UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 (FEE NOT REQUIRED)
For the period October 1, 1997 (date of formation) through March 31, 1998
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 (NO FEE REQUIRED)
For the transition period from __________________ to _________________________
Commission file number 333-1664
NISSAN AUTO RECEIVABLES 1997-A GRANTOR TRUST
(Exact name of registrant as specified in its charter)
NEW YORK
(governing law of pooling
and servicing agreement) NOT APPLICABLE
- ----------------------------------- -----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
c/o NISSAN MOTOR ACCEPTANCE CORPORATION, SERVICER
990 West 190th Street, Torrance, California 90502
--------------------------------------------------
(Address of principal executive offices)
(310) 719-8013
----------------------------------------------------
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
X Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K (ss.229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.
State the aggregate market value of the voting stock held by non-affiliates of
the registrant. The aggregate market value shall be computed by reference to the
price at which the stock was sold, or the average bid and asked prices of such
stock, as of a specified date within 60 days prior to the date of filing. (See
definition of affiliate in Rule 405, 17 CFR 230.405.).........................$0
1
<PAGE>
This Annual Report on Form 10-K is being filed by Nissan Motor
Acceptance Corporation ("NMAC"), as Servicer, on behalf of Nissan Auto
Receivables 1997-A Grantor Trust (the "Trust"), established pursuant to a
Pooling and Servicing Agreement, dated as of October 1, 1997, among Nissan Auto
Receivables Corporation, as Seller (the "Seller"), NMAC, as servicer and in its
individual capacity, and The Fuji Bank and Trust Company, as trustee (the
"Trustee"), pursuant to which the 6.15% Asset Backed Certificates, Class A (the
"Class A Certificates") registered under the Securities Act of 1933 were issued
by the Trust. Certain information that may otherwise have been required to be
included herein pursuant to Form 10-K has been omitted herefrom, or in certain
cases certain information has been included herein in lieu of such otherwise
required information, in accordance with the letter, dated June 28, 1996 (the
"No-Action Letter"), of the staff of the Office of Chief Counsel of the Division
of Corporation Finance of the Securities and Exchange Commission issued with
respect to series of pass-through securities issued by trusts formed by the
Seller or an affiliate thereof, as originator, including the Certificates.
PART I
Item 2. PROPERTIES.
The following table sets forth the aggregate information of the Trust
for the period from October 1, 1997 through March 31, 1998:
Distributions Allocable to Principal....................$189,224,000.00
Distributions Allocable to Income........................$24,263,000.00
Amounts Received from the Yield Supplement
Account Distributed as Income..........................$524,000.00
Servicing Fees Paid to Servicer (NMAC)....................$3,945,000.00
Class A Percentage of Servicing Fees................................87%
Class B Percentage of Servicing Fees................................13%
Additional Servicing Compensation
Paid to Servicer (NMAC).......................................0.00
Net Losses................................................$7,437,000.00
Net Liquidation Proceeds Received.........................$4,789,000.00
Average Rate and Percentages for the period from October 1, 1997 through March
31, 1998
Average Net Loss Ratio (including repossessions)..................1.93%
<TABLE>
<CAPTION>
Number of Dollar
Delinquency Amount
Ratio Contracts
----------- ---------
<S> <C> <C>
31-60 Days Delinquent .......................... 2.54% 2.71%
61-90 Days Delinquent .......................... 0.31% 0.35%
91 Days or More Delinquent ..................... 0.06% 0.07%
</TABLE>
2
<PAGE>
Item 3. LEGAL PROCEEDINGS.
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
All Class A Certificates issued by the Trust are registered in the
name of Cede & Co. Within the meaning of the No-Action Letter, the
number of "holders of record" of the Class A Certificates as of March
31, 1998, was 50.
There is no established public trading market for the Class A
Certificates.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The audited financial statements of the Trust and the related notes
are included herein on pages F-1 to F-11.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
3
<PAGE>
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
(a) List of documents filed as part of the Annual Report:
1. Index to Financial Statements: Page
Cover Page ..................................................F-1
Independent Auditors' Report ................................F-2
Balance Sheet as of March 31, 1998 ..........................F-3
Statement of Income for the period October 1, 1997
(date of formation) through March 31, 1998.................F-4
Statement of Changes in Net Assets Held in Trust
Principal for the period October 1, 1997
(date of formation) through March 31, 1998.................F-5
Statement of Cash Flows for the period October 1, 1997
(date of formation) through March 31, 1998.................F-6
Notes to Financial Statements................................F-7
2. Financial Statement Schedules:
Not applicable.
3. Exhibits:
Officer's Certificate dated as of March 31, 1998
The Registrant has also included herein the annualized financial
information set forth in Item 2.
(b) Reports on Form 8-K:
The Trust filed Current Reports on Form 8-K regarding
monthly distributions of principal and interest to
certificateholders on November 17, 1997 for the month ended
October 31, 1997, on December 15, 1997 for the month ended
November 30, 1997, on January 15, 1998 for the month ended
December 31, 1997, on February 16, 1998 for the month ended
January 31, 1998, on March 16, 1998 for the month ended
February 28, 1998 and on April 15, 1998 for the month ended
March 31, 1998. Included in each such Form 8-K report as
Exhibit 99.1 is the monthly servicing report for each
respective month end as provided by the Servicer to the
Trustee.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 of 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Date: June 29, 1998
Nissan Auto Receivables 1997-A
Grantor Trust (Registrant)
By: Nissan Motor Acceptance
Corporation, as Servicer
By: /s/ Yasuro Osawa
----------------
Name: Yasuro Osawa
Title: Vice President, Finance
5
<PAGE>
EXHIBIT INDEX
Sequentially
Numbered
Exhibit No. Description Page
----------- ----------- ------------
99.1 Officer's Certificate dated 7
as of March 31, 1998
6
<PAGE>
NISSAN MOTOR ACCEPTANCE CORPORATION
OFFICER'S CERTIFICATE
The undersigned, Yasuro Osawa, Vice President, Finance of NISSAN MOTOR
ACCEPTANCE CORPORATION, a California corporation (the "Company"), does hereby
certify, in his capacity as such corporate officer, as follows:
(1) The undersigned has caused a review of the activities of the Company,
in its capacity as Servicer, during the period October 29, 1997
through March 31, 1998, and of its performance to that certain Pooling
and Servicing Agreement dated as of October 1, 1997 (the "Agreement")
by and among the Company, Nissan Auto Receivables Corporation, as
Seller, and The Fuji Bank and Trust Company, as Trustee, to be
conducted under his supervision; and
(2) To the best of the undersigned's knowledge, based upon such review,
the Company has fulfilled all of its obligations under the Agreement
for the period October 29, 1997 through March 31, 1998.
This Officer's Certificate is being furnished to The Fuji Bank and Trust
Company, as Trustee, Standard & Poor's Ratings Services and Moody's Investors
Service, Inc., as required by Section 4.10(a) of the Agreement.
IN WITNESS WHEREOF, I have set my hand effective as of the 31st day of
March, 1998.
By: /s/ Yasuro Osawa
-----------------------
Name: Yasuro Osawa
Title: Vice President, Finance
7
<PAGE>
NISSAN AUTO RECEIVABLES
1997-A GRANTOR TRUST
Financial Statements as of
March 31, 1998 and
for the Period October 1, 1997
(date of formation) through March 31, 1998
F-1
<PAGE>
INDEPENDENT AUDITORS REPORT
Nissan Auto Receivables 1997-A Grantor Trust:
We have audited the accompanying balance sheet of Nissan Auto Receivables
1997-A Grantor Trust (the "Trust") as of March 31, 1998 and the related
statements of income, changes in net assets held in trust and cash flows for the
period October 1, 1997 (date of formation) through March 31, 1998. These
financial statements are the responsibility of the Trusts management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of the Trust as of March 31, 1998 and the
related statements of income, changes in net assets held in trust and cash flows
for the period October 1, 1997 (date of formation) through March 31, 1998 in
conformity with generally accepted accounting principles.
May 15, 1998
F-2
<PAGE>
NISSAN AUTO RECEIVABLES 1997-A GRANTOR TRUST
BALANCE SHEET
(Dollars in Thousands)
March 31, 1998
ASSETS:
Cash and cash equivalents in collection account (Notes 2 and 4) .... $ 39,783
Finance receivables (Notes 3, 4, 6 and 8) .......................... 671,804
Collections receivable from Servicer (Note 2) ...................... 1,548
Receivable from yield supplement account (Note 5) .................. 80
TOTAL .............................................................. $713,215
LIABILITIES:
Servicing fee payable (Notes 1 and 2) .............................. $ 591
Distributions payable - Class A (Note 4) ........................... 35,424
Distributions payable - Class B (Note 4) ........................... 5,396
Total liabilities ........................................... 41,411
NET ASSETS HELD IN TRUST:
Asset backed certificates, Class A (Notes 1, 3, 4 and 6) .......... 584,469
Asset backed certificates, Class B (Notes 1, 3, 4 and 6) ......... 87,335
Total net assets held in trust ................................. 671,804
TOTAL ............................................................. $713,215
See accompanying notes to financial statements
F-3
<PAGE>
NISSAN AUTO RECEIVABLES 1997-A GRANTOR TRUST
STATEMENT OF INCOME
(Dollars in Thousands)
Period
October 1, 1997
(Date of Formation)
through
March 31, 1998
--------------
INCOME:
Interest income on finance receivables (Note 4) .................... $40,122
Interest income from yield supplement account (Note 5) ............. 524
Total income ................................................. 40,646
EXPENSE:
Servicing fee (Notes 3 and 4) ...................................... 3,945
Excess amounts allocated to principal losses (Notes 3 and 4) ....... 7,198
Excess amounts paid to SSA (Notes 3, 4 and 6) ...................... 2,349
Excess amounts paid to Seller (Notes 3 and 4) ...................... 2,891
Total expense ................................................ 16,383
NET INCOME ......................................................... $24,263
See accompanying notes to financial statements
F-4
<PAGE>
NISSAN AUTO RECEIVABLES 1997-A GRANTOR TRUST
STATEMENT OF CHANGES IN NET ASSETS HELD IN TRUST
Period October 1, 1997
(Date of Formation) through March 31, 1998
(Dollars in Thousands)
<TABLE>
<CAPTION>
Class A Class B Total
<S> <C> <C> <C> <C>
Issuance of asset backed securities (Note 1).. $ 755,565 $ 112,900 $ 868,465
Net income ................................... 21,109 3,154 24,263
Interest distributions (Notes 3 and 4) ....... (21,109) (3,154) (24,263)
Principal distributions (Notes 3 and 4) ...... (171,096) (18,128) (189,224)
Principal reduction due to losses ............
(Notes 3 and 4) ........................... -- (7,198) (7,198)
Principal reduction due to shortfall (Note 4) -- (239) (239)
Ending Balance ............................... $ 584,469 $ 87,335 $ 671,804
</TABLE>
See accompanying notes to financial statements
F-5
<PAGE>
NISSAN AUTO RECEIVABLES 1997-A GRANTOR TRUST
STATEMENT OF CASH FLOWS
(Dollars in Thousands)
<TABLE>
<CAPTION>
Period
October 1, 1997
(Date of Formation)
through
March 31, 1998
<S> <C>
Cash flows from operating activities:
Net income ...................................................................... $ 24,263
Adjustments to reconcile net income to net cash provided by operating activities:
Excess amounts allocated to principal losses ............................... 7,198
Changes in operating assets and liabilities:
Increase in collections receivable from Servicer ......................... (1,548)
Increase in receivable from yield supplement account ..................... (80)
Increase in servicing fee payable ........................................ 591
Net cash provided by operating activities ..................................... 30,424
Net cash provided by investing activities -
principal payments from finance receivables ............................... 189,224
Cash flows from financing activities:
Trust principal distributions
Class A certificateholders ................................................... (138,833)
Class B certificateholder ................................................... (20,402)
Trust interest distributions
Class A certificateholders ................................................... (17,948)
Class B certificateholder ................................................... (2,682)
Net cash used in financing activities ........................................ (179,865)
Cash and cash equivalents at March 31, 1998 .................................. $ 39,783
Supplemental disclosure of cash flow information -
Non-cash investing activities:
Purchase of finance receivables in exchange for asset backed certificates .... $ 868,465
Principal reduction, resulting from losses, not paid due to cash shortfall ... $ 239
</TABLE>
See accompanying notes to financial statements
F-6
<PAGE>
NOTES TO FINANCIAL STATEMENTS
PERIOD OCTOBER 1, 1997 (DATE OF FORMATION) THROUGH MARCH 31, 1998
1. GENERAL INFORMATION
The Nissan Auto Receivables 1997-A Grantor Trust (the "Trust") was formed
by Nissan Auto Receivable Corporation (the "Seller") by selling and
assigning $868,465,000 of retail automotive vehicle finance receivables and
the related security interests in the vehicles financed thereby to The Fuji
Bank and Trust Company, as Trustee, in exchange for Class A certificates
representing an undivided ownership interest of 87% in the Trust and for
Class B certificates representing an undivided ownership interest of 13% in
the Trust. The Class A certificates were remarketed to the public and the
Class B certificates were retained by the Seller. The rights of the Class B
certificateholder to receive distributions are subordinated to the rights
of the Class A certificateholders. The Seller has the option to repurchase
the remaining receivables on or after the date on which the principal
balance declines below 10% of the aggregregate amount financed.
The parent of the Seller, Nissan Motor Acceptance Corporation (the
"Company" or the "Servicer") services the receivables pursuant to a Pooling
and Servicing Agreement dated as of October 1, 1997 (the "Agreement") and
is compensated for acting as the Servicer. In order to facilitate its
servicing functions and minimize administrative burdens and expenses, the
Company retains physical possession of the documents relating to the
receivables as custodian for the trustee. The Trust has no employees.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION - The financial statements have been prepared on an
accrual basis of accounting. The preparation of these financial statements
requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the
reporting period. Actual results could differ from those estimates.
CASH AND CASH EQUIVALENTS - The Company considers investments purchased
with a maturity of three months or less to be cash equivalents.
Cash and cash equivalents in the collection account as of March 31, 1998
amounted to $39,783,000, which represents payments, received by the
Servicer during March 1998.
COLLECTIONS RECEIVABLE - Collections receivable from the Servicer amounted
to $1,548,000 and is substantially comprised of collections received by the
Servicer on March 31, 1998 and deposited in the collection account on April
1, 1998.
F-7
<PAGE>
FINANCE RECEIVABLES - Interest income on these receivables is calculated
using the simple interest method and is recorded as earned. The finance
receivables have a weighted average coupon rate of 10.25% and a weighted
average maturity of 36 months at March 31, 1998.
SERVICING FEE - The servicing fee is calculated as 1% of the beginning
balance of finance receivables and is recorded on a monthly basis. The
amount of servicing fee for the period ended March 31, 1998 amounted to
$3,945,000, of which $591,000 is included in servicing fee payable at March
31, 1998.
3. PRIORITIES OF DISTRIBUTIONS
The total collections received by the trust are distributed in the
following priority:
Servicing fee
Class A interest at pass-through rate
Class A principal (including losses)
Class B interest at pass-through rate
Class B principal (including losses)
Excess amounts
If losses are greater than the excess amounts, the Class B
certificateholder will not receive its allocated principal. The principal
shortfall is carried over to future periods and is reduced by excess
collections, if any.
4. PRINCIPAL AND INTEREST PAYMENTS
Principal (including prepayments) is passed through on each distribution
date, as defined in the Agreement, commencing October 1, 1997. Principal
consists of payments on the receivables that are allocable to the repayment
of the amount financed. Interest is passed through to certificateholders on
each distribution date, as defined in the Agreement, commencing October 1,
1997, at a pass-through rate of 6.15% per annum, calculated using the
simple interest method. Excess amounts, if any, which is the difference
between the yield of the finance receivables, the servicing fee, the
pass-through rate and losses, are distributed to the Seller in accordance
with the terms of the Agreement.
F-8
<PAGE>
The cash flows for the period ended March 31, 1998 are summarized as
follows:
<TABLE>
<CAPTION>
Excess
Interest Principal amounts
Servicing at Pass- payments allocated Excess
fee through received to amounts
rate principal distributed
losses
--------- ------- -------- --------- -----------
<S> <C> <C> <C> <C> <C>
Class A certificateholders
Distributed .............. $ -- $ 17,948 $138,833 $ -- $ --
Distributions to be paid . 3,161 32,263
Class B certificateholder
Distributed .............. 2,682 15,022 5,380
Distributions to be paid . 472 3,106 1,818
Excess amounts paid to Seller 2,891
Excess amounts paid to SSA .. 2,349
Servicer
Distributed .............. 3,354
Distributions to be paid . 591
--------
Total amount distributed
and to be paid .............. $ 3,945 $ 24,263 $189,224 $ 7,198 $ 5,240
======== ======== ======== ======== ========
</TABLE>
A $239,000 shortfall of principal existed at March 31, 1998 because losses
in the month of February were greater than the excess amounts by $344,000.
Excess amounts of $105,000 during March were used to reduce this shortfall.
5. YIELD SUPPLEMENT ACCOUNT
The Agreement requires the Seller to set up a Yield Supplement Account
("YSA account") which is a separate trust account for the benefit of the
Class A certificateholders. The initial deposit required and made by the
Seller amounted to $1,898,667. This account is to compensate the Class A
certificateholders for all receivables purchased by the Trust with a yield
less than the pass-through rate of 6.15%. Amounts in the YSA account, which
are released to the Class A certificateholders on a monthly basis, are
calculated as one-twelfth times the difference between the yield of these
receivables and the pass-through rate. The amount in the YSA account at
March 31, 1998 was $1,395,000 which included $80,000 which is payable to
the Trust. The total amount of interest received from the YSA account
amounted to $524,000 for the period ended March 31, 1998.
F-9
<PAGE>
6. CREDIT ENHANCEMENT
To protect the Class A certificateholders, the Agreement requires the
Seller to set up a Subordination Spread Account ("SSA Account") which is a
separate trust account for the benefit of the Class A certificateholders.
The initial deposit required and made by the Seller amounted to $8,685,000.
Additionally, if certain loss and/or delinquency ratios rise above set
limits, the Seller is required to deposit in the SSA account all amounts
otherwise distributable to the Class B certificateholder and all excess
servicing amounts otherwise distributable to the Seller, until the SSA
account reaches the level specified in the Agreement. The specified amount
at March 31, 1998 was $67,180,000, which represents 10% of the finance
receivable balance. The SSA account amounted to $17,268,000 at March 31,
1998 and is comprised of:
Initial deposit required $ 8,685,000
Excess amounts ......... 2,349,000
Class B interest ....... 151,000
Class B principal ...... 6,083,000
$17,268,000
Neither Class B certificateholder nor the Seller will receive any
distributions while the loss and/or delinquency ratios continue to be above
the set limits for three consecutive months and until the SSA account
reaches the level specified. Accordingly, distributions and excess amounts
payable to the Class B certificateholder of $5,397,000 were deposited into
the SSA account on April 15, 1998 on behalf of the Class B
certificateholder. The balance of the SSA Account after these deposits was
$22,665,000. All distributions paid to the Class B certificateholder were
paid prior to loss ratios reaching the specified level.
As of March 31, 1998, the anticipated credit losses on Finance Receivables
based on historical loss experience are estimated to be $14,082,000.
Management believes that future receipts of excess servicing amounts will
be adequate to repay all amounts due to Class A and Class B
certificateholders, as such no allowance for bad debts has been
established.
7. FEDERAL INCOME TAXES
The Trust is classified as a grantor trust, and therefore is not taxable as
a corporation for federal income tax purposes. Each certificateholder is
treated as the owner of a pro rata undivided interest in each of the
receivables in the Trust.
F-10
<PAGE>
8. ESTIMATED FAIR VALUES OF FINANCE RECEIVABLES
The fair value of the finance receivables was estimated by discounting the
future cash flows using quoted interest rates. As of March 31, 1998, the
estimated fair value of the finance receivables was $672,463,000. All other
receivables, advances and payables approximate fair values due to the
short-term maturities of these instruments.
F-11
