EXHIBIT 99.5
April 19, 2000
Xxxxxx Xxxxxxx Capital Services Inc.
0000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
The purpose of this letter agreement is to confirm the terms and conditions of
the Swap Transaction (the "Trust Swap") entered into between Xxxxxx Xxxxxxx
Capital Services Inc. (the "Counterparty") and Capital Auto Receivables Asset
Trust 2000-1 (the "Trust") on the Trade Date listed below (the "Transaction").
This letter constitutes a "Confirmation" as referred to in the Trust ISDA
Agreement specified below.
1. The definitions and provisions contained in the 1991 ISDA Definitions
as supplemented by the 1998 Supplement (the "Definitions"), as
published by the International Swaps and Derivatives Association, Inc.
("ISDA"), are incorporated into this Confirmation. In the event of any
inconsistency between those definitions and provisions and this
Confirmation, this Confirmation will govern. The parties agree that
this transaction is a Transaction under the ISDA Master Agreement of
the parties dated April 19, 2000. The agreement is comprised of the
printed form of such agreement as published by ISDA, as supplemented
and modified by a Schedule ("Trust ISDA Agreement").
This Confirmation constitutes a binding agreement between you and us
and will supplement, form a part of, and be subject to the Trust ISDA
Agreement described above as amended and supplemented from time to
time.
The Counterparty and the Trust acknowledge that this Transaction
relates to the Floating Rate Variable Pay Asset Backed Term Notes (the
"Reference Notes") issued by the Trust for value pursuant to and
subject to the Indenture.
Capitalized terms used herein and not otherwise defined herein, in the
Trust ISDA Agreement or in the Definitions shall have the meanings
assigned to them in Exhibit A hereto.
All references to "dollars" or to "$" shall be references to amounts in
United States Dollars.
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
Type of Transaction: Interest Rate Swap Transaction
Notional Amount: $515,138,000 with respect to the initial Calculation
Period. The Notional Amount with respect to each Calculation Period
thereafter shall be equal to the Reference Note Balance as of the close
of business on the Distribution Date at the beginning of the relevant
Calculation Period (as set forth in the Calculation Statement (defined
below) delivered by the Trust to the Counterparty on or prior to the
Determination Date relating to such Calculation Period pursuant to
Section 3 below).
Trade Date: April 11, 2000
Effective Date: April 19, 0000
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Xxxxxxxxxxx Date: The earlier of the close of business on (i) September
15, 2005, (ii) the Fixed Rate Payer Payment Date after April 15, 2003
on which the Notional Amount is reduced to zero and (iii) the date on
which the Servicer effects its option to repurchase the receivables
pursuant to Section 8.01 of the Trust Sale and Servicing Agreement.
Fixed Amounts:
Fixed Rate Payer: The Trust
Fixed Rate Payer Period End Dates: The 15th calendar day of
each month, commencing May 15, 2000 to and including September
15, 2005 with, in each case, No Adjustment.
Fixed Rate Payer Payment Date: One Business Day prior to each
Distribution Date
Fixed Rate: 7.085%
Fixed Rate Day Count Fraction: 30/360
Floating Amounts:
Floating Rate Payer: The Counterparty
Floating Rate Payer Period End Dates: Each Fixed Rate Payer
Period End Date.
Floating Rate Payer Payment Dates: One Business Day prior to
each Distribution Date
Reset Dates: Each Distribution Date
Floating Rate: LIBOR (as defined in Exhibit A)
Spread: +7 Basis Points
Floating Rate Day Count Fraction: Actual/360
Compounding: Inapplicable
Business Days for Payment: New York (New York), Detroit (Michigan) and
Chicago (Illinois)
Calculation Agent: The Trust, or General Motors Acceptance Corporation,
as agent for and on behalf of the Trust.
Default Rate: For any United States Dollar payments, the rate
determined under the option entitled "USD Federal Funds - H.15" plus 1%
using daily Reset Dates. The Default Rate will be applied on the basis
of Compounding as if the overdue amount were a Notional Amount and
using daily Compounding Dates, and interest will accrue and be payable
before as well as after judgment.
3. Calculations and Notifications: On or before each Determination Date,
the Calculation Agent shall determine the Fixed Amount due to the
Counterparty on the next succeeding Fixed Rate Payer Payment Date and
the Floating Amount due to the Trust on the next succeeding Floating
Rate Payer Payment Date and the Calculation Agent shall notify the
Counterparty in writing of both (i) the Floating Rate and (ii) the
amount of such payment.
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In addition, on each Determination Date the Trust shall deliver to the
Counterparty (by facsimile with hard copy to follow) a statement (the
"Calculation Statement") setting forth with respect to the close of
business on the immediately preceding Distribution Date the Reference
Note Balance as of such Distribution Date.
The Trust will give the Counterparty prompt written notice of any
Default under the Indenture.
4. Credit Downgrade: In the event that the Joint Rating (as defined below)
of the Counterparty and the Offsetting Counterparty (as defined below)
is reduced below AA- by Standard & Poor's Rating Services and its
successors ("S&P") then the Counterparty shall promptly notify the
Trust (and any permitted assignee or transferee of the Trust) of such
event and (unless, within 30 days after such reduction, S&P has
reconfirmed the rating of the Reference Notes or the Other Notes which
was in effect immediately prior to such reduction) the Counterparty,
shall within thirty (30) days of the date of such reduction, with the
prior written confirmation of S&P that such arrangement will not result
in the reduction of the then-current rating of any of the Reference
Notes or the Other Notes as a direct result of the reduction, either:
(1) (x) obtain a substitute swap provider acceptable to the
Trust (such acceptance not to be unreasonably withheld) and
replace this Transaction with a swap transaction on
substantially similar terms or with such other amendments as
consented to in writing by the Trust (which consent shall not
be unreasonably withheld) provided such replacement would
result in a Joint Rating of at least AA-, except that such
substitute swap provider shall thenceforth be the
"Counterparty" hereunder; or (y) replace, with the consent of
the then current Offsetting Counterparty, the swap transaction
with the then current Offsetting Counterparty with a swap
transaction with a replacement Offsetting Counterparty on
terms approved by S&P or enter into a swap transaction with
another party such that such party shall be acting as an
intermediary between the Counterparty and the then current
Offsetting Counterparty; or
(2) enter into an ISDA Credit Support Annex with the Trust in
substantially the form attached as Exhibit B hereto; or
(3) enter into such other credit support arrangements to
assure performance by the Counterparty of its obligations
under this Transaction.
Notwithstanding the foregoing, in the event that the Joint Rating of
the Counterparty and the Offsetting Counterparty is reduced below A-,
then the Counterparty shall promptly notify the Trust (and any
permitted assignee or transferee of the Trust) of such event and
(unless, within 30 days after such reduction, S&P has reconfirmed the
rating of the Reference Notes or the Other Notes which was in effect
immediately prior to such reduction) the Counterparty shall within
thirty (30) days of the date of such reduction, with the prior written
confirmation of S&P that such arrangement will not result in the
reduction of the then-current rating of any of the Reference Notes or
the Other Notes as a direct result of the reduction, must obtain a
substitute swap provider acceptable to the Trust (such acceptance not
to be unreasonably withheld) and replace this Transaction with a swap
transaction on substantially similar terms or with such other
amendments as consented to in writing by the Trust (which consent shall
not be unreasonably withheld) provided such replacement would result in
a Joint Rating of at least AA-, except that such substitute swap
provider shall thenceforth be the "Counterparty" hereunder.
Upon any replacement of the Transaction with a swap transaction with a
substitute swap provider, this Transaction shall terminate without any
payment by either party hereto and any and all collateral posted by the
Counterparty shall be returned to it within three (3) Business Days and
any other form of collateral
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arrangement (including letters of credit, surety bond or other
guarantee) provided by or on behalf of the Counterparty shall
terminate.
"Offsetting Counterparty"means General Motors Acceptance Corporation
("GMAC") or any successor thereto under the swap transaction entered
into between (x) the Counterparty and (y) GMAC or any successor thereto
or any intermediary between the Counterparty and GMAC.
"Joint Rating" means the joint rating by S&P of the long-term
likelihood of payment under the interest rate swap determined by
locating the intersection of the Counterparty's long term senior
unsecured debt rating and the Offsetting Counterparty's long-term
senior unsecured debt rating in the following table:
OFFSETTING COUNTERPARTY'S RATING VS. COUNTERPARTY'S RATING
O AAA AA+ AA AA- A+ A A- BBB+ BBB BBB-
F AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA
F AA+ AAA AAA AAA AAA AAA AAA AAA AAA AAA AAA
S AA AAA AAA AAA AAA AAA AAA AAA AA+ AA+ AA+
E AA- AAA AAA AAA AA+ AA+ AA+ AA+ AA+ AA+ AA
T A+ AAA AAA AAA AA+ AA+ AA+ AA+ AA AA AA-
T A AAA AAA AAA AA+ AA+ AA AA AA- AA- A+
I A- AAA AAA AAA AA+ AA+ AA AA- A+ A+ A
N BBB AAA AAA AA+ AA+ AA AA- A+ A A A-
G +
BBB AAA AAA AA+ AA+ AA AA- A+ A A- BBB+
C BBB- AAA AAA AA+ AA AA- A+ A A- BBB+ BBB
O
U
N
T
E
R
P
A
R
T
Y
Notwithstanding the foregoing, in the event that the long term senior
unsecured debt rating of either the Counterparty or the Offsetting
Counterparty is rated below BBB- by S&P, then the Joint Rating shall be
the higher of the then current long term senior unsecured debt rating
of the Counterparty and the Offsetting Counterparty.
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In the event that the Counterparty fails to satisfy its obligations set
forth above in this Section 4, the Trust or any permitted assignee or
transferee of the Trust shall have the option, exercisable in its
discretion and with regard to the interests of the Noteholders, within
ten (10) Business Days following the date of expiry of the thirty (30)
day period after the date of the reduction, to designate (in writing)
an Early Termination Date on the basis that such failure shall be
treated as a Termination Event with the Counterparty as the Affected
Party. For the avoidance of doubt, the Counterparty and the Trust
acknowledge and agree that any such failure shall not constitute an
Event of Default.
5. Account Details:
Payments to Fixed Rate Payer:
Bank One, National Association
ABA No.: 000000000
A/C: No.: 4811-5377 further credit to
CARAT 2000-1 Collection Account No. 204902-000
Attn: X. Xxxxxxxxxx
Payments to Floating Rate Payer:
Citibank - New York
Account No.: 4072-4601
ABA No.: 000-000-000
6. Limited Recourse: Notwithstanding anything to the contrary contained
herein but without limiting the Counterparty's rights under Section
5(a)(i), all of the obligations of the Trust shall be payable by the
Trust only at the times and to the extent of funds available therefor
under the Trust Sale and Servicing Agreement and, to the extent such
funds are not available or are insufficient for the payment thereof,
shall not constitute a claim against the Trust to the extent of such
unavailability or insufficiency until such time as, and then to the
extent that, the Trust has assets sufficient to pay such prior
deficiency. This paragraph shall survive the termination of this
Agreement but in all cases shall expire one year and one day after the
final payment with respect to all notes and certificates issued by the
Trust.
7. Limitation of Liability: It is expressly understood and agreed by the
parties hereto that (a) this Agreement is executed and delivered by
Bankers Trust (Delaware), not individually or personally but solely as
Owner Trustee of Capital Auto Receivables Asset Trust 2000-1 in the
exercise of the powers and authority conferred and vested in it, (b)
each of the representations, undertakings and agreements herein made on
the part of the Trust is made and intended not as personal
representations, undertakings and agreements by Bankers Trust
(Delaware) but is made and intended for the purpose for binding only
the Trust, (c) nothing herein contained shall be construed as creating
any liability on Bankers Trust (Delaware), individually or personally,
to perform any covenant either expressed or implied contained herein,
all such liability, if any, being expressly waived by the parties
hereto and by any Person claiming by, through or under the parties
hereto and (d) under no circumstances shall Bankers Trust (Delaware) be
personally liable for the payment of any indebtedness or expenses of
the Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Trust
under this Agreement or any other related documents.
8. To the extent that a capitalized term in this Transaction is defined by
reference to a related definition contained in any Trust Document, for
purposes of this Transaction only, such capitalized term shall be
deemed to be amended only if the amendment of the term in a Trust
Document relating to such capitalized term occurs with the prior
written consent of the Counterparty.
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Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing the copy of this Confirmation enclosed for that purpose
and returning it to us.
CAPITAL AUTO RECEIVABLES ASSET
TRUST 2000-1
By: BANKERS TRUST (DELAWARE),
not in its individual capacity
but solely as Owner Trustee
By: /S/ XXXXXXX XXXXXXXXXX
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Name: Xxxxxxx XxxxxXxxxx
Title: Attorney-in-Fact
Accepted and confirmed as of the date first above written:
Xxxxxx Xxxxxxx Capital Services Inc.
By: __________________________
Name: __________________________
Title: __________________________
Acknowledged and agreed as of the date first above written:
General Motors Acceptance Corporation, solely as Calculation Agent
By:__________________________
Name:
Title:
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EXHIBIT A
The following terms shall have the following meanings in this Confirmation:
"Determination Date": the tenth (10th) day of each calendar month, or
if such tenth (10th) day is not a Business Day, the next succeeding Business
Day.
"Distribution Date": the fifteenth (15th) day of each succeeding
calendar month following the Effective Date or, if such fifteenth (15th) day is
not a Business Day, the next such succeeding Business Day, commencing May 15,
2000.
"Guarantor": Xxxxxx Xxxxxxx Xxxx Xxxxxx & Co. .
"Indenture": the Indenture, dated as of April 19, 2000 between the
Trust and the Indenture Trustee, as amended and supplemented from time to time
in accordance with its terms.
"Indenture Trustee": Bank One, National Association, a national banking
association not in its individual capacity but solely as trustee under the
Indenture, or any successor trustee under the Indenture.
"LIBOR": with respect to each Floating Rate Payer Payment Date other
than the initial Floating Rate Payer Payment Date, the rate for deposits in U.S.
Dollars for a period of one month which appears on the Telerate Service Page
3750 as of 11:00 a.m., London time, on the day that is two LIBOR Business Days
prior to the Distribution Date preceding such Floating Rate Payer Payment Date.
If the rate does not appear on that date on the Telerate Service Page 3750 (or
any other page as may replace that page on that service, or if that service is
no longer offered, any other service for displaying LIBOR or comparable rates as
may be selected by the Indenture Trustee after consultation with the Seller),
then LIBOR will be the Reference Bank Rate. For the initial Floating Rate Payer
Payment Date, LIBOR shall be 6.13%.
"LIBOR Business Day": any day other than a Saturday, Sunday or any
other day on which banks in London are required or authorized to be closed.
"Other Notes": The Class A Asset-Backed Notes issued by the Trust.
"Reference Bank Rate": for any Floating Rate Payer Payment Date, the
per annum rate determined on the basis of the rates at which deposits in U.S.
Dollars are offered by the reference banks (which will be four major banks that
are engaged in transactions in the London interbank market, selected by the
Indenture Trustee after consultation with the Seller) as of 11:00 a.m., London
time, on the day that is two LIBOR Business Days prior to the Distribution Date
preceding such Floating Rate Payer Payment Date to prime banks in the London
interbank market for a period of one month, in amounts approximately equal to
the principal amount of the Reference Notes then outstanding. The Indenture
Trustee will request the principal London office of each of the reference banks
to provide a quotation of its rate. If at least two quotations are provided, the
rate will be the arithmetic mean of the quotations, rounded upwards to the
nearest one-sixteenth of one percent. If on that date fewer than two quotations
are provided as requested, the rate will be the arithmetic mean, rounded upwards
to the nearest one-sixteenth of one percent, of the rates quoted by one or more
major banks in New York City, selected by the Indenture Trustee after
consultation with the Seller, as of 11:00 a.m., New York City time, on that date
to leading European banks for United States dollar deposits for a period of one
month in amounts approximately equal to the principal amount of any and all
classes of Reference Notes then outstanding. If no quotation can be obtained,
then LIBOR will be the rate for the prior Floating Rate Payer Payment Date.
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"Reference Note Balance": as of the Effective Date, $515,138,000 and,
with respect to each Distribution Date thereafter, the aggregate principal
balance of any and all outstanding Reference Notes.
"Seller": Capital Auto Receivables, Inc., which has executed the Trust
Sale and Servicing Agreement as the Seller, or its successor in interest
pursuant to Section 3.03 of the Trust Sale and Servicing Agreement.
"Trust Sale and Servicing Agreement": the Trust Sale and Servicing
Agreement, dated as of April 19, 2000 between the Seller, General Motors
Acceptance Corporation (as Servicer) and the Trust, as amended, modified and
supplemented from time to time in accordance with its terms.
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