Exhibit 99.1
SILVER TRIANGLE BUILDING
25505 WEST TWELVE MILE ROAD, SUITE 3000
SOUTHFIELD, MI 48034-8339
(248) 353-2700
CREDITACCEPTANCE.COM
NEWS RELEASE
FOR IMMEDIATE RELEASE
DATE: SEPTEMBER 21, 2006
INVESTOR RELATIONS: DOUGLAS W. BUSK
TREASURER
(248) 353-2700 EXT. 4432
IR@CREDITACCEPTANCE.COM
NASDAQ SYMBOL: CACC
CREDIT ACCEPTANCE CORPORATION ANNOUNCES COMPLETION OF $50 MILLION
CREDIT FACILITY
SOUTHFIELD, MICHIGAN - SEPTEMBER 21, 2006 - CREDIT ACCEPTANCE CORPORATION
(NASDAQ: CACC) (the "Company") announced today the completion of a $50.0 million
credit facility with Variable Funding Capital Company LLC, a multi-seller
commercial paper conduit administered by Wachovia Securities. Prior to this
facility, the effective amount the Company's special purpose entities could
borrow against collateral previously contributed by the Company to term
securitizations decreased as those related term securitizations amortized. This
facility allows the Company's special purpose entities to utilize more of their
borrowing capacity throughout the life of the related term securitization.
The facility, which was entered into by the Company's wholly-owned subsidiary,
Credit Acceptance Residual Funding LLC ("Residual Funding"), will allow Residual
Funding to finance its purchase of trust certificates from special purpose
entities (the "Term SPEs") that purchased loans to dealer-partners under the
Company's term securitization transactions. Historically, the Term SPEs'
residual interests in dealer loans, represented by their trust certificates,
have proven to have value that increases as their term securitization
obligations amortize. The new facility enables the Term SPEs to realize and
distribute to the Company up to 65% of that value prior to the time the related
term securitization senior notes are paid in full.
Residual Funding's interests in dealer loans, represented by its purchased trust
certificates, are subordinated to the interests of term securitization senior
noteholders but the entire arrangement is non-recourse to the Company.
Residual Funding did not make a draw on the facility at closing. The facility
matures September 19, 2007 with draws under the facility bearing interest at a
floating rate equal to LIBOR or the commercial paper rate plus 145 basis points.
The Company's contracted relationship with its dealer-partners remains
unaffected. The dealer-partners' rights to future payments of dealer holdback
are preserved and the Company will continue to recognize its servicing fee on
amounts collected.
DESCRIPTION OF CREDIT ACCEPTANCE CORPORATION
Since 1972, Credit Acceptance has provided auto loans to consumers, regardless
of their credit history. Our product is offered through a nationwide network of
automobile dealers who benefit from sales of vehicles to consumers who otherwise
could not obtain financing; from repeat and referral sales generated by these
same customers; and from sales to customers responding to advertisements for our
product, but who actually end up qualifying for traditional financing.
Without our product, consumers may be unable to purchase a vehicle or they may
purchase an unreliable one, or they may not have the opportunity to improve
their credit standing. As we report to the three national credit reporting
agencies, a significant number of our customers improve their lives by improving
their credit score and move on to more traditional sources of financing. Credit
Acceptance is publicly traded on the NASDAQ under the symbol CACC. For more
information, visit creditacceptance.com.
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