UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 25, 1999
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Commission File Number 333-29015
MERRILL LYNCH DEPOSITOR, INC.
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(Exact name of registrant as specified in its charter)
Delaware 13-3891329
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(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
World Financial Center
New York, New York 10281-1323
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:(212) 449-1000
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: [x] Yes [ ] No.
The Registrant meets the conditions set forth in General Instruction
H(1)(a) and (b) of Form 10-Q and is therefore filing this form with the reduced
disclosure format.
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MERRILL LYNCH DEPOSITOR, INC.
TABLE OF CONTENTS
Page No.
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PART I FINANCIAL INFORMATION
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Item 1 Financial Statements
Balance Sheet as of June 25, 1999
and December 25, 1998 3
Statements of Operations and Retained
Earnings for the three month period
ended June 25, 1999 and June 26, 1998. 4
Statements of Cash Flows for the three
month period ended June 25, 1999 and
June 26, 1998. 5
Notes to Financial Statements 6-7
PART II OTHER INFORMATION
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Item 1 Legal Proceedings 8
Item 2 Changes in Securities 8
Item 3 Defaults upon Senior Securities 8
Item 4 Submission of Matters to a Vote of
Security Holders 8
Item 5 Other Information 8
Item 6 Exhibits and Reports on Form 8-K 8
Signatures 9
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MERRILL LYNCH DEPOSITOR, INC.
BALANCE SHEET
AS OF June 25, 1999 and December 25,1998
1999 1998
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ASSET
Cash 0 0
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STOCKHOLDER'S EQUITY
Common Stock 0 0
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The accompanying notes are an integral part of these financial statements.
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MERRILL LYNCH DEPOSITOR, INC.
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
FOR THE THREE MONTH PERIOD ENDED
June 25, 1999 and June 26, 1998
1999 1998
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Revenues - Interest Income $ - -
Expenses - Interest Expense - -
Earnings Before Taxes - -
Provision For Income Taxes - -
Net Earnings - -
Retained earnings, beginning of year - -
Retained earnings, end of year $ - -
The accompanying notes are an integral part of these financial statements.
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MERRILL LYNCH DEPOSITOR, INC.
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTH PERIOD ENDED
June 25, 1999 and June 26, 1998
1999 1998
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CASH FLOW FROM OPERATING ACTIVITIES:
Net earnings $ - -
CASH FLOWS FROM FINANCING ACTIVITIES - -
CASH FLOWS FROM INVESTING ACTIVITIES - -
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CHANGE IN CASH - -
CASH, BEGINNING OF YEAR - -
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CASH, END OF YEAR $ - -
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SUPPLEMENTAL INFORMATION:
Cash payments for interest and taxes $ - -
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The accompanying notes are an integral part of these financial statements.
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MERRILL LYNCH DEPOSITOR, INC
NOTES TO FINANCIAL STATEMENTS
Note 1. Description of Business
Merrill Lynch Depositor, Inc.(the "Company") was incorporated in the
state of Delaware on August 13, 1993 under the name Merrill Lynch Asset Backed
Securities, Inc. and changed its name to the present one on June 3, 1997. The
Company is a wholly owned, limited purpose subsidiary of Merrill Lynch Mortgage
Capital Inc., which is an indirect, wholly owned subsidiary of Merrill Lynch &
Co.("ML&Co").
The Company has been established for the sole purpose of engaging in the
following activities: (a) acquiring, owning, holding, transferring, pledging,
selling, delivering, investing in or otherwise purchasing or disposing of (and
entering into agreements in connection with)(i) bonds, notes or other evidences
of indebtedness ("Debt Obligations"), debt or equity securities, obligations,
trust certificates ("Certificates") and other securities and instruments
(collectively, "Securities"), (ii) trade receivables("Receivables"), (iii) loan
agreements, promissory notes or other evidences of indebtedness ("Loans")
secured by Receivables or participation interests in pools of receivables
("Participation Interests"), and (iv) Participation Interests, in each case
together with any related insurance contracts and agreements with dealers,
originators and servicers of such Receivables; (b) acting as settlor or
depositor of trusts formed under trust agreements or other agreements (each an
"Agreement") to issue series (which may be divided into classes) of Certificates
representing undivided interests in Securities, Receivables, Loans,
Participation Interests, Subordinated Interests (as defined below), and to enter
into any other agreement in connection with the authorization, purchase,
issuance, sale and delivery of Certificates;(c) arranging or otherwise providing
for credit support or other enhancement for any series of Certificates, such as
insurance policies, letters of credit, puts, calls, interest rate swaps,
currency swaps, floors, caps, collars and other forms of hedging contracts; (d)
using proceeds from the Certificates as provided in the Agreements and loaning,
investing or otherwise applying proceeds and any other income as determined by
the Company's Board of Directors; (e) holding, pledging, transferring or
otherwise dealing with Certificates, Debt Obligations and any Certificates or
Debt Obligations representing a subordinated undivided in Receivables, Loans
and/or Participation Interests ("Subordinated Interests") or a residual interest
in Receivables ("Residual Interests"); (f) authorizing, issuing, selling and
delivering subordinated indebtedness; and (g) exercising all powers permitted to
corporations under the laws of the State of Delaware that are necessary or
convenient to accomplish the foregoing.
Each series of the Company's Certificates will be secured by, or represent
ownership of, a separate and identifiable pool of Debt Obligations purchased in
connection with the issuance of such Certificates.
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The Debt Obligations for each series of Certificates will be the Trustee
under each Agreement on behalf of the holders of the Certificates of that
series, and will not be available for the Certificates of any other series.
At June 25, 1999, the Company had one effective Registration Statement on
Form S-3 with the Securities and Exchange Commission ("SEC") for the issuance of
$500 million of securities and had filed another Registration Statement on Form
S-3 with the SEC for the issuance of $500 million of securities.
Note 2. Accounting Policies
The Company may borrow funds from an affiliate, as needed. Interest
expense is allocated to the Company based on the rate of the asset financed. All
other operating expenses are charged directly to the Parent.
Note 3. Income Taxes
The results of operations of the Company are included in the consolidated
Federal income tax return of ML&Co. ML&Co. allocates the income taxes to its
subsidiaries in a manner that approximates the separate company method.
The Company uses the asset and liability method in providing income taxes
on all transactions that have been recognized in the financial statements. The
asset and liability method requires that deferred taxes be adjusted to reflect
the tax rates at which future taxable amounts will be settled or realized. The
effects of tax rate changes on future deferred tax liabilities and deferred tax
assets, as well as other changes in income tax laws, are recognized in net
earnings in the period such changes are enacted.
Note 4. Year 2000
The Company does not believe that it has a material problem resulting from
the inability of computer programs to properly recognize a year that begins with
"20" instead of "19." The Company's operations do not rely on information
technology, but, to the extent that information technology becomes a significant
element of Company's operations, the Company would rely on its parent, ML&Co.,
with respect to its information technology. Therefore, the Company would rely
on the initiatives of its ML&Co. with respect to Year 2000 compliance.
ML&Co. believes that it has identified and evaluated its Internal Year
2000 problem and that it is devoting sufficient Resources to renovating
technology systems that are not already Year 2000 compliant. ML&Co. has allotted
nearly 10% of the current year's technology budget to its Year 2000 compliance
efforts. By the end of the third quarter of 1998, the total amount spent by
ML&Co. on its Year 2000 compliance initiative is expected to be approximately
$400 million. There can be no assurances that the cost if Year 2000 compliance
will not exceed those allocated by ML&Co., nor can there be any assurances that
these compliance efforts will succeed.
The Company maintains relationships certain third-parties, and is
undertaking to assess the Year 2000 readiness of these third-parties. To the
extent that these third-parties are adversely impacted by the Year 2000 issues,
there can be no assurance that the Company will not also be materially adversely
affected.
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PART II. OTHER INFORMATION
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Item 1. Legal Proceedings
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The Company is not a party to any pending legal proceedings, nor
is the Company aware of any proceedings contemplated by
governmental authorities.
Item 2. Changes in Securities
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Omitted pursuant to general instruction H(1) (a) and (b) of the
Form 10-Q.
Item 3. Defaults upon Senior Securities
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Omitted pursuant to general instruction H(1) (a) and (b) of the
Form 10-Q.
Item 4. Submission of Matters to a Vote of Security Holders
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Omitted pursuant to general instruction H(1) (a) and (b) of the
Form 10-Q.
Item 5. Other Information
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None
Item 6. Exhibits and Reports on Form 8-K
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(a) Exhibits required by Item 601 of Regulation S-K:
There are no exhibits required to be filed with this report.
(b) Reports for the Trust prepared by the Master Servicer are
filed on Form 8-K.
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SIGNATURES
Pursuant to the requirements 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.
By:\s\ Barry N. Finkelstein
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Name: Barry N. Finkelstein
Title: President / EVP / Treasurer
Dated: August 6, 1999
By:\s\ Michael McEvilly
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Name: Michael McEvilly
Title: Senior VP / Secretary
Dated: August 6, 1999
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