UNITED STATES
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 (Date of earliest event reported): AUGUST 25, 2004
CREDIT ACCEPTANCE CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Commission File Number 000-20202
MICHIGAN 38-1999511
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
25505 W. TWELVE MILE ROAD, SUITE 3000 48034-8339
SOUTHFIELD, MICHIGAN (Zip Code)
(Address of Principal Executive Offices)
(Registrant's telephone number, including area code): (248) 353-2700
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written Communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
SECTION 2 - FINANCIAL INFORMATION
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF- BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
On August 25, 2004, Credit Acceptance Corporation (the "Company") entered into a
$100 million asset-backed non-recourse secured financing. The terms and
conditions of this transaction are summarized in a press release issued by the
Company on August 25, 2004, which is attached as Exhibit 99(a) and is
incorporated herein by reference.
The secured financing creates a loan for which the Company's special purpose
trust created for the transaction is liable and which is secured by all the
assets of the trust and of another subsidiary created for the transaction. Such
loans are non-recourse to the Company, even though the trust, the subsidiary and
the Company are consolidated for financial reporting purposes. Except for the
Company's servicing fee and payments due to dealer-partners, the Company does
not receive, or have any rights in, any portion of such collections until the
trust's underlying indebtedness is paid in full, either through collections or
through a prepayment of the indebtedness. Thereafter, remaining collections
would be paid over to the subsidiary as the sole beneficiary of the trust where
they would be available to be distributed to the Company as the sole member of
subsidiary, or the Company may choose to cause the subsidiary to repurchase the
remaining dealer-partner advances from the trust and then dissolve, whereby the
Company would become the owner of such remaining collections.
The financing may be accelerated upon the occurrence of an "indenture event of
default." An "indenture event of default" includes: a default by the trust in
the payment of interest or principal when due; any breach of covenant or any
material breach of representation or warranty that is not cured within the
specified time following notice; the occurrence of certain bankruptcy or
insolvency events involving the trust or the subsidiary; a draw on one of the
financial insurance policies; the failure of collections on the transferred
assets to be more than a threshold percentage of projected collections for three
consecutive collection periods; a transfer by the subsidiary of its ownership of
the trust; the failure of the trustee to have a valid and perfected first
priority security interest in the trust property if such failure has not been
cured within ten business days; and the cessation of any transaction document to
be in full force and effect.
The agreements the Company entered into related to this transaction are attached
as Exhibits (f)(57) through (f)(62) and are incorporated herein by reference.
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
4(f)57 Indenture dated August 25, 2004 between Credit
Acceptance Auto Dealer Loan Trust 2004-1 and JPMorgan
Chase Bank
4(f)58 Sales and Servicing Agreement dated August 25, 2004
among the Company, Credit Acceptance Auto Dealer Loan
Trust 2004-1, Credit Acceptance Funding LLC 2004-1,
JPMorgan Chase Bank, and Systems & Services
Technologies, Inc.
4(f)59 Backup Servicing Agreement dated August 25, 2004 among
the Company, Credit Acceptance Funding 2004-1, Credit
Acceptance Auto Dealer Loan Trust 2004-1, Systems &
Services Technologies, Inc., Radian Asset Assurance
Inc., XL Capital Assurance Inc., and JPMorgan Chase Bank
4(f)60 Amended and Restated Trust Agreement dated August 25,
2004 between Credit Acceptance Funding LLC 2004-1 and
Wachovia Bank of Delaware, National Association
4(f)61 Contribution Agreement dated August 25, 2004 between the
Company and Credit Acceptance Funding LLC 2004-1
4(f)62 Intercreditor Agreement dated August 25, 2004 among the
Company, CAC Warehouse Funding Corporation II, Credit
Acceptance Funding LLC 2003-1, Credit Acceptance Auto
Dealer Loan Trust 2003-1, Credit Acceptance Funding LLC
2004-1, Credit Acceptance Auto Dealer Loan Trust 2004-1,
Wachovia Capital Markets, LLC, as agent, JPMorgan Chase
Bank, as agent, and Comerica Bank, as agent
99(a) Press Release dated August 25, 2004
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CREDIT ACCEPTANCE CORPORATION
(Registrant)
By: /s/ Douglas W. Busk
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Douglas W. Busk
Treasurer
August 30, 2004
INDEX OF EXHIBITS
EXHIBIT NO. DESCRIPTION
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4(f)57 Indenture dated August 25, 2004 between Credit Acceptance Auto
Dealer Loan Trust 2004-1 and JPMorgan Chase Bank
4(f)58 Sales and Servicing Agreement dated August 25, 2004 among the
Company, Credit Acceptance Auto Dealer Loan Trust 2004-1, Credit
Acceptance Funding LLC 2004-1, JPMorgan Chase Bank, and Systems &
Services Technologies, Inc.
4(f)59 Backup Servicing Agreement dated August 25, 2004 among the
Company, Credit Acceptance Funding 2004-1, Credit Acceptance Auto
Dealer Loan Trust 2004-1, Systems & Services Technologies, Inc.,
Radian Asset Assurance Inc., XL Capital Assurance Inc., and
JPMorgan Chase Bank
4(f)60 Amended and Restated Trust Agreement dated August 25, 2004
between Credit Acceptance Funding LLC 2004-1 and Wachovia Bank of
Delaware, National Association
4(f)61 Contribution Agreement dated August 25, 2004 between the Company
and Credit Acceptance Funding LLC 2004-1
4(f)62 Intercreditor Agreement dated August 25, 2004 among the Company,
CAC Warehouse Funding Corporation II, Credit Acceptance Funding
LLC 2003-1, Credit Acceptance Auto Dealer Loan Trust 2003-1,
Credit Acceptance Funding LLC 2004-1, Credit Acceptance Auto
Dealer Loan Trust 2004-1, Wachovia Capital Markets, LLC, as
agent, JPMorgan Chase Bank, as agent, and Comerica Bank, as agent
99(a) Press Release dated August 25, 2004