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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from __________ to _____________
FIRSTPLUS HOME LOAN OWNER TRUSTS
(Issuer with respect to the Securities)
FIRSTPLUS INVESTMENT CORPORATION
(Originator of the Trusts described herein)
(Exact name of Registrant as specified in its charter)
Nevada 33-65373 75-2596063
(State of Incorporation) (Commission File No.) (I.R.S. Employer
Identification No.)
3773 Howard Hughes Parkway
Suite 300N
Las Vegas, Nevada 89109
(Address of Principal executive offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (702) 892-3772
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes /X/ No / /
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to
this Form 10-K. / /
Aggregate market value of voting stock held by nonaffiliates of the Registrant
as of the latest practicable date, December 31, 1996: None
As of December 31, 1996, the latest practicable date, there were 1,000 shares
of FIRSTPLUS INVESTMENT CORPORATION common stock outstanding.
The Registrant meets the conditions set forth in General Instruction I(1)(a)
and (b) of Form 10-K and, therefore, is furnishing the abbreviated narrative
disclosure specified in Paragraph (2) of General Instruction I.
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TABLE OF CONTENTS
<TABLE>
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Page No.
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PART I
Item 1. Business
Item 2. Properties
Item 3. Legal Proceedings
Item 4. Submission of Matters to a Vote of Security Holders
PART II
Item 5. Market for Registrant's Common Equity and
Related Stockholder Matters
Item 6. Selected Financial Data
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operation
Item 8. Financial Statements and Supplementary Data
Item 9. Changes in and Disagreements with Accountants
on Accounting and Financial Disclosure
PART III
Item 10. Directors and Executive Officers of the Registrant
Item 11. Executive Compensation
Item 12. Security Ownership of Certain Beneficial Owners
and Management
Item 13. Certain Relationships and Related Transactions
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports
on Form 8-K
</TABLE>
Signatures
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PART I
ITEM 1. BUSINESS.
The Registrant was incorporated in the State of Nevada on May 12, 1995
as a wholly-owned, limited purpose finance subsidiary of FIRSTPLUS FINANCIAL
GROUP, INC. (formerly RAC Financial Group, Inc.), a publicly-traded, NASDAQ
exchange-listed corporation. The Registrant was organized to facilitate the
securitization of home loans through the issuance and sale of asset backed
securities.
The Registrant has filed a Registration Statement on Form S-3 (File
No. 333-11855) with the Securities and Exchange Commission, pursuant to which
the Registrant registered $1,240,625,000 aggregate principal amount of asset-
backed securities (the "Securities"), issuable by grantor trusts or owner
trusts in various series, for sale in accordance with the provisions of the
Securities Act of 1933, as amended (the "Act"). Pursuant to Rule 429 of the
General Rules and Regulations under the Act, the forms of Prospectus which are
filed as part of such Registration Statement are combined Prospectus' relating
also to $758,375,000 of securities registered under the Registrant's
Registration Statement on Form S-3 (File No. 33-65373) and to $1,000,000 of
securities registered under Registrant's Registration Statement on Form S-3
(File No. 333-10451).
ITEM 2. PROPERTIES.
The Registrant has no physical properties.
ITEM 3. LEGAL PROCEEDINGS.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Information in response to this Item is omitted pursuant to General
Instruction I.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
(a) All of the Registrant's outstanding common stock is owned by
FIRSTPLUS Financial Group, Inc. Accordingly, there is no established public
trading market for the Registrant's common stock. The Registrant has paid no
dividends with respect to its common stock.
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(b) At December 31, 1996, the number of holders of record of all
classes of Securities that remain outstanding as of such date was as follows:
<TABLE>
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SERIES NUMBER OF RECORD HOLDERS
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1996-2 1
1996-3 3
1996-4 3
</TABLE>
ITEM 6. SELECTED FINANCIAL DATA.
Information in response to this Item is omitted pursuant to General
Instruction I.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION.
Information in response to this Item is omitted pursuant to General
Instruction I.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
In lieu of the information required by Item 8, the Registrant hereby
incorporates by reference (i) the annual report of Ernst & Young LLP, dated
October 25, 1996 with regard to the Servicer's compliance with applicable
accounting standards filed herewith as Exhibit 28.2, (ii) the quarterly
statements of compliance of the Servicer for Series 1996-2 and Series 1996-3 to
be filed by amendment as Exhibit 28.1, and (iii) the annual reports aggregating
Servicer Monthly Remittance Reports for Series 1996-2, Series 1996-3 and Series
1996-4 for the fiscal year ended December 31, 1996 to be filed by amendment
as Exhibits 13.1, 13.2 and 13.3, respectively.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Information in response to this Item is omitted pursuant to General
Instruction I.
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ITEM 11. EXECUTIVE COMPENSATION.
Information in response to this Item is omitted pursuant to General
Instruction I.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
Information in response to this Item is omitted pursuant to General
Instruction I.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Information in response to this Item is omitted pursuant to General
Instruction I.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) Not applicable.
(b) The Registrant has filed the following Current Reports on Form
8-K during the last quarter of the fiscal year ended December
31, 1996:
(1) Current Reports on Form 8-K dated as of October 21,
1996, November 18, 1996 and December 18, 1996 with
respect to Monthly Servicer Remittance Reports for
Series 1996-2.
(2) Current Report on Form 8-K dated as of December 20,
1996 with respect to final loan pool for Series
1996-3.
(3) Current Reports on Form 8-K dated as of October 21,
1996, November 18, 1996 and December 18, 1996 with
respect to Monthly Servicer Remittance Reports for
Series 1996-3.
(4) Current Report on Form 8-K dated as of November 14,
1996 with respect to filing of Collateral Term Sheets
for Series 1996-4.
(5) Current Report on Form 8-K dated as of November 20,
1996 with respect to filing of Accountant's Consent
for Series 1996-4.
(6) Current Report on Form 8-K dated as of January 17,
1997 with respect to final loan pool for Series
1996-4.
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(7) Current Report on Form 8-K dated as of December 13,
1996 with respect to Monthly Servicer Remittance
Report for Series 1996-4.
(c) Exhibits
3.1 Amended and Restated Articles of Incorporation of the
Registrant (Incorporated herein by reference to
Exhibit to Amendment No. 2 to Registrant's
Registration Statement No. 33-65373 on Form S-3 filed
on May 10, 1996).
3.2 By-Laws of the Registrant (Incorporated herein by
reference to Exhibit to Registrant's Registration
Statement No. 33-65373 on Form S-3 filed on December
22, 1995).
4.1 Copy of Pooling and Servicing Agreement for Series
1996-2 dated as of June 1, 1996, among Registrant, as
Depositor, FIRSTPLUS FINANCIAL, INC., as Servicer,
and First Trust of California, N.A., as Trustee
(Incorporated herein by reference to Exhibit to the
Registrant's Current Report on Form 8-K dated as of
August 30, 1996).
4.2 Copy of Indenture for Series 1996-3 dated as of
September 1, 1996, among FIRSTPLUS HOME LOAN OWNER
TRUST 1996-3, as Issuer, and First Bank National
Association, as Indenture Trustee (Incorporated
herein by reference to Exhibit to the Registrant's
Current Report on Form 8-K dated as of December 20,
1996).
4.3 Copy of Trust Agreement for Series 1996-3 dated as of
September 1, 1996, among the Registrant, as
Depositor, FIRSTPLUS RESIDUAL HOLDINGS, INC.,
Wilmington Trust Company, as Owner Trustee, and First
Bank National Association, as Co-Owner Trustee
(Incorporated herein by reference to Exhibit to the
Registrant's Current Report on Form 8-K dated as of
December 20, 1996).
4.4 Copy of Indenture for Series 1996-4 dated as of
November 1, 1996, among FIRSTPLUS HOME LOAN OWNER
TRUST 1996-4, as Issuer, and First Bank National
Association, as Indenture Trustee (Incorporated
herein by reference to Exhibit to the Registrant's
Current Report on Form 8-K dated as of January 17,
1997).
4.5 Copy of Trust Agreement for Series 1996-4 dated as of
November 1, 1996, among the Registrant, as Depositor,
FIRSTPLUS RESIDUAL HOLDINGS, INC., Wilmington Trust
Company, as Owner Trustee, and First Bank National
Association, as Co-Owner Trustee (Incorporated herein
by reference
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to Exhibit to the Registrant's Current
Report on Form 8-K dated as of January 17, 1997).
10.1 Copy of Sale and Servicing Agreement for Series
1996-3 dated as of September 1, 1996, among the
Registrant, as Seller, FIRSTPLUS FINANCIAL, INC., as
Servicer, FIRSTPLUS HOME LOAN OWNER TRUST 1996-3, as
Issuer, and First Bank National Association, as
Indenture Trustee and Co-Owner Trustee (Incorporated
herein by reference to Exhibit to Registrant's
Current Report on Form 8-K dated as of December 20,
1996).
10.2 Copy of Sale and Servicing Agreement for Series
1996-4 dated as of November 1, 1996, among the
Registrant, as Seller, FIRSTPLUS FINANCIAL, INC., as
Servicer, FIRSTPLUS HOME LOAN OWNER TRUST 1996-4, as
Issuer, and First Bank National Association, as
Indenture Trustee and Co-Owner Trustee (Incorporated
herein by reference to Exhibit to Registrant's
Current Report on Form 8-K dated as of January 17,
1997).
*13.1 Annual Report Aggregating Servicer Monthly Remittance
Reports for Series 1996-2 for the fiscal year ended
December 31, 1996.
*13.2 Annual Report Aggregating Servicer Monthly Remittance
Reports for Series 1996-3 for the fiscal year ended
December 31, 1996.
*13.3 Annual Report Aggregating Servicer Monthly Remittance
Reports for Series 1996-4 for the fiscal year ended
December 31, 1996.
*28.1 Quarterly Statements of Compliance of Servicer for
Series 1996-2 and Series 1996-3.
28.2 Report of Ernst & Young LLP, dated October 25, 1996,
regarding Servicer's Compliance with Applicable
Accounting Standards.
(d) Not applicable.
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT
TO SECTION 12 OF THE ACT.
No annual report or proxy material has been sent to security holders.
* To be filed by amendment.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
FIRSTPLUS INVESTMENT CORPORATION
By: /s/ CHRISTOPHER J. GRAMLICH
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Christopher J. Gramlich
Senior Vice President
Dated: March 27, 1997
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been executed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
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/s/ KIRK R. PHILLIPS
- ------------------------- Director and President March 26, 1997
Kirk R. Phillips (Principal Executive
Officer)
/s/ MARK J. LANDRY
- ------------------------- Director, Treasurer and March 26, 1997
Mark J. Landry Chief Financial Officer
(Principal Financial
Officer and Principal
Accounting Officer)
/s/ LARRY G. STUDINSKI
- ------------------------- Director March 26, 1997
Larry G. Studinski
/s/ STEVEN A. RUBIN
- ------------------------- Director March 27, 1997
Steven A. Rubin
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INDEX TO EXHIBITS
<TABLE>
EXHIBIT
NUMBER DESCRIPTION
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3.1 Amended and Restated Articles of Incorporation of the
Registrant (Incorporated herein by reference to
Exhibit to Amendment No. 2 to Registrant's
Registration Statement No. 33-65373 on Form S-3 filed
on May 10, 1996).
3.2 By-Laws of the Registrant (Incorporated herein by
reference to Exhibit to Registrant's Registration
Statement No. 33-65373 on Form S-3 filed on December
22, 1995).
4.1 Copy of Pooling and Servicing Agreement for Series
1996-2 dated as of June 1, 1996, among Registrant, as
Depositor, FIRSTPLUS FINANCIAL, INC., as Servicer,
and First Trust of California, N.A., as Trustee
(Incorporated herein by reference to Exhibit to the
Registrant's Current Report on Form 8-K dated as of
August 30, 1996).
4.2 Copy of Indenture for Series 1996-3 dated as of
September 1, 1996, among FIRSTPLUS HOME LOAN OWNER
TRUST 1996-3, as Issuer, and First Bank National
Association, as Indenture Trustee (Incorporated
herein by reference to Exhibit to the Registrant's
Current Report on Form 8-K dated as of December 20,
1996).
4.3 Copy of Trust Agreement for Series 1996-3 dated as of
September 1, 1996, among the Registrant, as
Depositor, FIRSTPLUS RESIDUAL HOLDINGS, INC.,
Wilmington Trust Company, as Owner Trustee, and First
Bank National Association, as Co-Owner Trustee
(Incorporated herein by reference to Exhibit to the
Registrant's Current Report on Form 8-K dated as of
December 20, 1996).
4.4 Copy of Indenture for Series 1996-4 dated as of
November 1, 1996, among FIRSTPLUS HOME LOAN OWNER
TRUST 1996-4, as Issuer, and First Bank National
Association, as Indenture Trustee (Incorporated
herein by reference to Exhibit to the Registrant's
Current Report on Form 8-K dated as of January 17,
1997).
4.5 Copy of Trust Agreement for Series 1996-4 dated as of
November 1, 1996, among the Registrant, as Depositor,
FIRSTPLUS RESIDUAL HOLDINGS, INC., Wilmington Trust
Company, as Owner Trustee, and First Bank National
Association, as Co-Owner Trustee (Incorporated herein
by reference to Exhibit to the Registrant's Current
Report on Form 8-K dated as of January 17, 1997).
10.1 Copy of Sale and Servicing Agreement for Series
1996-3 dated as of September 1, 1996, among the
Registrant, as Seller, FIRSTPLUS FINANCIAL, INC., as
Servicer, FIRSTPLUS HOME LOAN OWNER TRUST 1996-3, as
Issuer, and First Bank National Association, as
Indenture Trustee and Co-Owner Trustee (Incorporated
herein by reference to Exhibit to Registrant's
Current Report on Form 8-K dated as of December 20,
1996).
10.2 Copy of Sale and Servicing Agreement for Series
1996-4 dated as of November 1, 1996, among the
Registrant, as Seller, FIRSTPLUS FINANCIAL, INC., as
Servicer, FIRSTPLUS HOME LOAN OWNER TRUST 1996-4, as
Issuer, and First Bank National Association, as
Indenture Trustee and Co-Owner Trustee (Incorporated
herein by reference to Exhibit to Registrant's
Current Report on Form 8-K dated as of January 17,
1997).
*13.1 Annual Report Aggregating Servicer Monthly Remittance
Reports for Series 1996-2 for the fiscal year ended
December 31, 1996.
*13.2 Annual Report Aggregating Servicer Monthly Remittance
Reports for Series 1996-3 for the fiscal year ended
December 31, 1996.
*13.3 Annual Report Aggregating Servicer Monthly Remittance
Reports for Series 1996-4 for the fiscal year ended
December 31, 1996.
*28.1 Quarterly Statements of Compliance of Servicer for
Series 1996-2 and Series 1996-3.
28.2 Report of Ernst & Young LLP, dated October 25, 1996,
regarding Servicer's Compliance with Applicable
Accounting Standards.
</TABLE>
* To be filed by amendment.
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EXHIBIT 28.2
[ERNST & YOUNG LLP LETTERHEAD]
Report of Independent Accountants
Board of Directors
FIRSTPLUS Financial, Inc.
We have examined management's assertion included in the accompanying report
titled Report of Management that, during the year ended September 30, 1996,
FIRSTPLUS Financial, Inc. (the Company), complied with the minimum servicing
standards set forth in the Mortgage Bankers Association of America's Uniform
Single Attestation Program for Mortgage Bankers (USAP) that are applicable to
home improvement and debt consolidation loans serviced by the Company pursuant
to the respective Pooling and Servicing Agreements for the Remodelers Home
Improvement Loan Asset-Backed Certificates, Series 1994-1, 1995-1, 1995-2,
1995-3, 1995-4, 1996-1, 1996-2, 1996-A, and 1996-3. Management has represented
to us that the minimum servicing standards related to mortgagor escrow accounts
and adjustable rate mortgages including: minimum servicing standards I.4.,
III.2. (with respect to tax and insurance disbursements made on behalf of the
mortgagors), III.3., III.4., V.2., V.3., and V.4. are not applicable to the
home improvement loans they service. Management is responsible for the
Company's compliance with the applicable requirements. Our responsibility is to
express an opinion on management's assertion about the Company's compliance
with the applicable minimum servicing standards based on our examination.
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants and, accordingly, included
examining, on a test basis, evidence about the Company's compliance with the
applicable minimum servicing standards and performing such other procedures as
we considered necessary in the circumstances. We believe that our examination
provides a reasonable basis for our opinion. Our examination does not provide a
legal determination on the Company's compliance with specified requirements.
In our opinion, management's assertion that the Company complied with
applicable minimum servicing standards as mentioned above during the year ended
September 30, 1996, is fairly stated, in all material respects.
/s/ ERNST & YOUNG LLP
October 25, 1996
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[FIRSTPLUS FINANCIAL, INC. LETTERHEAD]
October 25, 1996
REPORT OF MANAGEMENT
We, as members of management of FIRSTPLUS FINANCIAL, INC. (the Company), are
responsible for complying with the minimum servicing standards as set forth in
the Mortgage Bankers Association of America's Uniform Single Attestation
Program for Mortgage Bankers (USAP) that are applicable to home improvement
loans serviced by the Company pursuant to the Asset-Backed Certificates, Series
1994-1, 1995-1, 1995-2, 1995-3, 1995-4, 1996-1, 1996-2, 1996-A, and 1996-3. We
have interpreted that minimum servicing standards related to mortgagor escrow
accounts and adjustable rate mortgages, including: I.4, III.2 (with respect to
tax and insurance disbursements made on behalf of the mortgagers), III.3,
III.4, V.2, V.3 and V.4 are not applicable to the home improvement and debt
consolidation loans we service. We are also responsible for establishing and
maintaining effective internal control over compliance with the applicable
standards. We have performed an evaluation of the Company's compliance with the
applicable minimum servicing standards as set forth in the USAP as of September
30, 1996 and for the year then ended. Based on this evaluation, we assert that
during the year ended September 30, 1996, the Company complied with the minimum
servicing standards set forth in the USAP.
As of and for the year ended September 30, 1996, the Company has in effect a
mortgage bankers bond policy in the amount of $300,000 as well as an errors and
omissions policy in the amount of $1,000,000.
Very truly yours,
/s/ DANIEL T. PHILLIPS
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Daniel T. Phillips, Chairman & CEO
FIRSTPLUS FINANCIAL, INC.
/s/ ERIC C. GREEN
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Eric C. Green, President
FIRSTPLUS FINANCIAL, INC.
