Interest Rate Swap Confirmation Agreement between Ford Credit Auto Owner Trust 2001-B and Merrill Lynch Capital Services, Inc. (March 13, 2001)

Summary

This agreement confirms the terms of an interest rate swap between Ford Credit Auto Owner Trust 2001-B and Merrill Lynch Capital Services, Inc. Under the agreement, Ford Credit Auto Owner Trust pays a fixed interest rate and receives a floating rate from Merrill Lynch, based on a notional amount that decreases as certain notes are paid down. The swap is governed by a master ISDA agreement and will end when the notes are paid off or by August 15, 2003, whichever comes first. Both parties agree they are acting independently and not relying on each other's advice.

EX-10.2 7 k61559ex10-2.txt LETTER AGREEMENT DATED AS OF MARCH 13, 2001 1 EXHIBIT 10.2 Class A-3 Swap Confirmation March 13, 2001 To: Merrill Lynch Capital Services, Inc. Merrill Lynch World Headquarters 4 World Financial Center New York, New York 10080 Swap Group Tel: (212) 449-0371 Fax: (212) 449-1788 From: Ford Credit Auto Owner Trust 2001-B c/o The Bank of New York, as owner trustee ABS Finance Unit 101 Barclay Street 12E Floor New York, NY 10286 John Bobko Tel: (212) 815-5613 Fax: (212) 449-6993 Re: Interest Rate Swap Reference No. FCOAT 2001-B Class A-3 Swap Ladies and Gentlemen: The purpose of this letter agreement is to confirm the terms and conditions of the Swap Transaction entered into between Merrill Lynch Capital Services, Inc. ("Party A") and Ford Credit Auto Owner Trust 2001-B ("Party B") on the Trade Date listed below (the "Transaction"). This letter constitutes a "Confirmation" as referred to in the ISDA Agreement specified below. The definitions and provisions contained in the 1991 ISDA Definitions (as published by the International Swap Dealers Association, Inc.) (the "Definitions") are incorporated into this Confirmation, without regard to any amendment to the Definitions subsequent to the date hereof, except that references in the Definitions to a "Swap Transaction" shall be deemed references to a "Transaction" for purposes of this agreement. In the event of any inconsistency between those definitions and this Confirmation, this Confirmation will govern. 1. This Confirmation supplements, forms part of, and is subject to, the Master Agreement dated as of March 13, 2001, as amended and supplemented from time to time (the "Agreement") between you and us. All provisions contained in the Agreement govern this Confirmation except as expressly modified below. Other capitalized terms used herein and not otherwise defined shall have the meanings given them in the Indenture referred to in the Agreement. In the event of any inconsistency between those terms and this Confirmation, this Confirmation will govern. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Trade Date: March 13, 2001. Effective Date: March 22, 2001. Distribution Date: The fifteenth (15th) day of each calendar month or, if such day is not a Business Day, the next succeeding Business Day, commencing April 16, 2001.

1 2 Notional Amount: The Notional Amount initially shall equal $1,400,000,000 and shall decrease by an amount equal to the amount of the reduction in the aggregate principal balance of the Class A-3 Notes on each Distribution Date. Decreases in the Notional Amount with respect to the calculation of Fixed Amounts shall take effect as of the Period End Date occurring in the month of the Distribution Date. Party B shall determine the Notional Amount and shall inform Party A of such determination by the twelfth day of each calendar month. Termination Date: The date upon which the aggregate outstanding principal balance of the Class A-3 Notes has been reduced to zero, or August 15, 2003, whichever is earlier. Fixed Amounts Fixed Rate Payer: Party B. Fixed Rate Payer Payment Date: The 15th day of each calendar month, subject to adjustment in accordance with the Following Business Day Convention. The initial Fixed Rate Payer Payment Date will be April 16, 2001. Period End Date: The 15th day of each calendar month, with No Adjustment. The initial Period End Date will be April 15, 2001. Fixed Rate: 4.885%. Fixed Rate Day Count Fraction: 30/360. Floating Amounts Floating Rate Payer: Party A. Floating Rate Payer Payment Dates: The 15th day of each calendar month, subject to adjustment in accordance with the Following Business Day Convention. The initial Fixed Rate Payer Payment Date will be April 16, 2001. Floating Rate for initial Calculation Period: 4.98%. Floating Rate Option: USD-LIBOR-BBA. Designated Maturity: One month. Spread: 0.05%. Floating Rate Day Count Fraction: Actual/360.

2 3 Reset Dates: The first day of each Floating Rate Payer Calculation Period. Business Days: New York and Delaware. Calculation Agent: Party A, unless an Event of Default has occurred where Party A is the Defaulting Party, in which event the Calculation Agent shall be Party B. 3. Account Details Payments to Party A: Bankers Trust Company New York, NY ABA # 021001033 Account No. 00-811-874 Ref: Merrill Lynch Capital Services, Inc. Dollar Swaps, New York, NY Payments to Party B: The Chase Manhattan Bank ABA# 021-000-021 Account #: 507951883 Account Name: Ford Incoming Wire Account Ref: AC160041.1 FORD 2001-B Swap Receipt Party A Operations Contact: Merrill Lynch Capital Services, Inc. Merrill Lynch World Headquarters 4 World Financial Center New York, NY 10080 Swap Group Tel: (212) 449-0371 Fax: (212) 449-1788 Party B Operations Contact: The Chase Manhattan Bank Corporate Trust Administration 450 West 33rd Street, 14th floor New York, New York 10001 Attention: Michael A. Smith Tel: (212) 946-3346 Fax: (212) 946-8302 4. Miscellaneous Non-Reliance: Each party represent to the other party that it is acting for its own account, and it has made its own independent decisions to enter into this Transaction and as to whether this Transaction is appropriate or proper for it based upon its own judgment and upon advice from such advisors as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into this Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be considered to be investment advice or a recommendation to enter into this Transaction. No communication (written or oral) received from the other party shall be deemed to be an assurance or guarantee as to the expected results of this Transaction.

3 4 Please confirm that the foregoing correctly sets forth the terms of our agreement by executing this Confirmation and returning it to us. Best Regards, FORD CREDIT AUTO OWNER TRUST 2001-B By: THE BANK OF NEW YORK not in its individual capacity but solely as Owner Trustee By: /s/ John Bobko --------------------------------- Name: John Bobko Title: Assistant Treasurer Accepted and confirmed as of the Trade Date written above: MERRILL LYNCH CAPITAL SERVICES, INC. By: /s/ Roger A. Baum -------------------------------------- Name: Roger A. Baum Title: Designated Signatory 4