Negative Covenants of the Seller and the Servicer. Until
the Investment is reduced to zero and all other amounts due to the Purchaser
hereunder have been paid in full, neither the Seller nor the Servicer will,
unless the Purchaser has otherwise consented in writing:
(a) except as provided herein, sell, assign (by operation of law or
otherwise) or otherwise dispose of, or create or suffer to exist any
Adverse Claim upon or with respect to any Purchased Receivables, the
Related Security or any Collections or assign any right to receive income
in respect thereof; or
(b) amend or otherwise modify the terms of any Purchased Receivable,
or amend, modify or waive any term or condition of any Contract related
thereto, in each case, in any manner which is inconsistent with the
Credit and Collection Policy.
SECTION 8.4. Protection of the Purchaser's Interest. Until the
Investment is reduced to zero and all other amounts due to the Purchaser
hereunder have been paid in full, each of the Seller and the Servicer agrees
that from time to time, at its expense, it will promptly execute and deliver
all instruments and documents and take all action that the Administrative
Agent may from time to time reasonably request in order to perfect, evidence
and protect the validity, enforceability, perfection and priority of the
Administrative Agent's and the Purchaser's interests in the Purchased
Receivables, the Related Security and the Collections and to enable the
Administrative Agent and/or the Purchaser to exercise or enforce any of its
rights hereunder. Without limiting the generality of the foregoing, the
Seller and the Servicer will: (i) on or prior to the date hereof, mark its
master data processing records with a legend describing the
<PAGE>
page 22
Administrative Agent's and the Purchaser's interests therein; and (ii) upon
the request of the Administrative Agent, execute and file such financing or
continuation statements or amendments thereto or assignments thereof as may
be requested by the Administrative Agent, provided, however, that the Seller
is not required to deliver the Contracts to anyone other than the Servicer.
To the fullest extent permitted by applicable law, the Administrative Agent
shall be permitted to sign and file continuation statements and amendments
thereto and assignments thereof without the Seller's signature. A
reproduction of this Agreement or any financing statement shall be sufficient
as a financing statement.
ARTICLE IX: INDEMNIFICATION
SECTION 9.1. Indemnification. Without limiting any other rights which
the Agent or the Purchaser may have hereunder or under applicable law, the
Seller and the Servicer each agree to indemnify the Agent, the Purchaser and
any assign of the Purchaser, and each of their respective officers,
directors, agents and employees (each of the foregoing, an "Indemnified
Party") from and against any and all damages, losses, claims, taxes,
liabilities, costs, expenses and for all other amounts, payable, including
reasonable attorneys' fees (which attorneys may be employees of the Agent or
the Purchaser or assign) and all disbursements awarded against or incurred by
any of them (any or all of the foregoing, an "Indemnity Claim") out of, or as
a result of:
(a) any breach of any representation, warranty or covenant by the
Seller or Servicer;
(b) any untrue statements of material fact or untrue or materially
inaccurate information provided by the Seller or Servicer regarding the
Receivables or in any Servicer Report, the Schedule of Contracts, the
Credit and Collection Policy or any other information provided to the
Administrative Agent or the Purchaser with respect to this transaction;
(c) enforcement of this Agreement and any other documents delivered
hereunder; and
(d) any lawsuits, disputes or claims brought against the Agent, the
Purchaser or any of the Purchaser's assigns by any third party arising out of
or as a result of the existence of this Agreement;
provided, however, that neither the Seller nor the Servicer shall be liable
to any Indemnified Party to the extent that the final judgment of a court of
competent jurisdiction holds that such Indemnity Claim resulted from the
gross negligence or willful misconduct of such Indemnified Party.
<PAGE>
page 23
ARTICLE X: ADMINISTRATIVE AGENT
SECTION 10.1. Appointment of the Administrative Agent. The Purchaser
has appointed The First National Bank of Chicago as its Administrative Agent.
The Administrative Agent is responsible for administering and enforcing this
Agreement and fulfilling all other duties expressly assigned to it in this
Agreement. The Purchaser has granted the Administrative Agent the authority
to take all actions necessary to assure the Seller's compliance with the
terms of this Agreement and to take all actions required or permitted to be
performed by the Purchaser under this Agreement.
SECTION 10.2. Replacement of the Administrative Agent. The Purchaser
may, at any time in its discretion, remove the Administrative Agent and
appoint a new Administrative Agent, which shall have the duties described in
Section 10.1.
ARTICLE XI: MISCELLANEOUS
SECTION 11.1. Amendments. No amendment or waiver of, or consent to the
Seller's or the Servicer's departure from, any provision of this Agreement
shall be effective unless it is in writing and signed by the parties hereto
and then such amendment, waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it was given.
SECTION 11.2. Notices. All notices and other communications provided
for hereunder shall, unless otherwise stated herein, be in writing (including
photocopy, facsimile, electronic mail or other digital communication) and
sent, as to each party hereto, at its address set forth under its name on the
signature pages hereto, or at such other address as shall be designated by
such party in a written notice to the other parties hereto. All such notices
and communications shall be effective when sent.
SECTION 11.3. No Waiver; Remedies. No failure on the part of the
Purchaser to exercise, and no delay in exercising, any right hereunder or
under any Sale Document shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude any other or
further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.
SECTION 11.4. Binding Effect; Assignability. This Agreement shall be
binding upon and inure to the benefit of the Seller, the Servicer, the
Purchaser, the Administrative Agent and their respective successors and
assigns, except that the Seller shall not have the right to assign any
interest herein without the prior written consent of the Purchaser. The
Purchaser may assign any of its rights or obligations hereunder to any
Person; provided that in the case of any such assignment proposed to be made
prior to the occurrence of a Servicer Default, other than an
<PAGE>
page 24
assignment by the Purchaser to the Administrative Agent or to a liquidity
provider with respect to a Liquidity Facility, the consent of the Seller
(which consent shall not be unreasonably withheld) shall be required. This
Agreement shall create and constitute the continuing obligation of the
parties hereto in accordance with its terms, and shall remain in full force
and effect until such time as the Investment is reduced to zero and all other
amounts due to the Purchaser hereunder have been paid in full; provided,
however, that the rights and remedies of the Purchaser under Article IX shall
survive any termination of this Agreement.
SECTION 11.5. Governing Law. This Agreement and the Sale Documents
shall be governed by, and construed in accordance with, the laws of the State
of New York.
SECTION 11.6. Construction of the Agreement. The parties hereto intend
that the conveyance of the interest in the Purchased Receivables by the
Seller to the Purchaser shall be treated as sales for purposes of generally
accepted accounting principles. If, despite such intention, a determination
is made that such transactions shall not be treated as sales, then this
Agreement shall be interpreted to constitute a security agreement and the
transactions effected hereby shall be deemed to constitute a secured
financing by the Purchaser to the Seller under applicable law. For such
purpose, the Seller hereby grants to the Purchaser a continuing security
interest in the Receivables listed on the Schedule of Contracts and the
Related Security and Collections related thereto to secure the obligations of
the Seller to the Purchaser hereunder.
SECTION 11.7. No Proceedings. The Seller, the Administrative Agent
and the Servicer each hereby agrees that it will not institute against the
Purchaser any bankruptcy, reorganization, insolvency or similar proceeding
until the date which is one year and one day since the last day on which any
commercial paper notes or medium term notes issued by the Purchaser shall
have matured.
SECTION 11.8. Confendtiality. The Purchaser agrees to maintain the
confidentiality of any information regarding the Seller obtained in
accordance with the terms of this Agreement which is not publicly available,
but the Purchaser may, with advance notice to the Seller, reveal such
information (a) to applicable rating agencies, liquidity providers and credit
providers, (b) as necessary or appropriate in connection with the
administration or enforcement of this Agreement or its funding of the
Purchase under this Agreement, (c) as required by law, government regulation,
court proceeding or subpoena or (d) to bank regulatory agencies and
examiners.
SECTION 11.9. Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the
same agreement.
<PAGE>
page 25
IN WITNESS WHEREOF, the parties have caused this Agreement to be
signed by their duly authorized officers as of the date set forth on the
cover page of this Agreement.
PREMIER RECEIVABLES L.L.C.
as Seller
By: /s/ D. H. Olson
-------------------
Title: Assistant Treasurer
--------------------
of Premier Auto Receivables Company,
a Member of the Seller
Address: 27777 Franklin Road
Southfield, Michigan 48034-8286
Attention: Assistant Secretary
Facsimile: 248-948-3138
CHRYSLER FINANCIAL CORPORATION
as Servicer
By: /s/ D. H. Olson
----------------
Title: Assistant Treasurer
-------------------
Address: 27777 Franklin Road
Southfield, Michigan 48034-8286
Attention: Assistant Secretary
Facsimile: 248-948-3138
<PAGE>
PREFERRED RECEIVABLES FUNDING
CORPORATION,
as Purchaser
By: /s/ Alison K. Dolin
----------------------
Authorized Signer
Address:
c/o The First National Bank of Chicago
One First National Plaza
Chicago, IL 60670-0079
Attn: John J. Loy
Facsimile: 312-732-1844
THE FIRST NATIONAL BANK OF CHICAGO,
as Administrative Agent
By: /s/ Alison K. Dolin
---------------------
Vice President
Address:
One First National Plaza
Chicago, IL 60670-0597
Attn: John J. Loy
Facsimile: 312-732-3205
=============================================================================
RECEIVABLES SALE AGREEMENT
Dated as of June 29, 1998
among
PREMIER RECEIVABLES L.L.C.
as Seller,
CHRYSLER FINANCIAL CORPORATION
as Servicer,
OLD LINE FUNDING CORP.
as Purchaser
and
ROYAL BANK OF CANADA
as Agent
=============================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I: DEFINITIONS......................................................1
ARTICLE II: THE SALE AND PURCHASE..........................................13
SECTION 2.1. Sale and Purchase....................................13
SECTION 2.2. Purchase Price.......................................14
SECTION 2.3. Seller's Optional Termination........................14
ARTICLE III: FEES AND EXPENSES.............................................15
SECTION 3.1. Determination of Carrying Costs......................15
(a) Purchase Discount.............................15
(b) Servicer Fee..................................17
SECTION 3.2. Interest on Unpaid Amounts...........................17
ARTICLE IV: CONDITIONS PRECEDENT TO PURCHASE...............................17
SECTION 4.1. Conditions Precedent to Purchase.....................17
(a) Absence of Liens..............................18
(b) Financing Statements..........................18
(c) Schedule of Contracts.........................18
(d) Seller Resolutions............................18
(e) Servicer Resolutions..........................18
(f) Legal Opinion of Counsel to the
Seller and the Servicer.......................19
(g) Good Standing Certificates....................19
(h) Representations and Covenants.................19
(i) Other Documents...............................19
(j) Upfront Fee..........Error! Bookmark not defined.
ARTICLE V: SETTLEMENT PROCEDURES...........................................20
SECTION 5.1. Collections .........................................20
SECTION 5.2. Application of Collections...........................20
SECTION 5.3. Application of Collections on
Settlement Dates.....................................21
SECTION 5.4. Servicer Report......................................21
SECTION 5.5. Repurchase Obligations...............................21
ARTICLE VI: SERVICING OF RECEIVABLES.....................................21
SECTION 6.1. Appointment and Duties of Servicer...................22
i
<PAGE>
SECTION 6.2. Replacement of Servicer..............................22
SECTION 6.3. Custody of Receivable Files..........................24
SECTION 6.4. Duties of Servicer as Custodian......................25
SECTION 6.5. Effective Period and Termination.....................25
ARTICLE VII: REPRESENTATIONS AND WARRANTIES................................26
SECTION 7.1. Representations and Warranties of
the Seller and the Servicer..........................26
ARTICLE VIII: COVENANTS...................................................27
SECTION 8.1. Affirmative Covenants of the Seller and the
Servicer.............................................28
SECTION 8.2. Reporting Requirements of the Servicer...............28
SECTION 8.3. Negative Covenants of the Seller and the Servicer....29
SECTION 8.4. Protection of the Purchaser's Interest...............30
ARTICLE IX: AGENT.........................................................30
SECTION 9.1. Appointment of Agent.................................30
ARTICLE X: MISCELLANEOUS..................................................31
SECTION 10.1. Amendments, Etc.....................................31
SECTION 10.2. Notices, Etc........................................31
SECTION 10.3. No Waiver; Remedies.................................31
SECTION 10.4. Binding Effect; Assignability.......................31
SECTION 10.5. Governing Law.......................................32
SECTION 10.6. Construction of the Agreement.......................32
SECTION 10.7. No Proceedings......................................33
SECTION 10.8. Confidentiality.....................................33
SECTION 10.9. Execution in Counterparts...........................33
SECTION 10.10. Indemnification by Seller of Investors, etc........33
EXHIBITS
EXHIBIT A - Form of Servicer Report
EXHIBIT B - Form of Opinion of Counsel
ii
<PAGE>
RECEIVABLES SALE AGREEMENT, dated as of June 29, 1998,
among PREMIER RECEIVABLES L.L.C., a Michigan limited liability company, as
the "Seller," CHRYSLER FINANCIAL CORPORATION, a Michigan corporation, as the
initial "Servicer," OLD LINE FUNDING CORP., a Delaware corporation, as the
"Purchaser," and ROYAL BANK OF CANADA, a Canadian chartered bank acting
through its New York Branch, as the "Agent" for the Investors.
ARTICLE I: DEFINITIONS
"Adverse Claim" means any mortgage, pledge, security
interest, hypothecation, assignment, deposit arrangement, encumbrance, lien
(consensual, statutory or other), charge, security arrangement, or any other
encumbrance or other right or claim in, of or on any Person's assets or
properties in favor of any other Person, of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, and any financing lease having substantially the same economic
effect as any of the foregoing).
"Agent" means Royal Bank of Canada, a Canadian chartered
bank acting through its New York Branch, and any successor or assign thereof
under Section 9.1.
"Agreement" means this Receivables Sale Agreement, as it
may be amended from time to time.
"Aggregate Principal Balance" means, at any time, the
aggregate Principal Balance of all Purchased Receivables at such time.
"Amount Financed" means (i) with respect to any Receivable
that is not a Balloon Payment Receivable, the amount advanced under such
Receivable toward the purchase price of the Financed Vehicle and any related
costs, exclusive of any amount allocable to the premium of force-placed
physical damage
<PAGE>
insurance covering the Financed Vehicle; and (ii) with respect to a Balloon
Payment Receivable, an amount equal to the present value of the fixed level
payment monthly installments (not including the amount designated as the
Balloon Payment) under the Balloon Payment Receivable, assuming that each
payment is made on the due date in the month in which such payment is due,
discounted at the APR for such Balloon Payment Receivable.
"Annual Percentage Rate" or "APR" of a Receivable means the
annual rate of finance charges stated in the related Contract.
"Balloon Payment" means, for any Receivable, the dollar
amount of any payment which is not a level monthly payment (other than the
first or last payment made on the Receivable which is minimally different
from the other level payments).
"Balloon Payment Program" means a retail installment sale
program in which the final payment is a Balloon Payment and the Balloon
Payment may be made by the Obligor by (i) payment in full in cash of the
Balloon Payment, (ii) return of the Financed Vehicle to the Servicer in lieu
of paying the Balloon Payment in cash provided that certain conditions are
satisfied or (iii) refinancing the Balloon Payment in accordance with certain
conditions.
"Balloon Payment Receivable" means any Contract listed on
the Schedule of Contracts that provides for amortization of the loan over a
series of fixed level payment monthly installments in accordance with the
actuarial method, the simple interest method or the Rule of 78s, but also
requires a final payment that is greater than the scheduled monthly payments
and is due after payment of such scheduled monthly payments and that may be
made by (i) payment in full in cash of a Balloon Payment, (ii) return of the
Financed Vehicle to the Servicer provided certain conditions are satisfied or
(iii) refinancing the Balloon Payment in accordance with certain conditions.
"Business Day" means any day other than a day on which
banks are not authorized to be open or required to be closed in New York
City.
"Carrying Costs" means, for each Settlement Period, an
amount equal to the sum of:
2
<PAGE>
(i) (PD + PF) x DSP x AI
---
360
plus
(ii) SF x DP x APB
--
360
where PD = Purchase Discount
PF = Program Fee
SF = Servicer Fee
DSP = the number of days in such
Settlement Period
DP = thirty days, except for the
initial Settlement Period when
it shall be the number of days
from the Cut-Off Date to June
30, 1998
AI = the average daily Investment for
such Settlement Period
APB = the Aggregate Principal Balance
on the first day of such
Settlement Period.
"Carrying Costs True-up Amount" has the meaning assigned to
that term in Section 3.1(a).
"Certificate of Title" means any certificate, instrument or
other document issued by a state or other governmental authority in respect
of any motor vehicle for the purpose of evidencing the ownership of, or any
Adverse Claim in or against, such motor vehicle.
"CFC" means Chrysler Financial Corporation, a Michigan
corporation.
3
<PAGE>
"Collection" means any amount paid by an Obligor or any
other party with respect to a Purchased Receivable, including Liquidation
Proceeds.
"Contract" means, with respect to any Receivable, any and
all instruments, agreements, invoices or other writings pursuant to which
such Receivable arises or which evidence such Receivable.
"Credit and Collection Policy" means the credit and
collection policies and practices of the Servicer and any successor Servicer
relating to Receivables and Contracts, such policies being subject to
unilateral revision or modification at any time by the Servicer or successor
Servicer.
"Credit Facilities" means each of the committed loan
facilities, lines of credit, letters of credit and other forms of credit
enhancement available to the Purchaser which are not Liquidity Facilities.
"Cut-Off Date" means June 25, 1998.
"Dealer" means an automobile or light-duty truck dealership
located within the United States at or through which a Financed Vehicle shall
have been purchased or is proposed to be purchased.
"Delinquency Ratio" means, as of the last calendar day of
any month, a fraction, expressed as a percentage, the numerator of which is
the sum of the Principal Balances of all Receivables which were Delinquent
Receivables as of the last calendar day of such month and the last calendar
day of each of the two immediately preceding months, to the extent such
preceding months exist, and the denominator of which is the sum of the
Aggregate Principal Balance on such last calendar day of such month and on
the last calendar day of each of the two immediately preceding months, to the
extent such preceding months exist.
"Delinquent Receivable" means any Receivable which has 10%
or more of a scheduled payment past due for more than 60 days.
"Designated Account" means an account in the name of and
owned by the Agent, designated by the Agent in a writing delivered to the
Seller pursuant
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to the provisions of Section 5.1, for the purpose of receiving Collections of
Purchased Receivables.
"Eligible Receivable" means, as of the Cut-Off Date, any
Receivable:
(i) the Obligor of which (a) is a resident of the United
States and (b) is not an affiliate of the originating Dealer or any
of the parties hereto,
(ii) the Obligor of which (a) is not the Obligor of any
Receivable which has 10% or more of a scheduled payment past due for
more than 60 days and (b) is not the subject of any bankruptcy,
insolvency or reorganization proceeding or any other proceeding
seeking the entry of an order for relief or the appointment of a
receiver, trustee or other similar official for it or any
substantial part of its property,
(iii) which is "chattel paper" within the meaning of
Section 9-105 of the UCC of all applicable jurisdictions,
(iv) which is denominated and payable only in United
States dollars in the United States,
(v) which (a) has been originated in the United States
by a Dealer for the retail sale of a Financed Vehicle in the
ordinary course of such Dealer's business and (b) satisfies all
applicable requirements of the Credit and Collection Policy,
(vi) which arises under a Contract (a) which, together
with such Receivable, is (1) in full force and effect and
constitutes the legal, valid and binding obligation of the related
Obligor, enforceable against such Obligor in accordance with its
terms, and (2) subject to no dispute, offset, counterclaim or other
defense, and (b) with respect to which (x) no default, breach,
violation or event permitting acceleration under the terms thereof
has occurred and (y) there has not arisen any condition that, with
notice or lapse of time or both, would constitute a default, breach,
violation or event permitting acceleration under the terms thereof,
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(vii) which, together with the related Contract, (a) is
secured by a perfected, valid, subsisting and enforceable first
priority security interest in favor of CFC in the related Financed
Vehicle, (b) contains customary and enforceable provisions such that
the rights and remedies of the holder of such security interest are
adequate for realization against the collateral of the benefits of
the security, and (c) was originated and transferred to the Seller
without any conduct constituting fraud or misrepresentation on the
part of the applicable Dealer, CFC or the Seller,
(viii) which, together with the related Contract,
immediately following the execution of such Contract, was purchased
by (and the originating Dealer has validly assigned all of its
right, title and interest therein to) CFC, which, in turn, has sold
such Receivable to the Seller, and such purchase and assignment of
such Receivable, such Contract and the Related Security to CFC is
expressly contemplated in such Contract,
(ix) which, together with the Contract related thereto,
does not contravene any laws, rules or regulations applicable
thereto (including, without limitation, laws, rules and regulations
relating to usury, truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection
practices and privacy) and with respect to which no part of the
Contract related thereto is in violation of any such law, rule or
regulation,
(x) the Financed Vehicle securing which (a) is free and
clear of any Adverse Claim other than the security interest therein
then being assigned by the Seller to the Agent for the benefit of
the Investors, and no enforcement action, whether by repossession or
otherwise, has been taken with respect to such Financed Vehicle, and
(b) is covered by the Required Insurance in respect of such Financed
Vehicle, and such Required Insurance is in full force and effect,
and the proceeds of the Required Insurance has been assigned to the
Seller and such proceeds are fully assignable to the Agent, for the
benefit of the Investors,
(xi) as to which the Agent has not notified the Seller
that such Receivable or class of Receivables is not acceptable as an
Eligible
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Receivable, including, without limitation, because such Receivable
arises under a Contract that is not acceptable,
(xii) with respect to the outstanding balance thereof,
(a) the related Contract requires that payment in full of such
outstanding balance is scheduled to be made (1) not earlier than
three months after, and (2) not later than 72 months after the date
any interest therein is purportedly transferred to the Agent for the
benefit of the Investors hereunder and (b) such outstanding balance
is scheduled to be paid in equal consecutive monthly installments,
unless such Receivable arises under a Balloon Payment Program, and
(xiii) which Receivable bears interest at the per annum
rate stated on the face of the related Contract, which per annum
rate remains fixed during the term of such Receivable and accrued
interest on such Receivable is payable monthly, in arrears.
"Fee Agreement" means the agreement, dated as of the date
hereof, between the Agent and the Seller with respect to fees paid in
connection with this Agreement, as the same may be amended from time to time.
"Finance Charges" means, with respect to any Receivable and
its related Contract, any finance, interest or similar charges paid by an
Obligor pursuant to such Contract, including, without limitation, any charge
paid in connection with any extension or adjustment under such Contract
(without regard to whether any such extension or adjustment is permitted
under the terms of this Agreement).
"Financed Vehicle" means an automobile or light-duty truck,
together with all accessions thereto, securing an Obligor's indebtedness
under the applicable Contract.
"Hedging Proceeds" means any amount payable by CFC to the
Agent under an interest rate swap confirmation, dated as of June 29, 1998, as
the same may be amended.
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"Insolvency Event" means, with respect to a specified
Person, (a) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of such Person or any substantial
part of its property in an involuntary case under any applicable federal or
state bankruptcy, insolvency or other similar law now or hereafter in effect,
or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part
of its property, or ordering the winding-up or liquidation of such Person's
affairs, and such decree or order shall remain unstayed and in effect for a
period of 60 consecutive days; or (b) the commencement by such Person of a
voluntary case under any applicable federal or state bankruptcy, insolvency
or other similar law now or hereafter in effect, or the consent by such
Person to the entry of an order for relief in an involuntary case under any
such law, or the consent by such Person to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part
of its property, or the making by such Person of any general assignment for
the benefit of creditors, or the failure by such Person generally to pay its
debts as such debts become due, or the taking of action by such Person in
furtherance of any of the foregoing.
"Insurance Policy" means (i) any comprehensive and
collision, fire, theft or other insurance policy maintained by an Obligor in
which the Servicer is named as loss payee with respect to one or more
Financed Vehicles, and (ii) any credit, life or disability insurance
maintained by an Obligor in connection with any Contract.
"Investment" means the aggregate amount of cash paid by the
Purchaser to the Seller for the Purchase, less the amount of all Collections
received and applied as reductions of Investment pursuant to Article V.
"Investor" means the Purchaser and all other owners by
assignment or otherwise of a Receivable (originally purchased by the
Purchaser) or any interest therein and, to the extent of the undivided
interests so purchased, shall include any participants.
"Liquidated Receivable" means any Receivable liquidated by
the Servicer through the sale of a Financed Vehicle or otherwise.
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"Liquidation Proceeds" means, with respect to any
Liquidated Receivable, the monies collected in respect thereof, from whatever
source, net of the sum of any amounts expended by the Servicer in connection
with such liquidation and any amounts required by law to be remitted to the
Obligor on such Liquidated Receivable.
"Liquidity Facilities" means each of the loan facilities,
asset purchase agreements, lines of credit and other financial accommodations
available to the Purchaser to support the liquidity of the Purchaser's
commercial paper notes and medium term notes.
"Net Loss" for a month means the sum of the Aggregate
Principal Balance of all Purchased Receivables which are deemed to be
uncollectible for such month, minus any Liquidation Proceeds received during
such month, plus any losses resulting from disposition expenses paid during
such month.
"Net Loss Ratio" means, as of the last day of any month, a
fraction, expressed as a percentage, the numerator of which is the product of
(i) the sum of the Net Loss for such month and the two immediately preceding
months, to the extent such months exist, and (ii) a factor of 12 divided by
the number of months included in the sum in clause (i), and the denominator
of which is the average of the Aggregate Principal Balance on the first day
of the month and the first day of the two immediately preceding months, to
the extent such months exist.
"Obligor" means any Person which is obligated to make
payment on a Receivable.
"Person" means any corporation, natural person, firm, joint
venture, partnership, limited liability company, trust, unincorporated
organization, enterprise, government or any department or agency of any
government.
"Precomputed Receivable" means any Receivable under which
the portion of a payment allocable to earned interest (which may be referred
to in the related Contract as an add-on finance charge) and the portion
allocable to the Amount Financed is determined according to the sum of
periodic balances or the sum of monthly balances or any equivalent method or
which is a monthly actuarial receivable.
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"Principal Balance" means with respect to any Receivable
the outstanding principal balance thereof determined in accordance with the
Credit and Collection Policy and the Servicer's customary calculation
methods, provided, that with respect to a Receivable identified as a Balloon
Payment Receivable, the Principal Balance shall not include the Balloon
Payment.
"Program Fee" means the fee specified as such in the Fee
Agreement which shall include all annual expenses, including but not limited
to legal fees, audit fees, filing and administrative fees, liquidity and
credit enhancement fees and dealer commissions.
"Purchase" has the meaning assigned to that term in
Section 2.1.
"Purchase Date" means the date on which the conditions
precedent to the Purchase described in Section 4.1 have been satisfied or
waived.
"Purchase Discount" has the meaning assigned to that term
in Section 3.1(a).
"Purchased Receivable" means an Eligible Receivable arising
under a Contract listed on the Schedule of Contracts delivered to the Agent
prior to the Purchase Date being sold to the Purchaser under this Agreement.
Each Purchased Receivable is a Simple Interest Receivable.
"Purchaser" means Old Line Funding Corp. and any successor
or assign of the Purchaser that is a receivables investment company which in
the ordinary course of its business issues commercial paper or other
securities to fund its acquisition and maintenance of receivables.
"Receivable" means the indebtedness and other obligations
of an Obligor arising under a Contract, whether such indebtedness or other
obligations constitute accounts, chattel paper, instruments or general
intangibles, and including, without limitation, the obligation to pay any
Finance Charges with respect thereto.
"Receivables Files" means the documents specified in
Section 6.3.
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"Related Security" means, with respect to any Receivable:
(i) all of the Seller's interest in the Financed
Vehicle, the financing of the purchase of which gave rise to such
Receivable, including, without limitation, all of the Seller's
right, title and interest in and to the proceeds of the Insurance
Policies, and all warranties, indemnities, service obligations and
other contract rights issued or granted by, or otherwise existing
under applicable law against, the manufacturer or Dealer in respect
of such Financed Vehicle,
(ii) all other security interests or liens and
property subject thereto from time to time, if any, purporting to
secure payment of such Receivable, whether pursuant to the Contract
related to such Receivable, or otherwise, together with all
financing statements signed by an Obligor describing any collateral
securing such Receivable, and including, without limitation, all
security interests or liens, and property subject thereto, granted
by any Person (whether or not the primary Obligor on such
Receivable) under or in connection therewith,
(iii) all books, records and other information relating to
such Receivable, including, without limitation, all Contracts,
(iv) all service contracts and other contracts and
agreements relating to such Receivable, and
(v) all proceeds of any of the foregoing.
"Required Insurance" means an Insurance Policy with respect
to a Financed Vehicle (i) that has been issued to the Obligor by an insurance
company acceptable to the Servicer, (ii) that provides comprehensive
collision, fire, theft and other physical damage coverage, (iii) that is in
an amount not less than the market value of the applicable Financed Vehicle
and (iv) that has the Servicer noted as the loss payee thereon.
"Reserve" means an amount equal to 5.25% of the Investment
as of the Purchase Date, which will be delivered in the form of Receivables.
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"Sale Documents" means this Agreement, the Fee Agreement,
the Exhibits hereto to which the Seller is a party and all other
certificates, instruments, agreements and documents executed from time to
time by the Seller in connection with the transactions contemplated in this
Agreement.
"Scheduled Payment" means the required monthly payment
arising from a Contract for a Precomputed Receivable.
"Schedule of Contracts" means the list of Contracts
delivered to the Agent, such list being in microfiche, paper or electronic
format.
"Seller" means Premier Receivables L.L.C., a Michigan
limited liability company, and its successors and permitted assigns.
"Servicer" means CFC or any replacement thereof under
Article VI.
"Servicer Default" has the meaning assigned to that term
in Section 6.2.
"Servicer Fee" has the meaning assigned to the term in
Section 3.1(b).
"Servicer Report" means the report in the form of Exhibit A
hereto to be provided by the Servicer in accordance with Section 5.4 of this
Agreement, which report shall include a calculation of the Delinquency Ratio
and the Net Loss Ratio for the applicable month.
"Settlement Date" means the 10th day of each month
following a related Settlement Period (or if such 10th day is not a Business
Day, the next succeeding Business Day).
"Settlement Period" means a calendar month, provided, that,
for purposes of the initial Settlement Period, such period shall commence as
of the Purchase Date and end on June 30, 1998; provided, however, that for
purposes of calculating the Servicer Fee for the initial Settlement Period,
such period shall commence as of the Cut-Off Date and end on June 30, 1998.
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"Simple Interest Method" means the method of allocating a
fixed level payment to principal and interest, pursuant to which the portion
of such payment that is allocated to interest is equal to the product of (a)
the fixed rate of interest, (b) the unpaid principal balance and (c) a
fraction, the numerator of which is the number of days elapsed since the
preceding payment of interest was made and the denominator of which is 365,
and the remainder of such payment is allocable to principal.
"Simple Interest Receivable" means any Receivable under
which the portion of a payment allocable to interest and the portion
allocable to principal is determined in accordance with the Simple Interest
Method.
ARTICLE II: THE SALE AND PURCHASE
SECTION 2.1. Sale and Purchase. Upon the terms and subject
to the conditions set forth herein, effective as of the Purchase Date,
(i) the Seller hereby sells, transfers and assigns to
the Purchaser all of the Seller's right, title and interest to and
in the Purchased Receivables, together with the Related Security and
Collections from and after the Cut-Off Date relating to such
Purchased Receivables,
(ii) the Purchaser hereby purchases and accepts the
transfer and assignment of all of the Seller's right, title and
interest to and in the Purchased Receivables, together with the
Related Security and Collections relating to such Purchased
Receivables (the foregoing sale, transfer and assignment being
referred to as the "Purchase") and
(iii) the Purchaser hereby, without any further action
hereunder, does sell, transfer, assign, set over and otherwise
convey to the Seller, effective as of the Purchase Date, without
recourse, representation or warranty of any kind, all right, title
and interest of the Purchaser in and to the Balloon Payments, all
monies due and to become due and all amounts received with respect
thereto and all proceeds thereof.
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SECTION 2.2. Purchase Price. The purchase price payable by
the Purchaser for the Purchase shall equal the Aggregate Principal Balance as
of the Cut-Off Date. Such purchase price shall be comprised of a cash
component and a deferred payment component. The cash component of the
purchase price shall be paid by the Purchaser to the Seller on the Purchase
Date and shall equal the Aggregate Principal Balance of the Purchased
Receivables as of the Cut-Off Date minus the Reserve calculated as of such
Purchase Date. Upon and after the reduction of the Investment to zero and the
payment in full of all other amounts due to the Purchaser hereunder, all
Collections or other cash received by the Purchaser on account of Receivables
and the interest of the Purchaser therein and all Receivables held by or on
behalf of the Purchaser will be transmitted in the form received by the
Purchaser to the Seller. The transmission of such amount by the Purchaser
shall be deemed to satisfy the payment of the deferred payment component of
the purchase price under this Section 2.2.
SECTION 2.3. Optional Termination. Chrysler Financial
Corporation shall have the right, on five (5) Business Days' written notice
to the Agent, at any time following the reduction of the Aggregate Principal
Balance hereunder to a level that is less than ten percent (10%) of the
Aggregate Principal Balance on the Purchase Date, to purchase from the
Purchaser all, and not part, of the then outstanding Purchased Receivables,
together with the Related Security and Collections relating to such Purchased
Receivables. The purchase price in respect thereof shall be an amount equal
to the Investment outstanding at such time plus all other amounts payable
(whether due or accrued) hereunder or under any other Sale Document to the
Investors or the Agent at such time. Such purchase shall be without
representation, warranty or recourse of any kind by, on the part of or
against the Investors or the Agent.
ARTICLE III: FEES AND EXPENSES
SECTION 3.1. Determination of Carrying Costs. In
calculating the amount of Carrying Costs to be distributed each Settlement
Period out of Collections of Purchased Receivables:
(a) Purchase Discount.
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(i) "Purchase Discount" shall mean an amount equal to
the weighted average of the following:
(1) the weighted average of the discount rates on
all commercial paper notes issued at a discount and
outstanding during the related Settlement Period (other than
commercial paper notes the proceeds of which are used by the
Purchaser to (x) purchase receivables, or extend financing
secured thereby, at a fixed interest rate or (y) conduct any
arbitrage activities of the Purchaser), converted to an annual
yield-equivalent rate on the basis of a 360-day year;
(2) the weighted average of the annual interest
rates payable on all interest-bearing commercial paper notes
outstanding during the related Settlement Period (other than
the commercial paper notes described in clauses (x) and (y) of
paragraph (1) above), on the basis of a 360-day year; and
(3) the weighted average of the annual interest
rates applicable to any Liquidity Facilities under which the
Purchaser has borrowed loans or sold interests during the
related Settlement Period which loans shall be borrowed only
after a determination by the Purchaser that financing its
activities during such period by issuing commercial paper
notes would not be practicable or cost efficient;
provided that, to the extent that the Investment is funded by a
specific issuance of commercial paper notes and/or by a specific
borrowing or sale under a Liquidity Facility or a Credit Facility,
the Purchase Discount shall equal the rate or weighted average of
the rates applicable to such issuance or borrowing or sale,
provided, further, that, for purposes of the foregoing, the interest
rates applicable under any Liquidity Facility shall not exceed the
reserve adjusted "LIBO Rate" quoted by the Agent plus 0.25% per
annum (unless not available) and the interest rates under any Credit
Facility shall not exceed the rate of interest per annum published
on such day (or, if not then published, on the most recently
preceding day) in The Wall Street Journal as the "Prime Rate" per
annum.
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(ii) Two Business Days prior to the end of each
Settlement Period, the Agent shall determine the Purchase Discount
pursuant to (i) above by using the actual Purchase Discount for each
day elapsed in such month and estimating the Purchase Discount for
each remaining day in such month. In addition, the Agent shall
concurrently notify the Servicer of the actual Purchase Discount for
any days during the immediately preceding Settlement Period with
respect to which the Purchase Discount was estimated, and the
difference, if any, between the Carrying Costs actually paid using
the estimated Purchase Discount and the Carrying Costs which would
have been paid had the actual Purchase Discount been available (such
differential being the "Carrying Costs True-up Amount"). If the
amount of Carrying Costs paid for such immediately preceding
Settlement Period based upon an estimated Purchase Discount was less
than the amount of Carrying Costs for such Settlement Period based
upon the actual Purchase Discount, the amount of Collections
remitted to the Agent pursuant to Section 5.2 shall be increased by
an amount equal to the Carrying Costs True-up Amount, or, if the
amount of Carrying Costs paid for such immediately preceding
Settlement Period based upon an estimated Purchase Discount was
greater than the amount of Carrying Costs for such Settlement Period
based upon the actual Purchase Discount, the amount of Collections
remitted to the Agent pursuant to Section 5.2 shall be decreased by
an amount equal to the Carrying Costs True-up Amount.
(b) Servicer Fee. "Servicer Fee" shall mean a servicer fee
in respect of each Settlement Period, equal to 1.0% per annum (assuming a
30/360 day basis) of the Principal Balance of Purchased Receivables on the
first day of such Settlement Period; the Servicer Fee shall be remitted by
the Purchaser to the Servicer from Collections received pursuant to Article V
hereof. If CFC is acting as the Servicer, then the Servicer shall retain an
amount equal to the Servicer Fee (in full satisfaction of the payment of such
fee to the Servicer) out of amounts required to be remitted by the Servicer
in accordance with Section 5.3(a).
SECTION 3.2. Interest on Unpaid Amounts. To the extent
that the Seller or Servicer fails to pay when due to the Investors or the
Agent any fee, expense or other amount payable hereunder or under any Sale
Document, interest shall be due and payable on such unpaid amount, for each
day until paid in full, at
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the rate of interest per annum published on such day (or, if not then
published, on the most recently preceding day) in The Wall Street Journal as
the "Prime Rate." Changes in the rate payable hereunder shall be effective on
each date on which a change in the "Prime Rate" is so published.
ARTICLE IV: CONDITIONS PRECEDENT TO PURCHASE
SECTION 4.1. Conditions Precedent to Purchase. The
following conditions must be satisfied before the Purchaser will make the
Purchase:
(a) Absence of Liens. The Seller shall certify that all
Purchased Receivables, Related Security and all proceeds thereof are free and
clear of any Adverse Claim.
(b) Financing Statements. The Agent will have received
acknowledgment copies of UCC-1 financing statements, and all other documents
reasonably requested by the Agent, to evidence the perfection of the interest
of the Agent on behalf of the Investors in the Purchased Receivables, the
Related Security and the Collections.
(c) Schedule of Contracts. The Agent will have received
the Schedule of Contracts.
(d) Seller Resolutions. The Agent will have received a
certificate of the Seller attesting to:
(i) the resolutions of the majority interest of the
Seller's members authorizing the execution by the Seller of the Sale
Documents to be executed by the Seller;
(ii) the names and signatures of the officers of the
Seller's members authorized to execute the Sale Documents to be
executed by the Seller; and
(iii) the completeness and correctness of the attached
articles of organization and operating agreement of the Seller.
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(e) Servicer Resolutions. The Agent will have received a
certificate of the Servicer's Secretary or Assistant Secretary
attesting to:
(i) the resolutions of the Servicer's Board of
Directors (or an executive committee thereof) authorizing the
execution by the Servicer of the Sale Documents to be executed by
the Servicer;
(ii) the names and signatures of the officers of the
Servicer authorized to execute the Sale Documents to be executed by
the Servicer; and
(iii) the completeness and correctness of the attached
restated articles of incorporation and by-laws of the Servicer.
(f) Legal Opinion of Counsel to the Seller and the
Servicer. The Agent will have received an opinion from counsel to the Seller
and the Servicer, such counsel being "in-house" counsel unless otherwise
required by any agencies providing a credit rating to the transaction
contemplated hereby, substantially in the form attached hereto as Exhibit B,
together with such other matters as the Agent may reasonably request.
(g) Good Standing Certificates. The Agent will have
received certificates of recent date issued by the Secretary of State of the
State of Michigan, as to the legal existence and good standing of the Seller
and the Servicer.
(h) Representations and Covenants. On and as of the
Purchase Date (i) the representations and warranties of the Seller and the
Servicer in Article VII shall be true and correct with the same effect as if
made on such date and (ii) the Seller and the Servicer shall be in compliance
with the covenants set forth in Article VIII. The Seller and the Servicer, by
accepting the proceeds of such Purchase, shall be deemed to have certified as
to the truth and accuracy of each of the matters described in the foregoing
clauses (i) and (ii), both before and after giving effect to such Purchase.
(i) Other Documents. The Agent will have received all
other documents that the Agent had reasonably requested from the Seller or
the Servicer.
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ARTICLE V: SETTLEMENT PROCEDURES
SECTION 5.1. Collections. The Servicer shall segregate all
Collections from other funds of the Servicer and the Seller within two
Business Days of receipt thereof and hold such Collections in trust for the
Investors in the Designated Account, provided, however, notwithstanding the
foregoing, for so long as (i) CFC remains the Servicer, (ii) no Servicer
Default shall have occurred and be continuing and (iii) CFC maintains a
long-term unsecured senior debt rating of at least BBB- by Standard & Poor's
Ratings Group and Baa3 by Moody's Investors Service, Inc., the Servicer shall
not be required to segregate all Collections and shall remit such Collections
with respect to each Settlement Period to the Agent on the Settlement Date
relating to such Settlement Period. The Seller will not deposit or otherwise
credit, or cause or permit to be so deposited or credited, to the Designated
Account cash or cash proceeds other than Collections of the Purchased
Receivables.
SECTION 5.2. Application of Collections. All collections
for the Settlement Period shall be applied by the Servicer as follows:
(a) With respect to each Receivable (other than a Balloon
Payment Receivable), payments by or on behalf of the Obligor shall be applied
in the case of Precomputed Receivables, to the Scheduled Payment and, in the
case of Simple Interest Receivables, to interest and principal in accordance
with the Simple Interest Method.
(b) All Liquidation Proceeds with respect to any Balloon
Payment Receivable shall be applied first to the related Receivable and only
after the payment in full of the Principal Balance thereof plus accrued but
unpaid interest thereon shall any such Liquidation Proceeds be applied to, or
constitute, the related Balloon Payment.
SECTION 5.3. Application of Collections on Settlement
Dates. The Servicer will, by 3:00 P.M. (New York time) on each Settlement
Date, from Collections received during the preceding Settlement Period, pay
to the Agent and the Agent shall distribute such Collections, together with
any Hedging Proceeds received by the Agent with respect to such Settlement
Period, to the Investors (a) first, an amount equal to the Carrying Costs for
the Settlement Period (as such
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amount shall be increased or decreased by the Carrying Costs True-up Amount,
if any, for the immediately preceding Settlement Period as determined
pursuant to Section 3.1(a)(ii)) and (b) second, all remaining Collections as
a reduction to Investment.
SECTION 5.4. Servicer Report. The Servicer will provide the
Agent, either in writing or electronically, with a Servicer Report with
respect to each Settlement Period no later than 15 days following the end of
such Settlement Period (or, if such 15th day is not a Business Day, the next
succeeding Business Day).
SECTION 5.5. Repurchase Obligations. If on any day the
Agent determines that the Seller has extended the maturity of any Contract
relating to a Purchased Receivable or that a Purchased Receivable was not an
Eligible Receivable on the Purchase Date, the Seller agrees to pay to the
Agent for the account of the Investors the amount of the outstanding balance
of such Receivable in full, and the subject Purchased Receivable shall
thereupon be deemed reconveyed to the Seller. Any amounts received by the
Agent pursuant to this Section 5.5 with respect to a Purchased Receivable
shall be applied to reduce the Investment.
ARTICLE VI: SERVICING OF RECEIVABLES
SECTION 6.1. Appointment and Duties of Servicer. The Agent
and the Seller each hereby appoint CFC as the Servicer and CFC accepts such
appointment. The Servicer, for the benefit of the Investors (to the extent
provided herein), shall manage, service, administer, make collections and
discharge liens on the Purchased Receivables with reasonable care, using that
degree of skill and attention that the Servicer exercises with respect to all
comparable automotive receivables that it services for itself or others. If
the Servicer shall commence a legal proceeding to enforce a Purchased
Receivable, the Investors shall thereupon be deemed to have automatically
assigned, solely for the purpose of collection, such Purchased Receivables to
the Servicer. If in any enforcement suit or legal proceeding it shall be held
that the Servicer may not enforce a Purchased Receivable on the ground that
it shall not be a real party in interest or a holder entitled to enforce such
Purchased Receivable, the Agent shall, at the Servicer's
20
<PAGE>
expense and direction, take steps to enforce such Receivable, including
bringing suit in its name or the name of the Investors. The Agent shall upon
the written request of the Servicer furnish the Servicer with any powers of
attorney and other documents reasonably necessary or appropriate to enable
the Servicer to carry out its servicing and administrative duties hereunder.
SECTION 6.2. Replacement of Servicer.
(a) If any of the following events (a "Servicer Default")
shall occur and be continuing:
(i) any failure by the Servicer to make any payment
or deposit required to be made hereunder and the continuance of such
failure for a period of five Business Days;
(ii) any representation or warranty made by the
Servicer in Section 7.1 or any information set forth in a Servicer
Report or other certificate delivered to the Agent, shall prove to
have been incorrect in any material respect when made, which
continues to be incorrect in any material respect for a period of
sixty days after the earlier of the date on which an officer of the
Servicer has actual knowledge thereof and the date on which written
notice thereof has been given to the Servicer requiring the same to
be remedied, by the Agent;
(iii) failure on the part of the Servicer to observe
or perform in any material respect any other term, covenant or
agreement in this Agreement or any other Sale Document which
continues unremedied for sixty days after the earlier of the date on
which an officer of the Servicer has actual knowledge of such
failure and the date on which written notice of such failure has
been given to the Servicer requiring the same to be remedied, by the
Agent; or
(iv) an Insolvency Event with respect to the Seller or
the Servicer,
then, so long as such Servicer Default shall not have been remedied, the
Agent shall have the right to remove CFC (or any successor Servicer) as
Servicer by
21
<PAGE>
giving written notice thereof to the Servicer. On and after receipt of such
written notice, all authority and power of the Servicer under this Agreement
shall, without further action, pass to and be vested in such successor
Servicer as may be appointed by the Agent; provided however, that the
Servicer cannot be removed until a successor Servicer is selected and
appointed and such successor Servicer meets industry-wide standards for being
a Servicer of retail automotive receivables.
(b) If CFC is removed as Servicer, CFC shall transfer to
any successor Servicer designated by the Agent all records, correspondence
and documents (including computer software) requested by the Agent or such
successor Servicer and permit such Persons to have access to, and to copy,
all software used by the Servicer in the collection, administration or
monitoring of the Purchased Receivables. In the case of software that is then
licensed by, or otherwise made available to, the Servicer from or by any
third party, the Servicer shall use its best efforts to obtain such consents
and otherwise take all actions necessary in order to enable any Servicer
hereunder to succeed to all rights of CFC to the quiet use and enjoyment of
such software for the purpose of discharging the obligations of the Servicer
under or in connection with the Sale Documents.
(c) Following the occurrence of a Servicer Default, (i)
the Agent may (a) notify Obligors of the ownership interest of the Agent on
behalf of the Investors hereunder in the Purchased Receivables and the
Related Security, (b) notify each issuer of an Insurance Policy of the
ownership interest of the Agent on behalf of the Investors hereunder in the
Purchased Receivables and in the Related Security (including the applicable
Financed Vehicle and Insurance Policy thereon), and (c) direct the Seller to,
whereupon the Seller immediately shall, note the interest of the Agent on
behalf of the Investors hereunder on each Certificate of Title relating to
each Financed Vehicle and (ii) the Investors and the Agent shall have, in
addition to all other rights and remedies under this Agreement or otherwise,
all other rights and remedies provided under the Uniform Commercial Code of
the applicable jurisdiction and other applicable laws, which rights shall be
cumulative.
(d) In the event of a Servicer Default, each of the Seller
and the Servicer (with respect to itself) will, unless the Agent has
otherwise consented in writing, at any reasonable time, permit the Agent or
its agents or representatives,
22
<PAGE>
to visit and inspect any of its properties, to examine its books of account
and other records and files relating to Purchased Receivables (including,
without limitation, computer tapes and disks) and to discuss its affairs,
business, finances and accounts with its officers and employees. The Seller
shall pay to the Agent and the Investors any and all reasonable costs and
expenses of the Agent and the Investors, if any (including reasonable counsel
fees and expenses) in connection with the enforcement of this Agreement and
the other documents delivered hereunder.
SECTION 6.3. Custody of Receivable Files. To assure uniform
quality in servicing the Receivables and to reduce administrative costs, the
Agent and the Seller hereby irrevocably appoint the Servicer, and the
Servicer hereby accepts such appointment, to act for the benefit of the
Investors and the Seller as custodian of the following documents or
instruments which are hereby or will hereby be constructively delivered to
the Agent, as pledgee of the Seller, as of the Purchase Date with respect to
each Purchased Receivable (the "Receivable Files"):
(a) the fully executed original of the Contract related to
such Purchased Receivable;
(b) the original credit application fully executed by the
Obligor;
(c) the original Certificate of Title or such documents
that the Servicer or the Seller shall keep on file, in accordance with its
customary procedures, evidencing the security interest of the Seller in the
Financed Vehicle; and
(d) any and all other documents that the Servicer or the
Seller shall keep on file, in accordance with its customary procedures,
relating to a Purchased Receivable, an Obligor or a Financed Vehicle.
SECTION 6.4. Duties of Servicer as Custodian. The Servicer
shall hold the Receivable Files as custodian for the benefit of the Seller
and the Investors and maintain such accurate and complete accounts, records
and computer systems pertaining to each Receivable File as shall enable the
Seller to comply with this Agreement. In performing its duties as custodian
the Servicer
23
<PAGE>
shall act with reasonable care, using that degree of skill and attention that
the Servicer exercises with respect to receivable files relating to all
comparable automotive receivables that the Servicer services for itself or
others.
SECTION 6.5. Effective Period and Termination. The
Servicer's appointment as custodian shall become effective as of the Cut-Off
Date and shall continue in full force and effect until terminated pursuant to
this Section. If CFC shall cease to be Servicer in accordance with the
provisions of this Agreement, the appointment of such Servicer as custodian
shall be terminated by the Agent. The Agent may terminate the Servicer's
appointment as custodian at any time following the occurrence of a Servicer
Default under Section 6.2(a) upon thirty days written notification to the
Servicer. As soon as practicable after any termination of such appointment,
the Servicer shall deliver the Receivable Files to the Agent or to a Person
designated by the Agent at a place or places as the Agent may reasonably
designate.
ARTICLE VII: REPRESENTATIONS AND WARRANTIES
SECTION 7.1. Representations and Warranties of the Seller
and the Servicer. Each of the Seller and the Servicer makes, with respect to
itself, the following representations and warranties to the Investors and the
Agent.
(a) It is a limited liability company or corporation, as
applicable, duly organized or incorporated, validly existing and in good
standing under the laws of the jurisdiction of its organization or
incorporation and is duly qualified and in good standing as a foreign
corporation or limited liability company in each jurisdiction where the
failure to be so qualified could materially adversely affect its ability to
perform its obligations hereunder.
(b) The execution, delivery and performance by the Seller
and the Servicer of the Sale Documents are within the Seller's and the
Servicer's respective corporate powers, have been duly authorized by all
necessary corporate action, do not contravene (i) the Seller's or the
Servicer's respective articles of organization or charter, as applicable, or
operating agreement or by-laws, as applicable, or (ii) any law or contractual
restriction binding on or affecting the Seller or the Servicer, and do not
result in or require the creation of any Adverse
24
<PAGE>
Claim (other than pursuant hereto) upon or with respect to any of its
properties; and no transaction contemplated hereby requires compliance with
any bulk sales act or similar law.
(c) No authorization or approval or other action by, and
no notice to or filing with, any governmental authority or regulatory body is
required for the due execution, delivery and performance by the Seller or the
Servicer of the Sale Documents, or for the perfection of or the exercise by
the Agent on behalf of the Investors of its rights and remedies under the
Sale Documents, except for the filing of the financing statements referred to
in Section 4.1(b).
(d) Each Sale Document constitutes the legal, valid and
binding obligation of the Seller and the Servicer, respectively, enforceable
in accordance with its terms.
(e) There is no pending or threatened action or proceeding
affecting the Seller or the Servicer or any of its subsidiaries before any
court, governmental agency or arbitrator which may materially adversely
affect (i) its financial condition or operations or (ii) its ability to
perform its obligations under the Sale Documents, or which could affect the
legality, validity or enforceability of any Sale Document or of the interest
of the Agent on behalf of the Investors in the Purchased Receivables.
(f) The Seller is the legal and beneficial owner of the
Receivables, the Related Security and Collections, free and clear of any
Adverse Claim, except as created by this Agreement; upon consummation of the
Purchase, the Agent on behalf of the Investors will acquire a valid and
perfected first priority ownership interest in the Purchased Receivables and
in the Related Security and the Collections with respect thereto, free and
clear of any Adverse Claim except as created by this Agreement.
(g) The information provided by the Seller to the Servicer
for use in each Servicer Report prepared under Section 5.4 and all
information and Sale Documents furnished or to be furnished at any time by
the Seller to the Agent in connection with this Agreement is or will be
accurate in all material respects as of its date, and no such document will
contain any untrue statement of a material fact
25
<PAGE>
or will omit to state a material fact which is necessary to make the facts
stated therein not misleading.
(h) The Seller is treating the conveyance of the interest
in the Purchased Receivables and the Collections under this Agreement to the
Agent on behalf of the Investors as a sale for purposes of generally accepted
accounting principles.
ARTICLE VIII: COVENANTS
SECTION 8.1. Affirmative Covenants of the Seller and the
Servicer. Until the Investment is reduced to zero and all other amounts due
to the Agent and the Investors hereunder have been paid in full, each of the
Seller and the Servicer (with respect to itself) will, unless the Agent has
otherwise consented in writing:
(a) Maintain its existence in the jurisdiction of its
organization or incorporation, and qualify and remain qualified in good
standing as a foreign corporation or limited liability company in each
jurisdiction where the failure to be so qualified could materially adversely
affect its ability to perform its obligations hereunder.
(b) Maintain and implement administrative and operating
procedures, and keep and maintain all records and other information,
reasonably necessary or advisable for the collection of the Purchased
Receivables (including, without limitation, records adequate to permit the
daily identification of Purchased Receivables and all Collections and
adjustments to Purchased Receivables).
(c) At its expense timely and fully perform and comply
with all material provisions and covenants required to be observed by CFC or
the Seller under the Contracts related to the Purchased Receivables.
(d) Comply in all material respects with the Credit and
Collection Policy in regard to each Purchased Receivable and any Contract
related to such Receivable.
26
<PAGE>
(e) Treat the conveyance of the interest in the Purchased
Receivables and the Collections under this Agreement as a sale for purposes
of generally accepted accounting principles.
SECTION 8.2. Reporting Requirements of the Servicer. Until
the Investment is reduced to zero and all amounts due to the Agent and the
Investors hereunder have been paid in full, the Servicer will, unless the
Agent shall otherwise consent in writing, furnish to the Agent:
(a) the Servicer Report as required under Section 5.4;
(b) as soon as possible, and in any event within thirty
days, a description and, if applicable, the steps being taken with respect
thereto by the Persons affected thereby of: (i) the occurrence of any
Servicer Default or event which with the passage of time or the giving of
notice or both would constitute a Servicer Default or (ii) the institution of
any litigation, arbitration proceeding or governmental proceeding which could
be reasonably likely to have a material adverse effect on the performance by
the Servicer of its obligations under this Agreement or the other Sale
Documents or the collectibility of the Purchased Receivables; and
(c) such other information, documents, records or reports
respecting the Purchased Receivables or the condition or operations,
financial or otherwise, of the Servicer or the Seller as the Agent may from
time to time reasonably request.
SECTION 8.3. Negative Covenants of the Seller and the
Servicer. Until the Investment is reduced to zero and all other amounts due
to the Agent and the Investors hereunder have been paid in full, neither the
Seller nor the Servicer will, unless the Agent has otherwise consented in
writing;
(a) Except as provided herein, sell, assign (by operation
of law or otherwise) or otherwise dispose of, or create or suffer to exist
any Adverse Claim upon or with respect to any Purchased Receivables, the
Related Security or any Collections or assign any right to receive income in
respect thereof.
27
<PAGE>
(b) Amend or otherwise modify the terms of any Purchased
Receivable, or amend, modify or waive any term or condition of any Contract
related thereto, in each case, in any manner which is inconsistent with the
Credit and Collection Policy.
SECTION 8.4. Protection of the Purchaser's Interest.
(a) Until the Investment is reduced to zero and all other
amounts due to the Agent and the Investors hereunder have been paid in full,
each of the Seller and the Servicer agrees that from time to time, at its
expense, it will promptly execute and deliver all instruments and documents
and take all action that the Agent may from time to time reasonably request
in order to perfect, evidence and protect the validity, enforceability,
perfection and priority of the interest of the Agent on behalf of the
Investors in the Purchased Receivables, the Related Security and the
Collections and to enable the Agent and/or the Investors to exercise or
enforce any of its rights hereunder. Without limiting the generality of the
foregoing, the Seller and the Servicer will: (i) on or prior to the date
hereof, mark its master data processing records with a legend describing the
Agent's and the Investors' interests therein; and (ii) upon the request of
the Agent, execute and file such financing or continuation statements or
amendments thereto or assignments thereof as may be requested by the Agent,
provided, however, that the Seller is not required to deliver the Contracts
to anyone other than the Servicer;
(b) To the fullest extent permitted by applicable law, the
Agent shall be permitted to sign and file continuation statements and
amendments thereto and assignments thereof without the Seller's signature.
Carbon, photographic or other reproduction of this Agreement or any financing
statement shall be sufficient as a financing statement.
ARTICLE IX: AGENT
SECTION 9.1. Appointment of Agent. The Investors have
appointed Royal Bank of Canada as their initial Agent. The Agent is
responsible for administering and enforcing this Agreement and fulfilling all
other duties expressly assigned to it in this Agreement. The Investors have
granted the Agent the authority to take all actions necessary to assure the
Seller's compliance with
28
<PAGE>
the terms of this Agreement and to take all actions required or permitted to
be performed by the Investors under this Agreement.
ARTICLE X: MISCELLANEOUS
SECTION 10.1. Amendments, Etc. No amendment or waiver of,
or consent to the Seller's or the Servicer's departure from, any provision of
this Agreement shall be effective unless it is in writing and signed by the
Agent, on behalf of the Investors, and in the case of any amendment, by the
Seller and the Servicer and then such amendment, waiver or consent shall be
effective only in the specific instance and for the specific purpose for
which it was given.
SECTION 10.2. Notices, Etc. All notices and other
communications provided for hereunder shall, unless otherwise stated herein,
be in writing (including photocopy, facsimile, electronic mail or other
digital communication) and sent, as to each party hereto, at its address set
forth under its name on the signature pages hereto, or at such other address
as shall be designated by such party in a written notice to the other parties
hereto. All such notices and communications shall be effective when sent.
SECTION 10.3. No Waiver; Remedies. No failure on the part
of the Agent to exercise, and no delay in exercising, any right hereunder or
under any Sale Document shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude any other or
further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.
SECTION 10.4. Binding Effect; Assignability.
(a) This Agreement shall be binding upon and inure to the
benefit of the Seller, the Servicer, the Investors, the Agent and their
respective successors and assigns, except that the Seller shall not have the
right to assign any interest herein without the prior written consent of the
Agent. The Investors may assign any of their rights or obligations hereunder
to any Person; provided that in the case of any such assignment proposed to
be made prior to the occurrence of a Servicer
29
<PAGE>
Default, the consent of the Seller (which consent shall not be unreasonably
withheld) shall be required.
(b) This Agreement shall create and constitute the
continuing obligation of the parties hereto in accordance with its terms, and
shall remain in full force and effect until such time as the Investment is
reduced to zero and all other amounts due to the Agent and the Investors
hereunder have been paid in full; provided, however, that the rights and
remedies of the Purchaser under Article IX and the provisions of Section 10.7
shall survive any termination of this Agreement.
SECTION 10.5. Governing Law. This Agreement and the Sale
Documents shall be governed by, and construed in accordance with, the laws of
the State of New York, except to the extent that the perfection of the
interests of the Investors in the Receivables or remedies hereunder, in
respect thereof, are governed by the laws of a jurisdiction other than the
State of New York.
SECTION 10.6. Construction of the Agreement. The parties
hereto intend that the conveyance of the interest in the Purchased
Receivables by the Seller to the Agent on behalf of the Investors shall be
treated as sales for purposes of generally accepted accounting principles.
If, despite such intention, a determination is made that such transactions
shall not be treated as sales, then this Agreement shall be interpreted to
constitute a security agreement and the transactions effected hereby shall be
deemed to constitute a secured financing by the Agent on behalf of the
Investors to the Seller under applicable law. For such purpose, the Seller
hereby grants to the Agent on behalf of the Investors a continuing security
interest in the Purchased Receivables and the Related Security and
Collections related thereto to secure the obligations of the Seller to the
Agent on behalf of the Investors hereunder.
SECTION 10.7. No Proceedings. Each of the Seller, the
Agent, the Investors and the Servicer each hereby agrees that it will not
institute against the Purchaser any bankruptcy, reorganization, insolvency or
similar proceeding until the date which is one year plus one day since the
last day on which any commercial paper notes or medium term notes issued by
the Purchaser were outstanding.
30
<PAGE>
SECTION 10.8. Confidentiality. The Investors and the Agent
agree to maintain the confidentiality of any information regarding the Seller
and Servicer obtained in accordance with the terms of this Agreement which is
not publicly available, but the Investors and the Agent may, with advance
notice to the Seller and Servicer, reveal such information (a) to applicable
rating agencies, liquidity providers and credit providers, (b) as necessary
or appropriate in connection with the administration or enforcement of this
Agreement or its funding of the Purchase under this Agreement, (c) as
required by law, government regulation, court proceeding or subpoena or (d)
to bank regulatory agencies and examiners.
SECTION 10.9. Execution in Counterparts. This Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be
an original and all of which when taken together shall constitute one and the
same agreement. Delivery of an executed counterpart of a signature page to
this Agreement by facsimile shall be effective as delivery of a manually
executed counterpart of this Agreement.
SECTION 10.10. Indemnification by Seller of Investors, etc.
Without limiting any other rights which the Investors, the Agent and their
respective officers, directors, employees, agents and Affiliates may have
hereunder or under applicable law, the Seller hereby indemnifies such parties
and holds them harmless from and against any and all damages, losses, claims,
liabilities and related costs and expenses (including attorneys' fees and
disbursements) incurred by any of them arising out of or resulting from this
Agreement or the purchase by the Purchaser of any interest in the Purchased
Receivables or the Related Security and Collections related thereto,
including, without limitation:
(a) any warranty or products liability claim allegedly
arising out of or in connection with merchandise or services which are the
subject of, or were financed with the proceeds of, any Contract under which
any of the Purchased Receivables arise, or any use or misuse by any Person of
any Financed Vehicle (including, without limitation, any use involving the
handling or disposition of any hazardous substance or waste material);
31
<PAGE>
(b) the failure to vest in the Agent for the benefit of the
Investors an ownership or first perfected security interest in the Purchased
Receivables, the Related Security and Collections in respect thereof, free
and clear of any Adverse Claim other than as authorized hereunder; and
(c) the commingling of Collections of Purchased Receivables
at any time with other funds.
32
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement
to be signed by their duly authorized officers as of the date set forth on
the cover page of this Agreement.
SELLER PREMIER RECEIVABLES L.L.C.
By: /s/ Byron C. Babbish
----------------------------------------------
Name: Byron C. Babbish
Title: Assistant Secretary of Premier Auto
Receivables Company, a Member of
the Seller
Address: 27777 Franklin Road
Southfield, MI 48034
Attention: Assistant Treasurer
Tel. No.: 248-948-3067
Facsimile: 248-948-3138
SERVICER CHRYSLER FINANCIAL CORPORATION
By: /s/ John J. Shea
----------------------------------------------
Name: John J. Shea
Title: Assistant Treasurer
Address: 27777 Franklin Road
Southfield, MI 48034
Attention: Assistant Secretary
Tel. No.: 248-948-3067
Facsimile: 248-948-3138
PURCHASER OLD LINE FUNDING CORP.
33
<PAGE>
By: ROYAL BANK OF CANADA,
as attorney in fact
By: /s/ Stephan J. Grossnickle
----------------------------------------------
Name: Stephan J. Grossnickle
Title: Managing Director
By: /s/ Denham O. Turton
----------------------------------------------
Name: Denham O. Turton
Title: Senior Manager
Address: c/o Lord Securities Corporation
Two Wall Street, 19th Floor
New York, NY 10005
Attention: Vice President
Tel. No.: (212) 346-9000
Facsimile: (212) 346-9012
34
<PAGE>
AGENT ROYAL BANK OF CANADA
By: /s/ Stephan J. Grossnickle
----------------------------------------------
Name: Stephan J. Grossnickle
Title: Managing Director
By: /s/ Denham O. Turton
----------------------------------------------
Name: Denham O. Turton
Title: Senior Manager
Address: One Liberty Plaza
5th Floor
New York, NY 10006-1404
Attention: Managing Director,
North American
Securitization Group
Tel. No.: (212) 428-6474
Facsimile: (212) 428-2304
35
Exhibit 12-A
Chrysler Financial Corporation and Subsidiaries
Computations of Ratios of Earnings to Fixed Charges
(dollars in millions)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
----------------
1998 1997
---- ----
<S> <C> <C>
Net earnings before cumulative effect of
changes in accounting principles $228 $196
Add back:
Taxes on income 110 101
Fixed charges 479 408
---- ----
Earnings available for fixed charges $817 $705
==== ====
Fixed charges:
Interest expense $472 $399
Rent 7 9
---- ----
Total fixed charges $479 $408
==== ====
Ratio of earnings to fixed charges 1.71 1.73
==== ====
</TABLE>
The ratio of earnings to fixed charges is computed by dividing earnings
available for fixed charges by total fixed charges. Fixed charges consist of
interest, amortization of debt discount and expense, and rentals. Rentals
included in fixed charges are the portion of total rent expense
representative of the interest factor (deemed to be one-third).
<PAGE>
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Exhibit 12-B
Chrysler Corporation and Consolidated Subsidiaries
Computations of Ratios of Earnings to Fixed Charges
and Preferred Stock Dividend Requirements
(dollars in millions)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
--------------------
1998 1997
---- -----
<S> <C> <C>
Net earnings before extraordinary item $2,055 $1,512
Add back:
Taxes on income 1,219 1,003
Fixed charges 755 673
Amortization of previously capitalized
interest 56 63
Deduct:
Capitalized interest 85 97
Undistributed earnings from less
than fifty percent owned affiliates -- 3
------ ------
Earnings available for fixed charges $4,000 $3,151
====== ======
Fixed charges:
Interest expense $ 596 $ 488
Capitalized interest 85 97
Credit line commitment fees 3 4
Interest portion of rent expense 71 84
------ ------
Total fixed charges $ 755 $ 673
====== ======
Ratio of earnings to fixed charges 5.30 4.68
====== ======
Preferred stock dividend requirements $ 0 $ 1
====== ======
Ratio of earnings to fixed charges and
preferred stock dividend requirements $ 5.30 $ 4.68
====== ======
</TABLE>
The ratio of earnings to fixed charges is computed by dividing earnings
available for fixed charges by total fixed charges. The ratio of earnings to
fixed charges and preferred stock dividend requirements is computed by
dividing earnings for fixed charges by the sum of total fixed charges and
preferred stock dividend requirements.
<PAGE>
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Exhibit 15-A
[Letterhead of Deloitte & Touche LLP]
Deloitte &
Touche LLP
____________ _________________________________________
Suite 900 Telephone (313) 396-3000
600 Renaissance Center
Detroit, Michigan 48243-1704
Chrysler Financial Corporation
27777 Franklin Road
Southfield, Michigan
We have made a review,in accordance with standards established by the
American Institute of Certified Public Accountants, of the unaudited interim
financial information of Chrysler Financial Corporation (a subsidiary of
Chrysler Corporation) and consolidated subsidiaries for the periods ended
June 30, 1998 and 1997, as indicated in our report dated July 9, 1998;
because we did not perform an audit, we expressed no opinion on that
information.
We are aware that our report referred to above, which is included in your
Quarterly Report on Form 10-Q for the quarter ended June 30, 1998,
is incorporated by reference in Registration Statement Nos. 33-64179,
333-31093 and 333-49647 on Form S-3.
We also are aware that the aforementioned report, pursuant to Rule 436(c)
under the Securities Act of 1933, is not considered a part of the Registration
Statement prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that
Act.
/s/ Deloitte & Touche LLP
July 13, 1998
_______________
Deloitte Touche
Tohmatsu
International
_______________
<PAGE>
THIS PAGE INTENTIONALLY LEFT BLANK
Exhibit 15-B
[Letterhead of Deloitte & Touche LLP]
Deloitte &
Touche LLP
____________ _________________________________________
Suite 900 Telephone (313) 396-3000
600 Renaissance Center
Detroit, Michigan 48243-1704
INDEPENDENT ACCOUNTANTS' REPORT
Shareholder and Board of Directors
Chrysler Financial Corporation
Southfield, Michigan
We have reviewed the accompanying condensed consolidated balance sheet of
Chrysler Financial Corporation (a subsidiary of Chrysler Corporation) and
consolidated subsidiaries as of June 30, 1998 and 1997, and the related
condensed consolidated statements of net earnings, shareholder's investment
and cash flows for the three months and six months ended June 30, 1998 and
1997. These financial statements are the responsibility of the Company's
management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures
to financial data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with generally accepted auditing standards, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the condensed consolidated financial statements referred
to above for them to be in conformity with generally accepted accounting
principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet of Chrysler Financial Corporation
and consolidated subsidiaries as of December 31, 1997, and the related
consolidated statements of net earnings and cash flows for the year then
ended (not presented herein); and in our report dated January 22, 1998, we
expressed an unqualified opinion on those consolidated financial statements.
In our opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of December 31, 1997 is fairly presented, in
all material respects, in relation to the consolidated balance sheet from
which it has been derived.
/s/ Deloitte & Touche LLP
July 9, 1998
_______________
Deloitte Touche
Tohmatsu
International
_______________
<PAGE>
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<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM CHRYSLER FINANCIAL CORPORATION AND
SUBSIDIARIES FINANCIAL STATEMENTS FOR THE SIX MONTHS
ENDED JUNE 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> $ 777
<SECURITIES> 410
<RECEIVABLES> 17,299
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 23,442
<CURRENT-LIABILITIES> 0
<BONDS> 16,153
0
0
<COMMON> 25
<OTHER-SE> 3,274
<TOTAL-LIABILITY-AND-EQUITY> 23,442
<SALES> 0
<TOTAL-REVENUES> 1,474
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 471
<LOSS-PROVISION> 193
<INTEREST-EXPENSE> 472
<INCOME-PRETAX> 338
<INCOME-TAX> 110
<INCOME-CONTINUING> 228
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 228
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
