SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934
for the fiscal year ended December 31, 1997
Commission File Number: 333-22559
Salomon Brothers Mortgage Securities VII, Inc.
(Exact Name of registrant as specified in its charter)
Delaware 13-3439681
(State or Other Juris- (I.R.S. Employer
diction of Incorporation) Identification No.)
Seven World Trade Center, New York, New York 10048
(Address of Principal Executive Office)
212-783-5659
(Registrant's telephone number, including area code)
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.
Not applicable.
Aggregate market value of voting stock held by non-affiliates of the
Registrant as of December 31, 1997.
Not applicable.
Number of shares of common stock outstanding a
s of December 31, 1997.
Not applicable.
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Table of Contents
PART I
Item 1. Business..................................................3
Item 2. Properties................................................3
Item 3. Legal Proceedings.........................................3
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.......................................3
Item 6. Selected Financial Data...................................3
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 Statement Schedules And Reports On
Form 8-K................................................4
Signatures........................................................4
Exhibit Index.....................................................4
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PART I
ITEM 1. BUSINESS
This Annual Report on Form 10-K relates to the Trust Fund formed,
and the Mortgage Pass-Through Certificates, Series 1997-HUD 1 issued,
pursuant to a Pooling and Servicing Agreement, dated as of April 1, 1997
(the "Pooling and Servicing Agreement"), by and among Salomon Brothers
Mortgage Securities VII, Inc. as sponsor (the "Company") Ocwen Federal
Bank FSB, as master servicer, LaSalle National Bank, as trustee and
REMIC administrator, and ABN AMRO Bank, N.V., as fiscal agent. The
Certificates have been registered pursuant to the Act under a
Registration Statement on Form S-3 (No. 333-27083) (the "Registration
Statement").
Capitalized terms used herein and not defined have the same
meanings ascribed to such terms in the Pooling and Servicing Agreement.
This Annual Report is being filed by the Trustee, in its capacity as
such under the Pooling and Servicing Agreement, on behalf of Registrant.
The information contained herein has been supplied to the Trustee by
one or more of the Borrowers or other third parties without independent
review or investigation by the Trustee. Pursuant to the Pooling and
Servicing Agreement, the Trustee is not responsible for the accuracy
or completeness of such information.
ITEM 2. PROPERTIES
See Exhibits 99.1 and 99.2 hereto for Servicer s Annual Statement of
Compliance and Servicer s Independent Accountant s Report on Servicer's
servicing activities.
ITEM 3. LEGAL PROCEEDINGS
Except for claims arising in the ordinary course of business and
which are covered by liability insurance, there are no material pending
legal proceedings involving the Trust Fund, the Mortgages comprising the
Trust Fund or the Trustee, the Special Servicer or the 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 matters were submitted to a vote of Certificateholders during
the fiscal year covered by this report.
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
There was one registered holder of the Certificate representing an
equity interest in the Trust as of December 31, 1997. To the
Registrant'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 A 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 fund 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
Fund.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
ON FORM 8-K
(a)
1. Servicer's Annual Statement of Compliance for the period ended
12/31/97.
2. Servicer's Independent Accountant's Report on Servicer's servicing
activities.
(b) All current Reports on Form 8-K for the Trust have been filed as of
12/31/97.
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 by the undersigned thereunto duly authorized.
LASALLE NATIONAL BANK, IN
ITS CAPACITY AS TRUSTEE UNDER
THE POOLING AND SERVICING
AGREEMENT ON BEHALF OF Salomon
Brothers Mortgage Securities
VII, Inc., REGISTRANT
By: /s/ Russell Goldenberg
Name: Russell Goldenberg
Title: Senior Vice President
Dated: April 14, 1998
EXHIBIT INDEX
Exhibit No. Description
99.1 Servicer's Annual Statement of Compliance
99.2 Servicer's Independent Accountants' Report on Servicer's servicing
activities
Exhibit 99.1
March 30, 1998
0 C W E N
LaSalle National Bank
135 South LaSalle Street, Suite 1740
Chicago, Illinois 60674-4107
Attn: Asset-Backed Securities Trust Services Group Salomon Brothers
Mortgage Securities VII, Inc.
RE: 1997 Annual Compliance Information
As required by the terms of the Seller/Servicer Agreement, Trust Agreement
and/ or Pooling and Servicing Agreement, we have provided the following
compliance information:
1. Uniform Single Attestation Program (USAP) for Mortgage Bankers
prepared by an Independent Auditor,
2. Officer's Certificate As To Compliance, signed by a Servicing
(ifficer who is authorized to sign such documents.
Should you have any questions regarding this matter or services provided
by Ocwen Federal Bank, please do not hesitate to contact me at
(561) 681-8279 or fax (561) 68 1 -8186.
Sincerely,
By: /s/ Joseph Laigaie
Joseph Laigaie
Manager, Investor Reporting
Enclosures
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0 C W E N
March 30,1998
LaSalle National Bank
135 South LaSalle Street, Suite 1740
Chicago, Illinois 60674-4107
Ann: Asset-Backed Securities Services Group,
Salomon Brothers Mortgage Securities VII, Inc.
Mortgage Pass-Through Certificates, Series 1997-HUD I
I
RE: Officer Certification
I Jay B. Goldman as officer of Ocwen Federal Bank FSB (the "Banlo confirm
that activities required to be perfbrmed by the Bank under the servicig
agreement (the "Agreement) have been completed in accordance with the
intent of the respective Agreement, to the best of my knowledge.
Sincerely,
/s/ Jay B. Goldman
Jay B. Goldman
Vice President Loan Servicing
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Exhibit 99.2
One East Broward Boulevard
Telephone 954 463 6280
Suite 1700
Fort Lauderdale, FL 33301
Price Waterhouse LLP
LOAN SERVICING REPORT OF
INDEPENDENT CERT11FIED PUBLIC ACCOUNTANTS
March 25, 1998
To the Board of Directors of
Ocwen Federal Bank FSB
We have examined management's assertions about Ocwen Federal Bank
FSB's ("the Bank") compliance with the minimum servicing standards in the
Mortgage Bankers Association of America's Unlyorm Single Attestation
Program for Moqga Bankers as of and for the year ended December 31, 1997,
included in the accompanying management assertion. Management is
responsible for the Bank~s compliance with those minimum servicing
standards. Our responsibility is to express an opinion on management's
assertion about the entity's compliance 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 ba.sis, evidence about the
Bank'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 the Bank's compliance with the minimum servicing
standards.
In our opinion, management's assertion that the Bank has complied with
the aforementioned minimum servicing standards as of and for the year
ended December 3 1, 1997 is fairly stated, in all. material respects.
/s/ Price Waterhouse LLP
0 C W E N
MANAGENIENT'S ASSERTION ON COMPLIANCE WITH USAP
March 25, 1998
As of and for the year ended December 3 1, 1997, Ocwen Federal
Bank FSB (the "Bank") has complied 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 this same period, the Bank had
in effect a fidelity bond and an errors and omissions policy in the
combined amount of $10,000,000.00
/s/ Jay Goldman
Jay Goldman, Vice President
Date: March 25, 1998
