<PAGE>
<PAGE>
1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: October 2, 1998
AT&T CAPITAL CORPORATION
A Delaware Commission File I.R.S. Employer
Corporation No. 1-11237 No. 22-3211453
44 Whippany Road, Morristown, New Jersey 07962-1983
Telephone Number (973) 397-3000
<PAGE>
<PAGE>
2
Form 8-K October 2, 1998
Item 5. OTHER EVENTS
In accordance with the terms of a "no-action" letter dated October 2,
1998 (the "SEC letter") received from the Division of Corporation Finance of the
Securities and Exchange Commission ("SEC"), AT&T Capital Corporation ("Capital")
was permitted to cease filing periodic reports pursuant to Sections 13 and 15(d)
of the Securities Exchange Act of 1934 from and after the execution and delivery
by Newcourt Credit Group Inc. ("Newcourt") of an unconditional guarantee of the
outstanding debt securities of Capital which were not previously guaranteed by
Newcourt. As contemplated by the SEC letter, Newcourt has, on October 28, 1998,
in a footnote to the financial statements included in the periodic reports that
it filed with the SEC, disclosed certain summarized financial information
concerning Capital. Newcourt has also executed and delivered the guarantee
effective as of October 28, 1998 (the "Guarantee") which Guarantee covers all
Debt as such term is defined in the Guarantee.
Pursuant to the terms of the existing Support Agreement dated February
9, 1998, by and between Newcourt and Capital (the "Support Agreement"), the
Support Agreement has been terminated and replaced by the Guarantee effective as
of November 15, 1998. The Support Agreement may be terminated by its terms upon
written confirmation from at least two (2) nationally recognized statistical
rating agencies that have rated series of Debt of Capital that the termination
of the Support Agreement will not result on their ratings of such series of Debt
being downgraded. Capital has received such written confirmation from Duff &
Phelps Credit Rating Co. and Standard & Poors.
Copies of the Guarantee and the SEC letter, together with the letter
submitted to the SEC on behalf of Capital and Newcourt, are attached as Exhibits
hereto.
<PAGE>
<PAGE>
3
Form 8-K October 2, 1998
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99(a). Newcourt Credit Group Inc. Guarantee of AT&T Capital
Corporation Debt.
99(b). Letter dated October 2, 1998 from the Securities and
Exchange Commission to Sidley & Austin relating to Newcourt
Credit Group Inc. and AT&T Capital Corporation.
99(c). Letter dated October 2, 1998 to the Securities and Exchange
Commission submitted by Sidley & Austin on behalf of
Newcourt Credit Group Inc. and AT&T Capital Corporation.
<PAGE>
<PAGE>
4
Form 8-K October 2, 1998
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AT&T CAPITAL CORPORATION
DANIEL A. JAUERNIG
By: Daniel A. Jauernig
Group President and
Chief Financial Officer
November 17, 1998
<PAGE>
<PAGE>
5
Form 8-K October 2, 1998
EXHIBIT INDEX
Exhibit No.
99(a). Newcourt Credit Group Inc. Guarantee of AT&T Capital
Corporation Debt.
99(b). Letter dated October 2, 1998 from the Securities and
Exchange Commission to Sidley & Austin relating to Newcourt
Credit Group Inc. and AT&T Capital Corporation.
99(c). Letter dated October 2, 1998 to the Securities and Exchange
Commission submitted by Sidley & Austin on behalf of
Newcourt Credit Group Inc. and AT&T Capital Corporation.
<PAGE>
<PAGE>
1
Form 8-K October 2, 1998
Exhibit 99(a)
GUARANTEE
Guarantee dated as of October 28, 1998, made by Newcourt Credit Group
Inc. (together with its successors and assigns, the "Guarantor"), a corporation
incorporated under the laws of the Province of Ontario, to and in favor of and
for the benefit of all holders of Debt (as such term is herein defined)
(collectively, the "Holders").
WHEREAS the Guarantor is the indirect parent and owner of all the
issued and outstanding capital stock of AT&T Capital Corporation (the
"Company"); and
WHEREAS the Company may from time to time incur, assume or guarantee
additional Debt; and
WHEREAS, the Guarantor has agreed to guarantee the payment of all Debt
incurred by (or to be incurred by) the Company.
NOW THEREFORE, in consideration of the foregoing premises, and other
good and valuable consideration given by the Holders and the Company to the
Guarantor, the receipt and sufficiency of which are hereby acknowledged, the
Guarantor hereby agrees as follows (capitalized terms used but not defined
herein shall be as defined in the Indenture):
SECTION 1. DEFINITIONS. For purposes hereof,
(a) the term "Debt" shall mean (i) any indebtedness for borrowed money
incurred by the Company from any individual, corporation, partnership,
trust, association or other entity of any kind (each herein a "Person") and
(ii) indebtedness for borrowed money of any Person to another Person
assumed or guaranteed by the Company; provided that neither of the
following shall constitute Debt for purposes of this Guarantee: (x) any
indebtedness for borrowed money incurred, assumed or guaranteed from time
to time by the Company which indebtedness (or, in the case of a guaranty
thereof, such guaranty), by the terms of the instruments evidencing such
indebtedness (or guaranty) or any indenture or similar instrument relating
thereto, is not entitled to the benefit of this Guarantee; and (y) any
indebtedness for borrowed money (howsoever arising, including without
limitation by way of securitization or syndication transactions) incurred,
assumed or guaranteed from time to time by the Company which indebtedness
(or, in the case of a guaranty thereof, such guaranty) is secured by a
pledge, mortgage, security interest or lien on, or payable solely from the
income and proceeds of, any property (including, without limiting the
generality of such term, any shares of stock, other equity interests, debt,
intangible assets or tangible
<PAGE>
<PAGE>
2
Form 8-K October 2, 1998
Exhibit 99(a)
assets) of the Company or any direct or indirect subsidiary thereof and
which indebtedness (or guaranty) is not a general obligation of the
Company.
(b) the term "Debt Agreement" shall mean any and all agreements evidencing or
made in connection with the incurrence of any Debt.
SECTION 2. GUARANTEE. The Guarantor hereby, irrevocably and
unconditionally guarantees (as a guarantor and not as a surety) to the Holders
of the Debt the due and punctual payment of the principal of, premium, if any
and interest on such Debt when and as the same shall become due and payable,
whether at maturity, upon redemption or otherwise, according to the terms of the
applicable Debt Agreements (the obligations set forth in this Section 2 being
herein called the "Guaranteed Obligations").
SECTION 3. ABSOLUTE LIABILITY. The guarantor hereby guarantees that the
Guaranteed Obligations will be paid to the Holders strictly in accordance with
the terms and conditions hereof, and that the liability of the Guarantor under
this Guarantee shall be absolute and unconditional irrespective of:
(a) the validity or enforceability of the Debt;
(b) any contest by the Company or any other person as to the amount of the
Guaranteed Obligations or the validity or enforceability of the Debt;
(c) any defense, counter-claim or right of set-off available to the Company;
(d) any extension of the time or times for payment of the Guaranteed
Obligations or any other indulgences which the Holders may grant to the
Company or any amendment to or alteration of the Debt; and
(e) any other circumstances which might otherwise constitute a defense
available to, or a discharge of, the Guarantor, the Company or any other
person in respect of the Guaranteed Obligations or the Guarantor in respect
of the Guarantee.
SECTION 4. REMEDIES. The guarantee set forth in Section 2 constitutes a
present and continuing guarantee of payment and performance and not of
collection. The Guarantor agrees that its obligations hereunder shall be joint
and several with any and all other guarantees given in connection with the
Guaranteed Obligations from time to time. The Guarantor agrees that the Holders
shall not be bound to exhaust their recourse against the Company or any other
person or to make demand upon the Company or
<PAGE>
<PAGE>
3
Form 8-K October 2, 1998
Exhibit 99(a)
to realize on any security they may hold in respect of the Guaranteed
Obligations before being entitled to payment or performance hereunder. The
Guarantor hereby waives the right to require the Holders to join the Company in
any action brought hereunder or to commence any action against or obtain any
judgment against the Company or to pursue any other remedy or enforce any other
right. The Guarantor further agrees that nothing contained herein or otherwise
shall prevent the Holders from pursuing concurrently or successively all rights
and remedies available to them at law and/or in equity or under any Debt
Agreement, and the exercise of any of their rights or the completion of any of
their remedies shall not constitute a discharge of any of Guarantor's
obligations hereunder.
SECTION 5. PAYMENT ON DEMAND. The Guarantor shall make payment of the
amount of the Guaranteed Obligations and all other amounts payable by it to the
Holders hereunder forthwith after demand therefor is made in writing to it and
such demand shall be deemed to have been effectively made when either an
envelope containing such demand, addressed to it c/o Newcourt Credit Group Inc.,
2 Gatehall Drive, Parsippany, New Jersey, 07054 for the attention of Treasurer,
is personally delivered to such address or a facsimile transmission containing
such demand is sent to Guarantor, for the attention of the Treasurer, at the
following fax number: (973) 355-7021.
SECTION 6. SUBROGATION. Upon receipt by the Holders of any payment or
payments on account of liability under this Guarantee, the Guarantor shall not
be entitled to claim repayment against the Company until the claims of the
Holders against the Company in respect of the Guaranteed Obligations have been
repaid in full; and in the case of the liquidation, winding-up or bankruptcy of
the Company (whether voluntary or compulsory) or in the event that the Company
shall make a bulk sale of any of the Company's assets within the provisions of
any bulk sales legislation or makes an assignment for the benefit of creditors
or the assets of the Company are distributed to creditors for any other reason,
the Holders shall have the right to rank in priority to the Guarantor for their
full claims in respect of the Guaranteed Obligations and receive all
distributions and other payments in respect thereof until their claims in
respect of the Guaranteed Obligations have been paid in full, and the Guarantor
shall continue to be liable, less any payments made by or on behalf of the
Guarantor, for any balance which may be owing to the Holders by the Company. If
any amount shall be paid to the Guarantor on the account of any subrogation
rights at any time when all the Guaranteed Obligations shall not have been paid
in full, such amount shall be held in trust for the benefit of the Holders and
shall forthwith be paid to the Holders.
<PAGE>
<PAGE>
4
Form 8-K October 2, 1998
Exhibit 99(a)
SECTION 7. SUBORDINATION. All obligations, liabilities and indebtedness
of the Company to the Guarantor of any nature whatsoever (the "Corporate
Indebtedness") shall be subordinated to the payment in full of all obligations
owing by the Company to the Holders, and any payments received by the Guarantor
on account of such Corporate Indebtedness at a time when any Default or Event of
Default exists (as each such term is defined in the governing Debt Agreement)
shall be collected and received by the Guarantor in trust and paid over to the
Holders without impairing or releasing any obligations of the Guarantor
hereunder. The Guarantor shall not assign the Corporate Indebtedness nor any
part thereof to any person other than to a subsidiary of the Company which has
provided a guarantee to the Holders in respect of the Guaranteed Obligations in
the form and substance of this Guarantee, without the prior written consent of
the Holders.
SECTION 8. SUSPENSION OF GUARANTOR RIGHTS. The Guarantor agrees that so
long as any obligations remain outstanding hereunder, whether present or future,
direct or indirect, absolute or contingent, matured or not, the Guarantor shall
not exercise any rights which the Guarantor may at any time have by reason of
the performance of any of its obligations hereunder:
(a) to be indemnified by the Company;
(b) to claim contribution from any other guarantor of the debts, liabilities or
obligations of the Company; or
(c) to take the benefit (in whole or in part and whether by way of subrogation
or otherwise) of any rights of the Holders under the governing Debt
Agreements.
SECTION 9. WAIVERS. The Guarantor hereby waives, to the extent
permitted by applicable law, (i) notice of acceptance of this Guarantee by the
Holders and any and all notices and demands of every kind which may be required
to be given by any statute, rule or law, (ii) any defense, right of set-off or
other claim which the Guarantor may have against the Company or which the
Guarantor or the Company may have against the Holders, (iii) presentment for
payment, demand for payment, notice of nonpayment or dishonor, protest and
notice of protest, diligence in collection and any and all formalities which
otherwise might be legally required to charge the Guarantor with liability,
except for demands or notices expressly provided for herein, (vi) any failure by
the Holders to inform the Guarantor of any facts the Holders may now or
hereafter know about the Company, the Debt or the transactions contemplated by
the governing Debt Agreement, it being understood and agreed that the Holders
have no duty to so inform the Guarantor, that the Guarantor is fully responsible
for being and remaining informed by the Company of all circumstances bearing on
the existence or creation, or the risk of nonpayment
<PAGE>
<PAGE>
5
Form 8-K October 2, 1998
Exhibit 99(a)
or nonperformance of the Guaranteed Obligations and (v) any and all right to
cause a marshaling of assets of the Company or any other action by any court or
governmental body with respect thereto.
SECTION 10. AMENDMENT. This Guarantee may be amended or terminated by
the Guarantor at any time in writing; provided that, so long as any series of
Debt (or, if not issued as a series, any other Debt) incurred, assumed or
guaranteed by the Company prior to such amendment or termination remains
outstanding, no such amendment which adversely affects the holders of such
series of Debt (or, if not issued as a series, such other Debt) or any such
termination shall become effective with respect to such series of Debt (or such
other Debt) unless (i) at least two nationally recognized statistical rating
agencies that have rated such series of Debt (or such other Debt) prior to such
amendment or termination confirm in writing that their ratings for such series
of Debt (or such other Debt) in effect immediately prior to such amendment or
termination will not be downgraded as a result of such amendment or termination
(or, in the case of any such series of Debt (or such other Debt) that is not so
rated, such series of Debt (or such other Debt) shall be treated in the same
manner as any series of similar Debt (or other similar Debt) that is so rated);
or (ii) such series of Debt (or such other Debt) shall have been defeased in
accordance with the provisions of the instrument evidencing such series of Debt
(or such other Debt) or any indenture or similar instrument relating thereto; or
(iii) the holders of at least a majority of the outstanding principal amount of
such series of Debt consent (or, consents) in writing to such amendment or
termination.
SECTION 11. RIGHTS OF HOLDERS OF DEBT. All holders of Debt incurred,
assumed or guaranteed by the Company during the term of this Guarantee or
incurred, assumed and guaranteed by the Company prior to the date hereof shall
be intended third-party beneficiaries of this Guarantee.
SECTION 12. CONTINUING GUARANTEE. The guarantee herein shall be a
continuing guarantee and shall extend to all present and future Guaranteed
Obligations and shall be binding as a continuing obligation of the Guarantor
until the earlier of (i) the date the Guarantor is released from any further
obligation hereunder in accordance with the terms of the relevant governing Debt
Agreement; and (ii) the date on which the Company or the Guarantor shall have
performed and satisfied in full the Guaranteed Obligation. This Guarantee shall
continue to be effective or be reinstated, as the case may be, if at any time
any payment of any of the Guaranteed Obligations is rescinded or must otherwise
be refunded by the Holders upon the insolvency,
<PAGE>
<PAGE>
6
Form 8-K October 2, 1998
Exhibit 99(a)
bankruptcy or reorganization of the Company or otherwise, regardless of whether
the Holders contest the order requiring the return of such payment, all as
though such payment had not been made.
SECTION 12. INTEREST ACT (CANADA). The Guarantor acknowledges that, for
the purposes of the Interest Act (Canada), (i) whenever any interest or fee
applicable to the Guaranteed Obligations is calculated using a rate based on a
year of 360 days or 365 days, such rate determined pursuant to such calculation,
when expressed as an annual rate, is equivalent to (x) the applicable rate based
on a year of 360 days or 365 days, as the case may be; (ii) the principle of
deemed reinvestment of interest does not apply to any interest calculation in
respect of the Guaranteed Obligations; and (iii) the rates of interest
stipulated in respect of the Guaranteed Obligations are intended to be nominal
rates and not effective rates or yields.
SECTION 13. SUCCESSORS OF THE COMPANY. Any change or changes in the
name of the Company or reorganization (whether by way of reconstruction,
consolidation, amalgamation, merger, transfer, sale, lease or otherwise) of the
Company or its business shall not affect or in any way limit or lessen the
liability of the Guarantor hereunder and this Guarantee shall extend to any
person, firm or Company acquiring or from time to time caring on the business of
the Company.
SECTION 14. NO RECOURSE. Any right of subrogation acquired by the
Guarantor by reason of payment under or pursuant to this Guarantee shall not be
exercised until the Guaranteed Obligations and other amounts due to the Holders
hereunder have been paid or repaid in full and shall be no greater than the
right held by the Holders, and the Guarantor shall have no recourse against the
Holders for any irregularity or defect in the manner or procedure by which the
Holders make demand or pursue any rights or remedies they may have.
SECTION 15. REPRESENTATIONS AND WARRANTIES. The Guarantor represents
and warrants that:
(a) Organization and Qualification. It is a corporation duly incorporated and
validly existing under the laws of the Province of Ontario.
(b) Corporate Power. It has full corporate right, power and authority to own
its property and assets and to carry on its business as now conducted as
contemplated to be conducted and to enter into and perform this Guarantee.
<PAGE>
<PAGE>
7
Form 8-K October 2, 1998
Exhibit 99(a)
(c) Conflict with Other Instruments. Neither the execution and delivery of this
Guarantee nor the consummation of the transactions herein contemplated nor
compliance with the terms conditions and provisions hereof (i) conflicts
with or results in a breach of any of the terms, conditions or provisions
of (A) its charter documents or by-laws; (B) any law, rule or regulation
having the force of law; (C) any material contractual restriction binding
on or affecting it or its properties; or (d) any writ, judgment,
injunction, determination or award which is binding on it; or (ii) results
in, or requires the creation or imposition of any lien upon or security
interest in or with respect to the properties now owned or hereafter
acquired by it under any contractual provision binding on or affecting it.
(d) Authorization, Governmental Approvals etc. The execution and delivery of
this Guarantee and the consummation by it of the transactions herein
contemplated have been duly authorized by all necessary corporate action
and no authorization, consent, approval, license or exemption under any
applicable law, rule or regulation having the force of law, and no
registration, qualification, designation, declaration, recording, or filing
with any official body, is or was necessary therefor or to perfect the same
or to preserve the benefit thereof to the Holders, except such as are in
full force and effect, unamended, at the date hereof.
(e) Execution and Binding Obligation. This Guarantee has been duly executed and
delivered by it, and constitutes the legal, valid and binding obligation of
it enforceable against it in accordance with its terms, subject to the
effect of any applicable bankruptcy, fraudulent conveyance, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
general and the effect of general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).
(f) Actions. There is no pending or threatened action or proceeding affecting
it before any court, governmental agency or arbitrator, which may
materially adversely affect its financial condition or operations.
(g) Shares. The Guarantor is the registered and beneficial holder of 100% of
the issued and outstanding shares of the capital stock of the Company.
<PAGE>
<PAGE>
8
Form 8-K October 2, 1998
Exhibit 99(a)
SECTION 16. PAYMENT OF TAXES AND OTHER TAXES.
(a) The Guarantor hereby agrees to obtain any necessary exchange control
approvals, consents or authorizations which may at any time and from time
to time be required by the laws of the Province of Ontario or any state in
the United States in connection with the making of payments hereunder. Any
and all payments by the Guarantor hereunder shall be made and shall be free
and clear of and without set-off or counter claim and without deduction for
or on account of, or withholding for any and all present or future income
or other taxes, levies, imposts, dues, charges, fees, deductions,
withholdings or restrictions or conditions of any nature whatever now or
hereafter imposed, levied, collected or withheld or assessed by any country
(or by any political subdivision or taxing authority thereof or therein),
and all liabilities with respect thereto (all such taxes, levies, imposts,
duties, charges, fees, deductions, withholdings and liabilities being
hereinafter referred to as "Taxes") unless such Taxes are required by law
or the administration thereof to be deducted or withheld. If the Guarantor
shall be required by law to deduct or withhold any Taxes from or in respect
of any amount payable hereunder, subject as provided in the next following
sentence, (i) the sum payable shall be increased as may be necessary so
that after making all required deductions or withholding applicable to
additional amounts paid under this Section), the Holders receive an amount
equal to the sum they would have received if no deduction or withholding
had been made, (ii) the Guarantor shall make such deductions or
withholdings, and (iii) the Guarantor shall pay the full amount deducted or
withheld to the relevant taxation or other authority in accordance with
applicable law.
(b) The Guarantor shall pay any present or future stamp or documentary taxes or
any other excise or property taxes, charges or similar levies (all such
taxes, charges and levies being hereinafter referred to as "Other Taxes")
which arise from any payment made hereunder or from the execution, delivery
or registration of, or otherwise with respect to, this Guarantee.
(c) The Guarantor shall indemnify the Holders for the full amount of Taxes or
Other Taxes (including, without limitation, any Taxes or Other Taxes
imposed by any jurisdiction on amounts payable under this Section) paid by
the Holders and any liability (including penalties, interest and expenses)
arising therefrom or with respect thereto, whether or not such Taxes or
Other Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days from the date the Holders make
written demand therefor. A
<PAGE>
<PAGE>
9
Form 8-K October 2, 1998
Exhibit 99(a)
certificate as to the amount of such Taxes or Other Taxes submitted to the
Guarantor by the Holders and evidence of payment thereof shall, in the
absence of manifest error, be prima facie evidence of the amount due by the
Guarantor to the Holders
SECTION 17. GOVERNING LAW.
(a) This Guarantee shall be governed by and construed in accordance with the
laws of the State of New York applicable therein and shall be treated in
all respects as a New York contract.
(b) The Guarantor hereby (i) irrevocably submits to the jurisdiction of any
court sitting in the State of New York over any suit, action or proceeding
arising out of or relating to this Guarantee; (ii) irrevocably agrees that
all claims in respect of any such action or proceeding may be heard and
determined in such court; (iii) irrevocably waives, to the fullest extent
permitted by law, any objection which it may have or hereafter have to the
laying of the venue of any such suit, action or preceding brought in such a
court and nay claim that any such suit, action or preceding brought in such
a court and any claim that any such suit, action or proceeding brought in
such a court has been brought in an inconvenient forum; and (iv)
irrevocably appoints Newcourt Credit Group USA, Inc. (the "Process Agent"),
with an office at the date hereof at 2 Gatehall Drive, Parsippany, NJ 07054
(Fax No. (973) 355-7059), it authorized agent to accept and acknowledge
service of any and all process which may be served in any suit, action or
proceeding. Such service may be made by delivering a copy of such process
to the Guarantor in care of the Process Agent at the Process Agent's above
address and the Guarantor hereby irrevocably authorizes and directs the
Process Agent to accept such service on its behalf. As an alternative
method of service, the Guarantor also irrevocably consents to the service
of copies of such process to the Guarantor to: BCE Place, 181 Bay Street,
P.O. Box 827, Toronto, Canada M5J2T3 for the attention of President. The
Guarantor agrees that a final judgment in any such action or proceeding may
be enforced in any other manner provided by law. Nothing in this Section
shall affect the right of the Holders to serve process in any manner
permitted by law or limit the rights of the Trustee or the Holders to
service process in any manner permitted by law or limit the rights of the
Holders to bring proceedings against the Guarantor in the courts of any
other jurisdiction.
<PAGE>
<PAGE>
10
Form 8-K October 2, 1998
Exhibit 99(a)
(c) Subject to Section 17(e), the Guarantor hereby consents in respect of any
legal action or proceedings arising out of or in connection with this
Guarantee for the payment and performance hereof to the giving of any
relief or the issue of any process in connection with such action or
proceedings, including, without limitation the making, enforcement or
execution against any property whatsoever (irrespective of its use or
intended use) of any order or judgment which may be made or given in such
action or proceedings.
(d) To the extent that the Guarantor has or hereafter may acquire any immunity
from the jurisdiction of any court or from any legal process (whether
service of notice, attachment prior to judgment, attachment in the aid of
execution, execution or otherwise) with respect to itself or its property,
the Guarantor hereby irrevocably waives, to the fullest extent permitted by
law, such immunity in respect of its obligations under this guarantee and
any security for the payment and performance hereof.
(e) Nothing in this Section shall constitute a waiver by the Guarantor of any
right to (i) appeal any order or judgment referred to herein; (ii) seek any
stay or reconsideration or review of any such order or judgment, or (iii)
seek any stay of execution or levy pending any appeal from, or suit, action
or proceeding for reconsideration or review of, any such order or judgment.
(f) The Guarantor agrees that the Holders shall have the right to proceed
against the Guarantor or its property in a court in any location to enable
such person to (i) obtain personal jurisdiction over the Guarantor, or (ii)
to enforce a judgment or other court order entered in favor of such person.
The Guarantor agrees that it will not assert any permissive counterclaim in
any proceeding brought by such person to enforce a judgment or other court
order in favor of such person. The Guarantor waives any objection that it
may have to the location of the court in which such person has commenced a
proceeding described in this subsection.
SECTION 18. EFFECT OF SUPPORT AGREEMENT. By executing this Guarantee,
the Support Agreement dated as of February 9, 1998 between the Guarantor and the
Company is hereby [terminated] [modified to exclude the Guaranteed Obligations].
SECTION 19. HEADINGS, ETC. The division of this Guarantee into sections
and the insertion of headings are for convenience of reference only and shall
not affect the interpretation hereof.
<PAGE>
<PAGE>
11
Form 8-K October 2, 1998
Exhibit 99(a)
SECTION 20. SEVERABILITY. Any provision of this Guarantee which is
invalid or not enforceable shall not affect any other provision and shall be
deemed to be severable.
SECTION 21. SUCCESSORS AND ASSIGNS. This Guarantee shall extend to and
inure to the benefit of the Holders and their respective successors and assigns
and shall be binding upon the Guarantor and its successors and assigns. The
Guarantee is assignable by the Holders to the extent and in the same proportion
that any underlying interest in the Debt and the relevant applicable Debt
Agreements has been assigned and is assignable by the Holder.
IN WITNESS WHEREOF, the Guarantor has duly executed this Guarantee as
of the day and year first above written.
NEWCOURT CREDIT GROUP INC.
By: ____________________________
Name:
Title:
By: _____________________________
Name:
Title:
<PAGE>
<PAGE>
1
Form 8-K October 2, 1998
Exhibit 99(b)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
October 2, 1998
Mr. Dennis V. Osimitz
Sidley & Austin
One First National Plaza
Chicago, Illinois 60603
Re: Newcourt Credit Group, Inc.
Dear Mr. Osimitz:
In regard to your letter of October 2, 1998, our response thereto is
attached to the enclosed photocopy of your correspondence. By doing this, we
avoid having to recite or summarize the facts set forth in your letter.
Sincerely,
Catherine T. Dixon
Chief Counsel
<PAGE>
<PAGE>
2
Form 8-K October 2, 1998
Exhibit 99(b)
[SIDLEY & AUSTIN LETTERHEAD]
1933 Act/Section 5
1934 Act/Sections 13 and 15(d)
October 2, 1998
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Attention: Office of the Chief Counsel
Division of Corporation Finance
Re: Newcourt Credit Group Inc./AT&T Capital Corporation
Ladies/Gentlemen:
This letter is submitted on behalf of Newcourt Credit Group Inc., an
Ontario corporation ("Newcourt"), and AT&T Capital Corporation, a Delaware
corporation ("Capital").
I. BACKGROUND.
A. Newcourt Acquisition of Capital; Newcourt Securities. On January 12,
1998, all the outstanding common stock of Capital was acquired by Newcourt.
Shortly thereafter, Newcourt transferred all the outstanding common stock of
Capital to a wholly-owned subsidiary of Newcourt.
<PAGE>
<PAGE>
3
Form 8-K October 2, 1998
Exhibit 99(b)
In November 1997, Newcourt registered rights to acquire Newcourt common
shares under the Securities Act of 1933, as amended (the "Securities Act"), on
Form F-10 (No. 333-07974) as a "foreign private issuer" pursuant to the
multi-jurisdictional disclosure system with Canada ("MJDS"). In addition, in
April 1997, Newcourt registered its common shares on Form 40-F pursuant to
Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and became a reporting company under the Exchange Act. Newcourt has
advised us that it has thereafter filed, and will continue to file, reports on
Form 40-F and Form 6-K pursuant to the MJDS requirements. Accordingly, effective
May 1, 1998, Newcourt has been subject to the reporting requirements of Section
13 of the Exchange Act and filed all reports required to be filed thereunder for
a period of at least 12 months. Newcourt has advised us that it has issued debt
securities to the public in Canada, but has not issued any debt securities to
the public in the United States.
B. Existing Debt Securities. In recent years, Capital has issued debt
securities through public offerings in the United States (the "Existing Debt
Securities"). The Existing Debt Securities were registered by Capital under the
Securities Act using registration statements on Form S-3 (the most recent being
No. 333-18367) and the "shelf" procedures of Rule 415 under the Securities Act.
Capital files periodic reports pursuant to Sections 13 and 15(d) of the Exchange
Act.
C. Support Agreement. Following the acquisition of Capital by Newcourt, on
February 9, 1998, Newcourt and Capital entered into a support agreement (the
"Support Agreement") under which Newcourt has agreed to own (directly or
indirectly) a majority of the voting stock of Capital, maintain the net worth of
Capital at $1 or more and provide liquidity to Capital. Under the terms of the
Support Agreement, the holders of Capital's outstanding debt for borrowed money
are entitled to demand that Capital enforce its rights thereunder and to proceed
against Newcourt on behalf of Capital to enforce the rights of Capital
thereunder if Capital refuses to do so. However, the Support Agreement, by its
terms, provides that it is not a guaranty and that no holder of any such debt
shall have any right to proceed directly against Newcourt to obtain any amount
due with respect thereto. Thereafter, on February 20, 1998, Capital guaranteed
(the "Up-Stream Guaranty") certain outstanding indebtedness and bank liquidity
facilities of Newcourt (the "Newcourt Debt"). We have been advised by Newcourt
that the Up-Stream Guaranty was issued in order for Newcourt to continue in
compliance with Newcourt's indentures and loan agreements and to satisfy certain
rating agency requirements.
<PAGE>
<PAGE>
4
Form 8-K October 2, 1998
Exhibit 99(b)
D. Additional Registration Statements. On March 20, 1998, Capital filed a
registration statement on Form S-3 (No. 333-48415) under the Securities Act (the
"March 1998 Registration Statement") with respect to additional debt securities
of Capital (the "Additional Debt Securities"). The March 1998 Registration
Statement was declared effective on May 5, 1998. Newcourt filed a registration
statement on Form F-9 under the Securities Act relating to a full and
unconditional guaranty of the Additional Debt Securities by Newcourt (the
"Additional Debt Securities Guaranty"), which registration statement has also
become effective. An indenture was qualified under the Trust Indenture Act of
1939, as amended (the "TIA"), with respect to the Additional Debt Securities and
the related Additional Debt Securities Guaranty. Pursuant to Rule 4d-9 under the
TIA, the indenture relating to the Additional Debt Securities Guaranty will be
exempt from certain provisions of the TIA.
It is also contemplated that (i) Capital from time to time will file
additional registration statements on Form F-3 under the Securities Act (the
"Future Registration Statements") with respect to additional debt securities
(the "Future Debt Securities"), (ii) Newcourt from time to time will file
additional registration statements on Form F-9 (or, at Newcourt's election, Form
F-3), under the Securities Act relating to full and unconditional guaranties of
the Future Debt Securities by Newcourt (the "Future Debt Securities Guaranties")
and (iii) indentures will be qualified under the TIA with respect to the Future
Debt Securities and the related Future Debt Securities Guaranties. Pursuant to
Rule 4d-9 under the TIA, the indenture relating to the Future Debt Securities
Guaranties will be exempt from certain provisions of the TIA.
E. Existing Securities Guaranties. Newcourt is planning to issue a separate
guaranty (the "Existing Securities Guaranty") under which Newcourt would fully
and unconditionally guarantee the Existing Debt Securities and certain other
indebtedness of Capital. After issuance of the Existing Securities Guaranty, it
is contemplated that Newcourt and Capital would terminate the Support Agreement
in accordance with the terms thereof which permit termination under certain
conditions.
II. REQUESTED ACTIONS.
Newcourt and Capital respectfully request (i) the Securities and Exchange
Commission (the "Commission") to grant an order pursuant to Section 12(h) of the
Exchange Act exempting Capital from the reporting obligations under the Exchange
Act or (ii) in the alternative, the Staff of the Division of Corporation Finance
of the Commission (the "Staff") to confirm that, under the circumstances
described in this letter, it will not
<PAGE>
<PAGE>
5
Form 8-K October 2, 1998
Exhibit 99(b)
recommend any enforcement action to the Commission if Capital ceases to file
periodic reports pursuant to Sections 13 and 15(d) of the Exchange Act. The
foregoing request is predicated on the conditions that (a) the Existing
Securities Guaranty will be issued by Newcourt as contemplated hereby, (b) the
Additional Debt Securities will be guaranteed by the Additional Debt Securities
Guaranty and the Future Debt Securities will be guaranteed by the Future Debt
Securities Guaranties as contemplated hereby and (c) Newcourt will comply with
its periodic reporting requirements under the Exchange Act and include in such
periodic reports summarized financial information (as defined in Rule
1-02(bb)(1) of Regulation S-X) with respect to Capital.
Also, Newcourt and Capital respectfully request the Staff to confirm that
(x) Capital will remain eligible to issue Additional Debt Securities under the
March 1998 Registration Statement (or, if the Staff should conclude otherwise,
confirm that the March 1998 Registration Statement may be converted to a
Registration Statement on Form F-3 by post-effective amendment if General
Instruction I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time of the
filing of such post-effective amendment) and (y) so long as General Instruction
I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time a registration
statement on Form F-3 is filed by Capital, Capital will remain eligible to use
Form F-3 as a form of registration statement for registering Future Debt
Securities, in each case notwithstanding Capital's ceasing to file reports under
the Exchange Act pursuant to the requested exemptive order or no-action letter.
Lastly, Newcourt and Capital respectfully request the Staff to confirm that
it will not recommend enforcement action to the Commission, under the
circumstances described in this letter, if: (i) Newcourt does not register the
Existing Securities Guaranty under the Securities Act; and (ii) a supplemental
indenture is not qualified under the TIA with respect to the Existing Securities
Guaranty.
III. DISCUSSION.
A. NO REQUIREMENT FOR CAPITAL TO CONTINUE
TO FILE REPORTS WITH THE COMMISSION SUBSEQUENT TO THE
EFFECTIVENESS OF THE EXISTING SECURITIES GUARANTY AND
THE EXISTING SECURITIES SUBORDINATED GUARANTY.
Capital is a reporting company subject to the periodic reporting
requirements of Section 13 of the Exchange Act by virtue of Section 15(d)
thereof, and we have been advised by Capital that the Future Debt Securities,
the Additional Debt Securities and the Existing Debt Securities are or will be
the only outstanding securities of Capital with respect to
<PAGE>
<PAGE>
6
Form 8-K October 2, 1998
Exhibit 99(b)
which Capital is or will be subject to such reporting requirements.
In Staff Accounting Bulletin No. 53 ("SAB 53"), the Staff expressed the
view that in situations where the issuer of a guaranteed security is
wholly-owned by the guarantor, the guaranty is full and unconditional, the
guarantor is itself a reporting company under the Exchange Act and the issuer
has more than minimal independent operations of its own, upon application, the
issuer "would be conditionally exempted pursuant to Section 12(h) of the
Exchange Act from reporting obligations under such act." SAB 53, Paragraph G,
note 2. In implementing SAB 53, the Staff has routinely expressed no objection
to the cessation of such reporting by such subsidiaries, provided the parent
guarantor includes in the notes to its consolidated financial statements
"summarized financial information" on the subsidiary as defined in Rule
1-02(bb)(1) of Regulation S-X. See, e.g., Forest Oil Corporation (available
December 19, 1997); Cadbury Schweppes plc (available March 21, 1996); IntelCom
Group, Inc. (available December 28, 1995); CSR Limited (available October 25,
1995); Data Documents Holdings, Inc. (available March 31, 1995); Union Oil
Company of California (available September 2, 1994); Greystone Homes, Inc.
(available August 22, 1994); Time Warner Entertainment Company, L.P. (available
November 5, 1993); First Union Corporation (available July 30, 1993);
BankAmerica Corporation (available March 20, 1992); Union Carbide Corporation
(available April 12, 1991); Norfolk and Western Railway Company (available
December 24, 1990); and Time Warner Inc. (available January 9, 1990).
The same conclusion has been reached in situations where the guarantor is a
foreign corporation, including where (i) the guarantor is a Canadian corporation
and a foreign private issuer which satisfies its reporting obligations under the
Exchange Act through periodic filings using the MJDS provisions and the domestic
subsidiary registered its securities using Form F-3 (see, e.g., The Loewen
Group, Inc. (available November 18, 1994)), (ii) the guarantor is a Canadian
corporation (but not a foreign private issuer) which satisfies its reporting
obligations under the Exchange Act through periodic filings using the forms of
reports filed by domestic companies (see, e.g., The Loewen Group, Inc.
(available October 20, 1997; available March 13, 1997; and available December
13, 1996)), (iii) the guarantor is an Australian corporation which satisfies its
reporting obligations through periodic filings on Forms 20-F and 6-K and the
domestic subsidiary registered its securities using Form F-1 (see, e.g., CSR
Limited (available October 25, 1995)) and (iv) the guarantor is a Mexican
corporation which satisfies its reporting obligations through periodic filings
on Forms 20-F and 6-K (see, e.g., Dine, S.A. de C.V. (available October 24,
1997)).
<PAGE>
<PAGE>
7
Form 8-K October 2, 1998
Exhibit 99(b)
In addition, the same conclusion has been reached where the subsidiaries
continue to issue debt securities (guaranteed by the parent) registered under
the Securities Act pursuant to a shelf or other registration statement or where
a filing on Form S-3 was pending or planned. See, e.g., The Loewen Group Inc.
(available October 20, 1997); Data Documents Holdings, Inc. (available March 31,
1995); Union Oil Company of California (available September 2, 1994); Alcan
Aluminum Corp. (available March 1, 1993); Bell Atlantic Corporation (available
December 21, 1992); Joseph E. Seagram & Sons, Inc. (available March 25, 1992);
Southwestern Bell Capital Corporation (available October 16, 1986); and Pacific
Telesis Group (available July 25, 1986). In both Union Oil and Data Documents
Holdings, the Staff expressly stated, in the context of Form S-3, that "assuming
that General Instruction C.2. or C.3. is satisfied at the time a registration
statement is filed, the Division will not object if [the subsidiary ceasing to
file reports under the Exchange Act] uses Form S-3 to register future offerings
of securities". Based on the foregoing, so long as General Instruction C.2 or
C.3 to Form S-3 or General Instruction I.A.5(ii) or I.A.5(iii) to Form F-3
(which correspond to General Instruction C.2 and C.3 to Form S-3) is satisfied
at the time a registration statement on Form S-3 or Form F-3, as the case may
be, is filed (or, in the case of conversion of a registration statement on Form
S-3 to a registration statement on Form F-3 by post-effective amendment, General
Instruction I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time of the
filing of such post-effective amendment), Capital should remain eligible to
continue to issue Additional Debt Securities pursuant to the March 1998
Registration Statement and should remain eligible to use Form F-3 as a form of
registration statement for registering Future Debt Securities (or, in the case
of such a conversion, Additional Debt Securities).
The existence of the Up-Stream Guaranty provides an even stronger factual case
for the requested relief than was present in the above-referenced no-action
letters granting relief where no corresponding up-stream guaranty existed. This
is so because the combination of the Up-Stream Guaranty, the Existing Securities
Guaranty, the Existing Securities Subordinated Guaranty, the Additional Debt
Securities Guaranty and the Future Debt Securities Guaranty permit or will
permit the holders of the Newcourt Debt, the Existing Debt Securities, the
Additional Debt Securities and the Future Debt Securities to seek payment from
both Capital and Newcourt with respect to such securities (subject to any
applicable subordination provisions and, in the case of the Newcourt Debt
guaranteed by the Up-Stream Guaranty, to any potential challenge as to the
Up-Stream Guaranty under fraudulent conveyance principles, in which event the
existing case would still be similar to the facts present in such no-action
letters). Thus, the consolidated statements of Newcourt (which would include
Capital as a consolidated subsidiary) would
<PAGE>
<PAGE>
8
Form 8-K October 2, 1998
Exhibit 99(b)
be the most relevant financial statements for the holders of each of such
securities.
Rule 1-02(bb) of Regulation S-X defines "wholly-owned subsidiary" to mean a
subsidiary substantially all of whose outstanding voting shares are owned by its
parent and/or its parent's other wholly-owned subsidiaries. Thus, Capital is a
wholly-owned subsidiary of Newcourt within the meaning of such definition.
Capital has more than minimal independent operations of its own. Newcourt is a
reporting company under the Exchange Act by virtue of Section 13 thereof.
Newcourt expects to be current in its reporting obligations thereunder and is
prepared to provide summarized financial information (as defined in Rule
1-02(bb)(1) of Regulation S-X) as to Capital in Newcourt's periodic reports
under the Exchange Act (for so long as the Future Debt Securities, the
Additional Debt Securities or the Existing Debt Securities remain outstanding,
unless the filing of periodic reports would not otherwise be required).
The Staff has expressed its view, in previous no-action letters, that a
guarantee is unconditional unless there is a condition precedent to the
guarantor's liability, or unless a creditor must proceed against the principal
obligor before attempting to collect from the guarantor. See, e.g., Southwestern
Bell Corporation (available October 16, 1986); Pacific Telesis Group (available
July 25, 1986). The Future Debt Securities Guaranty, the Additional Debt
Securities Guaranty and the Existing Securities Guaranty by their terms do not
or will not require satisfaction of any condition precedent to Newcourt's
liability, and the holders of the Future Debt Securities, the Additional Debt
Securities and the Existing Debt Securities (upon execution of the Future Debt
Securities Guaranties, the Additional Debt Securities Guaranty and the Existing
Securities Guaranty, as the case may be) will (by the terms of such guaranties)
be entitled to proceed directly against Newcourt without proceeding first
against Capital. Thus, based upon the foregoing, upon execution of such
guaranties, Newcourt will have fully and unconditionally guaranteed the Future
Debt Securities, the Additional Debt Securities and the Existing Debt
Securities.
Under the circumstances described above and based upon the historical
position of the Staff expressed in SAB 53 and the letters referred to above, it
is consistent with the public interest and protection of investors to allow the
reports and other documents to be filed by Newcourt pursuant to Section 13 of
the Exchange Act to satisfy the reporting obligations of Capital with respect to
the Future Debt Securities, the Additional Debt Securities and the Existing Debt
Securities and for Capital to be relieved of its reporting obligations under
Sections 13 and 15(d) of the Exchange Act.
<PAGE>
<PAGE>
9
Form 8-K October 2, 1998
Exhibit 99(b)
B. NO REQUIREMENT FOR NEWCOURT TO REGISTER
THE EXISTING SECURITIES GUARANTY OR THE EXISTING SECURITIES
SUBORDINATED GUARANTY UNDER THE SECURITIES ACT OR TO
QUALIFY A SUPPLEMENTAL INDENTURE RELATING THERETO UNDER THE TIA .
Section 2(3) of the Securities Act states that the "sale" of a security
must involve some disposition "for value". We have been advised by Capital that,
under the terms of the indentures or other instruments relating to the Existing
Debt Securities, the holders thereof do not have any right to vote upon or
contest the Existing Securities Guaranty. As a result, such holders would not be
making an investment decision with respect to a "new" security. Furthermore,
such holders will not pay any consideration or give up any rights to obtain the
benefits of the Existing Securities Guaranty, and Newcourt has advised us that
it is not obligated to provide the Existing Securities Guaranty by any indenture
or other agreement. Accordingly, there should be no "sale" within the meaning of
Section 2(3) of the Securities Act and therefore no requirement to register the
Existing Securities Guaranty under the Securities Act. The Staff has previously
reached the same conclusion in similar situations. See, e.g., Time Warner
Entertainment Company, L.P. (available November 5, 1993); BankAmerica
Corporation (available March 20, 1992); Union Carbide Corporation (available
April 12, 1991); Norfolk and Western Railway Company (available December 24,
1990); Time Warner Inc. (available January 9, 1990); FHC-CompCare, Inc.
(available October 12, 1989); Daisy Systems Corporation (available April 10,
1989); Newell Co. (available July 22, 1987); McKesson Corp. (available September
12, 1985); and American General Corp. (available September 19, 1980).
For the same reasons discussed above, issuance of the Existing Securities
Guaranty should not constitute a "sale" within the meaning of Section 303(a) of
the TIA, which adopts the definition of "sale" contained in Section 2(3) of the
Securities Act. Accordingly, qualification of a supplemental indenture should
not be required under the TIA. The Staff has previously reached the same
conclusion in similar situations. See, e.g., BankAmerica Corporation (available
March 20, 1992); Union Carbide Corporation (available April 12, 1991); Norfolk
and Western Railway Company (available December 24, 1990); Time Warner Inc.
(available January 9, 1990); FHC-CompCare, Inc. (available October 12, 1989);
Daisy Systems Corporation (available April 10, 1989); Newell Co. (available July
22, 1987); McKesson Corp. (available September 12, 1985); and American General
Corp. (available September 19, 1980).
<PAGE>
<PAGE>
10
Form 8-K October 2, 1998
Exhibit 99(b)
IV. SUMMARY AND CONCLUSION.
Based upon the foregoing, on behalf of Newcourt and Capital, we
respectfully request the Commission to grant, pursuant to Section 12(h) of the
Exchange Act, an order exempting Capital from the periodic reporting
requirements of Sections 13 and 15(d) of the Exchange Act or, in the
alternative, the Staff to confirm that, under the circumstances described above,
it will not recommend to the Commission any enforcement action if Capital does
not comply with the periodic reporting requirements of Sections 13 and 15(d) of
the Exchange Act provided that Newcourt continues to comply with its periodic
reporting requirements under the Exchange Act pursuant to MJDS or otherwise, and
includes in its reports summarized financial information (as defined in Rule
1-02(bb)(1) of Regulation S-X) with respect to Capital.
Also, we respectfully request the Staff to confirm that (a) Capital will
remain eligible to issue Additional Debt Securities under the March 1998
Registration Statement (or, if the Staff should conclude otherwise, confirm that
the March 1998 Registration Statement may be converted to a Registration
Statement on Form F-3 by post-effective amendment if General Instruction
I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time of the filing of
such post-effective amendment) and (b) so long as General Instruction I.A.5(ii)
or I.A.5(iii) to Form F-3 is satisfied at the time a registration statement on
Form F-3 is filed by Capital, Capital will remain eligible to use Form F-3 as a
form of registration statement for registering Future Debt Securities, in each
case notwithstanding Capital's ceasing to file reports under the Exchange Act
pursuant to the requested exemptive order or no-action letter.
Lastly, we respectfully request the Staff to confirm that it will not
recommend enforcement action to the Commission, under the circumstances
described above, if: (i) Newcourt does not register the Existing Securities
Guaranty under the Securities Act; and (ii) a supplemental indenture is not
qualified under the TIA with respect to the Existing Securities Guaranty.
As required by Securities Act Release No. 33-6269, seven additional copies
of this letter are submitted herewith. If you have any questions concerning this
letter or if you require any additional information, please contact either
Dennis V. Osimitz (312/853-7748) or James D. Johnson (212/906-2350).
Additionally, if you do not agree with any of the views expressed herein, we
respectfully request an opportunity to discuss the matter with you prior to any
written response to this letter.
Very truly yours,
<PAGE>
<PAGE>
11
Form 8-K October 2, 1998
Exhibit 99(b)
October 2, 1998
RESPONSE OF THE OFFICE OF CHIEF COUNSEL
DIVISION OF CORPORATION FINANCE
Re: Newcourt Credit Group, Inc. ("Newcourt")
AT&T Capital Corporation ("Capital")
Incoming letter dated October 2, 1998
Based on the facts presented, the Division will not object if Capital does
not file reports under Sections 13 and 15(d) of the Securities Exchange Act of
1934 (the "Exchange Act") with respect to the Existing Debt Securities and the
Additional Debt securities (each as defined in your letter). In reaching this
position, we note that : (1) Newcourt is subject to the reporting requirements
of the Exchange Act; (2) Newcourt owns 100 percent of Capital's outstanding
common stock, and (3) Newcourt has fully and unconditionally guaranteed the
Additional Debt Securities, and will fully and unconditionally guarantee the
Existing Debt Securities.
As a condition to the position, Newcourt must, in a footnote to the
financial statements in its Exchange Act reports:
include summarized financial information concerning Capital which includes at
least the information described in Rule 1-02(bb) of Regulation S-X; and
state that Capital has not presented separate financial statements and other
disclosures concerning Capital because management has determined that such
information is not material to holders of the Existing Debt Securities and
the Additional Debt Securities, respectively.
Further, assuming that General Instruction C.2. or C.3. to Form S-3 was
satisfied at the time the March 1998 Registration Statement (as defined in your
letter) was filed, and a post-effective amendment is filed to convert such Form
S-3 to a Form F-3, the Division will not object if Capital uses Form F-3 to
register the Additional Debt Securities; provided, however, that General
Instruction I.A.5(ii) or (iii) to Form F-3 is satisfied when this post-effective
amendment is filed. Also, assuming that General Instruction I.A.5(ii) or
I.A.5(iii) to Form F-3 is satisfied at the time a registration statement is
filed on such Form (along with all other applicable prerequisites to use of
Form F-3), the Division will not object if Capital uses Form F-3 to register the
Future Debt Securities (as defined in your letter).
<PAGE>
<PAGE>
12
Form 8-K October 2, 1998
Exhibit 99(b)
Finally, no enforcement action will be recommended if (a) Newcourt does not
register the Existing Debt Securities Guaranty (as defined in your letter) under
the Securities Act of 1933, and (b) neither Newcourt nor Capital qualifies a
supplemental indenture under the Trust Indenture Act of 1939 in respect of the
Existing Debt Securities Guaranty. In reaching this position, we note your
representation that none of the holders of the outstanding securities of
Newcourt, Capital, or any other entity has the right to, or will, vote upon or
consent to the creation of the Existing Debt Security Guaranty.
These positions are based on the representations made to the Division in
your letter. Any different facts or conditions might require the Division to
reach a different conclusion. Further, this response expresses the Division's
position on enforcement action only and does not express any legal conclusion on
the questions presented.
Sincerely,
Mark Schwartz
Attorney-Adviser
<PAGE>
<PAGE>
1
Form 8-K October 2, 1998
Exhibit 99(c)
[SIDLEY & AUSTIN LETTERHEAD]
1933 Act/Section 5
1934 Act/Sections 13 and 15(d)
October 2, 1998
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Attention: Office of the Chief Counsel
Division of Corporation Finance
Re: Newcourt Credit Group Inc./AT&T Capital Corporation
Ladies/Gentlemen:
This letter is submitted on behalf of Newcourt Credit Group Inc., an
Ontario corporation ("Newcourt"), and AT&T Capital Corporation, a Delaware
corporation ("Capital").
I. BACKGROUND.
A. Newcourt Acquisition of Capital; Newcourt Securities. On January 12,
1998, all the outstanding common stock of Capital was acquired by Newcourt.
Shortly thereafter, Newcourt transferred all the outstanding common stock of
Capital to a wholly-owned subsidiary of Newcourt.
<PAGE>
<PAGE>
2
Form 8-K October 2, 1998
Exhibit 99(c)
In November 1997, Newcourt registered rights to acquire Newcourt common
shares under the Securities Act of 1933, as amended (the "Securities Act"), on
Form F-10 (No. 333-07974) as a "foreign private issuer" pursuant to the
multi-jurisdictional disclosure system with Canada ("MJDS"). In addition, in
April 1997, Newcourt registered its common shares on Form 40-F pursuant to
Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and became a reporting company under the Exchange Act. Newcourt has
advised us that it has thereafter filed, and will continue to file, reports on
Form 40-F and Form 6-K pursuant to the MJDS requirements. Accordingly, effective
May 1, 1998, Newcourt has been subject to the reporting requirements of Section
13 of the Exchange Act and filed all reports required to be filed thereunder for
a period of at least 12 months. Newcourt has advised us that it has issued debt
securities to the public in Canada, but has not issued any debt securities to
the public in the United States.
B. Existing Debt Securities. In recent years, Capital has issued debt
securities through public offerings in the United States (the "Existing Debt
Securities"). The Existing Debt Securities were registered by Capital under the
Securities Act using registration statements on Form S-3 (the most recent being
No. 333-18367) and the "shelf" procedures of Rule 415 under the Securities Act.
Capital files periodic reports pursuant to Sections 13 and 15(d) of the Exchange
Act.
C. Support Agreement. Following the acquisition of Capital by Newcourt, on
February 9, 1998, Newcourt and Capital entered into a support agreement (the
"Support Agreement") under which Newcourt has agreed to own (directly or
indirectly) a majority of the voting stock of Capital, maintain the net worth of
Capital at $1 or more and provide liquidity to Capital. Under the terms of the
Support Agreement, the holders of Capital's outstanding debt for borrowed money
are entitled to demand that Capital enforce its rights thereunder and to proceed
against Newcourt on behalf of Capital to enforce the rights of Capital
thereunder if Capital refuses to do so. However, the Support Agreement, by its
terms, provides that it is not a guaranty and that no holder of any such debt
shall have any right to proceed directly against Newcourt to obtain any amount
due with respect thereto. Thereafter, on February 20, 1998, Capital guaranteed
(the "Up-Stream Guaranty") certain outstanding indebtedness and bank liquidity
facilities of Newcourt (the "Newcourt Debt"). We have been advised by Newcourt
that the Up-Stream Guaranty was issued in order for Newcourt to continue in
compliance with Newcourt's indentures and loan agreements and to satisfy certain
rating agency requirements.
<PAGE>
<PAGE>
3
Form 8-K October 2, 1998
Exhibit 99(c)
D. Additional Registration Statements. On March 20, 1998, Capital filed a
registration statement on Form S-3 (No. 333-48415) under the Securities Act (the
"March 1998 Registration Statement") with respect to additional debt securities
of Capital (the "Additional Debt Securities"). The March 1998 Registration
Statement was declared effective on May 5, 1998. Newcourt filed a registration
statement on Form F-9 under the Securities Act relating to a full and
unconditional guaranty of the Additional Debt Securities by Newcourt (the
"Additional Debt Securities Guaranty"), which registration statement has also
become effective. An indenture was qualified under the Trust Indenture Act of
1939, as amended (the "TIA"), with respect to the Additional Debt Securities and
the related Additional Debt Securities Guaranty. Pursuant to Rule 4d-9 under the
TIA, the indenture relating to the Additional Debt Securities Guaranty will be
exempt from certain provisions of the TIA.
It is also contemplated that (i) Capital from time to time will file
additional registration statements on Form F-3 under the Securities Act (the
"Future Registration Statements") with respect to additional debt securities
(the "Future Debt Securities"), (ii) Newcourt from time to time will file
additional registration statements on Form F-9 (or, at Newcourt's election, Form
F-3), under the Securities Act relating to full and unconditional guaranties of
the Future Debt Securities by Newcourt (the "Future Debt Securities Guaranties")
and (iii) indentures will be qualified under the TIA with respect to the Future
Debt Securities and the related Future Debt Securities Guaranties. Pursuant to
Rule 4d-9 under the TIA, the indenture relating to the Future Debt Securities
Guaranties will be exempt from certain provisions of the TIA.
E. Existing Securities Guaranties. Newcourt is planning to issue a separate
guaranty (the "Existing Securities Guaranty") under which Newcourt would fully
and unconditionally guarantee the Existing Debt Securities and certain other
indebtedness of Capital. After issuance of the Existing Securities Guaranty, it
is contemplated that Newcourt and Capital would terminate the Support Agreement
in accordance with the terms thereof which permit termination under certain
conditions.
II. REQUESTED ACTIONS.
Newcourt and Capital respectfully request (i) the Securities and Exchange
Commission (the "Commission") to grant an order pursuant to Section 12(h) of the
Exchange Act exempting Capital from the reporting obligations under the Exchange
Act or (ii) in the alternative, the Staff of the Division of Corporation Finance
of the Commission (the "Staff") to confirm that, under the circumstances
described in this letter, it will not
<PAGE>
<PAGE>
4
Form 8-K October 2, 1998
Exhibit 99(c)
recommend any enforcement action to the Commission if Capital ceases to file
periodic reports pursuant to Sections 13 and 15(d) of the Exchange Act. The
foregoing request is predicated on the conditions that (a) the Existing
Securities Guaranty will be issued by Newcourt as contemplated hereby, (b) the
Additional Debt Securities will be guaranteed by the Additional Debt Securities
Guaranty and the Future Debt Securities will be guaranteed by the Future Debt
Securities Guaranties as contemplated hereby and (c) Newcourt will comply with
its periodic reporting requirements under the Exchange Act and include in such
periodic reports summarized financial information (as defined in Rule
1-02(bb)(1) of Regulation S-X) with respect to Capital.
Also, Newcourt and Capital respectfully request the Staff to confirm that
(x) Capital will remain eligible to issue Additional Debt Securities under the
March 1998 Registration Statement (or, if the Staff should conclude otherwise,
confirm that the March 1998 Registration Statement may be converted to a
Registration Statement on Form F-3 by post-effective amendment if General
Instruction I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time of the
filing of such post-effective amendment) and (y) so long as General Instruction
I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time a registration
statement on Form F-3 is filed by Capital, Capital will remain eligible to use
Form F-3 as a form of registration statement for registering Future Debt
Securities, in each case notwithstanding Capital's ceasing to file reports under
the Exchange Act pursuant to the requested exemptive order or no-action letter.
Lastly, Newcourt and Capital respectfully request the Staff to confirm that
it will not recommend enforcement action to the Commission, under the
circumstances described in this letter, if: (i) Newcourt does not register the
Existing Securities Guaranty under the Securities Act; and (ii) a supplemental
indenture is not qualified under the TIA with respect to the Existing Securities
Guaranty.
III. DISCUSSION.
A. NO REQUIREMENT FOR CAPITAL TO CONTINUE
TO FILE REPORTS WITH THE COMMISSION SUBSEQUENT TO THE
EFFECTIVENESS OF THE EXISTING SECURITIES GUARANTY AND
THE EXISTING SECURITIES SUBORDINATED GUARANTY.
Capital is a reporting company subject to the periodic reporting
requirements of Section 13 of the Exchange Act by virtue of Section 15(d)
thereof, and we have been advised by Capital that the Future Debt Securities,
the Additional Debt Securities and the Existing Debt Securities are or will be
the only outstanding securities of Capital with respect to
<PAGE>
<PAGE>
5
Form 8-K October 2, 1998
Exhibit 99(c)
which Capital is or will be subject to such reporting requirements.
In Staff Accounting Bulletin No. 53 ("SAB 53"), the Staff expressed the
view that in situations where the issuer of a guaranteed security is
wholly-owned by the guarantor, the guaranty is full and unconditional, the
guarantor is itself a reporting company under the Exchange Act and the issuer
has more than minimal independent operations of its own, upon application, the
issuer "would be conditionally exempted pursuant to Section 12(h) of the
Exchange Act from reporting obligations under such act." SAB 53, Paragraph G,
note 2. In implementing SAB 53, the Staff has routinely expressed no objection
to the cessation of such reporting by such subsidiaries, provided the parent
guarantor includes in the notes to its consolidated financial statements
"summarized financial information" on the subsidiary as defined in Rule
1-02(bb)(1) of Regulation S-X. See, e.g., Forest Oil Corporation (available
December 19, 1997); Cadbury Schweppes plc (available March 21, 1996); IntelCom
Group, Inc. (available December 28, 1995); CSR Limited (available October 25,
1995); Data Documents Holdings, Inc. (available March 31, 1995); Union Oil
Company of California (available September 2, 1994); Greystone Homes, Inc.
(available August 22, 1994); Time Warner Entertainment Company, L.P. (available
November 5, 1993); First Union Corporation (available July 30, 1993);
BankAmerica Corporation (available March 20, 1992); Union Carbide Corporation
(available April 12, 1991); Norfolk and Western Railway Company (available
December 24, 1990); and Time Warner Inc. (available January 9, 1990).
The same conclusion has been reached in situations where the guarantor is a
foreign corporation, including where (i) the guarantor is a Canadian corporation
and a foreign private issuer which satisfies its reporting obligations under the
Exchange Act through periodic filings using the MJDS provisions and the domestic
subsidiary registered its securities using Form F-3 (see, e.g., The Loewen
Group, Inc. (available November 18, 1994)), (ii) the guarantor is a Canadian
corporation (but not a foreign private issuer) which satisfies its reporting
obligations under the Exchange Act through periodic filings using the forms of
reports filed by domestic companies (see, e.g., The Loewen Group, Inc.
(available October 20, 1997; available March 13, 1997; and available December
13, 1996)), (iii) the guarantor is an Australian corporation which satisfies its
reporting obligations through periodic filings on Forms 20-F and 6-K and the
domestic subsidiary registered its securities using Form F-1 (see, e.g., CSR
Limited (available October 25, 1995)) and (iv) the guarantor is a Mexican
corporation which satisfies its reporting obligations through periodic filings
on Forms 20-F and 6-K (see, e.g., Dine, S.A. de C.V. (available October 24,
1997)).
In addition, the same conclusion has been reached where the subsidiaries
continue to issue debt securities (guaranteed by the parent)
<PAGE>
<PAGE>
6
Form 8-K October 2, 1998
Exhibit 99(c)
registered under the Securities Act pursuant to a shelf or other registration
statement or where a filing on Form S-3 was pending or planned. See, e.g., The
Loewen Group Inc. (available October 20, 1997); Data Documents Holdings, Inc.
(available March 31, 1995); Union Oil Company of California (available September
2, 1994); Alcan Aluminum Corp. (available March 1, 1993); Bell Atlantic
Corporation (available December 21, 1992); Joseph E. Seagram & Sons, Inc.
(available March 25, 1992); Southwestern Bell Capital Corporation (available
October 16, 1986); and Pacific Telesis Group (available July 25, 1986). In both
Union Oil and Data Documents Holdings, the Staff expressly stated, in the
context of Form S-3, that "assuming that General Instruction C.2. or C.3. is
satisfied at the time a registration statement is filed, the Division will not
object if [the subsidiary ceasing to file reports under the Exchange Act] uses
Form S-3 to register future offerings of securities". Based on the foregoing, so
long as General Instruction C.2 or C.3 to Form S-3 or General Instruction
I.A.5(ii) or I.A.5(iii) to Form F-3 (which correspond to General Instruction C.2
and C.3 to Form S-3) is satisfied at the time a registration statement on Form
S-3 or Form F-3, as the case may be, is filed (or, in the case of conversion of
a registration statement on Form S-3 to a registration statement on Form F-3 by
post-effective amendment, General Instruction I.A.5(ii) or I.A.5(iii) to Form
F-3 is satisfied at the time of the filing of such post-effective amendment),
Capital should remain eligible to continue to issue Additional Debt Securities
pursuant to the March 1998 Registration Statement and should remain eligible to
use Form F-3 as a form of registration statement for registering Future Debt
Securities (or, in the case of such a conversion, Additional Debt Securities).
The existence of the Up-Stream Guaranty provides an even stronger factual
case for the requested relief than was present in the above-referenced no-action
letters granting relief where no corresponding up-stream guaranty existed. This
is so because the combination of the Up-Stream Guaranty, the Existing Securities
Guaranty, the Existing Securities Subordinated Guaranty, the Additional Debt
Securities Guaranty and the Future Debt Securities Guaranty permit or will
permit the holders of the Newcourt Debt, the Existing Debt Securities, the
Additional Debt Securities and the Future Debt Securities to seek payment from
both Capital and Newcourt with respect to such securities (subject to any
applicable subordination provisions and, in the case of the Newcourt Debt
guaranteed by the Up-Stream Guaranty, to any potential challenge as to the
Up-Stream Guaranty under fraudulent conveyance principles, in which event the
existing case would still be similar to the facts present in such no-action
letters). Thus, the consolidated statements of Newcourt (which would include
Capital as a consolidated subsidiary) would be the most relevant financial
statements for the holders of each of such securities.
<PAGE>
<PAGE>
7
Form 8-K October 2, 1998
Exhibit 99(c)
Rule 1-02(bb) of Regulation S-X defines "wholly-owned subsidiary" to mean a
subsidiary substantially all of whose outstanding voting shares are owned by its
parent and/or its parent's other wholly-owned subsidiaries. Thus, Capital is a
wholly-owned subsidiary of Newcourt within the meaning of such definition.
Capital has more than minimal independent operations of its own. Newcourt is a
reporting company under the Exchange Act by virtue of Section 13 thereof.
Newcourt expects to be current in its reporting obligations thereunder and is
prepared to provide summarized financial information (as defined in Rule
1-02(bb)(1) of Regulation S-X) as to Capital in Newcourt's periodic reports
under the Exchange Act (for so long as the Future Debt Securities, the
Additional Debt Securities or the Existing Debt Securities remain outstanding,
unless the filing of periodic reports would not otherwise be required).
The Staff has expressed its view, in previous no-action letters, that a
guarantee is unconditional unless there is a condition precedent to the
guarantor's liability, or unless a creditor must proceed against the principal
obligor before attempting to collect from the guarantor. See, e.g., Southwestern
Bell Corporation (available October 16, 1986); Pacific Telesis Group (available
July 25, 1986). The Future Debt Securities Guaranty, the Additional Debt
Securities Guaranty and the Existing Securities Guaranty by their terms do not
or will not require satisfaction of any condition precedent to Newcourt's
liability, and the holders of the Future Debt Securities, the Additional Debt
Securities and the Existing Debt Securities (upon execution of the Future Debt
Securities Guaranties, the Additional Debt Securities Guaranty and the Existing
Securities Guaranty, as the case may be) will (by the terms of such guaranties)
be entitled to proceed directly against Newcourt without proceeding first
against Capital. Thus, based upon the foregoing, upon execution of such
guaranties, Newcourt will have fully and unconditionally guaranteed the Future
Debt Securities, the Additional Debt Securities and the Existing Debt
Securities.
Under the circumstances described above and based upon the historical
position of the Staff expressed in SAB 53 and the letters referred to above, it
is consistent with the public interest and protection of investors to allow the
reports and other documents to be filed by Newcourt pursuant to Section 13 of
the Exchange Act to satisfy the reporting obligations of Capital with respect to
the Future Debt Securities, the Additional Debt Securities and the Existing Debt
Securities and for Capital to be relieved of its reporting obligations under
Sections 13 and 15(d) of the Exchange Act.
<PAGE>
<PAGE>
8
Form 8-K October 2, 1998
Exhibit 99(c)
B. NO REQUIREMENT FOR NEWCOURT TO REGISTER
THE EXISTING SECURITIES GUARANTY OR THE EXISTING SECURITIES
SUBORDINATED GUARANTY UNDER THE SECURITIES ACT OR TO
QUALIFY A SUPPLEMENTAL INDENTURE RELATING THERETO UNDER THE TIA .
Section 2(3) of the Securities Act states that the "sale" of a security
must involve some disposition "for value". We have been advised by Capital that,
under the terms of the indentures or other instruments relating to the Existing
Debt Securities, the holders thereof do not have any right to vote upon or
contest the Existing Securities Guaranty. As a result, such holders would not be
making an investment decision with respect to a "new" security. Furthermore,
such holders will not pay any consideration or give up any rights to obtain the
benefits of the Existing Securities Guaranty, and Newcourt has advised us that
it is not obligated to provide the Existing Securities Guaranty by any indenture
or other agreement. Accordingly, there should be no "sale" within the meaning of
Section 2(3) of the Securities Act and therefore no requirement to register the
Existing Securities Guaranty under the Securities Act. The Staff has previously
reached the same conclusion in similar situations. See, e.g., Time Warner
Entertainment Company, L.P. (available November 5, 1993); BankAmerica
Corporation (available March 20, 1992); Union Carbide Corporation (available
April 12, 1991); Norfolk and Western Railway Company (available December 24,
1990); Time Warner Inc. (available January 9, 1990); FHC-CompCare, Inc.
(available October 12, 1989); Daisy Systems Corporation (available April 10,
1989); Newell Co. (available July 22, 1987); McKesson Corp. (available September
12, 1985); and American General Corp. (available September 19, 1980).
For the same reasons discussed above, issuance of the Existing Securities
Guaranty should not constitute a "sale" within the meaning of Section 303(a) of
the TIA, which adopts the definition of "sale" contained in Section 2(3) of the
Securities Act. Accordingly, qualification of a supplemental indenture should
not be required under the TIA. The Staff has previously reached the same
conclusion in similar situations. See, e.g., BankAmerica Corporation (available
March 20, 1992); Union Carbide Corporation (available April 12, 1991); Norfolk
and Western Railway Company (available December 24, 1990); Time Warner Inc.
(available January 9, 1990); FHC-CompCare, Inc. (available October 12, 1989);
Daisy Systems Corporation (available April 10, 1989); Newell Co. (available July
22, 1987); McKesson Corp. (available September 12, 1985); and American General
Corp. (available September 19, 1980).
<PAGE>
<PAGE>
9
Form 8-K October 2, 1998
Exhibit 99(c)
IV. SUMMARY AND CONCLUSION.
Based upon the foregoing, on behalf of Newcourt and Capital, we
respectfully request the Commission to grant, pursuant to Section 12(h) of the
Exchange Act, an order exempting Capital from the periodic reporting
requirements of Sections 13 and 15(d) of the Exchange Act or, in the
alternative, the Staff to confirm that, under the circumstances described above,
it will not recommend to the Commission any enforcement action if Capital does
not comply with the periodic reporting requirements of Sections 13 and 15(d) of
the Exchange Act provided that Newcourt continues to comply with its periodic
reporting requirements under the Exchange Act pursuant to MJDS or otherwise, and
includes in its reports summarized financial information (as defined in Rule
1-02(bb)(1) of Regulation S-X) with respect to Capital.
Also, we respectfully request the Staff to confirm that (a) Capital will
remain eligible to issue Additional Debt Securities under the March 1998
Registration Statement (or, if the Staff should conclude otherwise, confirm that
the March 1998 Registration Statement may be converted to a Registration
Statement on Form F-3 by post-effective amendment if General Instruction
I.A.5(ii) or I.A.5(iii) to Form F-3 is satisfied at the time of the filing of
such post-effective amendment) and (b) so long as General Instruction I.A.5(ii)
or I.A.5(iii) to Form F-3 is satisfied at the time a registration statement on
Form F-3 is filed by Capital, Capital will remain eligible to use Form F-3 as a
form of registration statement for registering Future Debt Securities, in each
case notwithstanding Capital's ceasing to file reports under the Exchange Act
pursuant to the requested exemptive order or no-action letter.
Lastly, we respectfully request the Staff to confirm that it will not
recommend enforcement action to the Commission, under the circumstances
described above, if: (i) Newcourt does not register the Existing Securities
Guaranty under the Securities Act; and (ii) a supplemental indenture is not
qualified under the TIA with respect to the Existing Securities Guaranty.
As required by Securities Act Release No. 33-6269, seven additional copies
of this letter are submitted herewith. If you have any questions concerning this
letter or if you require any additional information, please contact either
Dennis V. Osimitz (312/853-7748) or James D. Johnson (212/906-2350).
Additionally, if you do not agree with any of the views expressed herein, we
respectfully request an opportunity to discuss the matter with you prior to any
written response to this letter.
Very truly yours,
