Credit Acceptance Pleased to Announce Resolution of Litigation With Massachusetts Attorney General | News
Southfield, Michigan, September 1, 2021 (GLOBE NEWSWIRE) – Credit Acceptance Corporation (Nasdaq: CACC) (referred to as âCompanyâ, âCredit Acceptanceâ, âweâ, âusâ or âweâ) announced today finalizing a settlement resolving a dispute with the Massachusetts Attorney General, the important terms of which had previously been disclosed in April 2021.
This case has been vigorously contested. However, Credit Acceptance believes that it is in the best interest of the Company to conclude this litigation and is happy to announce its resolution. The Company looks forward to continuing to serve customers in the Commonwealth of Massachusetts through its fundraising programs.
The terms of the settlement are contained in a settlement agreement and an assurance of disclaimer filed in the Suffolk Superior Court in Commonwealth of Massachusetts v. Credit Acceptance Corporation, Civ. Share No. 2084CV01954-BLS2, and in a Form 8-K filed by the Company. Under the agreement, Credit Acceptance made no admission of liability.
Description of the credit acceptance company
Since 1972, Credit Acceptance has offered financing programs that allow automobile dealers to sell vehicles to consumers, regardless of their credit history. Our financing programs are offered through a national network of automobile dealerships that benefit from the sale of vehicles to consumers who would otherwise not be able to obtain financing; repeat and referral sales generated by these same customers; and sales to customers who respond to advertisements for our financing programs, but who eventually qualify for traditional financing.
Without our financing programs, consumers are often unable to purchase vehicles or they purchase unreliable vehicles. Additionally, as we report to the three national credit bureaus, an important ancillary benefit of our programs is that we provide consumers with the opportunity to improve their lives by improving their credit rating and switching to sources of credit. more traditional financing. Credit acceptance is listed on the Nasdaq under the symbol CACC. For more information visit creditacceptation.com.
Caution regarding forward-looking information
We claim safe harbor protection for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 for all of our forward-looking statements. Statements in this release that are not historical facts, such as those using terms such as “may”, “will”, “should”, “believe”, “expect”, “anticipate”, “”, âThe intentionâ, âthe planâ, âthe targetâ and those concerning our results, plans and future objectives, are âforward-looking statementsâ within the meaning of federal securities laws. These forward-looking statements only represent our outlook as of the date of this press release. Actual results could differ materially from these forward-looking statements, as the statements are based on our current expectations, which are subject to risks and uncertainties. Factors that could cause such a difference include, without limitation, the factors set out in Section 1A of our Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities and Exchange Commission on December 12, 2020. February 2021, and other risk factors discussed here or listed from time to time in our reports filed with the Securities and Exchange Commission and the following:
Industrial, operational and macroeconomic risks
The COVID-19 outbreak has negatively impacted our business, and the continuation of this pandemic, or any future outbreak of contagious diseases or other public health emergencies, could have a material adverse impact on our business, our financial condition, liquidity and results of operations. Our inability to accurately predict and estimate the amount and timing of future recoveries could have a material adverse effect on results of operations. Due to competition from traditional funding sources and non-traditional lenders, we may not be able to compete successfully. to administer our ancillary product offerings could have a negative impact on our business and financial results. We are dependent on our senior management and the loss of one of these people or the inability to hire additional team members could affect our ability to operate profitably. Our reputation is a key asset to our business, and our business can be affected by how we are viewed in the market. The concentration of our dealers in several states could be detrimental to us. Dependence on our outsourced business functions could adversely affect our business. execute our business strategy due to current economic conditions. Adverse changes in economic conditions, the automotive or financial industries, or the unprivileged consumer market could adversely affect our financial condition, liquidity and results of operations, the capacity of key suppliers on which we depend. to provide services to us, and our ability to enter into future financing transactions. Natural disasters, acts of war, terrorist attacks and threats or escalation of military activity in response to such attacks or otherwise may adversely affect our business, financial condition and results of operations. A small number of our shareholders have the ability to influence matters requiring shareholder approval and these shareholders have interests that may conflict with the interests of our other security holders.
Capital and liquidity risks
We may not be able to continue to access or renew sources of funding and obtain the capital necessary to maintain and grow our business. The terms of our debt limit the way we conduct our business. A breach of the terms of our secured financing facilities backed by assets or secured warehouses could have a material adverse impact on our operations. Our substantial debt could have a negative impact on our business, prevent us from meeting our debt obligations and negatively affect our financial position. We may not be able to generate sufficient cash flow to service our debt and fund transactions and may be required to take other steps to meet our obligations under such debt. Fluctuations in interest rates can negatively affect our borrowing costs, profitability and liquidity. The phasing out of the London Interbank Offered Rate (âLIBORâ), or the replacement of LIBOR with a different benchmark rate, could have a material adverse effect on our business. Downgrading our credit rating c This would increase the cost of our funding and restrict our access to capital markets and adversely affect our liquidity, financial condition and results of operations. This could further exacerbate the risks associated with our current debt levels. US and international capital market conditions may negatively affect lenders with whom we have relationships, causing us to incur additional costs and reduce our sources of liquidity, which may negatively affect our financial position, liquidity and results. operating.
Risks related to information technology and cybersecurity
Our reliance on technology could have a material adverse effect on our business. Our use of electronic contracts could affect our ability to perfect our ownership or security in consumer loans. decrease our profitability and damage our reputation.
Legal and regulatory risks
Litigation in which we are involved from time to time may adversely affect our financial condition, results of operations and cash flows. Changes in tax laws and the resolution of uncertain tax matters could have a material adverse effect on our results of operations and cash flows from operations. Regulations to which we are or may become subject could have a material adverse effect on our business.
Other factors currently not anticipated by management could also have a material adverse effect on our business, financial condition and results of operations. We do not undertake, and expressly disclaim any obligation, to update or change our statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Investor Relations: Douglas W. Busk Director of Treasury (248) 353-2700 Ext. 4432 [email protected]