CONFORMED COPY
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
November 4, 1999
Date of Report ........................................................
(Date of earliest event reported)
CARCO Auto Loan Master Trust
........................................................................
(Exact name of registrant as specified in its charter)
State of Delaware 333-38873 and 33-55795 None
......................................................................
(State or other jurisdiction (Commission) (IRS Employer
of incorporation) File No.) Identification No.)
27777 Franklin Rd., Southfield, Michigan 48034
..............................................
(Address of principal executive offices)
Registrant's telephone number, including area code (248) 948-3067
..................
This filing relates to Registration Statement No. 333-38873 and 33-55795.
Item 5. Other Events.
In connection with the proposed offering of CARCO Auto Loan Master
Trust Fixed Rate Auto Loan Asset Backed Certificates, Series 1999-4, Class
A-1 and Class A-2, attached as Exhibit 99 are certain materials prepared by
Chrysler Financial Company L.L.C. that are required to be filed pursuant to
the no-action letter dated May 20, 1994 issued by the staff of the Securities
and Exchange Commission (the "Commission") to Kidder, Peabody Acceptance
Corporation-1, Kidder, Peabody & Co. Incorporated and Kidder Structured Asset
Corporation and the no-action letter dated February 15, 1995 issued by the
staff of the Commission to the Public Securities Association.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
Listed below are the financial statements, pro forma financial
information and exhibits, if any, filed as a part of this Report:
(a) Financial statements of businesses acquired;
None
(b) Pro forma financial information:
None
(c) Exhibits:
Exhibit 99
- 2 -
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
CHRYSLER FINANCIAL COMPANY L.L.C.
Date: November 4, 1999 By: /s/ B.C. Babbish
---------------------------------
B.C. Babbish
Assistant Secretary
-3-
EXHIBIT INDEX
Exhibit
No. Description of Exhibit
- ------- ----------------------
99 Material prepared by Chrysler Financial Company L.L.C.
in connection with CARCO Auto Loan Master Trust Fixed
Rate Auto Loan Asset Backed Certificates, Series 1999-4
pursuant to the no-action letter dated May 20, 1994
issued by the staff of the Securities and Exchange
Commission (the "Commission") to Kidder, Peabody
Acceptance Corporation-1, Kidder, Peabody & Co.
Incorporated and Kidder Structured Asset Corporation and
the no-action letter dated February 15, 1995 issued by
the staff of the Commission to the Public Securities
Association.
-4-
EXHIBIT 99
CARCO Auto Loan Master Trust Fixed Rate Auto Loan Asset Backed Certificates,
Series 1999-4 Structural and Collateral Materials
The information contained in the attached materials is referred to
as the "Information".
The attached Term Sheet has been prepared by Chrysler Financial
Company L.L.C. ("CFC"). Neither Chase Securities Inc. nor any of its
affiliates makes any representation as to the accuracy or completeness of the
Information herein. The Information contained herein is preliminary and will
be superseded by the applicable prospectus supplement and by any other
information subsequently filed with the Securities and Exchange Commission.
The Information contained herein will be superseded by the
description of the collateral pool contained in the prospectus supplement
relating to the securities.
The Information addresses only certain aspects of the applicable
security's characteristics and thus does not provide a complete assessment.
As such, the Information may not reflect the impact of all structural
characteristics of the security. The assumptions underlying the Information,
including structure and collateral, may be modified from time to time to
reflect changed circumstances.
Although a registration statement (including the prospectus)
relating to the securities discussed in this communication has been filed
with the Securities and Exchange Commission and is effective, the final
prospectus supplement relating to the securities discussed in this
communication has not been filed with the Securities and Exchange Commission.
This communication shall not constitute an offer to sell or the solicitation
of an offer to buy nor shall there be any offer or sale of the securities
discussed in this communication in any state in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such state. Prospective purchasers are
referred to the final prospectus and prospectus supplement relating to the
securities discussed in this communication for definitive Information on any
matter discussed in this communication. Any investment decision should be
based only on the data in the prospectus and the prospectus supplement
("Offering Documents") and the then current version of the Information.
Offering Documents contain data that is current as of their publication dates
and after publication may no longer be complete or current. A final
prospectus and prospectus supplement may be obtained by contacting Andrew Dym
at 212-834-5132.
<TABLE>
<CAPTION>
DAIMLERCHRYSLER
CARCO Auto Loan Master Trust
U.S. AUTO RECEIVABLES COMPANY, Seller
CHRYSLER FINANCIAL COMPANY L.L.C., Servicer
Subject to Revision
Term Sheet dated November 4, 1999.
<S> <C>
Issuer............................................... CARCO Auto Loan Master Trust (the "Trust").
Seller............................................... U.S. Auto Receivables Company ("USA" or the "Seller").
Servicer............................................. Chrysler Financial Company L.L.C. ("CFC" or the
"Servicer"), a wholly owned subsidiary of DaimlerChrysler
Corporation ("DaimlerChrysler").
Trustee.............................................. The Bank of New York (the "Trustee").
Title of Securities.................................. $500,000,000 Fixed Rate Auto Loan Asset Backed
Certificates, Series 1999-4 (the "Series 1999-4
Certificates").
The Series 1999-4 Invested
Amount............................................ The aggregate Series 1999-4 Invested Amount is expected
to be $500,000,000 on the Series Issuance Date (based on
information as of the Series Cut-Off Date) and represents
the principal amount of the Series 1999-4 Certificates
invested in Receivables as of the Series Issuance Date.
The Invested Amount is subject to decrease to the extent
funds are deposited in the Excess Funding Account and,
subsequently, to increase to the extent amounts are
withdrawn from the Excess Funding Account and paid to the
Seller. The Invested Amount is also subject to reduction
during the Series 1999-4 Accumulation Period and any
Early Amortization Period and at such other times as
deposits are made to the Excess
1
Funding Account in connection with the payment of
Receivables.
The Trust's assets that are allocated to Series 1999-4 are
referred to herein as the "Series 1999-4
Certificateholders' Interest".
Interest............................................. Interest on the principal balance of the Series 1999-4
Certificates will accrue at [ ]% per annum (the "Series
1999-4 Certificate Rate") and will be payable to Series
1999-4 Certificateholders on the fifteenth day of each
month (or, if such day is not a business day, on the next
succeeding business day) (each, a "Distribution Date"),
commencing December 15, 1999. Interest will accrue for
the period from and including the most recent
Distribution Date to but excluding the next succeeding
Distribution Date (each an "Interest Period"), except
that the first Interest Period will be 33 days. Interest
for any Distribution Date due but not paid on such
Distribution Date will be due on the next Distribution
Date, together with, to the extent permitted by
applicable law, interest on such amount at the Series
1999-4 Certificate Rate. Interest will be calculated on
the basis of a 360-day year of twelve 30-day months.
Reserve Fund......................................... The "Reserve Fund" will be a trust account established
and maintained in the name of the Trustee for the benefit
of the Series 1999-4 Certificateholders. On the Series
Issuance Date, the Seller will deposit $[1,750,000]
([0.35%] of the principal balance of the Series 1999-4
Certificates) into the Reserve Fund. The "Reserve Fund
Required Amount" for any Distribution Date will equal
[0.35%] of the outstanding principal balance of the
Series 1999-4 Certificates for such Distribution Date
(after giving effect to any change therein on such
Distribution Date). The "Reserve Fund Deposit Amount" is
the amount, if any, by which the Reserve Fund Required
Amount exceeds the amount on deposit in the Reserve Fund.
Funds in the Reserve Fund will be invested in investments
that will mature on or prior to the next Distribution
Date. Amounts on deposit in the
2
Reserve Fund will be available to pay Monthly Interest,
the Monthly Servicing Fee and Investor Default Amounts.
Series 1999-4 Expected Payment
Date.............................................. November 15, 2002.
Excess Funding Account............................... Except as provided below, the Excess Funded Amount (the
amount, if any, of the Series 1999-4 Certificates not
invested in Receivables) will be maintained in a trust
account established with the Trustee (the "Excess Funding
Account").
Upon (a) the commencement of any Early Amortization Period
and (b) the May 2002 Distribution Date, some or all of
funds on deposit in the Excess Funding Account will be
distributed to the Series 1999-4 Certificateholders or
deposited in the Principal Funding Account.
Series 1999-4 Accumulation Period.................... Unless an Early Amortization Event that is not cured or
waived shall have occurred, the Series 1999-4
Certificates will have a Series 1999-4 Accumulation
Period of one, two, three, four or five month(s) long as
described in the following paragraph. During the Series
1999-4 Accumulation Period, Principal Collections and
certain other amounts allocable to the Series 1999-4
Certificateholders' Interest will be deposited on each
Distribution Date in a trust account established for the
benefit of the Series 1999-4 Certificateholders (the
"Principal Funding Account") and used to make principal
distributions to the Series 1999-4 Certificateholders
when due.
On the May 2002 Distribution Date and each Distribution
Date thereafter that occurs prior to the Series 1999-4
Accumulation Period Commencement Date, the Servicer shall
calculate the Series 1999-4 Accumulation Period Length.
The "Series 1999-4 Accumulation Period Length" will be
calculated on each such date as the lesser of (i) the
number of full Collection Periods between such
Distribution Date and the Series 1999-4 Expected Payment
3
Date and (ii) the product, rounded upwards to the nearest
integer not greater than five, of (a) one divided by the
lowest Monthly Payment Rate on the Receivables during the
last 12 months and (b) a fraction, the numerator of which
is the sum of (i) the Invested Amount as of such
Distribution Date (after giving effect to all changes
therein on such date) and (ii) the invested amounts of all
other Series (excluding certain Series) currently in their
amortization or accumulation periods or expected to be in
their amortization or accumulation periods by the Series
1999-4 Expected Payment Date and the denominator of which
is the sum of the Series 1999-4 Invested Amount and the
invested amounts as of such Distribution Date (after
giving effect to all changes therein on such date) of all
other outstanding Series (excluding certain Series) which
are expected to be outstanding on the Series 1999-4
Expected Payment Date. The Series 1999-4 Accumulation
Period Commencement Date (which will be the first day of a
Collection Period) will occur when the number of full
Collection Periods remaining until the Series 1999-4
Expected Payment Date first equals the Series 1999-4
Accumulation Period Length as calculated above. If the
Series 1999-4 Accumulation Period Length is one month, two
months, three months, four months or five months in
length, the "Series 1999-4 Accumulation Period
Commencement Date" shall be the first day of the October
2002 Collection Period, the September 2002 Collection
Period, the August 2002 Collection Period, the July 2002
Collection Period or the June 2002 Collection Period,
respectively. In addition, if at any time after the May
2002 Distribution Date, any other outstanding Series
(excluding certain Series) shall have entered into a
reinvestment period or an early amortization period, the
Series 1999-4 Accumulation Period Commencement Date shall
be the earlier of (i) the date that such outstanding
Series shall have entered into its reinvestment period or
early amortization period and (ii) the Series 1999-4
4
Accumulation Period Commencement Date as previously
determined.
The effect of the calculation described above is to permit
the reduction of the length of the Series 1999-4
Accumulation Period based on the invested amounts of
certain other Series which are scheduled to be in their
revolving periods during the Series 1999-4 Accumulation
Period and on increases in the principal payment rate,
which, if continued, would result in a shorter Series
1999-4 Accumulation Period.
Early Amortization Period............................ The Series 1999-4 Certificates will have an Early
Amortization Period if an Early Amortization Event
occurs. During an Early Amortization Period with respect
to Series 1999-4, Principal Collections and certain other
amounts allocable to the Series 1999-4
Certificateholders' Interest will be distributed to the
Series 1999-4 Certificateholders monthly on each
Distribution Date beginning with the Distribution Date
following the Collection Period in which such Early
Amortization Period commences.
The Seller is required to add Receivables to the Trust to
maintain the principal balance of Receivables in the Trust
at a specified level. The failure of the Seller to add
Receivables when required will result in the occurrence of
an Early Amortization Event. However, if no other Early
Amortization Event has occurred, the Early Amortization
Period resulting from such failure will terminate and the
Series 1999-4 Revolving Period will recommence when the
Seller would no longer be required to add Receivables to
the Trust, so long as the scheduled termination date of
such Revolving Period has not occurred.
Notwithstanding the foregoing, in the event of the
occurrence of certain Early Amortization Events, provided
that the scheduled termination date of the Series 1999-4
Revolving Period has not occurred, such Revolving Period
may recommence following receipt of (i) written
confirmation from each rating agency rating the Series
1999-4 Certificates (each, a "Rating
5
Agency") (other than Moody's) that such Rating Agency's
rating of the Series 1999-4 Certificates will not be
withdrawn or lowered as a result of such recommencement
and (ii) the consent of Series 1999-4 Certificateholders
holding Series 1999-4 Certificates evidencing more than
50% of the aggregate unpaid principal amount of the Series
1999-4 Certificates to such recommencement.
Early Amortization Events............................ The Early Amortization Events with respect to the Series
1999-4 Certificates will include each of the following
events:
1. failure on the part of USA, the Servicer or CFC (i) to
make any payment required by the Pooling and Servicing
Agreement or the Receivables Purchase Agreement, (ii)
to deliver a Distribution Date Statement required by
the Pooling and Servicing Agreement, (iii) to comply
with its covenant not to create any lien on a
Receivable or (iv) to observe or perform in any
material respect any other covenant or agreement set
forth in the Pooling and Servicing Agreement or the
Receivables Purchase Agreement beyond any applicable
grace period;
2. any representation or warranty made by CFC, as seller
of the Receivables to USA, in the Receivables Purchase
Agreement or by USA in the Pooling and Servicing
Agreement or any information required to be given by
USA to the Trustee to identify the Accounts proves to
have been incorrect in any material respect when made
and continues to be incorrect in any material respect
for a period of 60 days after written notice and as a
result the interests of the Certificateholders are
materially and adversely affected; provided, however,
that an Early Amortization Event shall not be deemed to
occur thereunder if USA has repurchased the related
Receivables or all such Receivables, if applicable,
during such period in accordance with the provisions of
the Pooling and Servicing Agreement;
6
3. the occurrence of certain events of bankruptcy,
insolvency or receivership relating to CFC,
DaimlerChrysler, the Trust or the Seller;
4. a failure by USA to convey Receivables in Additional
Accounts to the Trust when required;
5. on any Determination Date, the Available Subordinated
Amount for the next Distribution Date will be reduced
to an amount less than the Required Subordinated Amount
on such Determination Date after giving effect to the
distributions to be made on the next Distribution Date;
6. any Service Default with respect to the Series 1999-4
Certificates occurs;
7. on any Distribution Date, as of the last day of the
preceding Collection Period, the aggregate amount of
Principal Receivables relating to Used Vehicles exceeds
20% of the Pool Balance on such last day;
8. on any Determination Date, the average of the Monthly
Payment Rates for the three preceding Collection
Periods is less than 20%;
9. on any Distribution Date the amount of funds in the
Reserve Fund after giving effect to any withdrawals
therefrom or deposits thereto on such Distribution Date
shall be less than 0.10% of the outstanding principal
balance of the Series 1999-4 Certificates on such
Distribution Date (after giving effect to any changes
therein on such Distribution Date);
10. the Trust or USA becomes an investment company within
the meaning of the Investment Company Act of 1940, as
amended; and
11. the outstanding principal amount of the Series 1999-4
Certificates is not repaid by the Series 1999-4
Expected Payment Date.
7
Subordination of the Seller's
Interest.......................................... If the Interest Collections, Investment Proceeds, certain
amounts in the Reserve Fund and certain other amounts
allocable to the Series 1999-4 Certificateholders for any
Collection Period are not sufficient to cover the
interest payable with respect to the Series 1999-4
Certificates on the next Distribution Date (plus any
overdue interest and interest thereon), the Monthly
Servicing Fee for such Distribution Date, any Investor
Default Amount for such Distribution Date and certain
other amounts, the Available Subordinated Amount will be
applied to make up such deficiency.
The "Available Subordinated Amount" for a Determination
Date is equal to (a) the lesser of (i) the Available
Subordinated Amount for the preceding Determination Date,
minus, with certain limitations, the Draw Amount for such
preceding Determination Date, minus funds from the Reserve
Fund applied to cover any portion of the Investor Default
Amount, plus the excess, if any, of the Required
Subordinated Amount for such Determination Date over the
Required Subordinated Amount for the immediately preceding
Determination Date due to an increase in the Subordination
Factor, plus the amount of Excess Servicing available to
be paid to the Seller and (ii) the product of the
fractional equivalent of the Subordinated Percentage and
the Invested Amount minus (b) in the case of clause
(a)(i), the Incremental Subordinated Amount for such
preceding Determination Date, plus (c) the Incremental
Subordinated Amount for the current Determination Date,
plus (d) the Subordinated Percentage of funds to be
withdrawn from the Excess Funding Account on the
succeeding Distribution Date and paid to the Seller or
allocated to one or more Series; provided, however, (x)
that, from and after the commencement of the Series 1999-4
Accumulation Period until the Series 1999-4 Certificates
are paid in full and (y) from and after the commencement
of any Early Amortization Period that is not terminated as
described herein until the payment in full of the Series
1999-4
8
Certificates, the Available Subordinated Amount shall be
calculated based on the Invested Amount as of the close of
business on the day preceding such Series 1999-4
Accumulation Period or Early Amortization Period, as
applicable. The Available Subordinated Amount for the
first Determination Date is equal to the Required
Subordinated Amount. The "Required Subordinated Amount"
shall mean, as of any date of determination, the sum of
(a) the product of the initial Subordinated Percentage, as
adjusted from time to time other than as a result of an
increase therein at the option of the Seller, and the
Invested Amount and (b) the Incremental Subordinated
Amount.
The "Incremental Subordinated Amount" on any Determination
Date will equal the result obtained by multiplying (a) a
fraction, the numerator of which is the sum of the
Invested Amount on the last day of the immediately
preceding Collection Period and the Available Subordinated
Amount for such Determination Date (calculated without
adding the Incremental Subordinated Amount for such
Determination Date as described in clause (c) above), and
the denominator of which is the Pool Balance on such last
day by (b) the excess, if any, of (x) the sum of the
Overconcentration Amount, the Installment Balance Amount
and the aggregate amount of Ineligible Receivables on such
Determination Date over (y) the aggregate amount of
Ineligible Receivables, Receivables in Accounts containing
Dealer Overconcentrations and Receivables in Installment
Balances, in each case that became Defaulted Receivables
during the preceding Collection Period and are not subject
to reassignment from the Trust, unless certain insolvency
events relating to the Seller or CFC have occurred.
The "Subordinated Percentage" will initially equal the
percentage equivalent of a fraction, the numerator of
which is the Subordination Factor and the denominator of
which will be the excess of 100% over the Subordination
Factor. The Subordination Factor will initially be
[10.5%],
9
but will be subject to increase to [11.5%] in the event
that the rating of CFC's long-term unsecured debt is
lowered below BBB- by Standard & Poor's or withdrawn by
Standard & Poor's, unless the Seller receives written
confirmation from Standard & Poor's that the failure to so
increase the Subordination Factor would not result in such
Rating Agency lowering or withdrawing its rating of the
Series 1999-4 Certificates. The Seller may, in its sole
discretion, increase at any time the Available
Subordinated Amount for so long as the cumulative amount
of such discretionary increases does not exceed the lesser
of (i) $5,586,592.18 or (ii) [1.12%] of the Invested
Amount. The Seller is not under any obligation to increase
the Available Subordinated Amount at any time, except as
described herein. If the Available Subordinated Amount
were reduced to less than the Required Subordinated
Amount, an Early Amortization Event would occur. The
Seller could elect to increase the Available Subordinated
Amount at the time such an Early Amortization Event would
otherwise occur, thus preventing or delaying the
occurrence of the Early Amortization Event.
Required Participation
Percentage........................................ "Required Participation Percentage" shall mean, with
respect to Series 1999-4, 103%; provided, however, that
if the aggregate amount of Principal Receivables due from
any Dealer or group of affiliated Dealers at the close of
business on the last day of any Collection Period with
respect to which such determination is being made is
greater than 1.5% of the Pool Balance on such last day,
the Required Participation Percentage shall mean, as of
such last day and with respect to such Collection Period
and the immediately following Collection Period only,
104%; provided, further, that the Seller may, upon ten
days' prior notice to the Trustee and the Rating Agencies
reduce the Required Participation Percentage to not less
than 100%, so long as the Rating Agencies shall not have
notified the Seller or the Servicer that any such
reduction will result in a reduction or withdrawal
10
<PAGE>
z
of the rating of the Series 1999-4 Certificates or any
other outstanding Series or Class of Certificates.
Other Series Issuances............................... As of the date hereof, nine other Series issued by the
Trust are outstanding.
Allocations.......................................... Interest Collections, Principal Collections and Defaulted
Receivables allocated to Series 1999-4 will be further
allocated between the Series 1999-4 Certificateholders'
Interest and the Seller's Interest as described below.
Interest Collections and Defaulted Receivables allocated
to Series 1999-4 will be allocated at all times to the
Series 1999-4 Certificateholders' Interest based on the
Floating Allocation Percentage applicable during the
related Collection Period. The Floating Allocation
Percentage for any Collection Period is the percentage
obtained by dividing the Invested Amount on the last day
of the immediately preceding Collection Period by the
product of (x) the Pool Balance on the last day of the
immediately preceding Collection Period and (y) the Series
Allocation Percentage for the Collection Period in respect
of which the Floating Allocation Percentage is being
calculated. Principal Collections allocated to Series
1999-4 will be allocated to the Series 1999-4
Certificateholders' Interest based on the Floating
Allocation Percentage during any period (a "Nonprincipal
Period") that is not the Series 1999-4 Accumulation Period
or an Early Amortization Period and based on the Principal
Allocation Percentage during the Series 1999-4
Accumulation Period and any Early Amortization Period.
"Principal Allocation Percentage" for any Collection
Period generally means the percentage equivalent (which
shall never exceed 100%) of a fraction, the numerator of
which is the Invested Amount as of the last day of the
Series 1999-4 Revolving Period, if such last day has
occurred or, if such last day has not occurred, as of the
last day of the immediately preceding Collection Period
or, after the Series 1999-4 Certificates have been
11
paid in full, zero and the denominator of which is the
product of (x) the Pool Balance as of such last day and
(y) the Series Allocation Percentage for the Collection
Period in respect of which the Principal Allocation
Percentage is being calculated.
Excess Principal Collections......................... Principal Collections otherwise allocable to other
Series, to the extent such collections are not needed to
make payments to or deposits for the benefit of the
Certificateholders of such other Series, will be applied
to cover principal payments due to or for the benefit of
the holders of the Series 1999-4 Certificates and of
other Series of Certificates entitled thereto.
Excess Servicing..................................... All interest collections otherwise allocable to any
Series with respect to any Distribution Date, to the
extent such collections are not needed to make payments
to or deposits for the benefit of Certificateholders of
such Series on such Distribution Date, other than any
such collections that, if not distributed to the Seller,
would result in the available subordinated amount for
such Series being less than the required subordinated
amount for such Series, will be applied to cover
shortfalls with respect to interest payments and certain
other amounts due to or for the benefit of the holders of
the Series 1999-4 Certificates, the Series 1999-1
Certificates and certain Series of Certificates that may
be issued in the future, with such excess interest
collections allocated among such Series pro rata based on
the amounts of their respective shortfalls with respect
to such Distribution Date.
Registration of Series 1999-4
Certificates .................................... The Series 1999-4 Certificates will initially be
represented by one or more Certificates registered in the
name of Cede & Co., as the nominee of The Depository
Trust Company ("DTC"). No person acquiring an interest in
the Series 1999-4 Certificates will be entitled to
receive a definitive certificate representing such
person's interest except under certain limited
circumstances. Series 1999-4 Certificateholders may only
hold their Series 1999-4 Certificates
12
through DTC. Series 1999-4 Certificates may not be held
through Cedelbank or the Euroclear System.
Servicing Fee Rate .................................. 1.0% or, if the Monthly Servicing Fee has been waived,
0.0% for the Distribution Date in respect of which the
Monthly Servicing Fee has been waived.
Optional Repurchase ................................. The Series 1999-4 Certificateholders' Interest will be
subject to optional repurchase by the Servicer on any
Distribution Date after the Invested Amount is reduced to
an amount less than or equal to $50,000,000 (10% of the
initial outstanding principal amount of the Series 1999-4
Certificates). The purchase price will equal the sum of
(i) the Invested Amount on the Determination Date
preceding the Distribution Date on which the purchase is
scheduled to be made, (ii) accrued and unpaid interest on
the Series 1999-4 Certificates at the Series 1999-4
Certificate Rate (together with interest on overdue
interest) and (iii) any outstanding Carry-over Amount.
Series 1999-4 Termination Date....................... November 15, 2004.
ERISA Considerations ................................ Series 1999-4 Certificates may be eligible for purchase
by employee benefit plans.
Certificate Ratings ................................. It is a condition to the issuance of the Series 1999-4
Certificates that they be rated in the highest long-term
rating category by at least one nationally recognized
rating agency. A security rating is not a recommendation
to buy, sell or hold securities and is subject to
revision or withdrawal in the future by the assigning
rating agency.
Series Issuance Date ................................ November 12, 1999.
Series Cut-Off Date ................................. October 31, 1999.
</TABLE>
13
THE DEALER FLOORPLAN FINANCING BUSINESS
The Receivables sold to the Trust by the Seller pursuant to a
Pooling and Servicing Agreement among USA, CFC and the Trustee (the "Pooling
and Servicing Agreement") were or will be selected from extensions of credit
and advances made by DaimlerChrysler, directly or as successor to Chrysler
Corporation ("Chrysler"), and CFC, directly or as successor to Chrysler
Financial Corporation or Chrysler Credit Corporation ("CCC"), to
approximately 3,170 domestic motor vehicle dealers to finance their
automobile and light duty truck inventory. CFC, directly or as successor to
Chrysler Financial Corporation or CCC, financed 56.4% of the total number of
all DaimlerChrysler franchised dealers as of September 30, 1999. Furthermore,
CFC, directly or as successor to Chrysler Financial Corporation or CCC, has
extended credit lines to 1,170 DaimlerChrysler-franchised dealers that also
operate non-DaimlerChrysler franchises (representing approximately 40% of the
aggregate credit lines of dealers in the U.S. Wholesale Portfolio as of
September 30, 1999) and 427 non-DaimlerChrysler dealers (representing
approximately 15% of such aggregate credit lines). As of September 30, 1999,
the balance of Principal Receivables in the accounts of dealers serviced by
CFC (the "U.S. Wholesale Portfolio") was approximately $9.4 billion. CFC
currently services the U.S. Wholesale Portfolio through its Southfield
Support office and through a network of 25 zone offices located throughout
the United States.
As of September 30, 1999, the average credit lines per dealer in the
U.S. Wholesale Portfolio for new and used vehicles (which includes Auction
Vehicles) were $3.89 million and $0.47 million, respectively, and the average
balance of principal receivables per dealer was $2.97 million. As of
September 30, 1999, the aggregate total receivables balance as a percentage
of the aggregate total credit line was approximately 68.2%.
The following table sets forth the percentages of dealer account
balances by year of credit line origination for the U.S. Wholesale Portfolio.
<TABLE>
<CAPTION>
Portfolio Percentages by Year
of Credit Line Origination
As of September 30, 1999
Prior to
1999 1998 1997 1996 1995 1994 1993 1993
---- ---- ---- ---- ---- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C> <C>
6.42% 8.46% 6.67% 4.49% 7.13% 3.47% 5.96% 57.40%
</TABLE>
As of September 30, 1999, the weighted average spread over the Prime
Rate charged to dealers in the U.S. Wholesale Portfolio was approximately
0.75%.
Used Vehicles (which excludes Auction Vehicles) represented
approximately 4.05% of the aggregate principal amount of receivables in the
U.S. Wholesale Portfolio as of September 30, 1999. As of September 30, 1999,
Used Vehicles represented approximately 4.21% of the aggregate principal
amount of Receivables in the Trust (including Excluded Receivables).
The following table provides the percentage of dealers in the U.S.
Wholesale Portfolio that were subject to finance hold.
14
<TABLE>
<CAPTION>
Finance Hold Experience
As of
September 30, As of December 31,
------------- -------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989
---- ---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Percentage of Dealers ... 0.5% 0.9% 2.1% 1.1% 1.8% 1.6% 3.2% 6.8% 9.4% 6.8% 4.6%
</TABLE>
The following table provides the number and percentage of dealers in
Dealer Trouble Status in the U.S. Wholesale Portfolio as of the dates
indicated.
<TABLE>
<CAPTION>
Dealer Trouble Experience
As of
September 30, As of December 31
------------- -------------------------------------------------------------------------
1999 1998 1997 1996 1995 1994 1993 1992 1991 1990
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Number of Dealers .... 24 21 24 20 6 12 21 56 100 129
Percentage of Dealers 0.8% 0.7% 0.7% 0.6% 0.2% 0.3% 0.6% 1.8% 3.1% 4.2%
</TABLE>
THE ACCOUNTS
As of September 30, 1999, with respect to the Accounts in the Trust:
(a) there were approximately 3,040 Accounts and the Principal Receivables
balance was approximately $8.9 billion; (b) the average credit lines per
Dealer for new and used vehicles (which include Auction Vehicles) were
approximately $3.86 million and $0.48 million, respectively, and the average
balance of Principal Receivables per Dealer was approximately $2.92 million;
and (c) the aggregate total Receivables balance as a percentage of the
aggregate total credit line was approximately 67.3%. Unless otherwise
indicated, the statistics included in this paragraph, in the table below and
under " - Geographic Distribution" with respect to the Accounts and the
Receivables in the Trust give effect to approximately $19.7 million of
principal receivables balances with respect to certain Dealers (the "Excluded
Receivables" and the "Excluded Dealers", respectively) that are in voluntary
or involuntary bankruptcy proceedings or voluntary or involuntary liquidation
or that, subject to certain limitations, are being voluntarily removed by the
Seller (or the Servicer on its behalf) from the Trust. A portion of such
principal receivables was created after such Dealers entered into such status
or were designated by the Seller (or the Servicer on its behalf) for removal
from the Trust and, as a result thereof, are owned by CFC and not the Trust.
Principal receivables balances created prior to such Dealers entering into
such status or being designated for removal from the Trust are included in
the Principal Receivables balance.
The following table sets forth the percentages of dealer account
balances by year of credit line origination for the accounts in the Trust.
15
<TABLE>
<CAPTION>
Portfolio Percentages by Year
of Credit Line Origination
As of September 30, 1999
Prior to
1999 1998 1997 1996 1995 1994 1993 1993
---- ---- ---- ---- ---- ---- ---- --------
<S> <C> <C> <C> <C> <C> <C> <C>
5.12% 8.48% 6.54% 4.76% 5.54% 3.67% 6.13% 59.76%
</TABLE>
As of September 30, 1999, the weighted average spread over the Prime
Rate charged to Dealers was approximately 0.75%.
Loss Experience
The following tables set forth the average Principal Receivables
balance and loss experience for each of the periods shown on the U.S.
Wholesale Portfolio. Because the eligible Accounts in the Trust (the
"Eligible Accounts") will be only a portion of the entire U.S. Wholesale
Portfolio, actual loss experience with respect to the Eligible Accounts may
be different. There can be no assurance that the loss experience for the
Receivables in the future will be similar to the historical experience set
forth below with respect to the U.S. Wholesale Portfolio. In addition, the
historical experience set forth below reflects financial assistance provided
by DaimlerChrysler or Chrysler to DaimlerChrysler-franchised dealers. If
DaimlerChrysler is not able to or elects not to provide such assistance, the
loss experience in respect of the U.S. Wholesale Portfolio may be adversely
affected.
<TABLE>
<CAPTION>
Loss Experience for the U.S. Wholesale Portfolio
Nine Months
Ended September 30, Year Ended December 31,
------------------- ----------------------------------------------------
1999 1998 1998 1997 1996 1995 1994
---- ---- ---- ---- ---- ---- ----
(Dollars in millions)
<S> <C> <C> <C> <C> <C> <C> <C>
Average Principal Receivables
Balance(l) .................. $10,417 $9,202 $9,236 $8,877 $8,825 $8,256 $6,754
Net Losses/(Net
Recoveries)(2) .............. $ (0) $ 9 $ 11 $ 4 $ (0) $ (1) $ (1)
Net Losses/(Net Recoveries)
as a Percent of Liquidations 0.000% 0.022% 0.020% 0.007% (0.000)% (0.002)% (0.003)%
Net Losses/(Net Recoveries)
as a Percent of Average
Principal Receivables
Balance (3).................. (0.00)% 0.13% 0.12% 0.04% (0.00)% (0.01)% (0.01)%
</TABLE>
16
<TABLE>
<CAPTION>
Loss Experience for the U.S. Wholesale Portfolio (Continued)
Year Ended December 31,
--------------------------------------------------------------------------------
1993 1992 1991 1990 1989 1988 1987
---- ---- ---- ---- ---- ---- ----
(Dollars in millions)
<S> <C> <C> <C> <C> <C> <C> <C>
Average Principal
Receivables
Balance(l)................ $6,271 $5,344 $4,826 $4,726 $4,933 $4,129 $3,787
Net Losses/(Net
Recoveries)(2)............ $ 12 $ 26 $ 36 $ 23 $ 13 $ 3 $ 2
Net Losses/(Net
Recoveries) as a Percent
of Liquidations........... 0.035% 0.098% 0.163% 0.117% 0.060% 0.015% 0.015%
Net Losses/(Net
Recoveries) as a Percent
of Average Principal
Receivables Balance....... 0.19% 0.49% 0.75% 0.49% 0.26% 0.07% 0.06%
<CAPTION>
Year Ended December 31,
--------------------------------------------------------------------------------
1986 1985 1984 1983 1982 1981
---- ---- ---- ---- ---- ----
(Dollars in millions)
<S> <C> <C> <C> <C> <C> <C>
Average Principal
Receivables
Balance(l).............. $2,991 $2,532 $ 2,098 $1,461 $1,451 $1,390
Net Losses/(Net
Recoveries)(2).......... $ 3 $ 1 $ (2) $ 2 $ 14 $ 12
Net Losses/(Net
Recoveries) as a
Percent of
Liquidations............ 0.023% 0.004% (0.019)% 0.023% 0.239% 0.225%
Net Losses/(Net
Recoveries) as a
Percent of Average
Principal Receivables
Balance................. 0.10% 0.02% (0.09)% 0.12% 0.95% 0.85%
<FN>
(1) Average Principal Receivables Balance is the average of the
month-end principal balances for the thirteen months ending on the
last day of the period, except for the nine months ended September
30, 1999 and 1998 which are based on a four-month average.
(2) Net losses in any period are gross losses less recoveries for such
period.
(3) Percentages for the nine months ended September 30, 1999 and 1998
are expressed on an annualized basis.
</TABLE>
17
Aging Experience
The following table provides the age distribution of vehicle
inventory for all dealers in the U.S. Wholesale Portfolio, as a percentage of
total principal outstanding at the date indicated. Because the Eligible
Accounts will only be a portion of the entire U.S. Wholesale Portfolio,
actual age distribution with respect to the Eligible Accounts may be
different.
<TABLE>
<CAPTION>
Age Distribution for the U.S. Wholesale Portfolio
As of As of
September 30 December 31,
------------ -------------------------------------------------------------------
Days 1999 1998 1997 1996 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1-120.............. 84.6% 81.7% 80.1% 80.4% 82.2% 82.5% 82.4% 77.2% 75.9%
121-180............ 7.1 11.0 10.8 10.0 9.3 10.1 9.6 13.8 12.9
181-270............ 4.9 4.1 4.2 5.0 3.8 4.0 4.6 4.8 4.8
over 270........... 3.4 3.2 4.9 4.6 4.7 3.4 3.4 4.2 6.4
</TABLE>
Geographic Distribution
The following table provides the geographic distribution of the
vehicle inventory for all dealers in the Trust on the basis of receivables
outstanding and the number of dealers generating such portfolio.
<TABLE>
<CAPTION>
Geographic Distribution of Accounts in the Trust
As of September 30, 1999
Percentage of Percentage of
Receivables Receivables Total Number Number of
Outstanding (2) Outstanding (2)(4) of Dealers (3) Dealers (3)(4)
--------------- ------------------ -------------- --------------
<S> <C> <C> <C> <C>
Texas............ $ 776,925,835.64 8.77% 191 6.29%
California....... 700,455,050.61 7.90 187 6.16
New York......... 582,564,401.00 6.57 193 6.35
Florida.......... 510,488,993.96 5.76 119 3.92
Illinois......... 505,070,115.65 5.70 164 5.40
New Jersey....... 472,613,818.70 5.33 132 4.35
Michigan......... 471,172,100.05 5.32 148 4.87
Other............ 4,841,986,265.07 54.64 1,903 62.66
----------------- ------ ----- ------
Total............ $8,861,276,580.68 100.00% 3,037 100.00%
================= ====== ===== ======
<FN>
(1) No other state includes more than 5% of the outstanding Receivables.
(2) Includes Excluded Receivables.
(3) Includes Excluded Dealers.
(4) May not add to 100.00% due to rounding.
</TABLE>
18
MATURITY AND PRINCIPAL PAYMENT CONSIDERATIONS
Principal with respect to the Series 1999-4 Certificates will be
payable if an Early Amortization Period that is not terminated has commenced.
Full amortization of the Series 1999-4 Certificates by the November 2002
Distribution Date (the "Series 1999-4 Expected Payment Date") depends on,
among other things, repayment by Dealers of the Receivables and may not occur
if Dealer payments are insufficient therefor. Because the Receivables
generally are paid upon retail sale of the underlying Vehicle, the timing of
such payments is uncertain. In addition, there is no assurance that CFC will
generate additional Receivables under the Accounts or that any particular
pattern of Dealer payments will occur. In addition, the shorter the Series
1999-4 Accumulation Period Length the greater the likelihood that payment of
the Series 1999-4 Certificates in full by the Series 1999-4 Expected Payment
Date will be dependent on the reallocation of Principal Collections which are
initially allocated to other outstanding Series. If one or more other Series
from which Principal Collections are expected to be available to be
reallocated to the payment of the Series 1999-4 Certificates enters into an
early amortization period or reinvestment period after the May 2002
Distribution Date, Principal Collections allocated to such Series generally
will not be available to be reallocated to make payments of principal of the
Series 1999-4 Certificates and the final payment of principal of the Series
1999-4 Certificates may be later than the Series 1999-4 Expected Payment
Date.
Because an Early Amortization Event with respect to the Series
1999-4 Certificates may occur which would initiate an Early Amortization
Period, the final distribution of principal on the Series 1999-4 Certificates
may be made prior to the scheduled termination of the Series 1999-4 Revolving
Period or prior to the Series 1999-4 Expected Payment Date.
The amount of new Receivables generated in any month and monthly
payment rates on the Receivables may vary because of seasonal variations in
Vehicle sales and inventory levels, retail incentive programs provided by
Vehicle manufacturers and various economic factors affecting Vehicle sales
generally. The following table sets forth the highest and lowest monthly
payment rates for the U.S. Wholesale Portfolio during any month in the
periods shown and the average of the monthly payment rates for all months
during the periods shown, in each case calculated as the percentage
equivalent of a fraction, the numerator of which is the aggregate of all
collections of principal during the period and the denominator of which is
the average aggregate principal balance for such period. Monthly payment
rates reflected in the table include principal credit adjustments. The
monthly payment rates presented for 1981 through 1985 are calculated using
quarterly data while monthly payment rates for 1986 through September of 1999
reflect actual monthly data. There can be no assurance that the rate of
Principal Collections will be similar to the historical experience set forth
below. Because the Eligible Accounts will be only a portion of the entire
U.S. Wholesale Portfolio, historical monthly payment rates with respect to
the Eligible Accounts may be different than those shown below.
19
<TABLE>
<CAPTION>
Monthly Payment Rates for the U.S. Wholesale Portfolio
Nine Months
-------------
Ended
September 30, Year Ended December 31,
------------- ------------------------------------------------------------
1999 1998 1998 1997 1996 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Highest
Month ..... 69.0% 60.8% 60.8% 57.7% 58.3% 59.1% 59.7% 54.7% 50.6% 49.0%
Lowest
Month ..... 30.7 42.5 42.5 41.1 43.2 36.5 34.2 35.9 34.4 30.2
Average
of the
Months
in the
Period .... 49.3 50.1 50.0 48.2 49.0 45.6 50.3 46.6 41.3 38.4
<CAPTION>
Year Ended December 31,
----------------------------------------------------------------------------
1990 1989 1988 1987 1986 1985 1984 1983 1982 1981
---- ---- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Highest
Month ...... 42.1% 41.5% 48.7% 40.3% 56.7% 45.9% 43.7% 45.9% 35.5% 34.3%
Lowest
Month ...... 25.3 29.5 29.5 26.8 27.7 35.8 35.7 37.7 29.0 27.4
Average of
the Months
in the
Period ... 35.7 35.6 41.2 34.2 37.7 40.1 39.9 42.2 32.9 32.2
</TABLE>
