<PAGE> 1
PROSPECTUS SUPPLEMENT Rule 424(b)5
Registration Statement No. 33-55237
(TO PROSPECTUS DATED JUNE 1, 1995)
$500,000,000
FORD MOTOR CREDIT COMPANY
5 3/4% NOTES DUE JANUARY 25, 2001
Interest on the Notes will be payable on January 25 and July 25 of each
year, commencing July 25, 1996. The Notes may not be redeemed by Ford Credit.
The Notes will rank equally and ratably with all other unsecured and
unsubordinated indebtedness of Ford Credit, of which $75.5 billion was
outstanding at September 30, 1995.
The Notes will be represented by one or more Global Notes registered in the
name of the Depository's nominee. Interests in the Global Notes will be shown
on, and transfers thereof will be effected only through, records maintained by
the Depository and its participants. Except as described herein, Notes in
definitive form will not be issued. The Notes will trade in the Depository's
Same-Day Funds Settlement System until maturity, and secondary market trading
activity for the Notes will, therefore, settle in immediately available funds.
All payments of principal and interest will be made by Ford Credit in
immediately available funds. See "Description of Notes--Same-Day Settlement and
Payment."
------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT
RELATES. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<TABLE>
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT(2) FORD CREDIT(1)(3)
- -------------------------------------------------------------------------------------------------
Per Note.......................... 99.709% .450% 99.259%
- -------------------------------------------------------------------------------------------------
Total............................. $498,545,000 $2,250,000 $496,295,000
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
</TABLE>
(1) Plus accrued interest, if any, from January 25, 1996.
(2) Ford Credit has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deduction of estimated expenses of $200,000 to be paid by Ford
Credit.
------------------------------
The Notes are offered, subject to prior sale, when, as and if delivered to
and accepted by the Underwriters, and subject to certain other conditions. The
Underwriters reserve the right to withdraw, cancel or modify such offer and to
reject orders in whole or in part. It is expected that the Notes will be
delivered in book-entry form only, on or about January 25, 1996, through the
facilities of The Depository Trust Company.
------------------------------
BEAR, STEARNS & CO. INC.
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
SALOMON BROTHERS INC
JANUARY 22, 1996
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVERALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES AT A
LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements, and to the extent inconsistent therewith replaces, the
description of the general terms and provisions of Debt Securities set forth in
the Prospectus. The Notes are part of the Debt Securities registered by Ford
Motor Credit Company ("Ford Credit") in August 1994 to be issued on terms to be
determined at the time of sale. In addition to the Notes offered hereby, Debt
Securities in the aggregate principal amount of $5,450,000,000 previously have
been sold.
GENERAL
The Notes will be limited to $500,000,000 aggregate principal amount. The
Notes will be unsecured obligations of Ford Credit and will mature on January
25, 2001. The Notes will rank pari passu with all other unsecured and
unsubordinated indebtedness of Ford Motor Credit Company (parent company only).
The Notes will bear interest from January 25, 1996 at the rate per annum
set forth on the cover page of this Prospectus Supplement, payable on January 25
and July 25 of each year, commencing July 25, 1996, to the person in whose name
the Note was registered at the close of business on the 15th day preceding the
respective Interest Payment Date, subject to certain exceptions. The Notes are
not subject to redemption prior to maturity.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. All payments of principal and interest will be made by Ford
Credit in immediately available funds.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing-house or next-day funds. In contrast, the Notes
will trade in the Same-Day Funds Settlement System maintained by The Depository
Trust Company, New York, New York (the "Depository") until maturity, and
secondary market trading activity in the Notes will therefore be required by the
Depository to settle in immediately available funds. No assurance can be given
as to the effect, if any, of settlement in immediately available funds on
trading activity in the Notes.
RECENT DEVELOPMENTS
In December 1995, Ford Credit declared and paid to Ford a $250 million
dividend.
S-2
<PAGE> 3
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
and the Pricing Agreement relating to the Notes, Ford Credit has agreed to sell
to each of the underwriters named below (the "Underwriters") and each of the
Underwriters, for whom Bear, Stearns & Co. Inc. is acting as representative, has
severally agreed to purchase the principal amount of Notes set forth opposite
its name below.
<TABLE>
<CAPTION>
PRINCIPAL
UNDERWRITER AMOUNT
--------------------------------------------------------- -------------
<S> <C>
Bear, Stearns & Co. Inc. ................................ $ 125,000,000
Goldman, Sachs & Co. .................................... 125,000,000
J.P. Morgan Securities Inc. ............................. 125,000,000
Salomon Brothers Inc..................................... 125,000,000
-------------
Total....................................... $ 500,000,000
=============
</TABLE>
In the event of default by one or more Underwriters, the Underwriting
Agreement provides that in certain circumstances other Underwriters may be
substituted or the commitment of each non-defaulting Underwriter may be
increased up to 10%. However, if the default involves more than one-eleventh of
the aggregate principal amount of the Notes, the Pricing Agreement relating to
the Notes may be terminated by Ford Credit or by 50% or more in interest of
non-defaulting Underwriters, or, if not so terminated, less than all the Notes
may be sold.
The Underwriters have advised Ford Credit that they propose to offer all or
part of the Notes directly to retail purchasers at the initial public offering
price set forth on the cover page of this Prospectus Supplement, and to certain
securities dealers at such price less a concession not in excess of .300% of the
principal amount of the Notes. The Underwriters may allow and such dealers may
reallow to certain brokers and dealers a concession not in excess of .250% of
the principal amount of the Notes. After the Notes are released for sale to the
public, the offering price and other selling terms may from time to time be
varied.
Ford Credit has been advised by Bear, Stearns & Co. Inc. that they intend
to make a market in the Notes, but they are not obligated to do so and may
discontinue such market-making at any time without notice. No assurance can be
given as to the liquidity of the trading market for the Notes.
All secondary trading in the Notes will settle in immediately available
funds. See "Description of Notes -- Same-Day Settlement and Payment."
Ford Credit has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
In the ordinary course of their respective businesses, affiliates of J.P.
Morgan Securities Inc. have engaged, and may in the future engage, in commercial
banking and investment banking transactions with Ford and Ford Credit.
S-3
<PAGE> 4
FORD MOTOR CREDIT COMPANY
DEBT SECURITIES
Ford Credit, in August 1994, registered with the Securities and Exchange
Commission $6,000,000,000 aggregate principal amount of its Debt Securities
consisting of notes and/or debentures denominated in United States dollars or
any other currency or currencies, to be offered from time to time in one or more
series, on terms to be determined at or prior to the time of sale. The
Prospectus Supplement accompanying this Prospectus sets forth, with respect to
the particular series of Debt Securities for which this Prospectus and the
Prospectus Supplement are being delivered, the specific title, the aggregate
principal amount, the authorized denominations, the currencies of issue and
payment, the initial public offering price, the maturity, the interest rate or
rates (which may be either fixed or variable), if any, and/or method of
determination thereof, the time of payment of any interest, any redemption,
extension or early repayment terms, any provision for sinking fund payments, the
net proceeds to Ford Credit, the form of Debt Securities and other specific
terms relating to such series of Debt Securities.
Ford Credit may sell the Debt Securities to or through underwriters, and
also may sell the Debt Securities directly to other purchasers or through
agents. See "Plan of Distribution". In addition, the Debt Securities may be sold
to dealers at the applicable price to the public set forth in the Prospectus
Supplement relating to a particular series of Debt Securities who later resell
to investors. Such dealers may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"). If any agents
of Ford Credit, or any underwriters, are involved in the sale of any Debt
Securities, the names of such agents or underwriters and any applicable
commissions or discounts are set forth in the accompanying Prospectus
Supplement.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS JUNE 1, 1995
<PAGE> 5
AVAILABLE INFORMATION
FORD CREDIT AND FORD ARE SUBJECT TO THE INFORMATIONAL REQUIREMENTS OF THE
SECURITIES EXCHANGE ACT OF 1934 AND IN ACCORDANCE THEREWITH FILE REPORTS AND
OTHER INFORMATION WITH THE SECURITIES AND EXCHANGE COMMISSION (THE
"COMMISSION"). AS USED HEREIN OR IN THE PROSPECTUS SUPPLEMENT, "FORD" REFERS TO
FORD MOTOR COMPANY AND ITS SUBSIDIARIES UNLESS THE CONTEXT OTHERWISE REQUIRES.
SUCH REPORTS AND OTHER INFORMATION CAN BE INSPECTED AND COPIED AT THE PUBLIC
REFERENCE FACILITIES MAINTAINED BY THE COMMISSION AT 450 FIFTH STREET, N.W.,
WASHINGTON, D.C. 20549 AND AT THE FOLLOWING REGIONAL OFFICES OF THE COMMISSION:
7 WORLD TRADE CENTER, 13TH FLOOR, NEW YORK, NEW YORK 10048 AND NORTHWEST ATRIUM
CENTER, 500 WEST MADISON STREET, SUITE 1400, CHICAGO, ILLINOIS 60661. COPIES OF
SUCH MATERIAL CAN BE OBTAINED FROM THE PUBLIC REFERENCE SECTION OF THE
COMMISSION AT 450 FIFTH STREET, N.W., WASHINGTON, D.C. 20549 AT PRESCRIBED
RATES. SUCH REPORTS AND OTHER INFORMATION CONCERNING FORD CREDIT AND FORD CAN
ALSO BE INSPECTED AT THE OFFICES OF THE NEW YORK STOCK EXCHANGE, INC., 20 BROAD
STREET, NEW YORK, NEW YORK 10005, ON WHICH CERTAIN OF FORD CREDIT'S DEBT
SECURITIES ARE LISTED.
Ford Credit has filed with the Commission a Registration Statement under
the Securities Act with respect to the Debt Securities offered hereby. This
Prospectus and the Prospectus Supplement do not contain all the information set
forth in the Registration Statement and the exhibits and schedules thereto,
certain portions of which have been omitted pursuant to the rules and
regulations of the Commission. The information so omitted may be obtained from
the Commission's principal office in Washington, D.C. upon payment of the fees
prescribed by the Commission.
------------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Ford Credit's Annual Report on Form 10-K for the year ended December 31,
1994 (the "1994 10-K Report"), Ford Credit's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1995 (the "First Quarter 10-Q Report"), and Ford
Credit's Current Reports on Form 8-K dated January 17, 1995, February 10, 1995,
February 17, 1995, February 21, 1995 and March 24, 1995 are incorporated in this
Prospectus by reference. All documents filed by Ford Credit pursuant to Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date
of this Prospectus and prior to the termination of the offering of the Debt
Securities shall be deemed to be incorporated by reference into this Prospectus
and to be a part hereof from the date of filing such documents. Such reports
include, and such documents may include, information concerning Ford, as well as
Ford Credit.
FORD CREDIT UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON, INCLUDING
ANY BENEFICIAL OWNER, TO WHOM A COPY OF THIS PROSPECTUS AND THE PROSPECTUS
SUPPLEMENT HAVE BEEN DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH
PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS REFERRED TO ABOVE WHICH HAVE BEEN
OR MAY BE INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND THE PROSPECTUS
SUPPLEMENT, OTHER THAN EXHIBITS TO SUCH DOCUMENTS. WRITTEN OR TELEPHONIC
REQUESTS FOR SUCH DOCUMENTS SHOULD BE DIRECTED TO FORD MOTOR CREDIT COMPANY, THE
AMERICAN ROAD, DEARBORN, MICHIGAN 48121, ATTENTION: PUBLIC AFFAIRS DEPARTMENT
(TELEPHONE 313-594-1096).
------------------------
2
<PAGE> 6
INFORMATION CONCERNING FORD CREDIT
Ford Credit was incorporated in Delaware in 1959 and is a wholly-owned
subsidiary of Ford. As used herein "Ford Credit" refers to Ford Motor Credit
Company and its subsidiaries unless the context otherwise requires.
Ford Credit provides wholesale financing and capital loans to franchised
Ford Motor Company vehicle dealers and other dealers associated with such
franchisees and purchases retail installment sale contracts and retail leases
from them. Ford Credit also makes loans to vehicle leasing companies, the
majority of which are affiliated with such dealers. In addition, a wholly-owned
subsidiary of Ford Credit provides these financing services to other vehicle
dealers. More than 84% of all new vehicles financed by Ford Credit are
manufactured by Ford or its affiliates. In addition to vehicle financing, Ford
Credit makes loans to affiliates of Ford, finances certain receivables of Ford
and its subsidiaries, and offers diversified financing services which are
managed by USL Capital Corporation ("USL Capital"), a wholly-owned subsidiary of
Ford Holdings, Inc. ("Ford Holdings"). Ford Credit also manages the insurance
business of The American Road Insurance Company ("American Road"), a
wholly-owned subsidiary of Ford Holdings. Ford Credit also is a significant
equity participant in Ford Holdings whose primary activities are consumer and
commercial financing operations, insurance underwriting and equipment leasing.
The mailing address of Ford Credit's executive offices is The American
Road, Dearborn, Michigan 48121. The telephone number of such offices is (313)
322-3000.
INFORMATION CONCERNING FORD
The business of Ford Credit is substantially dependent upon Ford. Ford is
the second-largest producer of cars and trucks in the world, and ranks among the
largest providers of financial services in the United States.
Ford's two principal business segments are Automotive and Financial
Services. The activities of the Automotive segment consist of the design,
manufacture, assembly and sale of cars and trucks and related parts and
accessories. The Financial Services segment is comprised of the following direct
subsidiaries, the activities of which include financing operations, vehicle and
equipment leasing and insurance operations: Ford Credit, Ford Credit Europe plc
("Ford Credit Europe"), Ford Holdings, The Hertz Corporation and Granite
Management Corporation (formerly First Nationwide Financial Corporation). Ford
Holdings is a holding company that owns primarily Associates First Capital
Corporation ("The Associates"), USL Capital and American Road. In addition,
there are a number of international affiliates not listed above that are
consolidated in the total Financial Services results, but are managed by either
Ford Credit (which manages Ford Credit Europe, as well as other international
affiliates), The Associates or USL Capital.
------------------------
THIS PROSPECTUS CONTAINS BRIEF SUMMARIES OF CERTAIN MORE DETAILED
INFORMATION CONTAINED IN DOCUMENTS INCORPORATED HEREIN BY REFERENCE. SUCH
SUMMARIES ARE QUALIFIED IN THEIR ENTIRETY BY THE DETAILED INFORMATION CONTAINED
IN THE INCORPORATED DOCUMENTS.
------------------------
3
<PAGE> 7
USE OF PROCEEDS
Except as otherwise provided in the Prospectus Supplement, the net proceeds
from the sale of the Debt Securities will be added to the general funds of Ford
Credit and will be available for the purchase of receivables, for loans and for
use in connection with the retirement of debt. Such proceeds initially may be
used to reduce short-term borrowings (commercial paper, borrowings under bank
lines of credit and borrowings under agreements with bank trust departments) or
may be invested temporarily in short-term securities.
Ford Credit expects to issue additional long-term and short-term debt from
time to time. The nature and amount of Ford Credit's long-term and short-term
debt and the proportionate amount of each can be expected to vary from time to
time, as a result of business requirements, market conditions and other factors.
RATIO OF EARNINGS TO FIXED CHARGES
The ratio of "earnings" to "fixed charges" for Ford Credit and Ford were as
follows for the first three months of 1995 and 1994 and each of the years
1990-1994:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH
31 YEARS ENDED DECEMBER 31
------------- ----------------------------------------
1995 1994 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ford Motor Credit Company................ 1.31 1.52 1.49 1.56 1.37 1.23 1.14
Ford Motor Company....................... 2.0 1.9 2.0 1.5 * ** 1.2
</TABLE>
- ------------
* Earnings were inadequate to cover fixed charges by $237 million.
** Earnings were inadequate to cover fixed charges by $2,664 million.
For purposes of the Ford Credit ratio, "earnings" consist of income before
income taxes and cumulative effects of changes in accounting principles and
fixed charges. Income before income taxes and cumulative effects of changes in
accounting principles of Ford Credit includes the equity in net income of all
unconsolidated affiliates and minority interest in net income of subsidiaries.
"Fixed charges" consist of interest on borrowed funds, amortization of debt
discount, premium, and issuance expense and one-third of all rental expense (the
proportion deemed representative of the interest factor).
For purposes of the Ford ratio, "earnings" include the income/(loss) before
income taxes and cumulative effects of changes in accounting principles of Ford
and its majority-owned subsidiaries, whether or not consolidated, its
proportionate share of any fifty-percent-owned companies, and any income
received from less-than-fifty-percent-owned companies and fixed charges. "Fixed
charges" consist of interest on borrowed funds, preferred stock dividend
requirements of majority-owned subsidiaries, amortization of debt discount,
premium, and issuance expense, and one-third of all rental expense (the
proportion deemed representative of the interest factor).
DESCRIPTION OF DEBT SECURITIES
The Debt Securities are to be issued in one or more series under an
Indenture dated as of August 1, 1994, as supplemented from time to time (the
"Indenture"), between Ford Credit and First Fidelity Bank, National Association
("First Fidelity"), Trustee. The term "Trustee", as used herein, shall mean
First Fidelity and, if at any time there is more than one Trustee acting under
the Indenture, the term "Trustee" as used herein with respect to Indenture
Securities (as defined below) of any particular series shall mean the Trustee
with respect to the Indenture Securities of such series. The following
statements with respect to the Debt Securities are subject to the detailed
provisions of the Indenture, the form of which is filed as an exhibit to the
Registration Statement.
4
<PAGE> 8
Parenthetical references below are to the Indenture or the Form of Security
contained therein and, whenever any particular provision of the Indenture or any
term used therein is referred to, such provision or term is incorporated by
reference as a part of the statement in connection with which such reference is
made, and the statement in connection with which such reference is made is
qualified in its entirety by such reference.
The particular terms of each series of Debt Securities, as well as any
modification or addition to the general terms of the Debt Securities as herein
described, which may be applicable to a particular series of Debt Securities,
are described in the Prospectus Supplement relating to such series of Debt
Securities and will be set forth in a filing with the Commission. Accordingly,
for a description of the terms of a particular series of Debt Securities,
reference must be made to the Prospectus Supplement relating to such series and
to the description of Debt Securities set forth in this Prospectus.
GENERAL
The Debt Securities offered hereby will be limited to $6,000,000,000
aggregate principal amount or the equivalent thereof in any currency, although
the Indenture provides that additional debt securities may be issued thereunder
up to the aggregate principal amount, which is not limited by the Indenture,
authorized from time to time by Ford Credit's Board of Directors. So long as a
single Trustee is acting for the benefit of the holders of all the Debt
Securities offered hereby and any such additional debt securities issued under
the Indenture, the Debt Securities and any such additional debt securities are
herein collectively referred to as the "Indenture Securities". The Indenture
also provides that there may be more than one Trustee under the Indenture, each
with respect to one or more different series of Indenture Securities. See also
"Trustee" herein. At any time when two or more Trustees are acting, each with
respect to only certain series, the term "Indenture Securities" as used herein
shall mean the one or more series with respect to which each respective Trustee
is acting and the powers and trust obligations of each such Trustee as described
herein shall extend only to the one or more series of Indenture Securities for
which it is acting as Trustee. The effect of the provisions contemplating that
there might be more than one Trustee acting for different series of Indenture
Securities is that, in that event, those Indenture Securities (whether of one or
more than one series) for which each Trustee is acting would be treated as if
issued under a separate indenture.
The Prospectus Supplement which accompanies this Prospectus sets forth a
description of the particular series of Debt Securities being offered thereby,
including (as applicable): (1) the designation or title of such Debt Securities;
(2) the aggregate principal amount of such Debt Securities; (3) the percentage
of their principal amount at which such Debt Securities will be offered; (4) the
date or dates on which the principal of such Debt Securities will be payable;
(5) the rate or rates (which may be either fixed or variable) and/or the method
of determination of such rate or rates at which such Debt Securities shall bear
interest, if any; (6) the date or dates from which any such interest shall
accrue, or the method of determination of such date or dates, and the date or
dates on which any such interest shall be payable; (7) the terms for redemption,
extension or early repayment of such Debt Securities, if any; (8) the
denominations in which such Debt Securities are authorized to be issued; (9) the
currencies or currency units in which such Debt Securities are issued or
payable; (10) the provisions for a sinking fund, if any; (11) any additional
restrictive covenants included for the benefit of the holders of such Debt
Securities; (12) any additional Event of Default with respect to such Debt
Securities; (13) whether such Debt Securities are issuable as a Global Security;
and (14) any other term or provision relating to such Debt Securities which is
not inconsistent with the provisions of the Indenture.
One or more series of Debt Securities may be sold at a substantial discount
below their stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates. Federal income tax
consequences and special considerations applicable thereto will be described in
the Prospectus Supplement relating to any such series of Debt Securities.
5
<PAGE> 9
The Debt Securities will be unsecured obligations of Ford Credit and will
rank prior to all subordinated indebtedness of Ford Motor Credit Company (parent
company only) and pari passu with all other unsecured and unsubordinated
indebtedness of Ford Motor Credit Company (parent company only).
Except as otherwise provided in the Prospectus Supplement, principal,
premium, if any, and interest, if any, will be payable at an office or agency to
be maintained by Ford Credit in New York City, except that at the option of Ford
Credit interest may be paid by check mailed to the person entitled thereto.
(Form of Security and Sections 10.01 and 10.02).
Except as otherwise provided in the Prospectus Supplement, the Debt
Securities will be issued only in fully registered form without coupons and may
be presented for registration of transfer or exchange at the corporate trust
office of the Trustee. No service charge will be made for any transfer or
exchange of the Debt Securities, but Ford Credit may require payment of a sum to
cover any tax or other governmental charge payable in connection therewith.
(Section 3.05).
BOOK-ENTRY, DELIVERY AND FORM
Unless otherwise specified in the applicable Prospectus Supplement, each
series of Debt Securities will be issued in the form of one or more fully
registered Global Notes (the "Global Notes") which will be deposited with, or on
behalf of, The Depository Trust Company, New York, New York (the "Depository")
and registered in the name of Cede & Co., the Depository's nominee. Except as
set forth below, the Global Notes may be transferred, in whole and not in part,
only to another nominee of the Depository or to a successor of the Depository or
its nominee.
The Depository has advised as follows: It is a limited-purpose trust
company which holds securities for its participating organizations (the
"Participants") and facilitates the settlement among Participants of securities
transactions in such securities through electronic book-entry changes in its
Participants' accounts. Participants include securities brokers and dealers
(including certain of the underwriters or agents), banks and trust companies,
clearing corporations and certain other organizations. Access to the
Depository's system is also available to others such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a Participant, either directly or indirectly ("indirect participants"). Persons
who are not Participants may beneficially own securities held by the Depository
only through Participants or indirect participants.
The Depository advises that its established procedures provide that (i)
upon issuance of the Debt Securities by Ford Credit the Depository will credit
the accounts of Participants designated by the underwriters or agents with the
principal amounts of the Debt Securities purchased by the underwriters or
through the agents, and (ii) ownership of interests in the Global Notes will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by the Depository, the Participants and the indirect
participants. The laws of some states require that certain persons take physical
delivery in definitive form of securities which they own. Consequently, the
ability to transfer beneficial interests in the Global Notes is limited to such
extent.
So long as a nominee of the Depository is the registered owner of the
Global Notes, such nominee for all purposes will be considered the sole owner or
holder of such Debt Securities under the Indenture. Except as provided below or
in the Prospectus Supplement, owners of beneficial interests in the Global Notes
will not be entitled to have Debt Securities registered in their names, will not
receive or be entitled to receive physical delivery of Debt Securities in
definitive form, and will not be considered the owners or holders thereof under
the Indenture.
Neither Ford Credit, the Trustee, any Paying Agent nor the Security
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in the Global Notes, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
6
<PAGE> 10
Principal and interest payments on the Debt Securities registered in the
name of the Depository's nominee will be made by the Trustee to the Depository.
Under the terms of the Indenture, Ford Credit and the Trustee will treat the
persons in whose names the Debt Securities are registered as the owners of such
Debt Securities for the purpose of receiving payment of principal and interest
on the Debt Securities and for all other purposes whatsoever. Therefore, neither
Ford Credit, the Trustee nor any Paying Agent has any direct responsibility or
liability for the payment of principal or interest on the Debt Securities to
owners of beneficial interests in the Global Notes. The Depository has advised
Ford Credit and the Trustee that its present practice is to credit the accounts
of the Participants on the appropriate payment date in accordance with their
respective holdings in principal amount of beneficial interests in the Global
Notes as shown on the records of the Depository, unless the Depository has
reason to believe that it will not receive payment on such payment date.
Payments by Participants and indirect participants to owners of beneficial
interests in the Global Notes will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the
responsibility of the Participants or indirect participants.
If the Depository is at any time unwilling or unable to continue as
depository and a successor depository is not appointed by Ford Credit within 90
days, Ford Credit will issue Debt Securities in definitive form in exchange for
the Global Notes. In addition, Ford Credit may at any time determine not to have
a series of Debt Securities represented by Global Notes and, in such event, will
issue Debt Securities of such series in definitive form in exchange for the
Global Notes. In either instance, an owner of a beneficial interest in the
Global Notes will be entitled to have Debt Securities of such series equal in
principal amount to such beneficial interest registered in its name and will be
entitled to physical delivery of such Debt Securities in definitive form. Unless
otherwise specified in the Prospectus Supplement, Debt Securities so issued in
definitive form will be issued in denominations of $1,000 and integral multiples
thereof and will be issued in registered form only, without coupons.
SUBSIDIARIES
The term "subsidiary of the Company" is defined in the Indenture as a
corporation a majority of the outstanding voting stock of which is owned,
directly or indirectly, by Ford Credit or by one or more subsidiaries of Ford
Credit, or by Ford Credit and one or more subsidiaries of Ford Credit. The term
"Restricted Subsidiary" is defined in the Indenture as a subsidiary of the
Company, incorporated in or conducting the major part of its business in the
United States, any of the activities of which includes insurance underwriting or
which had, at the end of its last quarterly accounting period preceding the date
of computation, assets with a value in excess of $1 million representing
accounts or notes receivable resulting from the financing of new cars, trucks,
tractors and farm and industrial equipment manufactured or sold by Ford or from
the financing of used cars, trucks, tractors and farm and industrial equipment
of the same types, whether manufactured by Ford or others. (Section 1.01). Ford
Holdings, which owns American Road and the other insurance businesses formerly
owned by Ford Credit, is not a subsidiary of the Company and therefore not a
Restricted Subsidiary, as such terms are defined in the Indenture. So long as
stock of Ford Holdings is directly owned by Ford Credit or by a Restricted
Subsidiary, such stock will be subject to the "Limitation on Liens" provision
described below. Ford Credit currently owns its stock in Ford Holdings directly
but is under no obligation to continue to do so.
LIMITATION ON LIENS
If Ford Credit or any Restricted Subsidiary shall pledge or otherwise
subject to any lien (such a pledge or lien is defined in the Indenture as a
"Mortgage") any of its property or assets, Ford Credit will secure or cause such
Restricted Subsidiary to secure the Indenture Securities equally and ratably
with (or prior to) the indebtedness secured by such Mortgage. This restriction
does not apply to Mortgages securing such indebtedness which shall not exceed $5
million in the aggregate at any one time outstanding and does not apply to (a)
certain Mortgages created or incurred to
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secure financing of the export or marketing of goods outside the United States,
(b) Mortgages on accounts receivable payable in foreign currencies securing
indebtedness incurred and payable outside the United States, (c) Mortgages in
favor of Ford Credit or any Restricted Subsidiary, (d) Mortgages in favor of
governmental bodies to secure progress, advance or other payments, or deposits
with any governmental body required in connection with the business of Ford
Credit or a Restricted Subsidiary, (e) deposits made in connection with pending
litigation, (f) Mortgages existing at the time of acquisition of the assets
secured thereby (including acquisition through merger or consolidation) and
certain purchase money Mortgages, and (g) any extension, renewal or replacement
of any Mortgage or Mortgages referred to in the foregoing clauses (a) through
(f), inclusive. (Section 10.04).
MERGER AND CONSOLIDATION
The Indenture provides that no consolidation or merger of Ford Credit with
or into any other corporation shall be permitted, and no sale or conveyance of
its property as an entirety, or substantially as an entirety, may be made to
another corporation, if, as a result thereof, any asset of Ford Credit or a
Restricted Subsidiary would become subject to a Mortgage, unless the Indenture
Securities shall be equally and ratably secured with (or prior to) the
indebtedness secured by such Mortgage, or unless such Mortgage could be created
pursuant to Section 10.04 (see "Limitation on Liens" above) without equally and
ratably securing the Indenture Securities. (Section 8.03).
EVENTS OF DEFAULT AND NOTICE THEREOF
Except as may otherwise be provided in an indenture supplemental to the
Indenture, the following events in respect of a particular series of Indenture
Securities are defined in the Indenture as "Events of Default": (a) failure to
pay interest for 30 days after becoming due; (b) failure to pay the principal or
premium, if any, for five business days after becoming due at maturity, on
redemption or otherwise; (c) failure to make a sinking fund payment for five
days after becoming due; (d) failure to perform any other covenants for 90 days
after notice; and (e) certain events of bankruptcy, insolvency or
reorganization. (Section 5.01).
If an Event of Default in respect of a particular series of Indenture
Securities outstanding occurs and is continuing, either the Trustee or the
holders of at least 25% in aggregate principal amount of the Indenture
Securities outstanding of such series may declare the principal amount (or, if
the Indenture Securities of such series are Original Issue Discount Securities
(as defined in the indenture), such portion of the principal amount as may be
specified in the terms of such series) of all of the Indenture Securities of
such series to be due and payable immediately. At any time after such a
declaration of acceleration in respect of a particular series of Indenture
Securities has been made, but before a judgment or decree for the payment of
money due upon acceleration has been obtained by the Trustee, the holders of a
majority in aggregate principal amount of the Indenture Securities outstanding
of such series may, under certain circumstances, waive all defaults and rescind
and annul such declaration and its consequences if all Events of Default in
respect of the Indenture Securities of such series, other than the non-payment
of principal due solely by such declaration of acceleration, have been cured or
waived as provided in the Indenture. (Section 5.02).
The Indenture provides that the Trustee shall, within 90 days after the
occurrence of a default in respect of a particular series of Indenture
Securities, give the holders of such series notice of all uncured defaults known
to it (the term "default" to include the events specified above without grace
periods); provided that, except in the case of default in the payment of the
principal of, or premium, if any, on, or interest on any of the Indenture
Securities of such series, the Trustee shall be protected in withholding such
notice if it in good faith determines that the withholding of such notice is in
the interests of the holders of such series. (Section 6.01).
Pursuant to the terms of the Indenture, Ford Credit is required to furnish
to the Trustee annually a statement of certain officers of Ford Credit stating
whether or not to the best of their knowledge
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Ford Credit is in default in respect of any series of Indenture Securities in
the performance and observance of the terms of the Indenture and, if Ford Credit
is in default, specifying such default and the nature thereof.
The Indenture provides that the holders of a majority in aggregate
principal amount of all Indenture Securities of a particular series then
outstanding will have the right to waive certain defaults in respect of such
series and, subject to certain limitations, to direct the time, method and place
of conducting any proceedings for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee. (Sections 5.12 and
5.13). No provision of the Indenture requires the Trustee to expend or risk its
own funds or otherwise incur any personal financial liability in the performance
of any of its duties thereunder, or in the exercise of any of its rights or
powers, if there are reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to the Trustee.
MODIFICATION OF THE INDENTURE
With certain exceptions, the Indenture, the rights and obligations of Ford
Credit and the rights of the holders of a particular series may be modified by
Ford Credit with the consent of the holders of not less than 66 2/3% in
aggregate principal amount of the Indenture Securities of such series then
outstanding; but no such modification may be made which would (i) extend the
fixed maturity of any Indenture Security of such series, or reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon, without the consent of the holder of each Indenture Security of such
series so affected; or (ii) reduce the above-stated percentage of Indenture
Securities of such series, the consent of the holders of which is required to
modify or alter the Indenture, without the consent of the holders of all
Indenture Securities of such series then outstanding. (Section 9.02).
TRUSTEE
The Trustee may resign or be removed with respect to one or more series of
Indenture Securities and a successor Trustee may be appointed to act with
respect to such one or more series. (Section 6.08). In the event that there
shall be two or more persons acting as Trustee with respect to different series
of Indenture Securities, each such Trustee shall be a trustee of a trust or
trusts under the Indenture separate and apart from the trust or trusts
administered by any other such Trustee, and any action described herein to be
taken by the "Trustee" may then be taken by each such Trustee with respect to,
and only with respect to, the one or more series of Indenture Securities for
which it is acting as Trustee. (Section 6.09).
CONCERNING FIRST FIDELITY
First Fidelity Bank, National Association, Trustee under the Indenture, is
a depositary of Ford Credit, has a committed credit facility available to Ford
Credit and its subsidiaries and has performed other services for Ford Credit in
the normal course of its business.
REPORTS
Ford Credit publishes annual reports, containing certified financial
statements, and quarterly reports, containing interim unaudited financial
statements. Copies of such reports will be available upon request.
PLAN OF DISTRIBUTION
Ford Credit may sell the Debt Securities to or through underwriters, and
also may sell the Debt Securities directly to one or more other purchasers or
through agents.
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The Prospectus Supplement sets forth the terms of the offering of the
particular series of Debt Securities to which such Prospectus Supplement
relates, including (i) the name or names of any underwriters or agents with whom
Ford Credit has entered into arrangements with respect to the sale of such
series of Debt Securities, (ii) the initial public offering or purchase price of
such series of Debt Securities, (iii) any underwriting discounts, commissions
and other items constituting underwriters' compensation from Ford Credit and any
other discounts, concessions or commissions allowed or reallowed or paid by any
underwriters to other dealers, (iv) any commissions paid to any agents, (v) the
net proceeds to Ford Credit, and (vi) the securities exchanges, if any, on which
such series of Debt Securities will be listed.
Unless otherwise set forth in the Prospectus Supplement relating to a
particular series of Debt Securities, the obligations of the underwriters to
purchase such series of Debt Securities will be subject to certain conditions
precedent and each of the underwriters with respect to such series of Debt
Securities will be obligated to purchase all of the Debt Securities of such
series allocated to it if any such Debt Securities are purchased. Any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers may be changed from time to time.
The Debt Securities may be offered and sold by Ford Credit directly or
through agents designated by Ford Credit from time to time. Unless otherwise
indicated in the Prospectus Supplement, any such agent or agents will be acting
on a best efforts basis for the period of its or their appointment. Any agent
participating in the distribution of the Debt Securities may be deemed to be an
"underwriter", as that term is defined in the Securities Act, of the Debt
Securities so offered and sold. The Debt Securities also may be sold to dealers
at the applicable price to the public set forth in the Prospectus Supplement
relating to a particular series of Debt Securities who later resell to
investors. Such dealers may be deemed to be "underwriters" within the meaning of
the Securities Act.
If so indicated in the Prospectus Supplement relating to a particular
series of Debt Securities, Ford Credit will authorize underwriters or agents to
solicit offers by certain institutions to purchase Debt Securities of such
series from Ford Credit pursuant to delayed delivery contracts providing for
payment and delivery at a future date. Such contracts will be subject only to
those conditions set forth in the Prospectus Supplement and the Prospectus
Supplement will set forth the commission payable for solicitation of such
contracts.
Underwriters and agents may be entitled, under agreements entered into with
Ford Credit, to indemnification by Ford Credit against certain civil
liabilities, including liabilities under the Securities Act.
LEGAL OPINIONS
The legality of the Debt Securities offered hereby will be passed on for
Ford Credit by J. D. Bringard, Esq., Vice President--General Counsel of Ford
Credit, or other counsel satisfactory to any underwriters or agents, and for any
underwriters or agents by Shearman & Sterling, 599 Lexington Avenue, New York,
N.Y. Mr. Bringard is a full-time employee of Ford Credit and owns and holds
options to purchase shares of Common Stock of Ford. Shearman & Sterling act as
counsel to the Compensation and Option Committee and the Audit Committee of the
Board of Directors of Ford and occasionally act as counsel to Ford and Ford
Credit in connection with certain transactions.
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EXPERTS
The financial statements which are incorporated in this Prospectus by
reference to the 1994 10-K Report have been audited by Coopers & Lybrand L.L.P.
("Coopers & Lybrand"), 400 Renaissance Center, Detroit, Michigan 48243,
independent certified public accountants, to the extent indicated in their
report therein, and have been so incorporated in reliance upon the report of
that firm, given on their authority as experts in accounting and auditing, which
report includes an explanatory paragraph indicating Ford Credit changed its
methods of accounting for postretirement healthcare benefits and income taxes in
1992.
With respect to the unaudited interim financial information of Ford Credit
for the periods ended March 31, 1995 and 1994, included in the First Quarter
10-Q Report, incorporated by reference in this Prospectus, Coopers & Lybrand
have reported that they have applied limited procedures in accordance with
professional standards for a review of such information. However, their report
included in the First Quarter 10-Q Report states that they did not audit and
they do not express an opinion on that interim financial information. The
accountants are not subject to the liability provisions of Section 11 of the
Securities Act for their report on the unaudited interim financial information
because such report is not a "report" or a "part" of the registration statement
prepared or certified by the accountants within the meaning of Sections 7 and 11
of such Act.
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NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR THE PROSPECTUS
SUPPLEMENT, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT
BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS AND THE PROSPECTUS
SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY ANY SECURITIES OTHER THAN THE SECURITIES OFFERED BY THIS PROSPECTUS AND THE
PROSPECTUS SUPPLEMENT OR AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY
SUCH SECURITIES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE
SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS
PROSPECTUS AND THE PROSPECTUS SUPPLEMENT NOR ANY SALE MADE THEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN
THE AFFAIRS OF FORD CREDIT OR FORD MOTOR COMPANY SINCE THE DATE OF THIS
PROSPECTUS OR THE PROSPECTUS SUPPLEMENT, OR THAT THE INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SINCE SUCH DATE.
------------------------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Description of Notes................. S-2
Recent Developments.................. S-2
Underwriting......................... S-3
PROSPECTUS
Available Information................ 2
Incorporation of Certain Documents by
Reference.......................... 2
Information Concerning Ford Credit... 3
Information Concerning Ford.......... 3
Use of Proceeds...................... 4
Ratio of Earnings to Fixed Charges... 4
Description of Debt Securities....... 4
Plan of Distribution................. 9
Legal Opinions....................... 10
Experts.............................. 11
</TABLE>
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$500,000,000
FORD MOTOR
CREDIT COMPANY
5 3/4% NOTES
DUE JANUARY 25, 2001
(LOGO)
----------------------------------------
PROSPECTUS SUPPLEMENT
----------------------------------------
BEAR, STEARNS & CO. INC.
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
SALOMON BROTHERS INC
JANUARY 22, 1996
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