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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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, 1997
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
Commission file number 333-21511
BENEFICIAL MORTGAGE SERVICES, INC.
(Depositor)
BENEFICIAL HOME EQUITY LOAN TRUST 1997-2
(Issuer in Respect of the Beneficial Home Equity Loan
Asset Backed Certificates, Series 1997-2)
(Exact name of registrant as specified in its
charter)
New York (Issuer) 13-3973303 (Issuer)
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
301 North Walnut Street
Wilmington, Delaware 19801
(Address of principal executive offices of
Depositor and Master Servicer) (Zip Code)
Registrant's telephone number, including area code:
(302) 425-2500 (Depositor and Master Servicer)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Title of each class: Name of each exchange on
which registered:
None None
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SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
None
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(Title of class)
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. [ ]
State the aggregate market value of the voting stock held by
non-affiliates of registrant. The aggregate market value shall be computed by
reference to the price at which the stock was sold, or the average bid and asked
prices of such stock, as of a specified date within 60 days prior to the date of
filing.
Not applicable
Documents Incorporated By Reference
Not Applicable
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<PAGE>
TABLE OF CONTENTS
Part I
Item 1. Business 3
Item 2. Properties 3
Item 3. Legal Proceedings
Item 4. Submission of Matters to a Vote of Security Holders 3
Part II
Item 5. Market for Registrant's Common Equity and Related
Shareholder Matters 4
Item 6. Selected Financial Data 4
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 4
Item 8. Financial Statements and Supplementary Data 4
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 4
Part III
Item 10. Directors and Executive Officers of the Registrant 4
Item 11. Executive Compensation 4
Item 12. Security Ownership of Certain Beneficial Owners
and Management 4
Item 13. Certain Relationships and Related Transactions 4
PART IV
Item 14. Exhibits, Financial Statements Schedules and
Reports on Form 8-K 5
Signature 6
Exhibit Index 7
<PAGE>
PART I
Item 1. Business.
This Annual Report on Form 10-K relates to the Beneficial Home
Equity Loan Trust 1997-2 (the "Trust"), a fund formed pursuant to a Pooling and
Servicing Agreement, dated as of September 1, 1997 (the "Pooling and Servicing
Agreement"), by and among Beneficial Mortgage Corporation, as master servicer
(the "Master Servicer"), and The Chase Manhattan Bank (National Association),
acting thereunder not in its individual capacity but solely as trustee. The
Trust, which is the issuer of the Certificates, became subject to the reporting
requirements under Section 13 of the Securities Exchange Act of 1934, as
amended, when the Registration Statement on Form S-11 (No.333-21511) (the
"Registration Statement"), filed by the Depositor on behalf of the Trust, became
effective.
Capitalized terms used herein and not defined have the same
meanings ascribed to such terms in the Pooling and Servicing Agreement.
This Annual Report on Form 10-K is being filed by the
Depositor, in its capacity as such under the Pooling and Servicing Agreement, on
behalf of the Trust. The information reported and contained herein has been
prepared by the Master Servicer, pursuant to the Pooling and Servicing
Agreement.
Item 2. Properties.
Not applicable.
Item 3. Legal Proceedings.
The Master Servicer is not aware of any material pending legal
proceedings involving the Trust, the Home Equity Loans comprising the Trust or
the Trustee or the Master Servicer with respect to or affecting their respective
duties under the Pooling and Servicing Agreement.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter has been submitted to a vote of the
Certificateholders through the solicitation of proxies or otherwise.
<PAGE>
PART II
Item 5. Market for Registrant's Common Equity and Related Shareholder
Matters.
As of December 31, 1997, Cede & Co., the nominee of the
Depository Trust Company ("DTC"), was the only holder of record of the Class A
Certificates, the Class M Certificates and the Class B Certificates. DTC holds
the Certificates for the accounts of others. To the Depositor's knowledge, as of
that date, there was no principal market in which the Certificates representing
an equity interest in the Trust were traded.
Item 6. Selected Financial Data.
Not applicable.
Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
Not applicable.
Item 8. Financial Statements and Supplementary Data.
Not applicable.
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure.
None.
PART III
The information required by Items 10, 11, 12 and 13 is not
applicable as the Trust does not have directors or officers and
Certificateholders have no right to vote (except with respect to required
consents to certain amendments to the Pooling and Servicing Agreement and upon
certain events of default) or control the Trust.
<PAGE>
PART IV
ITEM 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.
(a) (1) Financial Statements
Not applicable.
(2) Financial Statement Schedules
Not applicable.
(3) Exhibits
99.1 Servicer's Annual Statement of Compliance for the period
ended 12/31/97.
99.2 Servicer's Independent Auditor's Report of Servicer's
Servicing Activities.
(b) Current Reports on Form 8-K for the Trust were filed on November 28,
1997 and December 29, 1997 during the quarter ended December 31, 1997.
<PAGE>
SIGNATURE
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 behalf of Beneficial Home Equity Loan Trust 1997-2 by the
undersigned, thereunto duly authorized.
BENEFICIAL HOME EQUITY LOAN TRUST 1997-2
Registrant
By: Beneficial Mortgage Services, Inc.
(Depositor)
By: /s/ Richard J. Zak
Richard J. Zak
Vice President and Controller
March 31, 1998
<PAGE>
EXHIBIT INDEX
Exhibit Number Exhibit
99.1 Servicer's Annual Statement of Compliance
99.2 Servicer's Independent Auditor's Report of
Servicer's Servicing Activities.
<PAGE>
Exhibit 99.1
Servicer's Annual Statement of Compliance
OFFICER'S CERTIFICATE
This certificate pertains to the obligations of Beneficial Mortgage Corporation
(BMC), as Master Servicer, under the terms of the Pooling and Servicing
Agreement (P&S Agreement) dated September 1, 1997, by and among BMC, as master
servicer and The Chase Manhattan Bank (National Association), as trustee
pursuant to which the Beneficial Home Equity Loan Asset Backed Certificates,
Series 1997-2, were issued on September 16, 1997.
I certify that a review of the activities of BMC as Master Servicer during the
year ended December 31, 1997 and of it performance under the P&S Agreement have
been made under my supervision and to the best of my knowledge, based on such
review, BMC has fulfilled all of its material obligations under the P&S
Agreement for the year.
/s/ M. Flory Cook
M. Flory Cook
Vice President and Operations
Controller
Beneficial Mortgage Corporation
March 31, 1998
<PAGE>
Exhibit 99.2
Servicer's Independent Auditor's Report on Servicer's Servicing Activity
To the Board of Directors of
Beneficial Mortgage Corporation
We have examined the accompanying management's assertion about
Beneficial Mortgage Corporation's compliance with the minimum servicing
standards identified in the Mortgage Bankers Association of America's Uniform
Single Attestation Program for Mortgage Bankers (USAP) as of and for the period
ended December 31, 1997, which is required by the Pooling and Servicing
Agreement dated as of September 1, 1997 between Beneficial Mortgage
Corporation, as master servicer, and The Chase Manhattan Bank (National
Association), as trustee, pursuant to which the Beneficial Home Equity
Loan Asset Backed Certificates, Series 1997-2 were issued. Management is
responsible for Beneficial Mortgage Corporation's compliance with those
minimum servicing standards. Our responsibility is to express an opinion on
management's assertion about the entity's compliance based upon 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 Beneficial
Mortgage Corporation's compliance with the 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
Beneficial Mortgage Corporation's compliance with the minimum servicing
standards.
In our opinion, management's assertion that Beneficial
Mortgage Corporation complied with the aforementioned minimum servicing
standards as of and for the year ended December 31, 1997 is fairly stated, in
all material respects.
This report is intended solely for the information and use of
the Board of Directors and the management of Beneficial Mortgage Corporation and
The Chase Manhattan Bank (National Association) and should not be used of any
other purpose.
/s/ DELOITTE AND TOUCHE LLP
DELOITTE AND TOUCHE LLP
Parsippany, New Jersey
March 20, 1998
<PAGE>
MANAGEMENT'S ASSERTION
Beneficial Mortgage Corporation, an indirect wholly-owned subsidiary of
Beneficial Corporation (the "Company"), has compiled in all material respects
with the minimum servicing standards set forth in the Mortgage Bankers
Association of America's Uniform Single Attestation Program for Mortgage Bankers
as of and for the period ended December 31, 1997, which is required by the
Pooling and Servicing Agreement dated as of September 1, 1997 between Beneficial
Mortgage Corporation, as master servicer, and The Chase Manhattan Bank (National
Association), as trustee, pursuant to which the Beneficial Home Equity Loan
Asset Backed Certificates, Series 1997-2 were issued. As of and for this same
period, the Company had in effect a fidelity bond and errors and omissions
policy in the amount of $35,000,000.
/s/ Allen L. Wehrhahn
Allen L. Wehrhahn
President
/s/ M. Flory Cook
M. Flory Cook
Vice President and Operations Controller
March 6, 1998
