This
preliminary prospectus supplement relates to an effective
registration statement under the Securities Act of 1933 and is
subject to completion. This preliminary prospectus supplement
and the accompanying prospectus do not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be
any sale of these securities in any jurisdiction in which
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
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Filed Pursuant to Rule 424(b)(3)
Registration Statement
No. 333-159107
Subject
to completion, dated September 14, 2010
PROSPECTUS
SUPPLEMENT
(To Prospectus dated May 11, 2009)
$
Ford Motor Credit Company
LLC
%
Notes due September 15, 2015
The Notes will bear interest from
September , 2010 at the rate
of % per annum. Ford Credit will
pay interest on the Notes semi-annually in arrears on
March 15 and September 15 of each year, beginning
March 15, 2011.
Investing in the Notes involves
risks. See Risk Factors on
page S-1
of this prospectus supplement and Risk Factors
beginning on page 1 of the accompanying prospectus.
Neither the Securities and
Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus supplement and the
accompanying prospectus. Any representation to the contrary is a
criminal offense.
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Per Note
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Total
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Initial public offering price
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%
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$
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Underwriting discounts and commissions
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%
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$
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Proceeds, before expenses, to Ford Credit
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%
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$
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Interest on the Notes will accrue
from September , 2010 and must be paid by the
purchasers if the Notes are delivered to the purchasers after
that date. Ford Credit expects that delivery of the Notes will
be made to investors on or about September ,
2010.
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Deutsche Bank Securities
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Goldman, Sachs & Co.
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HSBC
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Morgan Stanley
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Prospectus
Supplement dated September , 2010
TABLE OF
CONTENTS
Prospectus Supplement
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Page
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S-ii
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S-1
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S-1
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S-1
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S-5
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S-7
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S-7
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Prospectus
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Risk Factors
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1
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Where You Can Find More Information
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1
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Information Concerning Ford Credit
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1
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Ratio of Earnings to Fixed Charges
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3
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Use of Proceeds
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3
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Prospectus
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3
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Prospectus Supplement or Term Sheet
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4
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Description of Debt Securities
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4
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Description of Warrants
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20
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Plan of Distribution
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22
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Legal Opinions
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22
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Independent Registered Public Accounting Firm
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22
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You should rely only on the information contained or
incorporated by reference in this prospectus supplement or the
accompanying prospectus. No one is authorized to provide you
with different information.
The Notes are not being offered in any jurisdiction where the
offer is not permitted.
You should not assume that the information in this prospectus
supplement or the accompanying prospectus is accurate as of any
date other than the date on the front of the documents.
S-i
FORWARD-LOOKING
STATEMENTS
Statements included or incorporated by reference herein may
constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on expectations, forecasts
and assumptions by our management and involve a number of risks,
uncertainties, and other factors that could cause actual results
to differ materially from those stated, including, without
limitation, those set forth in Item 1A
Risk Factors and Item 7
Managements Discussion and Analysis of Financial Condition
and Results of Operations Risk Factors of Ford
Credits Annual Report on
Form 10-K
for the year ended December 31, 2009 (the 2009 Annual
Report on
Form 10-K)
and in Part 1 Item 2
Managements Discussion and Analysis of Financial Condition
and Results of Operations in Ford Credits Quarterly
Reports on
Form 10-Q
for the quarters ended March 31, 2010 (First Quarter
2010
Form 10-Q
Report) and June 30, 2010 (Second Quarter 2010
Form 10-Q
Report), which are incorporated herein by reference.
We cannot be certain that any expectations, forecasts or
assumptions made by management in preparing these
forward-looking statements will prove accurate, or that any
projections will be realized. It is to be expected that there
may be differences between projected and actual results. Our
forward-looking statements speak only as of the date of their
initial issuance, and we do not undertake any obligation to
update or revise publicly any forward-looking statements,
whether as a result of new information, future events, or
otherwise.
S-ii
RISK
FACTORS
Before purchasing any Notes, you should read carefully this
prospectus supplement, the accompanying prospectus and the
documents incorporated by reference herein, including the risk
factors discussions in Ford Credits 2009 Annual Report on
Form 10-K,
First Quarter 2010
Form 10-Q
Report, and Second Quarter 2010
Form 10-Q
Report for risk factors regarding Ford and Ford Credit.
DESCRIPTION OF
NOTES
This description of the terms of the Notes adds information to
the description of the general terms and provisions of debt
securities in the prospectus. If this summary differs in any way
from the summary in the prospectus, you should rely on this
summary. The Notes are part of the debt securities registered by
Ford Credit in May 2009 to be issued on terms to be determined
at the time of sale.
The Notes will initially be limited to
$ aggregate
principal amount, will be unsecured obligations of Ford Credit
and will mature on September 15, 2015. The Notes are not
subject to redemption prior to maturity. The Notes will be
issued in minimum denominations of $100,000 and will be issued
in integral multiples of $1,000 for higher amounts.
Ford Credit may, from time to time, without the consent of the
holders of the Notes, issue additional notes having the same
ranking and the same interest rate, maturity and other terms as
the Notes. Any such additional notes will, together with the
Notes, constitute a single series of notes under the Indenture.
No additional Notes may be issued if an Event of Default has
occurred with respect to the Notes.
The Notes will bear interest from September ,
2010 at the rate of % per annum.
Interest on the Notes will be payable on March 15 and
September 15 of each year (each such day an Interest
Payment Date), commencing March 15, 2011, to the
persons in whose names the Notes were registered at the close of
business on the 15th day preceding the Interest Payment
Date, subject to certain exceptions.
Interest on the Notes will be computed on the basis of a
360-day
year
comprised of twelve
30-day
months.
Book-Entry,
Delivery and Form
The Notes will be issued in the form of one or more fully
registered Global Notes (the Global Notes) which
will be deposited with, or on behalf of, The Depository Trust
Company, New York, New York (the
Depository) and registered in the name of
Cede & Co., the Depositorys nominee. Notes in
definitive form will not be issued, unless the Depository
notifies Ford Credit that it is unwilling or unable to continue
as depository for the Global Notes and Ford Credit fails to
appoint a successor depository within 90 days or unless
otherwise determined, at Ford Credits option. Beneficial
interests in the Global Notes will be represented through
book-entry accounts of financial institutions acting on behalf
of beneficial owners as direct and indirect participants in the
Depository.
Initial settlement for the Notes will be made in immediately
available funds. Secondary market trading between participants
of the Depository will occur in the ordinary way in accordance
with Depository rules and will be settled in immediately
available funds using the Depositorys Same-Day Funds
Settlement System.
UNITED STATES
TAXATION
The following discussion of the material United States federal
income tax and, in the case of a
non-United
States person, estate tax consequences of the acquisition,
ownership and disposition of a Note is the opinion of
Shearman & Sterling LLP, special tax counsel to Ford
Credit, and counsel for
S-1
the Underwriters. It applies to you only if you are the
beneficial owner of a Note that you acquire at its original
issuance at the issue price and hold the Note as a capital asset
within the meaning of section 1221 of the Internal Revenue
Code of 1986, as amended (the Code). This discussion
does not apply to you if you are subject to special treatment
under the United States federal income tax law, such as:
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dealers in securities or currencies;
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financial institutions or life insurance companies;
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tax-exempt organizations;
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S corporations, real estate investment trusts or regulated
investment companies;
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persons holding Notes as part of a hedge, straddle, conversion
or other synthetic security or integrated
transaction;
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taxpayers subject to the alternative minimum tax;
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U.S. holders (as defined below) with a functional currency
other than the United States dollar; or
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certain United States expatriates.
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The discussion is based on the Code, Treasury regulations
(including temporary regulations) promulgated thereunder,
rulings, published administrative positions of the United States
Internal Revenue Service (the IRS) and judicial
decisions, all as in effect on the date of this prospectus
supplement, which are subject to change, possibly with
retroactive effect, or to different interpretations.
This discussion does not purport to address all of the
United States federal income tax consequences that may be
applicable to you in light of your personal investment
circumstances or status. Prospective purchasers of Notes should
consult their own tax advisors concerning United States federal
income tax consequences of acquiring, owning and disposing of
the Notes, as well as any state, local or foreign tax
consequences.
U.S.
Holders
This section describes the material United States federal income
tax consequences to U.S. holders. You are a
U.S. holder for purposes of this discussion if
you are, for United States federal income tax purposes:
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an individual who is a citizen or resident of the United States,
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a domestic corporation;
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an estate that is subject to United States federal income
taxation without regard to the source of its income, or
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a trust if (1) a court within the United States is able to
exercise primary supervision over the administration of the
trust and one or more United States persons have the authority
to control all substantial decisions of the trust or (2) a
valid election is in effect under applicable Treasury
regulations for the trust to be treated as a United States
person.
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If a United States partnership (including for this purpose any
entity treated as a partnership for United States federal income
tax purposes) is a beneficial owner of the Notes, the treatment
of a partner in the partnership generally will depend upon the
status of the partner and upon the activities of the
partnership. A holder of Notes that is a partnership and
partners in such partnership should consult their tax advisors.
S-2
Interest.
Generally, a U.S. holder will
include stated interest on the Notes as ordinary income at the
time it is paid or accrued in accordance with the
U.S. holders method of accounting for United States
federal income tax purposes.
Sale or Other Disposition of Notes.
Upon the
sale or other disposition of a Note, a U.S. holder
generally will recognize gain or loss equal to the difference
between the amount realized on the sale or other disposition,
except to the extent such amount is attributable to accrued but
unpaid stated interest, and the holders tax basis in the
Note. Your tax basis in your Note generally will be your cost of
the Note.
Gain or loss so recognized will be capital gain or loss and will
be long-term capital gain or loss if your holding period in the
Note exceeds one year. Long-term capital gains recognized by
non-corporate holders generally will be subject to a lower tax
rate than the rate applicable to ordinary income. The
deductibility of capital losses is subject to limitations.
Non-United
States Persons
This section describes the material United States federal income
tax consequences to
non-United
States persons. Subject to the discussion of backup withholding
below:
(i) payments of principal and interest on a Note that is
beneficially owned by a non-United States person will not be
subject to United States federal withholding tax;
provided,
that in the case of interest, (x) (a) the
beneficial owner does not actually or constructively own 10% or
more of the total combined voting power of all classes of stock
of Ford Credit entitled to vote, (b) the beneficial owner
is not a controlled foreign corporation that is related,
directly or indirectly, to Ford Credit through stock ownership,
and (c) either (A) the beneficial owner of the Note
certifies to the person otherwise required to withhold United
States federal income tax from such interest, under penalties of
perjury, that it is not a United States person and provides its
name and address or (B) a securities clearing organization,
bank or other financial institution that holds customers
securities in the ordinary course of its trade or business (a
financial institution) and holds the Note certifies
to the person otherwise required to withhold United States
federal income tax from such interest, under penalties of
perjury, that such statement has been received from the
beneficial owner by it or by a financial institution between it
and the beneficial owner and furnishes the payor with a copy
thereof; (y) the beneficial owner is entitled to the
benefits of an income tax treaty under which the interest is
exempt from United States federal withholding tax and the
beneficial owner of the Note or such owners agent provides
an
IRS Form W-8BEN
claiming the exemption; or (z) the beneficial owner
conducts a trade or business in the United States to which the
interest is effectively connected and the beneficial owner of
the Note or such owners agent provides an
IRS Form W-8ECI;
provided that in each such case, the relevant certification or
IRS Form is delivered pursuant to applicable procedures and is
properly transmitted to the person otherwise required to
withhold United States federal income tax, and none of the
persons receiving the relevant certification or IRS Form has
actual knowledge that the certification or any statement on the
IRS Form is false;
(ii) a non-United States person will not be subject to
United States federal income or withholding tax on any gain
realized on the sale, exchange or redemption of a Note unless
the gain is effectively connected with the beneficial
owners trade or business in the United States or, in the
case of an individual, the holder is present in the United
States for 183 days or more in the taxable year in which
the sale, exchange or redemption occurs and certain other
conditions are met; and
(iii) a Note owned by an individual who at the time of
death is not a citizen or resident of the United States will not
be subject to United States federal estate tax as a result of
such individuals death if the individual does not actually
or constructively own 10% or more of the total combined voting
power of all classes of stock of Ford Credit entitled to vote
and the income on the Note would not have been effectively
connected with a U.S. trade or business of the individual.
S-3
If a beneficial owner or holder of a Note is a non-United States
partnership, the non-United States partnership will be required
to provide an IRS
Form W-8IMY,
and unless it has entered into a withholding agreement with the
IRS, to attach an appropriate certification obtained from each
of its partners.
Interest on a Note that is effectively connected with the
conduct of a trade or business in the United States by a holder
of a Note who is a non-United States person, although exempt
from United States withholding tax, may be subject to United
States income tax as if such interest was earned by a United
States person. In addition, if such holder is a non-United
States corporation, it may be subject to a branch profits tax at
a rate of 30% (or such lower rate provided by an applicable
income tax treaty) of its annual earnings and profits that are
so effectively connected, subject to specific adjustments.
Backup
Withholding and Information Reporting
In general, information reporting requirements will apply to
certain payments of principal and interest made on a Note and
the proceeds of the sale of a Note within the United States to
non-corporate
holders of the Notes, and backup withholding will
apply to such payments if the holder fails to provide an
accurate taxpayer identification number in the manner required
or to report all interest and dividends required to be shown on
its federal income tax returns.
Information reporting on IRS Form 1099 and backup
withholding will not apply to payments made by Ford Credit or a
paying agent to a non-United States person on a Note if, in the
case of interest, the IRS Form described in clause (y) or
(z) in Paragraph (i) under Income and Withholding
Tax has been provided under applicable procedures, or, in
the case of interest or principal, the certification described
in clause (x)(c) in Paragraph (i) under Income
and Withholding Tax and a certification that the
beneficial owner satisfies certain other conditions have been
supplied under applicable procedures, provided that the payor
does not have actual knowledge that the certifications are
incorrect.
Payments of the proceeds from the sale of a Note made to or
through a foreign office of a broker will not be subject to
information reporting or backup withholding, except that if the
broker is a United States person, a controlled foreign
corporation for United States tax purposes, a foreign person 50%
or more of whose gross income is effectively connected with a
United States trade or business for a specified three-year
period, a foreign partnership with specific connections to the
United States, or, a United States branch of a foreign bank or
foreign insurance company, information reporting may apply to
such payments. Payments of the proceeds from the sale of a Note
to or through the United States office of a broker are subject
to information reporting and backup withholding unless the
holder or beneficial owner certifies that it is a non-United
States person and that it satisfies certain other conditions or
otherwise establishes an exemption from information reporting
and backup withholding.
Backup withholding is not a separate tax, but is allowed as a
refund or credit against the holders United States federal
income tax, provided the necessary information is furnished to
the Internal Revenue Service.
Interest on a Note that is beneficially owned by a non-United
States person will be reported annually on IRS Form 1042-S,
which must be filed with the Internal Revenue Service and
furnished to such beneficial owner.
S-4
UNDERWRITING
Ford Credit is selling the Notes to the Underwriters named below
under an Underwriting Agreement dated July 30, 2009 and a
related Pricing Agreement dated September ,
2010. Deutsche Bank Securities Inc., Goldman, Sachs &
Co., HSBC Securities (USA) Inc. and Morgan Stanley &
Co. Incorporated are acting as representatives of the
Underwriters. The Underwriters and the amount of Notes each has
agreed to severally purchase from Ford Credit are as follows:
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Principal Amount
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Underwriter
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of Notes
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Deutsche Bank Securities Inc.
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$
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Goldman, Sachs & Co.
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HSBC Securities (USA) Inc.
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Morgan Stanley & Co. Incorporated
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Total
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$
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Under the terms and conditions of the Underwriting Agreement and
the related Pricing Agreement, if the Underwriters take any of
the Notes, then they are obligated to take and pay for all of
the Notes.
The Underwriters have advised Ford Credit that they propose
initially to offer the Notes directly to purchasers at the
initial public offering price set forth on the cover page of
this prospectus supplement, and may offer the Notes to certain
securities dealers at such price less a concession not in excess
of % of the initial public offering
price of the Notes. The Underwriters may allow, and such dealers
may reallow, a concession not in excess
of % of the initial public offering
price of the Notes to certain other dealers. After the Notes are
released for sale to the public, the offering price and other
selling terms with respect to the Notes may from time to time be
varied by the Underwriters.
The Notes are a new issue of securities with no established
trading market. Ford Credit has been advised by the Underwriters
that they intend to make a market in the Notes, but they are not
obligated to do so and may discontinue such market-making at any
time without notice. No assurance can be given as to the
liquidity of the trading market for the Notes.
In connection with the offering, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect the
price of the Notes. Specifically, the Underwriters may
over-allot in connection with the offering, creating a short
position with respect to the Notes. In addition, the
Underwriters may bid for, and purchase, Notes in the open market
to cover any short position or to stabilize the price of the
Notes. Any of these activities may stabilize or maintain the
market price of the Notes above independent market levels. The
Underwriters are not required to engage in these activities, and
may end any of these activities at any time.
No Public
Offering Outside the United States
No action has been or will be taken in any jurisdiction outside
of the United States of America that would permit a public
offering of the Notes, or the possession, circulation or
distribution of this prospectus supplement or any material
relating to Ford Credit, in any jurisdiction where action for
that purpose is required. Accordingly, the Notes included in
this offering may not be offered, sold or exchanged, directly or
indirectly, and neither this prospectus supplement or any other
offering material or advertisements in connection with this
offering may be distributed or published, in or from any such
country or jurisdiction, except in compliance with any
applicable rules or regulations of any such country or
jurisdiction.
S-5
European Economic
Area
In relation to each Member State of the European Economic Area
(EEA) which has implemented the EU prospectus directive, as
defined below (each, a relevant member state), with effect from
and including the date on which the prospectus directive is
implemented in that relevant member state (the relevant
implementation date) the Notes which are the subject of the
offering contemplated in this prospectus supplement will not be
offered to the public in that relevant member state prior to the
publication of a prospectus in relation to the Notes which has
been approved by the competent authority in that relevant member
state or, where appropriate, approved in another relevant member
state and notified to the competent authority in that relevant
member state, all in accordance with the prospectus directive,
except that, with effect from and including the relevant
implementation date, an offer of such Notes may be made to the
public in that relevant member state at any time:
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(a)
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to legal entities which are authorized or regulated to operate
in the financial markets or, if not so authorized or regulated,
whose corporate purpose is solely to invest in securities;
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(b)
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to any legal entity which has two or more of (1) an average
of at least 250 employees during the last financial year;
(2) a total balance sheet of more than 43,000,000 and
(3) an annual net turnover of more than 50,000,000,
as shown in its last annual or consolidated accounts;
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to fewer than 100 natural or legal persons per Member State,
other than qualified investors as defined in the prospectus
directive; or
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in any other circumstances falling within Article 3(2) of
the prospectus directive, provided that no such offer of Notes
shall require Ford Credit or any Underwriter to publish a
prospectus pursuant to Article 3 of the prospectus
directive or supplement a prospectus pursuant to Article 16
of the prospectus directive.
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For the purposes of this provision, the expression an offer of
notes to the public in relation to any notes in any relevant
member state means the communication in any form and by any
means of sufficient information on the terms of the offer and
the notes to be offered so as to enable an investor to decide to
purchase or subscribe the notes, as the same may be varied in
that Member State by any measure implementing the prospectus
directive in that Member State and the expression prospectus
directive means Directive 2003/71/EC and includes any relevant
implementing measure in each relevant member state.
United
Kingdom
The Notes will only be offered (a) in compliance with all
applicable provisions of the Financial Services and Markets Act
2000 (FSMA) with respect to anything done in
relation to the Notes in, from or otherwise involving the United
Kingdom and (b) each Underwriter has only communicated or
caused to be communicated and will only communicate or cause to
be communicated any invitation or inducement to engage in
investment activity (within the meaning of Section 21 of
the FSMA) received by it in connection with the issue or sale of
Notes in circumstances in which Section 21(1) of the FSMA
does not apply to Ford Credit. Without limitation to the other
restrictions referred to herein, this prospectus supplement is
directed only at (1) persons outside the United Kingdom,
(2) persons having professional experience in matters
relating to investments who fall within the definition of
investment professionals in Article 19(5) of
the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005; (3) high net worth bodies corporate,
unincorporated associations and partnerships and trustees of
high value trusts as described in Article 49(2) of the
Financial Services and Markets Act 2000 (Financial Promotion)
Order 2005 or (4) persons to whom an invitation or
inducement to engage in investment activity (within the meaning
of section 21 of the FSMA) in connection with the issue or
sale of any securities may otherwise lawfully be communicated or
caused to be communicated. Without limitation to the other
restrictions referred to herein, any investment or investment
activity to which this prospectus supplement relate is available
only to, and will be engaged in only with, such
S-6
persons, and persons within the United Kingdom who receive this
communication (other than persons who fall within (1) to
(4) above) should not rely or act upon this communication.
Secondary Trading
Prior to Settlement
It is expected that delivery of the Notes will be made against
payment therefor on or about the date specified in the last
paragraph of the cover page of this prospectus supplement, which
will be the fifth business day following the date of pricing of
the Notes (such settlement cycle being referred to herein as
T+5). Under
Rule 15c6-1
under the Securities Exchange Act of 1934, as amended, trades in
the secondary market generally are required to settle in three
business days, unless the parties to any such trade expressly
agree otherwise. Accordingly, purchasers who wish to trade the
Notes on the date of pricing or the following business day will
be required, by virtue of the fact that the Notes initially will
settle in T+5, to specify an alternate settlement cycle at the
time of any such trade to prevent a failed settlement.
Purchasers of Notes who wish to trade those Notes on the date of
pricing or the following business day should consult their own
advisor.
All secondary trading in the Notes will settle in immediately
available funds.
Ford Credit has agreed to indemnify the several Underwriters
against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. Ford Credit estimates that
it will spend approximately $250,000 for printing, registration
fees, rating agency and other expenses related to the offering
of the Notes. The Underwriters have agreed to reimburse Ford
Credit for certain expenses.
In the ordinary course of their respective businesses, certain
of the Underwriters and their respective affiliates have
engaged, and may in the future engage, in commercial banking,
general financing and/or investment banking transactions with
Ford Credit, Ford and certain of their affiliates. In the
ordinary course of their various business activities, the
Underwriters and their respective affiliates may make or hold a
broad array of investments and actively trade debt and equity
securities (or related derivative securities) and financial
instruments (including bank loans) for their own account and for
the accounts of their customers, and such investment and
securities activities may involve securities
and/or
instruments of Ford Credit or Ford. The Underwriters and their
respective affiliates may also make investment recommendations
and/or
publish or express independent research views in respect of such
securities or instruments and may at any time hold, or recommend
to clients that they acquire, long
and/or
short
positions in such securities and instruments.
LEGAL
OPINIONS
The legality of the Notes offered by Ford Credit hereby will be
passed on for Ford Credit by Louis J. Ghilardi, Managing
Counsel and Assistant Secretary of Ford, or other counsel
satisfactory to the Underwriters. The Underwriters are being
represented by Shearman & Sterling LLP, New York,
New York. Mr. Ghilardi is a full-time employee of
Ford, and owns and holds options to purchase shares of common
stock of Ford. Shearman & Sterling LLP has in the past
provided, and may continue to provide, legal services to Ford
and its subsidiaries.
INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The financial statements of Ford Motor Credit Company LLC as of
December 31, 2009 and 2008 and for each of the three years
in the period ended December 31, 2009 and managements
assessment of the effectiveness of the internal control over
financial reporting as of December 31, 2009 (which is
included in Managements Report on Internal Control over
Financial Reporting of Ford Credits
Form 10-K
for the year ended December 31, 2009) incorporated in this
Prospectus Supplement by reference to the Annual Report on
Form 10-K
have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, an independent registered public
accounting firm, given on the authority of said firm as experts
in auditing and accounting.
S-7
With respect to the unaudited consolidated financial information
of Ford Motor Credit Company LLC for the quarters ended
June 30, 2010 and 2009 and March 31, 2010 and 2009,
incorporated by reference in this prospectus supplement,
PricewaterhouseCoopers LLP reported that it has applied limited
procedures in accordance with professional standards for a
review of such information. However, its separate reports dated
August 6, 2010 and May 7, 2010, each incorporated by
reference in this prospectus supplement, state that the firm did
not audit and does not express an opinion on that unaudited
consolidated financial information. PricewaterhouseCoopers LLP
has not carried out any significant or additional audit tests
beyond those that would have been necessary if its report had
not been included. Accordingly, the degree of reliance on its
report on such information should be restricted in light of the
limited nature of the review procedures applied.
PricewaterhouseCoopers LLP is not subject to the liability
provisions of Section 11 of the Securities Act of 1933 (the
Act) for its report on the unaudited consolidated
financial information because that report is not a
report or a part of the registration
statement prepared or certified by PricewaterhouseCoopers LLP
within the meaning of Sections 7 and 11 of the Act.
S-8
Ford Motor Credit Company
LLC
Senior Debt Securities,
Subordinated Debt Securities and Warrants
This prospectus is part of a registration statement that Ford
Credit filed with the SEC. Under this registration, Ford Credit
may, from time to time, sell the following types of securities
described in this prospectus in one or more offerings:
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our debt securities, in one or more series, which may be senior
debt securities or subordinated debt securities, in each case
consisting of notes, debentures or other unsecured evidences of
indebtedness;
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warrants to purchase debt securities; or
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any combination of these securities.
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This prospectus provides a general description of the securities
we may offer. Each time we sell securities, we will provide a
prospectus supplement or term sheet that will contain specific
information about the terms of that offering. The prospectus
supplement or term sheet may also add, update or change
information contained in this prospectus.
Investments in the securities involve certain risks. See
Risk Factors
beginning on page 1 of this
prospectus.
You should read both this prospectus and any prospectus
supplement or term sheet together with additional information
described under the heading Where You Can Find More
Information.
Our principal executive offices are located at:
Ford Motor Credit Company LLC
One American Road
Dearborn, Michigan 48126
313-322-3000
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus is May 11, 2009.
TABLE OF
CONTENTS
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You should rely only on the information contained or
incorporated by reference in this prospectus and in any
accompanying prospectus supplement. No one has been authorized
to provide you with different information.
The securities are not being offered in any jurisdiction
where the offer is not permitted.
You should not assume that the information in this prospectus
or any prospectus supplement is accurate as of any date other
than the date on the front of the documents.
RISK
FACTORS
Your investment in the securities involves certain risks. In
consultation with your own financial and legal advisers, you
should carefully consider whether an investment in the
securities is suitable for you. The securities are not an
appropriate investment for you if you do not understand the
terms of the securities or financial matters generally. In
addition, certain factors that may adversely affect the business
of Ford Motor Credit Company LLC, referred to hereafter as Ford
Credit, and Ford Motor Company, referred to hereafter as Ford,
are discussed in Ford Credits periodic reports referred to
in Where You Can Find More Information, below. For
example, Ford Credits Annual Report on Form 10-K for the
year ended December 31, 2008 contains a discussion of
significant risks that could be relevant to an investment in the
securities. You should not purchase the securities described in
this Prospectus unless you understand and know you can bear all
of the investment risks involved.
You can learn more about the financial results and credit
ratings of Ford Credit by reading the annual, quarterly and
current reports and other information Ford Credit files with the
Securities and Exchange Commission, referred to hereafter as the
SEC. You may read and copy any document Ford Credit files at the
SECs public reference room at 100 F Street, N.E.,
Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330
for further information on the public reference room. The SEC
filings of Ford Credit also are available to you at the
SECs web site at
http://www.sec.gov.
The SEC allows Ford Credit to incorporate by reference the
information it files with the SEC, which means that Ford Credit
can disclose important information to you by referring you to
those documents, which are considered part of this prospectus.
Information that Ford Credit files later with the SEC will
automatically update and supersede the previously filed
information. Ford Credit incorporates by reference the documents
listed below and any future filings made with the SEC under
Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 until the offering of all the Securities
has been completed.
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Annual Report of Ford Credit on
Form 10-K
for the year ended December 31, 2008, which is referred to
hereafter as the
2008 10-K
Report.
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Quarterly Report of Ford Credit on
Form 10-Q
for the quarter ended March 31, 2009, which is referred to
hereafter as the
2009 10-Q
Report.
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Current Reports of Ford Credit on
Form 8-K
filed in 2009 on January 5, January 29*,
February 4, March 3, March 4, March 23,
April 1, April 6, and May 1.
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*
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Other than information that has been furnished to, and not filed
with, the SEC, which information is not incorporated into this
prospectus.
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These reports include information about Ford as well as
information about Ford Credit.
You may request copies of these filings at no cost, by writing
or telephoning Ford Credits principal executive offices at
the following address:
Ford Motor Credit Company LLC
One American Road
Dearborn, MI 48126
Attn: Corporate Secretary
1-800-426-2888
INFORMATION
CONCERNING FORD CREDIT
Ford Credit was incorporated in Delaware in 1959, was converted
to a Delaware limited liability company on May 1, 2007 and
is an indirect, wholly owned subsidiary of Ford. As used herein
Ford Credit refers to Ford Motor Credit Company LLC
and its subsidiaries unless the context otherwise requires.
1
Ford Credit offers a wide variety of automotive financing
products to and through automotive dealers throughout the world.
Our primary financing products fall into three categories:
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Retail financing purchasing retail installment sale
contracts and retail lease contracts from dealers, and offering
financing to commercial customers, primarily vehicle leasing
companies and fleet purchasers, to lease or purchase vehicle
fleets;
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Wholesale financing making loans to dealers to
finance the purchase of vehicle inventory, also known as
floorplan financing; and
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Other financing making loans to dealers for working
capital, improvements to dealership facilities, and to purchase
or finance dealership real estate.
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We also service the finance receivables and leases we originate
and purchase, make loans to Ford affiliates, purchase certain
receivables of Ford and its subsidiaries and provide insurance
services related to our financing programs.
We earn our revenue primarily from:
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Payments made under retail installment sale contracts and retail
leases that we purchase;
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Interest supplements and other support payments from Ford and
affiliated companies on special-rate financing programs; and
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Payments made under wholesale and other dealer loan financing
programs.
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We conduct our financing operations directly and through our
subsidiaries and affiliates. We offer substantially similar
products and services throughout many different regions, subject
to local legal restrictions and market conditions. We divide our
business segments based on geographic regions: a North America
segment and an International segment. The North America segment
includes our operations in the United States and Canada. The
International segment includes our operations in all other
countries in which we do business directly and indirectly.
North America
Segment
We do business in all states of the United States and all
provinces in Canada. Our United States operations accounted for
65% and 62% of our total managed receivables at year-end 2008
and 2007, respectively, and our Canadian operations accounted
for about 9% and 10% of our total managed receivables at
year-end 2008 and 2007, respectively. Managed receivables
include on-balance sheet receivables, excluding unearned
interest supplements related to finance receivables, and
securitized off-balance sheet receivables that we continue to
service.
In the United States and Canada, under the Ford Credit brand
name, we provide financing services to and through dealers of
Ford, Lincoln and Mercury brand vehicles and non-Ford vehicles
also sold by these dealers and their affiliates. We provide
similar financial services under the Volvo brand name to and
through Volvo dealers.
International
Segment
Our International segment includes operations in three main
regions: Europe, Asia-Pacific and Latin America. Our Europe
region is our largest international operation, accounting for
about 22% of our total managed receivables at year-end 2008
and 2007. Within the International segment, our Europe region
accounted for 85% and 79% of our managed receivables at year-end
2008 and 2007, respectively. Most of our European operations are
managed through a United Kingdom-based subsidiary, FCE Bank
plc, referred to hereafter as FCE. FCE operates in the United
Kingdom and operates branches in 11 other European countries. In
addition, FCE has operating subsidiaries in the United Kingdom,
Hungary, Poland and the Czech Republic that provide a variety of
wholesale, leasing and retail vehicle financing. In our largest
European markets, Germany and the United Kingdom, FCE offers
most of our products and services under the Ford Credit/Bank,
Land Rover Financial Services, Jaguar Financial Services, and
Mazda Credit/Bank brands. In the U.K., FCE also offers products
and services under the Volvo Car Finance brand, while in Germany
this is provided through a different Ford subsidiary. FCE
generates most of our European revenue and contract volume from
Ford Credit/
2
Bank brand products and services. FCE, through our Worldwide
Trade Financing division, provides financing to
distributors/importers in countries where typically there is no
established local Ford presence. The Worldwide Trade Financing
division currently provides financing in over 70 countries.
In addition, other private label operations and alternate
business arrangements exist in some European markets.
In the Asia-Pacific region, we operate in Australia, Taiwan,
Thailand, and China. In the Latin America region, we operate in
Mexico, Brazil, Chile and Argentina. We have joint ventures with
local financial institutions and other third parties in various
locations around the world.
The mailing address of Ford Credits executive offices is
One American Road, Dearborn, Michigan 48126, United States
of America. The telephone number of such offices is
(313) 322-3000.
RATIO OF EARNINGS
TO FIXED CHARGES
The ratio of earnings to fixed charges for the three months
ended March 31, 2009 and for the years
2006-2008
for Ford Credit are included as an exhibit to Ford Credits
2009 10-Q Report and are incorporated in this prospectus by
reference. The ratio of earnings to fixed charges for the three
months ended March 31, 2009 and for the years
2004-2008
for Ford are included as an exhibit to Fords Quarterly
Report on Form 10-Q for the quarter ended March 31, 2009
and are incorporated in this prospectus by reference.
USE OF
PROCEEDS
Except as otherwise provided in a prospectus supplement, the net
proceeds from the sale of the securities will be added to the
general funds of Ford Credit and will be available for the
purchase of receivables, for loans and for use in connection
with the retirement of debt.
Ford Credit expects to issue additional long-term and short-term
debt from time to time. The nature and amount of Ford
Credits long-term and short-term debt and the
proportionate amount of each can be expected to vary from time
to time, as a result of business requirements, market conditions
and other factors.
PROSPECTUS
This prospectus is part of a registration statement that we
filed with the SEC. Under this registration process, we may sell
any combination of the following securities in one or more
offerings:
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unsecured debt securities (debt securities), which
may be either senior (the senior securities) or
subordinated (the subordinated securities); or
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warrants to purchase debt securities (debt warrants).
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The terms of the securities will be determined at the time of
offering.
We will refer to the debt securities and debt warrants, or any
combination of those securities, proposed to be sold under this
prospectus and the applicable prospectus supplement or term
sheet as the offered securities. The offered
securities, together with any debt securities, issuable upon
exercise of debt warrants or conversion or exchange of other
offered securities, as applicable, will be referred to as the
securities.
Because we are a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act of 1933, as amended (the
Act), we may add to and offer additional securities,
including those to be sold by security holders, by filing a
prospectus supplement or term sheet with the SEC at the time of
the offer.
3
PROSPECTUS
SUPPLEMENT OR TERM SHEET
This prospectus provides you with a general description of the
debt securities and warrants to purchase debt securities we may
offer. Each time we sell securities, we will provide a
prospectus supplement or term sheet which may be in the form
attached hereto as Exhibit A that will contain specific
information about the terms of that offering. The prospectus
supplement or term sheet may also add to, update or change
information contained in this prospectus and, accordingly, to
the extent inconsistent, information in this prospectus is
superseded by the information in the prospectus supplement or
term sheet. You should read both this prospectus and any
prospectus supplement or term sheet together with the additional
information described above under the heading Where You
Can Find More Information.
The prospectus supplement or term sheet to be provided with this
prospectus will describe the terms of the securities offered,
any initial public offering price, the price paid to us for the
securities, the net proceeds to us, the manner of distribution
and any underwriting compensation and the other specific
material terms related to the offering of these securities.
For more detail on the terms of the securities, you should read
the exhibits filed with or incorporated by reference in our
registration statement.
DESCRIPTION OF
DEBT SECURITIES
We will issue debt securities in one or more series under an
Indenture, dated as of February 1, 1985, as supplemented,
between us and The Bank of New York Mellon, as successor to
Manufacturers Hanover Trust Company, as Trustee (the
Trustee). The Indenture may be supplemented further
from time to time.
The Indenture is a contract between us and The Bank of
New York Mellon acting as Trustee. The Trustee has two main
roles. First, the Trustee can enforce your rights against us if
an Event of Default described below occurs. Second,
the Trustee performs certain administrative duties for us.
The Indenture is summarized below. Because this discussion is a
summary, it does not contain all of the information that may be
important to you. We filed the Indenture as an exhibit to the
registration statement, and we suggest that you read those parts
of the Indenture that are important to you. You especially need
to read the Indenture to get a complete understanding of your
rights and our obligations under the covenants described below
under Limitation on Liens and Merger and
Consolidation. Throughout the summary we have included
parenthetical references to the Indenture so that you can easily
locate the provisions being discussed.
The specific terms of each series of debt securities will be
described in the particular prospectus supplement or term sheet
relating to that series. The prospectus supplement or term sheet
may or may not modify the general terms found in this prospectus
and will be filed with the SEC. For a complete description of
the terms of a particular series of debt securities, you should
read both this prospectus and the prospectus supplement or term
sheet relating to that particular series.
General
The Indenture does not limit the amount of debt securities that
may be issued under it. Therefore, additional debt securities
may be issued under the Indenture.
The prospectus supplement or term sheet that will accompany this
prospectus will describe the particular series of debt
securities being offered by including:
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the designation or title of the series of debt securities;
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the total principal amount of the series of debt securities;
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the percentage of the principal amount at which the series of
debt securities will be offered;
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the date or dates on which principal will be payable;
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the rate or rates (which may be either fixed or variable) and/or
the method of determining such rate or rates of interest, if any;
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the date or dates from which any interest will accrue, or the
method of determining such date or dates, and the date or dates
on which any interest will be payable;
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the terms for redemption, extension or early repayment, if any;
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the currencies in which the series of debt securities are issued
and payable;
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the provision for any sinking fund;
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any additional restrictive covenants;
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any additional Events of Default;
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whether the series of debt securities are issuable in
certificated form;
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any special tax implications, including provisions for original
issue discount;
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any provisions for convertibility or exchangeability of the debt
securities into or for any other securities, including into or
for any securities of a third party;
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whether the debt securities are subject to subordination and the
terms of such subordination; and
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any other terms.
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The debt securities will be unsecured obligations of Ford
Credit. Senior debt securities will rank equally with Ford
Credits other unsecured and unsubordinated indebtedness
(parent company only). Subordinated debt securities will be
unsecured and subordinated in right of payment to the prior
payment in full of all of our unsecured and unsubordinated
indebtedness. See Subordination below.
Unless the prospectus supplement or term sheet states otherwise,
principal (and premium, if any) and interest, if any, will be
paid by us in immediately available funds.
Unless otherwise specified in the applicable prospectus
supplement or term sheet, the debt securities will be
denominated in U.S. dollars and all payments on the debt
securities will be made in U.S. dollars.
Payment of the purchase price of the debt securities must be
made in immediately available funds.
As used in this prospectus, Business Day means any
day, other than a Saturday or Sunday, that is neither a legal
holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The
City of New York; provided, however, that, with respect to
foreign currency Notes, the day is also not a day on which
commercial banks are authorized or required by law, regulation
or executive order to close in the Principal Financial Center
(as defined below) of the country issuing the specified currency
(or, if the specified currency is the euro, the day is also a
day on which the Trans-European Automated Real Time Gross
Settlement Express Transfer (TARGET) System is open); and
provided further that, with respect to Notes as to which LIBOR
is an applicable interest rate basis, the day is also a London
Business Day.
London Business Day means a day on which commercial
banks are open for business (including dealings in the
designated LIBOR Currency) in London.
Principal Financial Center means (i) the
capital city of the country issuing the specified currency or
(ii) the capital city of the country to which the
designated LIBOR Currency relates, as applicable,
5
except that the term Principal Financial Center
means the following cities in the case of the following
currencies:
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Principal Financial
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Currency
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Center
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U.S. dollars
Australian dollars
Canadian dollars
New Zealand dollars
South African rand
Swiss francs
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The City of New York
Sydney
Toronto
Auckland
Johannesburg
Zurich
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In the event that the LIBOR Currency is the euro, the Principal
Financial Center will be London.
Unless otherwise specified in the applicable prospectus
supplement or term sheet, the authorized denominations of debt
securities denominated in U.S. dollars will be integral
multiples of $1,000. The authorized denominations of foreign
currency debt securities will be set forth in the applicable
prospectus supplement or term sheet.
The Indenture does not contain any provisions that give you
protection in the event we issue a large amount of debt or we
are acquired by another entity.
Interest
Interest-bearing debt securities will bear interest from their
respective dates of issue at a fixed rate (Fixed Rate
Notes) or a floating rate (Floating Rate
Notes, and Fixed Rate Notes and Floating Rate Notes are
collectively referred to hereafter as Notes.). The
applicable prospectus supplement will specify the interest rate
applicable to each interest-bearing Note and the frequency with
which interest is payable. Unless otherwise specified in the
prospectus supplement or term sheet relating to interest-bearing
Notes, the following applicable terms will apply.
Interest, if any, on the Notes will be payable in arrears on
each Interest Payment Date to the persons in whose names the
Notes are registered at the close of business on the 15th day
preceding each such Interest Payment Date.
The Interest Payment Dates for interest-bearing
Notes with the stated payment frequencies will be as follows:
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Interest Payment Frequency
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Interest Payment Dates
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Monthly
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Twentieth day of each calendar month, beginning in the first
calendar month following the month in which the Note was issued.
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Quarterly
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Twentieth day of every third month, beginning in the third
calendar month following the month in which the Note was issued.
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Semiannual
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Twentieth day of every sixth month, beginning in the sixth
calendar month following the month in which the Note was issued.
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Annual
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Twentieth day of every twelfth month, beginning in the twelfth
calendar month following the month in which the Note was issued.
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Interest rates on the Notes may differ depending upon, among
other factors, the aggregate principal amount of Notes purchased
in any single transaction. Notes with different variable terms
other than interest rates may also be offered concurrently to
different investors. We may change interest rates or formulas
and other terms of Notes from time to time, but no change of
terms will affect any Note previously issued or as to which we
have accepted an offer to purchase.
Each interest payment on a Note will include interest accrued
from, and including, the issue date or the last Interest Payment
Date, as the case may be, to, but excluding, the following
Interest Payment Date or the Maturity Date, as the case may be
(each such time period an Interest Period).
6
Fixed Rate
Notes
Each Fixed Rate Note will bear interest at a fixed interest rate
per annum. Interest on Fixed Rate Notes will be computed on the
basis of a 360-day year of twelve 30-day months. If the Maturity
Date or an Interest Payment Date for any Fixed Rate Note is not
a Business Day, then the principal and interest for that Note
will be paid on the next Business Day, and no interest will
accrue from and after the Maturity Date or on such Interest
Payment Date.
Floating Rate
Notes
Each Floating Rate Note will have an interest rate basis or
formula. Ford Credit may base that formula on:
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the Commercial Paper Rate;
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LIBOR;
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the Federal Funds Rate;
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the Prime Rate;
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the Treasury Rate;
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the CMT Rate; or
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another interest rate basis or formula.
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The prospectus supplement or term sheet also will indicate any
Spread which will be added to or subtracted from(or which will
be applied as a multiplier) the interest rate formula to
determine the interest rate. A Floating Rate Note may have
either of the following: a ceiling on the rate at which interest
may accrue during any Interest Period (a Maximum Interest
Rate), and a floor on the rate at which interest may
accrue during any Interest Period. In addition to any Maximum
Interest Rate limitation, the interest rate on the Floating Rate
Notes will in no event be higher than the maximum rate permitted
by New York law, as the same may be modified by United States
law for general application.
Ford Credit will appoint a calculation agent to calculate
interest rates on the Floating Rate Notes. Unless a different
party is identified in the prospectus supplement or term sheet,
The Bank of New York Mellon will be the calculation agent. In
most cases, a Floating Rate Note will have a specified
Interest Reset Date, Interest Determination
Date and Calculation Date associated with it.
An Interest Reset Date is the date on which the interest rate on
a Floating Rate Note changes. An Interest Determination Date is
the date as of which the new interest rate is determined, based
on the applicable interest rate basis or formula. The
Calculation Date is the date by which the calculation agent will
determine the new interest rate for a particular Interest Reset
Date.
Change of Interest Rate.
Ford Credit may
reset the interest rate on each Floating Rate Note daily,
weekly, monthly, quarterly, semi-annually, annually or on some
other basis specified in the applicable prospectus supplement or
term sheet.
The related prospectus supplement or term sheet will describe
the initial interest rate and/or interest rate formula for each
Note. That rate is effective until the following Interest Reset
Date. Thereafter, the interest rate will be the rate determined
as of each Interest Determination Date. Each time a new interest
rate is determined, it becomes effective on the next Interest
Reset Date. If any Interest Reset Date is not a Business Day,
then the Interest Reset Date is postponed to the next Business
Day, except, in the case of a LIBOR Note, if the next Business
Day is in the next calendar month, the Interest Reset Date is
the immediately preceding Business Day.
Date Interest Rate is Determined.
The
Interest Determination Date for Floating Rate Notes will be
specified in the applicable prospectus supplement or term sheet.
7
Index
Maturity
The prospectus supplement or term sheet for each Floating Rate
Note will typically specify an Index Maturity for
such Notes, which is the period to maturity of the instrument or
obligation on which the floating interest rate formula is based
(e.g., Three Month LIBOR).
Calculation Date.
The Calculation
Date, if applicable, relating to an Interest Determination
Date will be the earlier of (1) the tenth calendar day
after such Interest Determination Date or, if such day is not a
Business Day, the next following Business Day, or (2) the
Business Day immediately preceding the relevant Interest Payment
Date or the Maturity Date, as the case may be.
Upon the request of the beneficial holder of any Floating Rate
Note, Ford Credit will provide, or cause the calculation agent
to provide, the interest rate then in effect for such Floating
Rate Note and, if available, the interest rate that will become
effective on the next Interest Reset Date for such Floating Rate
Note.
Payment of Interest.
Payments of interest on
Floating Rate Notes will be paid on the Interest Payment Dates
and on the day of maturity, redemption or repurchase.
Each interest payment on a Floating Rate Note will include
interest accrued from, and including, the issue date or the last
Interest Payment Date, as the case may be, to, but excluding,
the following Interest Payment Date or the Maturity Date, as the
case may be.
Ford Credit will pay installments of interest on Floating Rate
Notes beginning on the first Interest Payment Date after its
issue date to holders of record on the corresponding Regular
Record Date. The Regular Record Date for a Floating Rate Note
will be on the 15th day (whether or not a Business Day)
preceding the Interest Payment Date. If an Interest Payment Date
for any Floating Rate Note (but not the Maturity Date) is not a
Business Day, the Interest Payment Date will be postponed to the
next Business Day, except that in the case of LIBOR Notes, if
the next Business Day is in the next calendar month, the
Interest Payment Date will be the immediately preceding Business
Day. If the Maturity Date of any Floating Rate Note is not a
Business Day, principal, premium, if any, and interest for that
Note will be paid on the next Business Day, and no interest will
accrue from and after the Maturity Date.
Ford Credit will calculate accrued interest on a Floating Rate
Note by multiplying the principal amount of a Note by an accrued
interest factor. The accrued interest factor is the sum of the
interest factors calculated for each day in the period for which
accrued interest is being calculated. The interest factor for
each day will be computed by dividing the interest rate in
effect on that day by (1) the actual number of days in the
year, in the case of Treasury Rate Notes or CMT Rate Notes, or
(2) 360, in the case of other Floating Rate Notes. The interest
factor for Floating Rate Notes for which the interest rate is
calculated with reference to two or more interest rate bases
will be calculated in each period in the same manner as if only
one of the applicable interest rate bases applied. All
percentages resulting from any calculation are rounded to the
nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upward. For
example, 9.876545% (or .09876545) will be rounded to 9.87655%
(or .0987655). Dollar amounts used in the calculation are
rounded to the nearest cent (with one-half cent being rounded
upward).
Calculation of Interest.
The interest rate
basis for different types of Floating Rate Notes will be
determined as follows.
Commercial Paper Rate Notes.
The Commercial
Paper Rate for any Interest Determination Date is the
Money Market Yield of the rate for that date for commercial
paper having the Index Maturity described in the related
prospectus supplement or term sheet, as published in H.15(519)
prior to 3:00 p.m. New York City time on the Calculation
Date for such Interest Determination Date under the heading
Commercial Paper Nonfinancial.
8
The calculation agent will observe the following procedures if
the Commercial Paper Rate cannot be determined as described
above:
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If the above rate is not published in H.15(519) by
3:00 p.m., New York City time, on the Calculation Date, the
Commercial Paper Rate will be the Money Market Yield of the rate
on that Interest Determination Date for commercial paper having
the Index Maturity described in the prospectus supplement or
term sheet, as published in H.15 Daily Update, or such other
recognized electronic source used for the purpose of displaying
such rate, under the caption Commercial Paper
Nonfinancial.
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If that rate is not published in H.15(519), H.15 Daily Update or
another recognized electronic source used for the purpose of
displaying such rate by 3:00 p.m. New York City time on the
Calculation Date, then the calculation agent will determine the
Commercial Paper Rate to be the Money Market Yield of the
average of the offered rates of three leading dealers of
US dollar commercial paper in New York City as of
11:00 A.M., New York City time, on that Interest
Determination Date for commercial paper having the Index
Maturity described in the prospectus supplement or term sheet
placed for an industrial issuer whose bond rating is
Aa, or the equivalent, from a nationally recognized
securities rating organization. The calculation agent will
select the three dealers referred to above.
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If fewer than three dealers selected by the calculation agent
are quoting as mentioned above, the Commercial Paper Rate will
remain the Commercial Paper Rate then in effect on that Interest
Determination Date.
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Money Market Yield means a yield (expressed as a
percentage) calculated in accordance with the following formula:
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D × 360
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Money Market Yield =
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× 100
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360 (D × M)
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where D refers to the applicable per annum rate for
commercial paper quoted on a bank discount basis and expressed
as a decimal, and M refers to the actual number of
days in the reset period for which interest is being calculated.
LIBOR Notes.
The LIBOR for any Interest
Determination Date is the rate for deposits in the LIBOR
Currency having the Index Maturity specified in such pricing
supplement or term sheet as such rate is displayed on Reuters on
page LIBOR01 (or any other page as may replace such page on
such service for the purpose of displaying the London interbank
rates of major banks for the designated LIBOR Currency)
(Reuters Page LIBOR01) as of 11:00 a.m.,
London time, on such LIBOR Interest Determination Date.
The following procedure will be followed if LIBOR cannot be
determined as described above:
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The calculation agent shall request the principal London offices
of each of four major reference banks in the London interbank
market, as selected by the calculation agent to provide the
calculation agent with its offered quotation for deposits in the
designated LIBOR Currency for the period of the Index Maturity
specified in the applicable pricing supplement or term sheet,
commencing on the related Interest Reset Date, to prime banks in
the London interbank market at approximately 11:00 a.m.,
London time, on such LIBOR Interest Determination Date and in a
principal amount that is representative for a single transaction
in the designated LIBOR Currency in such market at such time. If
at least two such quotations are so provided, then LIBOR on such
LIBOR Interest Determination Date will be the arithmetic mean
calculated by the calculation agent of such quotations. If fewer
than two such quotations are so provided, then LIBOR on such
LIBOR Interest Determination Date will be the arithmetic mean
calculated by the calculation agent of the rates quoted at
approximately 11:00 a.m., in the applicable Principal
Financial Center (as described above), on such LIBOR Interest
Determination Date by three major banks (which may include
affiliates of the agents) in such Principal Financial Center
selected by the calculation agent for loans in the designated
LIBOR Currency to leading
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European banks, having the Index Maturity specified in the
applicable pricing supplement or term sheet and in a principal
amount that is representative for a single transaction in the
designated LIBOR Currency in such market at such time;
provided
,
however
, that if the banks so selected
by the calculation agent are not quoting as mentioned in this
sentence, LIBOR determined as of such LIBOR Interest
Determination Date shall be LIBOR in effect on such LIBOR
Interest Determination Date.
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LIBOR Currency means the currency specified in the
applicable prospectus supplement or term sheet as to which LIBOR
shall be calculated or, if no such currency is specified in the
applicable prospectus supplement or term sheet,
U.S. dollars.
EURIBOR Notes.
The EURIBOR for any
Interest Determination Date is the offered rate for deposits in
euro having the Index Maturity specified in the applicable
pricing supplement or term sheet, beginning on the second TARGET
Business Day after such EURIBOR Interest Determination Date, as
that rate appears on Reuters Page EURIBOR 01 as of
11:00 a.m., Brussels time, on such EURIBOR Interest
Determination Date.
The following procedure will be followed if EURIBOR cannot be
determined as described above:
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EURIBOR will be determined on the basis of the rates, at
approximately 11:00 a.m., Brussels time, on such EURIBOR
Interest Determination Date, at which deposits of the following
kind are offered to prime banks in the euro-zone interbank
market by the principal euro-zone office of each of four major
banks in that market selected by the calculation agent: euro
deposits having such EURIBOR Index Maturity, beginning on such
EURIBOR Interest Reset Date, and in a representative amount. The
calculation agent will request that the principal euro-zone
office of each of these banks provide a quotation of its rate.
If at least two quotations are provided, EURIBOR for such
EURIBOR Interest Determination Date will be the arithmetic mean
of the quotations.
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If fewer than two quotations are provided as described above,
EURIBOR for such EURIBOR Interest Determination Date will be the
arithmetic mean of the rates for loans of the following kind to
leading euro-zone banks quoted, at approximately
11:00 a.m., Brussels time on that Interest Determination
Date, by three major banks in the euro-zone selected by the
calculation agent: loans of euro having such EURIBOR Index
Maturity, beginning on such EURIBOR Interest Reset Date, and in
an amount that is representative of a single transaction in euro
in that market at the time.
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If fewer than three banks selected by the calculation agent are
quoting as described above, EURIBOR for the new interest period
will be EURIBOR in effect for the prior interest period. If the
initial base rate has been in effect for the prior interest
period, however, it will remain in effect for the new interest
period.
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Federal Funds Rate Notes.
The Federal Funds
Rate will be calculated by reference to either the
Federal Funds (Effective) Rate, the Federal
Funds Open Rate or the Federal Funds Target
Rate, as specified in the applicable pricing supplement or
term sheet. The Federal Funds Rate is the rate determined by the
calculation agent, with respect to any Interest Determination
Date relating to a Floating Rate Note for which the interest
rate is determined with reference to the Federal Funds Rate (a
Federal Funds Rate Interest Determination Date), in
accordance with the following provisions:
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If Federal Funds (Effective) Rate is the specified Federal Funds
Rate in the applicable pricing supplement or term sheet, the
Federal Funds Rate as of the applicable Federal Funds Rate
Interest Determination Date shall be the rate with respect to
such date for United States dollar federal funds as published in
H.15(519) opposite the caption Federal funds
(effective), as such rate is displayed on Reuters on page
FEDFUNDS1 (or any other page as may replace such page on such
service) (Reuters Page FEDFUNDS1) under the
heading EFFECT, or, if such rate is not so published
by 3:00 p.m., New York City time, on the calculation date,
the rate with respect to such Federal Funds Rate Interest
Determination Date for United States dollar federal
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funds as published in H.15 Daily Update, or such other
recognized electronic source used for the purpose of displaying
such rate, under the caption Federal funds
(effective).
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The following procedure will be followed if Federal Funds
(Effective) Rate is the specified Federal Funds Rate in
the applicable pricing supplement or term sheet and such Federal
Funds Rate cannot be determined as described above. The Federal
Funds Rate with respect to such Federal Funds Rate Interest
Determination Date shall be calculated by the calculation agent
and will be the arithmetic mean of the rates for the last
transaction in overnight United States dollar federal funds
arranged by three leading brokers of U.S. dollar federal
funds transactions in New York City selected by the calculation
agent, prior to 9:00 a.m., New York City time, on the
Business Day following such Federal Funds Rate Interest
Determination Date;
provided, however
, that if the
brokers so selected by the calculation agent are not quoting as
mentioned in this sentence, the Federal Funds Rate determined as
of such Federal Funds Rate Interest Determination Date will be
the Federal Funds Rate in effect on such Federal Funds Rate
Interest Determination Date.
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If Federal Funds Open Rate is the specified Federal Funds Rate
in the applicable pricing supplement or term sheet, the Federal
Funds Rate as of the applicable Federal Funds Rate Interest
Determination Date shall be the rate on such date under the
heading Federal Funds for the relevant Index
Maturity and opposite the caption Open as such rate
is displayed on Reuters on page 5 (or any other page as may
replace such page on such service) (Reuters
Page 5), or, if such rate does not appear on Reuters
Page 5 by 3:00 p.m., New York City time, on the
calculation date, the Federal Funds Rate for the Federal Funds
Rate Interest Determination Date will be the rate for that day
displayed on FFPREBON Index page on Bloomberg L.P.
(Bloomberg), which is the Fed Funds Opening Rate as
reported by Prebon Yamane (or a successor) on Bloomberg.
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The following procedure will be followed if Federal Funds
Open Rate is the specified Federal Funds Rate in the
applicable pricing supplement or term sheet and such Federal
Funds Rate cannot be determined as described above. The Federal
Funds Rate on such Federal Funds Rate Interest Determination
Date shall be calculated by the calculation agent and will be
the arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three
leading brokers of United States dollar federal funds
transactions in New York City selected by the calculation agent
prior to 9:00 a.m., New York City time, on such Federal
Funds Rate Interest Determination Date;
provided
,
however
, that if the brokers so selected by the
calculation agent are not quoting as mentioned in this sentence,
the Federal Funds Rate determined as of such Federal Funds Rate
Interest Determination Date will be the Federal Funds Rate in
effect on such Federal Funds Rate Interest Determination Date.
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If Federal Funds Target Rate is the specified Federal Funds Rate
in the applicable pricing supplement or term sheet, the Federal
Funds Rate as of the applicable Federal Funds Rate Interest
Determination Date shall be the rate on such date as displayed
on the FDTR Index page on Bloomberg. If such rate does not
appear on the FDTR Index page on Bloomberg by 3:00 p.m.,
New York City time, on the calculation date, the Federal Funds
Rate for such Federal Funds Rate Interest Determination Date
will be the rate for that day appearing on Reuters
Page USFFTARGET= (or any other page as may replace such
page on such service) (Reuters
Page USFFTARGET=).
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The following procedure will be followed if Federal Funds
Target Rate is the specified Federal Funds Rate in the
applicable pricing supplement or term sheet and such Federal
Funds Rate cannot be determined as described above. The Federal
Funds Rate on such Federal Funds Rate Interest Determination
Date shall be calculated by the calculation agent and will be
the arithmetic mean of the rates for the last transaction in
overnight United States dollar federal funds arranged by three
leading brokers of United States dollar federal funds
transactions in
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New York City selected by the calculation agent prior to
9:00 a.m., New York City time, on such Federal Funds Rate
Interest Determination Date.
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Prime Rate Notes.
The Prime Rate for any
Interest Determination Date is the prime rate or base lending
rate for that date, as published in H.15(519) by 3:00 p.m.,
New York City time, on the Calculation Date for that Interest
Determination Date under the heading Bank Prime Loan
or, if not yet published on the Calculation Date, the rate for
such Interest Determination Date as published in H.15 Daily
Update, or such other recognized electronic source used for the
purpose of displaying such rate, under the caption Bank
Prime Loan.
The calculation agent will follow the following procedures if
the Prime Rate cannot be determined as described above:
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If the rate is not published in H.15(519) H.15 Daily Update or
another recognized electronic source used for the purpose of
displaying such rate by 3:00 p.m., New York City time,
on the Calculation Date, then the calculation agent will
determine the Prime Rate to be the average of the rates of
interest publicly announced by each bank that appears on the
Reuters screen designated as US Prime 1 as that
banks prime rate or base lending rate as in effect as of
11:00 a.m., New York City time, for that Interest
Determination Date.
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If at least one rate but fewer than four rates appear on the
Reuters screen US Prime 1 on the Interest Determination
Date, then the Prime Rate will be the average of the prime rates
or base lending rates quoted (on the basis of the actual number
of days in the year divided by a
360-day
year) as of the close of business on the Interest Determination
Date by three major money center banks in the City of New York
selected by the calculation agent.
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If the banks selected by the calculation agent are not quoting
as mentioned above, the Prime Rate will remain the Prime Rate
then in effect on the Interest Determination Date.
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Reuters Screen US PRIME 1 means the display on
the Reuter Monitor Money Rates Service (or any successor
service) on the US PRIME 1 page (or any other
page as may replace that page on that service) for the purpose
of displaying prime rates or base lending rates of major United
States banks.
Treasury Rate Notes.
The Treasury Rate
for any Interest Determination Date is the rate for that date
set at the auction of direct obligations of the United States
(Treasury bills) having the Index Maturity described
in the related prospectus supplement or term sheet under the
caption INVESTMENT RATE on the display on Reuters on
page USAUCTION10 (or any other page as may replace such page on
such service) or page USAUCTION11 (or any other page as may
replace such page on such service) by 3:00 p.m.,
New York City time, on the Calculation Date for that
Interest Determination Date.
The calculation agent will follow the following procedures if
the Treasury Rate cannot be determined as described above:
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If the rate is not so published on the Calculation Date, the
Treasury Rate will be the Bond Equivalent Yield of the auction
rate of such Treasury bills as published in H.15 Daily Update,
or such recognized electronic source used for the purpose of
displaying such rate, under the caption U.S. Government
Securities/Treasury Bills/Auction High.
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If the rate is not published by 3:00 p.m. New York
City time on the Calculation Date and cannot be determined as
described in the immediately preceding paragraph, the Treasury
Rate will be the Bond Equivalent Yield of the auction rate of
such Treasury bills as otherwise announced by the United States
Department of Treasury.
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If the results of the most recent auction of Treasury bills
having the Index Maturity described in the prospectus supplement
or term sheet are not yet published or announced as described
above by 3:00 p.m., New York City time, on the
Calculation Date, or if no auction is held on the
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Interest Determination Date, then the Treasury Rate will be the
Bond Equivalent Yield on such Interest Determination Date of
Treasury bills having the Index Maturity specified in the
applicable prospectus supplement or term sheet as published in
H.15(519) prior to 3:00 p.m. New York City time under
the caption U.S. Government securities/Treasury
bills/Secondary market or, if not published by
3:00 p.m., New York City time, on the Calculation
Date, the rate on such Interest Determination Date of such
Treasury Bills as published in H.15 Daily Update, or such other
recognized electronic source used for the purpose of displaying
such rate, under the caption U.S. Government
securities/Treasury bills/Secondary market.
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If such rate is not published in H.15(519) H.15 Daily Update or
another recognized electronic source used for the purpose of
displaying such rate by 3:00 p.m., New York City time,
on the related Calculation Date, then the calculation agent will
determine the Treasury Rate to be the Bond Equivalent Yield of
the average of the secondary market bid rates, as of
approximately 3:30 p.m., New York City time, on the
Interest Determination Date of three leading primary U.S.
government securities dealers for the issue of Treasury bills
with a remaining maturity closest to the Index Maturity
described in the related prospectus supplement or terms sheet.
The calculation agent will select the three dealers referred to
above.
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If fewer than three dealers selected by the calculation agent
are quoting as mentioned above, the Treasury Rate will remain
the Treasury Rate then in effect on that Interest Determination
Date.
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Bond Equivalent Yield means a yield (expressed as a
percentage) calculated in accordance with the following formula:
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D × N
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Bond Equivalent Yield =
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× 100
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360 (D × M)
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where D refers to the applicable per annum rate for
Treasury bills quoted on a bank discount basis, N
refers to 365 or 366, as the case may be, and M
refers to the actual number of days in the applicable Interest
Period.
CMT Rate Notes.
The CMT Rate for
any Interest Determination Date is:
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If Reuters Page FRBCMT is the specified CMT
Reuters Page in the applicable pricing supplement or term sheet,
the CMT Rate on the CMT Rate Interest Determination Date shall
be a percentage equal to the yield for United States Treasury
securities at constant maturity having the Index
Maturity specified in the applicable pricing supplement or term
sheet as set forth in H.15(519) under the caption Treasury
constant maturities, as such yield is displayed on Reuters
(or any successor service) on page FRBCMT (or any other page as
may replace such page on such service) (Reuters
Page FRBCMT) for such CMT Rate Interest Determination
Date.
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If such rate does not appear on Reuters Page FRBCMT, the
CMT Rate on such CMT Rate Interest Determination Date shall be a
percentage equal to the yield for United States Treasury
securities at constant maturity having the Index
Maturity specified in the applicable pricing supplement or term
sheet and for such CMT Rate Interest Determination Date as set
forth in H.15(519) under the caption Treasury constant
maturities.
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If such rate does not appear in H.15(519), the CMT Rate on such
CMT Rate Interest Determination Date shall be the rate for the
period of the Index Maturity specified in the applicable pricing
supplement or term sheet as may then be published by either the
Federal Reserve Board or the United States Department of the
Treasury that the calculation agent determines to be comparable
to the rate that would otherwise have been published in
H.15(519).
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If the Federal Reserve Board or the United States Department of
the Treasury does not publish a yield on United States Treasury
securities at constant maturity having the Index
Maturity specified in the applicable pricing supplement or term
sheet for such CMT Rate Interest
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Determination Date, the CMT Rate on such CMT Rate Interest
Determination Date shall be calculated by the calculation agent
and shall be a yield-to-maturity based on the arithmetic mean of
the secondary market bid prices at approximately 3:30 p.m.,
New York City time, on such CMT Rate Interest Determination Date
of three leading primary United States government securities
dealers in New York City (which may include the agents or their
affiliates) (each, a reference dealer) selected by
the calculation agent from five such reference dealers selected
by the calculation agent and eliminating the highest quotation
(or, in the event of equality, one of the highest) and the
lowest quotation (or, in the event of equality, one of the
lowest) for United States Treasury securities with an original
maturity equal to the Index Maturity specified in the applicable
pricing supplement or term sheet, a remaining term to maturity
no more than one year shorter than such Index Maturity and in a
principal amount that is representative for a single transaction
in such securities in such market at such time. If fewer than
three prices are provided as requested, the CMT Rate on such CMT
Rate Interest Determination Date shall be calculated by the
calculation agent and shall be a yield-to-maturity based on the
arithmetic mean of the secondary market bid prices as of
approximately 3:30 p.m., New York City time, on such CMT
Rate Interest Determination Date of three reference dealers
selected by the calculation agent from five such reference
dealers selected by the calculation agent and eliminating the
highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest) for United States Treasury securities with an
original maturity greater than the Index Maturity specified in
the applicable pricing supplement or term sheet, a remaining
term to maturity closest to such Index Maturity and in a
principal amount that is representative for a single transaction
in such securities in such market at such time. If two such
United States Treasury securities with an original maturity
greater than the Index Maturity specified in the applicable
pricing supplement or term sheet have remaining terms to
maturity equally close to such Index Maturity, the quotes for
the treasury security with the shorter original term to maturity
will be used. If fewer than five but more than two such prices
are provided as requested, the CMT Rate on such CMT Rate
Interest Determination Date shall be calculated by the
calculation agent and shall be based on the arithmetic mean of
the bid prices obtained and neither the highest nor the lowest
of such quotations shall be eliminated;
provided
,
however
, that if fewer than three such prices are
provided as requested, the CMT Rate determined as of such CMT
Rate Interest Determination Date shall be the CMT Rate in effect
on such CMT Rate Interest Determination Date.
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If Reuters Page FEDCMT is the specified CMT
Reuters Page in the applicable pricing supplement or term sheet,
the CMT Rate on the CMT Rate Interest Determination Date shall
be a percentage equal to the one-week or one-month, as specified
in the applicable pricing supplement or term sheet, average
yield for United States Treasury securities at constant
maturity having the Index Maturity specified in the
applicable pricing supplement or term sheet as set forth in
H.15(519) opposite the caption Treasury Constant
Maturities, as such yield is displayed on Reuters on
page FEDCMT (or any other page as may replace such page on
such service) (Reuters Page FEDCMT) for the
week or month, as applicable, ended immediately preceding the
week or month, as applicable, in which such CMT Rate Interest
Determination Date falls.
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If such rate does not appear on Reuters Page FEDCMT, the
CMT Rate on such CMT Rate Interest Determination Date shall be a
percentage equal to the one-week or one-month, as specified in
the applicable pricing supplement or term sheet, average yield
for United States Treasury securities at constant
maturity having the Index Maturity specified in the
applicable pricing supplement or term sheet for the week or
month, as applicable, preceding such CMT Rate Interest
Determination Date as set forth in H.15(519) opposite the
caption Treasury Constant Maturities.
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If such rate does not appear in H.15(519), the CMT Rate on such
CMT Rate Interest Determination Date shall be the one-week or
one-month, as specified in the applicable pricing
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supplement or term sheet, average yield for United States
Treasury securities at constant maturity having the
Index Maturity specified in the applicable pricing supplement or
term sheet as otherwise announced by the Federal Reserve Bank of
New York for the week or month, as applicable, ended immediately
preceding the week or month, as applicable, in which such CMT
Rate Interest Determination Date falls.
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If the Federal Reserve Bank of New York does not publish a
one-week or one-month, as specified in the applicable pricing
supplement or term sheet, average yield on United States
Treasury securities at constant maturity having the
Index Maturity specified in the applicable pricing supplement or
term sheet for the applicable week or month, the CMT Rate on
such CMT Rate Interest Determination Date shall be calculated by
the calculation agent and shall be a yield-to-maturity based on
the arithmetic mean of the secondary market bid prices at
approximately 3:30 p.m., New York City time, on such CMT
Rate Interest Determination Date of three reference dealers
selected by the calculation agent from five such reference
dealers selected by the calculation agent and eliminating the
highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest) for United States Treasury securities with an
original maturity equal to the Index Maturity specified in the
applicable pricing supplement or term sheet, a remaining term to
maturity of no more than one year shorter than such Index
Maturity and in a principal amount that is representative for a
single transaction in such securities in such market at such
time. If fewer than five but more than two such prices are
provided as requested, the CMT Rate on such CMT Rate Interest
Determination Date shall be the rate on the CMT Rate Interest
Determination Date calculated by the calculation agent based on
the arithmetic mean of the bid prices obtained and neither the
highest nor the lowest of such quotation shall be eliminated. If
fewer than three prices are provided as requested, the CMT Rate
on such CMT Rate Interest Determination Date shall be calculated
by the calculation agent and shall be a yield-to-maturity based
on the arithmetic mean of the secondary market bid prices as of
approximately 3:30 p.m., New York City time, on such CMT
Rate Interest Determination Date of three reference dealers
selected by the calculation agent from five such reference
dealers selected by the calculation agent and eliminating the
highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality,
one of the lowest) for United States Treasury securities with an
original maturity longer than the Index Maturity specified in
the applicable pricing supplement or term sheet, a remaining
term to maturity closest to such Index Maturity and in a
principal amount that is representative for a single transaction
in such securities in such market at such time. If two United
States Treasury securities with an original maturity greater
than the Index Maturity specified in the applicable pricing
supplement or term sheet have remaining terms to maturity
equally close to such Index Maturity, the quotes for the
Treasury security with the shorter original term to maturity
will be used. If fewer than five but more than two such prices
are provided as requested, the CMT Rate on such CMT Rate
Interest Determination Date shall be the rate on the CMT Rate
Interest Determination Date calculated by the calculation agent
based on the arithmetic mean of the bid prices obtained and
neither the highest nor lowest of such quotations shall be
eliminated;
provided, however
, that if fewer than three
such prices are provided as requested, the CMT Rate determined
as of such CMT Rate Determination Date shall be the CMT Rate in
effect on such CMT Rate Interest Determination Date.
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Eleventh District Cost of Funds Rate
Notes.
The Eleventh District Cost of Funds
Rate for any Interest Determination Date is the rate equal
to the monthly weighted average cost of funds for the calendar
month preceding the Interest Determination Date as displayed on
Reuters Page COFI/ARMS (or any other page as may replace
that specified page on that service) as of 11:00 A.M.,
San Francisco time, on the Calculation Date for that
Interest Determination Date under the caption
11th District.
15
The following procedures will be used if the Eleventh District
Cost of Funds Rate cannot be determined as described above:
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If the rate is not displayed on the relevant page as of
11:00 A.M., San Francisco time, on the Calculation
Date, then the Eleventh District Cost of Funds Rate will be the
monthly weighted average cost of funds paid by member
institutions of the Eleventh Federal Home Loan Bank
District, as announced by the Federal Home Loan Bank of
San Francisco, as the cost of funds for the calendar month
preceding the date of announcement.
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If no announcement was made relating to the calendar month
preceding the Interest Determination Date, the Eleventh District
Cost of Funds Rate will remain the Eleventh District Cost of
Funds Rate then in effect on the Interest Determination Date.
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Indexed
Notes
We may issue debt securities for which the amount of interest or
principal that you will receive will not be known on your date
of purchase. Interest or principal payments for these types of
debt securities, which we call Indexed Notes, are
determined by reference to securities, financial or
non-financial indices, currencies, commodities, interest rates,
or a composite or baskets of any or all of the above. Examples
of indexed items that may be used include a published stock
index, the common stock price of a publicly traded company, the
value of the U.S. dollar versus the Japanese yen, or the
price of a barrel of West Texas intermediate crude oil.
If you purchase an Indexed Note, you may receive a principal
amount at maturity that is greater than or less than the
Notes face amount, and an interest rate that is greater
than or less than the interest rate that you would have earned
if you had instead purchased a conventional debt security issued
by us at the same time with the same maturity. The amount of
interest and principal that you will receive will depend on the
structure of the Indexed Note and the level of the specified
indexed item throughout the term of the Indexed Note and at
maturity. Specific information pertaining to the method of
determining the interest payments and the principal amount will
be described in the prospectus supplement or term sheet, as well
as additional risk factors unique to the Indexed Note, certain
historical information for the specified indexed item and
certain additional United States federal tax considerations.
Renewable
Notes
We may issue Renewable Notes (Renewable Notes) which
are debt securities that will automatically renew at their
stated maturity date unless the holder of a Renewable Note
elects to terminate the automatic extension feature by giving
notice in the manner described in the related prospectus
supplement or term sheet.
The holder of a Renewable Note must give notice of termination
at least 15 but not more than 30 days prior to a Renewal
Date. The holder of a Renewable Note may terminate the automatic
extension for less than all of its Renewable Notes only if the
terms of the Renewable Note specifically permit partial
termination. An election to terminate the automatic extension of
any portion of the Renewable Note is not revocable and will be
binding on the holder of the Renewable Note. If the holder
elects to terminate the automatic extension of the maturity of
the Note, the holder will become entitled to the principal and
interest accrued up to the Renewal Date. The related prospectus
supplement or term sheet will identify a stated maturity date
beyond which the maturity date cannot be renewed.
If a Renewable Note is represented by a global security, The
Depository Trust Company (DTC) or its nominee will
be the holder of the Note and therefore will be the only entity
that can exercise a right to terminate the automatic extension
of a Note. In order to ensure that DTC or its nominee will
exercise a right to terminate the automatic extension provisions
of a particular Renewable Note, the beneficial owner of the Note
must instruct the broker or other DTC participant through which
it holds
16
an interest in the Note to notify DTC of its desire to terminate
the automatic extension of the Note. Different firms have
different cut-off times for accepting instructions from their
customers and, accordingly, each beneficial owner should consult
the broker or other participant through which it holds an
interest in a Note to ascertain the cut-off time by which an
instruction must be given for delivery of timely notice to DTC
or its nominee.
Extendible
Notes
We may issue Notes whose stated maturity date may be extended at
our option (an Extendible Note) for one or more
whole-year periods (each, an Extension Period), up
to but not beyond a stated maturity date described in the
related prospectus supplement or term sheet.
We may exercise our option to extend the Extendible Note by
notifying the applicable Trustee (or any duly appointed paying
agent) at least 45 but not more than 60 days prior to the
then-effective maturity date. If we elect to extend the
Extendible Note, the Trustee (or paying agent) will mail (at
least 40 days prior to the maturity date) to the registered
holder of the Extendible Note a notice (an Extension
Notice) informing the holder of our election, the new
maturity date and any updated terms. Upon the mailing of the
Extension Notice, the maturity of that Extendible Note will be
extended automatically as set forth in the Extension Notice.
However, we may, not later than 20 days prior to the
maturity date of an Extendible Note (or, if that date is not a
Business Day, prior to the next Business Day), at our option,
establish a higher interest rate, in the case of a Fixed Rate
Note, or a higher Spread and/or Spread Multiplier, in the case
of a Floating Rate Note, for the Extension Period by mailing or
causing the Trustee (or paying agent) to mail notice of such
higher interest rate or higher Spread and/or Spread Multiplier
to the holder of the Note. The notice will be irrevocable.
If we elect to extend the maturity of an Extendible Note, the
holder of the Note will have the option to instead elect
repayment of the Note by us on the then-effective maturity date.
In order for an Extendible Note to be so repaid on the maturity
date, we must receive, at least 15 days but not more than
30 days prior to the maturity date:
(1) the Extendible Note with the form Option to Elect
Repayment on the reverse of the Note duly
completed; or
(2) a facsimile transmission, telex or letter from a member
of a national securities exchange or the Financial Industry
Regulatory Authority (FINRA) (formerly the National
Association of Securities Dealers, Inc.) or a commercial bank or
trust company in the United States setting forth the name of the
holder of the Extendible Note, the principal amount of the Note,
the principal amount of the Note to be repaid, the certificate
number or a description of the tenor and terms of the Note, a
statement that the option to elect repayment is being exercised
thereby and a guarantee that the Note be repaid, together with
the duly completed form entitled Option to Elect
Repayment on the reverse of the Note, will be received by
the applicable Trustee (or paying agent) not later than the
fifth Business Day after the date of the facsimile transmission,
telex or letter; provided, however; that the facsimile
transmission, telex or letter will only be effective if the Note
and form duly completed are received by the applicable Trustee
(or paying agent) by that fifth Business Day. The option may be
exercised by the holder of an Extendible Note for less than the
aggregate principal amount of the Note then outstanding if the
principal amount of the Note remaining outstanding after
repayment is an authorized denomination.
If an Extendible Note is represented by a global security, DTC
or its nominee will be the holder of that Note and therefore
will be the only entity that can exercise a right to repayment.
To ensure that DTC or its nominee timely exercises a right to
repayment with respect to a particular Extendible Note, the
beneficial owner of that Note must instruct the broker or other
participant through which it holds an interest in the Note to
notify DTC of its desire to exercise a right of repayment.
Different firms have different cut-off times for accepting
instructions from their customers and, accordingly, each
beneficial
17
owner should consult the broker or other participant through
which it holds an interest in an Extendible Note to determine
the cut-off time by which an instruction must be given for
timely notice to be delivered to DTC or its nominee.
Limitation on
Liens
If Ford Credit or any Restricted Subsidiary (as defined in the
Indenture) shall pledge or otherwise subject to any lien (as
defined in the Indenture as a Mortgage) any of its
property or assets, Ford Credit will secure or cause such
Restricted Subsidiary to secure the debt securities equally and
ratably with (or prior to) the indebtedness secured by such
Mortgage. This restriction does not apply to Mortgages securing
such indebtedness which shall not exceed $5 million in the
aggregate at any one time outstanding and does not apply to:
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certain Mortgages created or incurred to secure financing of the
export or marketing of goods outside the United States;
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Mortgages on accounts receivable payable in foreign currencies
securing indebtedness incurred and payable outside the United
States;
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Mortgages in favor of Ford Credit or any Restricted Subsidiary;
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Mortgages in favor of governmental bodies to secure progress,
advance or other payments, or deposits with any governmental
body required in connection with the business of Ford Credit or
a Restricted Subsidiary;
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deposits made in connection with pending litigation;
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Mortgages existing at the time of acquisition of the assets
secured thereby (including acquisition through merger or
consolidation) and certain purchase money Mortgages; and
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any extension, renewal or replacement of any Mortgage or
Mortgages referred to in the foregoing clauses, inclusive.
(Section 10.04).
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Merger and
Consolidation
The Indenture provides that no consolidation or merger of Ford
Credit with or into any other corporation shall be permitted,
and no sale or conveyance of its property as an entirety, or
substantially as an entirety, may be made to another
corporation, if, as a result thereof, any asset of Ford Credit
or a Restricted Subsidiary would become subject to a Mortgage,
unless the debt securities shall be equally and ratably secured
with (or prior to) the indebtedness secured by such Mortgage, or
unless such Mortgage could be created pursuant to Section 10.04
(see Limitation on Liens above) without equally and
ratably securing the debt securities. (Section 8.03).
Events of Default
and Notice Thereof
The Indenture defines an Event of Default as being
any one of the following events:
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failure to pay interest for 30 days after becoming due;
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failure to pay principal or any premium for five business days
after becoming due;
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failure to make a sinking fund payment for five days after
becoming due;
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failure to perform any other covenant applicable to the debt
securities for 90 days after notice;
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certain events of bankruptcy, insolvency or reorganization; and
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any other Event of Default provided in the prospectus supplement.
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An Event of Default for a particular series of debt securities
will not necessarily constitute an Event of Default for any
other series of debt securities issued under the Indenture.
(Section 5.01.)
If an Event of Default occurs and continues, the Trustee or the
holders of at least 25% of the total principal amount of the
series may declare the entire principal amount (or, if they are
Original Issue Discount Securities (as defined in the
Indenture), the portion of the principal amount as specified in
the terms of such series) of all of the debt securities of that
series to be due and payable immediately. If this happens,
subject to certain conditions, the holders of a majority of the
total principal amount of the debt securities of that series can
void the declaration. (Section 5.02.)
The Indenture provides that within 90 days after default under a
series of debt securities, the Trustee will give the holders of
that series notice of all uncured defaults known to it. (The
term default includes the events specified above
without regard to any period of grace or requirement of notice.)
The Trustee may withhold notice of any default (except a default
in the payment of principal, interest or any premium) if it
believes that it is in the interest of the holders.
(Section 6.02.)
Annually, Ford Credit must send to the Trustee a certificate
describing any existing defaults under the Indenture.
(Section 10.05.)
Other than its duties in case of a default, the Trustee is not
obligated to exercise any of its rights or powers under the
Indenture at the request, order or direction of any holders,
unless the holders offer the Trustee reasonable protection from
expenses and liability. (Section 6.01.) If they provide this
reasonable indemnification, the holders of a majority of the
total principal amount of any series of debt securities may
direct the Trustee how to act under the Indenture.
(Section 5.12.)
Modification of
the Indenture
With certain exceptions, Ford Credits rights and
obligations and your rights under a particular series of debt
securities may be modified with the consent of the holders of
not less than
two-thirds
of the total principal amount of those debt securities. No
modification of the principal or interest payment terms, and no
modification reducing the percentage required for modifications,
will be effective against you without your consent.
(Section 9.02.)
Subordination
The extent to which a particular series of subordinated debt
securities may be subordinated to our unsecured and
unsubordinated indebtedness will be set forth in the prospectus
supplement for any such series and the Indenture may be modified
by a supplemental indenture to reflect such subordination
provisions.
Global
Securities
Unless otherwise stated in a prospectus supplement, the debt
securities of a series will be issued in the form of one or more
global certificates that will be deposited with DTC, which will
act as depositary for the global certificates. Beneficial
interests in global certificates will be shown on, and transfers
of global certificates will be effected only through, records
maintained by DTC and its participants. Therefore, if you wish
to own debt securities that are represented by one or more
global certificates, you can do so only indirectly or
beneficially through an account with a broker, bank
or other financial institution that has an account with DTC
(that is, a DTC participant) or through an account directly with
DTC if you are a DTC participant.
While the debt securities are represented by one or more global
certificates:
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You will not be able to have the debt securities registered in
your name.
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You will not be able to receive a physical certificate for the
debt securities.
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Our obligations, as well as the obligations of the Trustee and
any of our agents, under the debt securities will run only to
DTC as the registered owner of the debt securities. For example,
once we make payment to DTC, we will have no further
responsibility for the payment even if DTC or your broker, bank
or other financial institution fails to pass it on so that you
receive it.
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Your rights under the debt securities relating to payments,
transfers, exchanges and other matters will be governed by
applicable law and by the contractual arrangements between you
and your broker, bank or other financial institution, and/or the
contractual arrangements you or your broker, bank or financial
institution has with DTC. Neither we nor the Trustee has any
responsibility for the actions of DTC or your broker, bank or
financial institution.
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You may not be able to sell your interests in the debt
securities to some insurance companies and others who are
required by law to own their debt securities in the form of
physical certificates.
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Because the debt securities will trade in DTCs Same-Day
Funds Settlement System, when you buy or sell interests in the
debt securities, payment for them will have to be made in
immediately available funds. This could affect the
attractiveness of the debt securities to others.
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A global certificate generally can be transferred only as a
whole, unless it is being transferred to certain nominees of the
depositary or it is exchanged in whole or in part for debt
securities in physical form. If a global certificate is
exchanged for debt securities in physical form, they will be in
denominations of $1,000 and integral multiples thereof, or
another denomination stated in the prospectus supplement.
DESCRIPTION OF
WARRANTS
The following is a general description of the terms of the
warrants we may issue from time to time. Particular terms of any
warrants we offer will be described in the prospectus supplement
or term sheet relating to such warrants.
General
We may issue warrants to purchase debt securities. Such warrants
may be issued independently or together with any such securities
and may be attached or separate from such securities. We will
issue each series of warrants under a separate warrant agreement
to be entered into between us and a warrant agent. The warrant
agent will act solely as our agent and will not assume any
obligation or relationship of agency for or with holders or
beneficial owners of warrants.
A prospectus supplement will describe the particular terms of
any series of warrants we may issue, including the following:
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the title of such warrants;
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the aggregate number of such warrants;
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the price or prices at which such warrants will be issued;
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the currency or currencies, including composite currencies, in
which the price of such warrants may be payable;
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the designation and terms of the securities purchasable upon
exercise of such warrants and the number of such securities
issuable upon exercise of such warrants;
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the price at which and the currency or currencies, including
composite currencies, in which the securities purchasable upon
exercise of such warrants may be purchased;
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the date on which the right to exercise such warrants shall
commence and the date on which such right will expire;
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whether such warrants will be issued in registered form or
bearer form;
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if applicable, the minimum or maximum amount of such warrants
which may be exercised at any one time;
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if applicable, the designation and terms of the securities with
which such warrants are issued and the number of such warrants
issued with each such security;
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if applicable, the date on and after which such warrants and the
related securities will be separately transferable;
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information with respect to book-entry procedures, if any;
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if applicable, a discussion of certain U.S. federal income tax
considerations; and
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any other terms of such warrants, including terms, procedures
and limitations relating to the exchange and exercise of such
warrants.
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Amendments and
Supplements to Warrant Agreement
We and the warrant agent may amend or supplement the warrant
agreement for a series of warrants without the consent of the
holders of the warrants issued thereunder to effect changes that
are not inconsistent with the provisions of the warrants and
that do not materially and adversely affect the interests of the
holders of the warrants.
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We may sell the securities to or through agents or underwriters
or directly to one or more purchasers.
By
Agents
We may use agents to sell the securities. The agents will agree
to use their reasonable best efforts to solicit purchases for
the period of their appointment.
By
Underwriters
We may sell the securities to underwriters. The underwriters may
resell the securities in one or more transactions, including
negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of sale. The obligations
of the underwriters to purchase the securities will be subject
to certain conditions. Each underwriter will be obligated to
purchase all the securities allocated to it under the
underwriting agreement. The underwriters may change any initial
public offering price and any discounts or concessions they give
to dealers.
Direct
Sales
We may sell securities directly to investors. In this case, no
underwriters or agents would be involved.
As one of the means of direct issuance of securities, we may
utilize the services of any available electronic auction system
to conduct an electronic dutch auction of the
offered securities among potential purchasers who are eligible
to participate in the auction of those offered securities, if so
described in the prospectus supplement.
General
Information
Any underwriters or agents will be identified and their
compensation described in a prospectus supplement.
We may have agreements with the underwriters, dealers and agents
to indemnify them against certain civil liabilities, including
liabilities under the Securities Act of 1933, or to contribute
to payments they may be required to make.
Underwriters, dealers and agents may engage in transactions
with, or perform services for, us or our subsidiaries in the
ordinary course of their businesses.
In compliance with guidelines of the FINRA, the maximum
consideration or discount to be received by any FINRA member or
independent broker dealer may not exceed 8% of the aggregate
amount of the securities offered pursuant to this prospectus and
any applicable prospectus supplement.
LEGAL
OPINIONS
Corey M. MacGillivray, who is Ford Credits Assistant
Secretary, has given an opinion about the legality of the
securities. Mr. MacGillivray owns shares of Ford common
stock and options to purchase shares of Ford common stock.
INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The financial statements and managements assessment of the
effectiveness of internal control over financial reporting
(which is included in Managements Report on Internal
Control over Financial Reporting) incorporated in this
prospectus by reference to the 2008
10-K Report
have been so incorporated in reliance on the report thereon
included therein of PricewaterhouseCoopers LLP, an independent
registered public accounting firm, given on their authority as
experts in accounting and auditing.
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With respect to the unaudited financial information of
Ford Credit for the three-month periods ended
March 31, 2009 and 2008, incorporated by reference in this
Prospectus, PricewaterhouseCoopers LLP reported that they have
applied limited procedures in accordance with professional
standards for a review of such information. However, their
separate report dated May 8, 2009 incorporated by reference
herein, states they did not audit and they do not express an
opinion on that unaudited financial information. Accordingly,
the degree of reliance on their report on such information
should be restricted in light of the limited nature of the
review procedures applied. PricewaterhouseCoopers LLP is not
subject to the liability provisions of Section 11 of the
Securities Act of 1933 for their report on the unaudited
financial information because that report is a
report or a part of the registration
statement prepared or certified by PricewaterhouseCoopers LLP
within the meaning of Section 7 and 11 of the Act.
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Date:
Term
Sheet
To Prospectus dated
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Original Issue Date:
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Maturity Date:
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Principal Amount:
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Interest Rate:
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Fixed
o
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Floating
o
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Interest Rate Basis:
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Index Maturity:
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Spread:
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Initial Interest Determination Date:
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Interest Determination Dates:
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Interest Reset Dates:
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Day Count Convention:
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Interest Payments Dates:
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Record Dates if different:
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Redemption Provisions:
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Treasury Makewhole Spread:
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Redemption Dates:
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Payment of Additional Amounts:
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Tax Redemption:
o
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Plan of Distribution:
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Ford Motor Credit Company Llc (NYSE:FCJ)
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Ford Motor Credit Company Llc (NYSE:FCJ)
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から 1 2024 まで 1 2025