<PAGE> 1
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
For fiscal year ended DECEMBER 31, 1995
-----------------
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 0-12316
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GUARANTEED MORTGAGE CORPORATION II
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MICHIGAN 31-1067092
- --------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
6061 SOUTH WILLOW DRIVE, SUITE 301, GREENWOOD VILLAGE, COLORADO 80111
- ------------------------------------------------------------------ ------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code - (303) 740-3370
--------------
Securities registered pursuant to Section 12(b) of the Act:
NONE
----
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, PAR VALUE $1.00 PER SHARE
---------------------------------------
(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 XX No
---- ----
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (paragraph 229.405 of this chapter) 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/X/
Aggregate market value of voting stock held by nonaffiliates of the
registrant as of March 1, 1996: $-0-
Number of shares of common stock outstanding as of March 1, 1996: 1,000.
Registrant meets the conditions set forth in General Instruction J(1)(a)
and (b) of Form 10-K and is therefore filing this Annual Report on Form 10-K
with the reduced disclosure format.
<PAGE> 2
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
PART I
ITEM 1. BUSINESS
Organization
Guaranteed Mortgage Corporation II (the "Company") was incorporated under
the laws of the State of Michigan on March 2, 1983, as a wholly-owned limited
purpose financing subsidiary of Pulte Financial Companies, Inc. ("PFCI"), a
wholly-owned subsidiary of Pulte Corporation, a publicly-owned holding company
listed on the New York Stock Exchange.
Issuance of GNMA-Collateralized Bonds
The Company was organized to facilitate the financing of long-term
mortgage loans on single-family residential homes primarily built by Pulte Home
Corporation ("PHC") through the issuance and sale of bonds secured by
mortgage-backed securities ("GNMA Certificates"), the payment of principal and
interest of which is guaranteed by the Government National Mortgage Association
("GNMA"). GNMA is a wholly-owned corporate instrumentality of the United
States within the Department of Housing and Urban Development. To accomplish
its purpose, the Company issued GNMA-collateralized bonds in series and used
the net proceeds of such sales to purchase GNMA Certificates backed by mortgage
loans (many of which were originated by ICM Mortgage Corporation, a
wholly-owned subsidiary of PHC, and were secured by homes built by PHC). Such
mortgage loans are either insured by the Federal Housing Administration ("FHA")
of the U.S. Department of Housing and Urban Development under the National
Housing Act of 1934, as amended, or partially guaranteed by the U.S. Veterans
Administration ("VA") under the Servicemen's Readjustment Act of 1944, as
amended.
The Company, although incorporated in March, 1983 and capitalized on June
21, 1983, did not commence operations until it issued its first series of bonds
on July 29, 1983. Prior to 1988, the Company issued 22 series of bonds having
an aggregate original principal amount of $2,362,952,000, with stated annual
interest rates ranging from 8.15% to 13.65%, and one class of bonds bearing
interest at a variable rate. The Company has not issued any bonds since 1987.
At December 31, 1995, the Company had $170,590,843 in aggregate principal
amount of bonds outstanding with stated annual interest rates ranging from
8.45% to 11.00%. All of the Company's bonds were offered and sold to the
public pursuant to registration statements filed with the Securities and
Exchange Commission.
Each series of the Company's bonds is secured by a separate collateral
package consisting, in part, of the GNMA Certificates purchased in connection
with the issuance of such bond series, letters of credit and cash. The
collateral package for each series is pledged to NBD Bank, N.A., as trustee on
behalf of the holders of the bonds of such series, and will not be available
for payment of bonds of any other series. Funds held by the trustee with
respect to each series of bonds are restricted so as to assure the payment of
principal and interest on the bonds to the extent of such funds.
Under the Company's articles of incorporation and the terms of the
indenture governing the issuance of the Company's GNMA-collateralized bonds,
the Company was restricted to only issue GNMA-collateralized bonds rated in the
highest category by Standard & Poor's Corporation.
ITEM 2. PROPERTIES
The Company has no material physical properties. Its primary asset is
ownership of the various GNMA Certificates, and the mortgage loans underlying
such GNMA Certificates, pledged to NBD Bank, N.A., as trustee, to secure the
Company's GNMA-collateralized bonds.
2
<PAGE> 3
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
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 J(2).
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
The Company is a wholly-owned subsidiary of PFCI. (See "Business -
Organization" in Item 1 of this Report.) Thus, there is no market for its
common stock.
ITEM 6. SELECTED FINANCIAL DATA
Information in response to this item is omitted pursuant to General
Instruction J(2).
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
The Company's mortgage-backed securities (GNMA Certificates) are used as
collateral for associated bonds payable. Mortgage-backed securities were
acquired from affiliates. Any difference between the acquisition price and the
principal balance of the securities at their date of acquisition (mortgage
discounts/premiums) was amortized into operations as an adjustment of mortgage
yield.
The Company's pretax loss before extraordinary item was $144,100 for 1995
compared to pretax loss before extraordinary item of $4,883,938 and $2,755,601
for 1994 and 1993, respectively.
Losses decreased during 1995 as compared to 1994 primarily as a result of
GMC II no longer incurring amortization expense related to mortgage/bond
discounts and bond issue costs as a result of GMC II changing its estimate of
amortization speeds in December 1994.
Earnings decreased during 1994 as compared to 1993 primarily due to
increased amortization of mortgage discounts, bond discounts and bond issue
costs as a result of GMC II changing its estimate of amortization speeds. As a
result of collateral coupon dispersion indicating further reduction of average
collateral coupon interest rates in 1995 and 1996, GMC II expensed all
remaining mortgage discount balances, bond discounts and issue costs in
December, 1994. The net amount of expense relating to this write off in 1994
amounted to $2,678,999.
3
<PAGE> 4
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
Key Factors Impacting Interest Revenue and Interest Expense
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Interest Revenue:
Mortgage-backed securities
portfolio balance at year end,
at amortized cost $171,595,178 $210,877,263 $310,688,906
Weighted average rate at
year end 8.99% 9.10% 9.38%
Interest income for the year $ 17,614,050 $ 21,948,862 $ 35,297,194
Amortization of net mortgage
discounts 938,991 1,037,008
Write-off of mortgage discounts 3,075,479
------------ ------------ ------------
Total interest income, including
amortization and write-off of
mortgage discounts $ 17,614,050 $ 25,963,332 $ 36,334,202
============ ============ ============
</TABLE>
<TABLE>
<CAPTION>
1995 1994 1993
---- ---- ----
<S> <C> <C> <C>
Interest Expense:
Bonds payable balance
at year end $170,590,843 $209,456,332 $318,735,393
Weighted average rate
at year end 9.12% 9.23% 9.48%
Interest expense for the year $ 17,566,587 $ 22,153,062 $ 35,781,198
Amortization of bond
discounts and issue costs 2,775,703 3,118,833
Write-off of bond discounts
and issue costs 5,754,478
------------ ------------ ------------
Total interest expense, including
amortization and write-off of bond
discounts and issue costs $ 17,566,587 $ 30,683,243 $ 38,900,031
============ ============ ============
</TABLE>
4
<PAGE> 5
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
Pre-tax extraordinary losses from bond extinguishments were $1,548,573
during 1994. These extraordinary losses resulted from write-offs of
unamortized bond discounts and issue costs. There were no extraordinary losses
related to bond extinguishments during 1995 and 1993.
Financial Condition and Liquidity
Each series of the Company's bonds is secured by a separate collateral
package consisting of the Certificates purchased in connection with the
issuance of a bond series, letters of credit and cash. The collateral package
for a series is pledged to NBD Bank, N.A. as trustee on behalf of the holders
of the bonds of such series. Funds held by the trustee with respect to the
bonds are restricted so as to assure the payment of principal and interest on
the bonds to the extent of such funds.
The Company will not have additional capital or liquidity requirements in
excess of collateral prepayments and letter of credit balances, assuming the
mortgage-backed securities (GNMA certificates) continue to pay principal and
interest in accordance with their terms. No additional capital requirements
are anticipated since the cash flows from the collateral packages are projected
to be sufficient to repay the existing debt.
5
<PAGE> 6
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
<TABLE>
<CAPTION>
Index to Financial Statements Page
----
<S> <C>
Balance Sheets at December 31, 1995 and 1994 7
Statements of Operations for the years ended
December 31, 1995, 1994 and 1993 8
Statements of Shareholder's Equity for the years ended
December 31, 1995, 1994 and 1993 9
Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993 10
Notes to Financial Statements 11
Report of Ernst & Young LLP, Independent Auditors 14
</TABLE>
6
<PAGE> 7
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
<TABLE>
<CAPTION>
1995 1994
------------ ------------
<S> <C> <C>
ASSETS
Cash .......................................................... $12,797 $522
Funds held by trustee ......................................... 4,005,267 4,340,779
Mortgage-backed securities held-to-maturity, at amortized
cost ......................................................... 210,877,263
Mortgage-backed securities available-for-sale, at estimated
fair value ................................................... 181,868,074
Accrued interest receivable ................................... 1,294,857 1,604,025
Due from affiliates ........................................... 236,402
------------ ------------
$187,417,397 $216,822,589
============ ============
LIABILITIES AND SHAREHOLDER'S EQUITY
Liabilities:
Bonds payable ................................................ $170,590,843 $209,456,332
Accrued liabilities, primarily interest ...................... 2,530,618 3,130,338
Due to affiliates ............................................ 68,779
Deferred income taxes ........................................ 4,109,158
------------ ------------
Total liabilities ......................................... 177,230,619 212,655,449
------------ ------------
Shareholder's equity:
Common stock, $1 par value; 50,000 shares
authorized; 1,000 shares issued and
outstanding ................................................. 1,000 1,000
Additional paid-in capital ................................... 19,000 19,000
Retained earnings ............................................ 4,003,040 4,147,140
Unrealized gains on securities available-for-sale, net of
income taxes of $4,109,158 .................................. 6,163,738
------------ ------------
Total shareholder's equity ................................ 10,186,778 4,167,140
------------ ------------
$187,417,397 $216,822,589
============ ============
</TABLE>
See accompanying notes.
7
<PAGE> 8
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
1995 1994 1993
----------- ------------ ------------
<S> <C> <C> <C>
Revenues:
Interest ......................................... $17,614,050 $21,948,862 $35,297,194
Amortization of net mortgage discounts ........... 4,014,470 1,037,008
----------- ------------ ------------
17,614,050 25,963,332 36,334,202
----------- ------------ ------------
Expenses:
Interest ......................................... 17,566,587 22,153,062 35,781,198
Amortization of bond discounts and issue costs ... 8,530,181 3,118,833
General and administrative ....................... 191,563 164,027 189,772
----------- ------------ ------------
17,758,150 30,847,270 39,089,803
----------- ------------ ------------
Loss before income tax benefit and
extraordinary item ............................... (144,100) (4,883,938) (2,755,601)
Income tax benefit ................................ 57,640 1,904,736 1,074,685
----------- ------------ ------------
Loss before extraordinary item .................... (86,460) (2,979,202) (1,680,916)
Extraordinary loss from early extinguishment
of debt, net of income tax benefits of $603,943 .. (944,630)
----------- ------------ ------------
Net loss .......................................... $ (86,460) $(3,923,832) $(1,680,916)
=========== ============ ============
</TABLE>
See accompanying notes.
8
<PAGE> 9
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
STATEMENTS OF SHAREHOLDER'S EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
ADDITIONAL UNREALIZED
COMMON PAID-IN RETAINED GAINS ON
STOCK CAPITAL EARNINGS SECURITIES TOTAL
------ ---------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Balance January 1, 1993 ......... $1,000 $19,000 $14,038,052 $14,058,052
Dividends ....................... (1,777,485) (1,777,485)
Net loss ........................ (1,680,916) (1,680,916)
------ ---------- ----------- ---------- -----------
Balance December 31, 1993 ....... 1,000 19,000 10,579,651 10,599,651
Dividends ....................... (2,508,679) (2,508,679)
Net loss ........................ (3,923,832) (3,923,832)
------ ---------- ----------- ---------- -----------
Balance December 31, 1994 ....... 1,000 19,000 4,147,140 4,167,140
Dividends ....................... (57,640) (57,640)
Unrealized gains on securities .. $6,163,738 6,163,738
Net loss ........................ (86,460) (86,460)
------ ---------- ----------- ---------- -----------
Balance December 31, 1995 ....... $1,000 $19,000 $4,003,040 $6,163,738 $10,186,778
====== ========== =========== ========== ===========
</TABLE>
See accompanying notes.
9
<PAGE> 10
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<TABLE>
<CAPTION>
1995 1994 1993
------------ ------------- -------------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss ........................................ $ (86,460) $ (3,923,832) $ (1,680,916)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Amortization of net mortgage discounts ........ (4,014,469) (1,037,008)
Amortization of bond discounts and
issue costs .................................. 8,530,182 3,118,833
Loss from early extinguishment of debt ........ 1,548,573
Provision for income tax benefit .............. (57,640) (2,508,679) (1,074,685)
Operating changes in cash due to:
Decrease in accrued interest receivable ....... 309,168 837,109 1,018,403
Increase in accrued liabilities ............... 2,993,936 5,319,427 7,791,041
------------ ------------- -------------
Net cash provided by operating activities .. 3,159,004 5,788,311 8,135,668
------------ ------------- -------------
Cash flows from investing activities:
Principal amortization and prepayments of
held-to-maturity mortgage-backed securities .... 22,176,866 67,206,718 126,932,233
Principal amortization and prepayments of
available-for-sale mortgage-backed securities .. 7,402,998
Transfer of held-to-maturity mortgage-backed
securities to affiliated holding company (net of
unamortized mortgage discounts) ................ 9,702,221 31,845,017
Decrease in funds held by trustee ............... 335,512 11,451,483 1,666,445
------------ ------------- -------------
Net cash provided by investing activities .. 39,617,597 110,503,218 128,598,678
------------ ------------- -------------
Cash flows from financing activities:
Bond principal payments ......................... (42,459,145) (116,360,495) (135,776,561)
Net change in due affiliates .................... (305,181) 68,725 (255,065)
Dividends to parent ............................. (702,800)
------------ ------------- -------------
Net cash used in financing activities ...... (42,764,326) (116,291,770) (136,734,426)
------------ ------------- -------------
Net increase (decrease) in cash .................. 12,275 (241) (80)
Cash at beginning of year ........................ 522 763 843
------------ ------------- -------------
Cash at end of year .............................. $ 12,797 $ 522 $ 763
============ ============= =============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the year for interest ........... $ 14,572,652 $ 16,833,634 $ 27,990,157
============ ============= =============
</TABLE>
See accompanying notes.
10
<PAGE> 11
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
NOTES TO FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION, RELATED PARTY TRANSACTIONS AND SIGNIFICANT ACCOUNTING
POLICIES
BASIS OF PRESENTATION
Guaranteed Mortgage Corporation II (GMC II) is a wholly-owned financing
subsidiary of Pulte Financial Companies, Inc. (PFCI), which is a wholly-owned
financing subsidiary of Pulte Corporation.
GMC II previously engaged in the acquisition of mortgage-backed securities
(guaranteed by the Government National Mortgage Association - GNMA) from
affiliates. Such acquisitions were financed principally through the issuance
of long term bonds secured by such mortgage-backed securities. GMC II has not
initiated any such transactions since 1987 and is presently allowing its
balance sheet to liquidate. As the mortgage-backed securities and bonds
outstanding continue to decline, operating revenues and expenses will decline
accordingly.
RELATED PARTY TRANSACTIONS
Transactions and arrangements between GMC II and PFCI, Pulte Corporation,
and/or Pulte Home Corporation (PHC), an indirect wholly-owned subsidiary of
Pulte Corporation, are summarized as follows:
- GMC II has periodic interest-free cash and non-cash advances from
certain affiliates, the net (receivable) payable balances of which were
$(236,402) and $68,779 at December 31, 1995 and 1994, respectively. Average
month-end balances due to (from) these affiliates were $(71,862) and
$2,797,441 during the years ended December 31, 1995 and 1994, respectively.
Advances payable by GMC II to affiliates initially related to the acquisition
of mortgage-backed securities and have been decreased by operating earnings
over the life of GMC II.
- GMC II's taxable income is included in the consolidated tax returns of
Pulte Corporation. Effective January 1, 1993, GMC II implemented the new
method of accounting for income taxes (FAS No. 109) that requires income taxes
to be provided by subsidiaries based on their own results of operations. GMC
II provides for income taxes on a stand alone basis at statutory rates. The
related income tax benefit related to operations was settled by a dividend to
the parent corporation and did not represent a cash transaction. Deferred
income taxes related to items not included in operations are not passed
through to the parent corporation.
- During 1995 and 1994 respectively, GMC II transferred $9,702,221 and
$31,845,017 of net mortgage-backed securities to its affiliate, Pulte
Financial Holding Corporation. The unamortized mortgage discount associated
with these transfers was $0 and $759,907 for 1995 and 1994, respectively.
- Certain of GMC II's corporate officers are also officers of PFCI, Pulte
Corporation, PHC, ICM and/or other affiliates of GMC II.
- PFCI incurs certain administrative expenses on behalf of GMC II, for which
GMC II reimburses PFCI.
- During the years ended December 31, 1995, 1994 and 1993, GMC II paid
dividends to PFCI of $57,640, $2,508,679 and $1,777,485, respectively. All
dividends during 1995 and 1994 related entirely to income tax benefits.
Dividends during 1993 included $1,074,685 of income tax benefits. These tax
related dividends did not represent cash transactions.
SIGNIFICANT ACCOUNTING POLICIES
- For the past several years, GMC II has been redeeming GNMA collateralized
bonds at the earliest possible redemption date for each individual bond
series. The bonds are typically redeemable at certain specified dates or when
the remaining principal balance of related collateral is less than 10% of the
collateral's original principal balance. With the adoption of SFAS No. 115,
Accounting for Certain Investments in Debt and Equity Securities, on January
1, 1994, GMC II determined that SFAS No. 115, paragraph 11-b, allowed for
continued classification of the GNMA securities as held-to-maturity, since all
sales of the securities were projected to occur at a point where less than 15%
of the securities' original principal balance would remain outstanding. These
projections were based on actual observed prepayments interpolated out to each
series' projected redemption date. The projections indicated outstanding
principal balance percentages of less than 10%, which was well below the 15%
threshold for classifying the securities as held-to-maturity.
11
<PAGE> 12
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
NOTES TO FINANCIAL STATEMENTS, CONTINUED
SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
From SFAS No. 115's adoption at January 1, 1994 through September 30,
1995, all sales of GNMA securities have been at levels less than 15% of the
original principal amounts. Given recent prepayment experience, it appears
that GMC II will liquidate the collateral and redeem the bonds at dates where
the remaining GNMA securities sale balances will be approximately 20% of the
securities' original principal amounts. Such collateral sales and bond
redemptions are projected to occur during 1996. Although GMC II's management
approach and intent with respect to these securities remains unchanged, the
ability to recognize future security sales for accounting purposes as
maturities is not now applicable given recent updated collateral balance
projections for the same redemption dates as previously used for all remaining
bond series. Accordingly, GMC II had reclassified all GNMA securities into the
available-for-sale category effective September 30, 1995.
- As a result of continued contraction in net interest spreads, GMC II changed
its accounting estimate of amortization speeds and expensed all remaining
mortgage discount balances, bond discounts and issue costs in December 1994.
The net amount of expense relating to this write-off amounted to $2,678,999.
- Gains from the sale of mortgage-backed securities are calculated based on
amortized cost.
- The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from these estimates.
2. MORTGAGE-BACKED SECURITIES
At December 31, 1995, mortgage-backed securities (GNMA certificates) had
an estimated fair market value based on quoted market prices of $181,868,074,
which included gross unrealized gains of $10,272,896 on securities with an
amortized cost of $171,595,178. At December 31, 1994, these securities had an
estimated fair market value based on quoted market prices of $213,132,078 which
included gross unrealized gains of $2,254,815 on securities with an amortized
cost of $210,877,263. Actual maturities of these mortgage-backed securities
may differ from contractual maturities because the issuers of the securities
may have the right to prepay obligations without penalties.
3. BONDS PAYABLE
During 1995, GMC II extinguished or called for the extinguishment of
$62,836,606 of its long-term debt prior to scheduled maturity. There were no
extraordinary losses related to these redemptions since all bond discounts
and issue costs related to these bonds had been fully amortized prior to
their redemption dates.
Bonds payable at December 31, 1995 consisted of five bond issues (six at
December 31, 1994) with stated interest rates ranging from 8.45% to 11.00%.
Weighted average stated interest rates were 9.12% and 9.23% at December 31,
1995 and 1994, respectively. All of these bond issues have classes of bonds
with serial maturities. Each series of the bonds is secured by separate pools
of mortgage-backed securities.
Timing of bond payments is dependent upon mortgage payments and
reinvestment rates. The bonds are further collateralized by letters of credit
in the aggregate amount of $1,065,000.
Under provisions of the bond indenture, funds held by trustee are
restricted so as to assure the payment of principal and interest on the bonds
to the extent of such funds.
The estimated fair market values of the outstanding bonds payable at
December 31, 1995 and 1994 were $170,591,000 and $210,309,000, respectively.
Fair market value at December 31, 1995 approximated the carrying values of such
bonds since GMC II is anticipating repayment of all debt in the near future.
Fair market value of outstanding bonds payable at December 31, 1994 was
estimated using secondary market activity for comparable securities. Secondary
market activity for these specific securities is limited.
4. EXTRAORDINARY ITEM
During the year ended December 31, 1994, GMC II extinguished $33,900,294
of its long-term debt prior to scheduled maturity, resulting in an
extraordinary pretax loss of $1,548,573 due to the write-off of unamortized
bond discounts and issue costs. Tax benefits related to the extraordinary loss
amounted to $603,943 for the year ended December 31, 1994.
The funds for this extinguishment were obtained from related party
advances.
12
<PAGE> 13
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
NOTES TO FINANCIAL STATEMENTS, CONTINUED
5. SUBSEQUENT EVENT
During January 1996, GMC II sold $54,570,863 of its mortgage-backed
securities resulting in a pretax gain of $4,260,819. GMC II also notified the
trustee of its intent to redeem on April 1, 1996, and May 1, 1996 $51,753,821
and approximately $52,000,000, respectively, of its long term debt prior to
scheduled maturity.
13
<PAGE> 14
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS
THE BOARD OF DIRECTORS AND SHAREHOLDER
GUARANTEED MORTGAGE CORPORATION II
We have audited the accompanying balance sheets of Guaranteed Mortgage
Corporation II as of December 31, 1995 and 1994, and the related statements of
operations, shareholder's equity and cash flows for each of the three years in
the period ended December 31, 1995. Our audits also included the financial
statement schedule listed in the Index at Item 14(a). These financial
statements and schedule are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements and
schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
As more fully described in Note 1, Guaranteed Mortgage Corporation II is a
wholly-owned financing subsidiary of Pulte Financial Companies, Inc., which in
turn is a wholly-owned financing subsidiary of Pulte Corporation. Guaranteed
Mortgage Corporation II has certain transactions with affiliates.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Guaranteed Mortgage
Corporation II at December 31, 1995 and 1994, and the results of its operations
and its cash flows for each of the three years in the period ended December 31,
1995, in conformity with generally accepted accounting principles. Also, in our
opinion, the related financial statement schedule, when considered in relation
to the basic financial statements taken as a whole, presents fairly in all
material respects the information set forth therein.
As discussed in Note 1 of the Notes to the Financial Statements, Guaranteed
Mortgage Corporation II changed its method of accounting for income taxes in
1993.
ERNST & YOUNG LLP
Detroit, Michigan
January 18, 1996
14
<PAGE> 15
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
This item is not applicable.
PART III
Information in response to this part is omitted pursuant to General
Instruction J(2).
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
AND REPORTS ON FORM 8-K
The following documents are filed as a part of this Annual Report on
Form 10-K:
(a) (1) Financial Statements
GUARANTEED MORTGAGE CORPORATION II
Balance Sheets at December 31, 1995 and 1994
Statements of Operations for the years ended
December 31, 1995, 1994 and 1993
Statements of Shareholder's Equity for the
years ended December 31, 1995, 1994 and 1993
Statements of Cash Flows for the years ended
December 31, 1995, 1994 and 1993
Notes to Financial Statements
Report of Ernst & Young LLP, Independent Auditors
(a) (2) Financial Statement Schedules
GUARANTEED MORTGAGE CORPORATION II
IV - Indebtedness of and to Related Parties - Not
Current
All other schedules have been omitted since the required
information is not present, is not present in amounts sufficient
to require submission of the schedule or because the required
information is included in the financial statements or notes
thereto.
15
<PAGE> 16
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
(a) (3) Exhibits
3.1 Articles of Incorporation and By-Laws
of Guaranteed Mortgage Corporation II, previously filed
as Exhibit 3.1 to the Registrant's Registration
Statement on Form S-3 (Registration No. 2-84696), are
hereby incorporated by reference.
4.1 Indenture between Guaranteed Mortgage
Corporation II and National Bank of Detroit, as trustee,
dated as of July 1, 1983, previously filed as Exhibit
4.1 to the Registrant's Current Report on Form 8-K,
dated as of July 29, 1983, is hereby incorporated by
reference.
4.2 Series 1983-B Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 1,
1983, previously filed as Exhibit 4.1 to the
Registrant's Current Report on Form 8-K, dated as of
October 27, 1983, is hereby incorporated by reference.
4.3 First Amendment to Series 1983-B
Supplement to Indenture between Guaranteed Mortgage
Corporation II and National Bank of Detroit, as trustee,
dated as of February 1, 1984, previously filed as
Exhibit 4.5 to the Registrant's Annual Report on Form
10-K for 1983, is hereby incorporated by reference.
4.4 Series M Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of July 1, 1985,
previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K, dated as of July 30, 1985,
is hereby incorporated by reference.
4.5 Series R Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 1,
1985, previously filed as Exhibit 4.1 to the
Registrant's Current Report on Form 8-K, dated as of
October 29, 1985, is hereby incorporated by reference.
4.6 Series S Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 15,
1985, previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K, dated as of October 29,
1985, is hereby incorporated by reference.
16
<PAGE> 17
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
4.7 Series Q Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of February 1,
1986, previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K, dated as of February 27,
1986, is hereby incorporated by reference.
4.8 Series T Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of April 1, 1986,
previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K dated as of April 30, 1986,
is hereby incorporated by reference.
4.9 Series U Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of May 1, 1986,
previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K dated as of May 29, 1986, is
hereby incorporated by reference.
4.10 Series V Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 1,
1986, previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K dated as of October 29, 1986,
is hereby incorporated by reference.
9.1 Pledge Agreement between Pulte
Financial Companies, Inc., and First National Bank of
Minneapolis, as pledgee, previously filed as Exhibit 4.4
to the Registrant's Registration Statement on Form S-3
(Registration No. 2-84696), is hereby incorporated by
reference.
10.1 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, as Representative of the Several
Underwriters, on the other, dated October 11, 1983,
previously filed as Exhibit 10.1 to the Registrant's
Current Report on Form 8-K, dated as of October 11,
1983, is hereby incorporated by reference.
17
<PAGE> 18
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
10.2 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, Goldman, Sachs & Co. and Shearson Lehman
Brothers Inc., as Representatives of the Several
Underwriters, on the other, dated June 26, 1985,
previously filed as Exhibit 10 to the Registrant's
Current Report on Form 8-K, dated as of July 30, 1985,
is hereby incorporated by reference.
10.3 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, Goldman,
Sachs & Co. and Shearson Lehman Brothers Inc., as
Representatives of the Several Underwriters, on the
other, dated June 26, 1985, previously filed as Exhibit
10.1 to the Registrant's Current Report on Form 8-K,
dated as of July 30, 1985, is hereby incorporated by
reference.
10.4 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation and Shearson Lehman Brothers Inc., as Sole
Underwriters, on the other, dated September 19, 1985,
previously filed as Exhibit 1.2 to the Registrant's
Current Report on Form 8-K, dated as of October 29,
1985, is hereby incorporated by reference.
10.5 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation and
Shearson Lehman Brothers Inc., as Sole Underwriters, on
the other, dated September 19, 1985, previously filed as
Exhibit 1.3 to the Registrant's Current Report on Form
8-K, dated as of October 29, 1985, is hereby
incorporated by reference.
10.6 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, as Sole Underwriter, on the other, dated
September 26, 1985, previously filed as Exhibit 1 to the
Registrant's Current Report on Form 8-K, dated as of
October 29, 1985, is hereby incorporated by reference.
18
<PAGE> 19
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
10.7 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, as Sole
Underwriter, on the other, dated September 26, 1985,
previously filed as Exhibit 1.1 to the Registrant's
Current Report on Form 8-K, dated as of October 29,
1985, is hereby incorporated by reference.
10.8 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and the First Boston Corporation, as Sole
Underwriter, on the other, dated January 23, 1986,
previously filed as Exhibit 1 to the Registrant's
Current Report on Form 8-K, dated as of February 27,
1986, is hereby incorporated by reference.
10.9 Terms Agreement between Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, as Sole
Underwriter, on the other, dated March 20, 1986,
previously filed as Exhibit 1 to the Registrant's
Current Report on Form 8-K dated as of April 30, 1986,
is hereby incorporated by reference.
10.10 Amendment to Terms Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, as Sole Underwriter, on the other, dated
April 29, 1986, previously filed as Exhibit 1.1 to the
Registrant's Current Report on Form 8-K, dated as of
April 30, 1986, is hereby incorporated by reference.
10.11 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, as Sole
Underwriter, on the other, dated April 2, 1986,
previously filed as Exhibit 1 to the Registrant's
Current Report on Form 8-K, dated as of May 29, 1986, is
hereby incorporated by reference.
10.12 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and Shearson Lehman
Brothers Inc. and The First Boston Corporation, as Sole
Underwriters, on the other, dated October 6, 1986,
previously filed as Exhibit 1.1 to the Registrant's
Current Report on Form 8-K, dated as October 29, 1986,
is hereby incorporated by reference.
19
<PAGE> 20
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
10.13 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and Shearson Lehman Brothers Inc. and The
First Boston Corporation, as Sole Underwriters, on the
other, dated October 6, 1986, previously filed as
Exhibit 1 to the Registrant's Current Report on Form
8-K, dated as of October 29, 1986, is hereby
incorporated by reference.
27 Financial Data Schedules
(b) Reports on Form 8-K.
The Company did not file any reports on Form 8-K during the last quarter
of the fiscal year covered by this Report.
20
<PAGE> 21
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
SCHEDULE IV - INDEBTEDNESS OF AND TO
RELATED PARTIES - NOT CURRENT
($000's omitted)
<TABLE>
<CAPTION>
Year Ended Year Ended Year Ended
December 31, December 31, December 31,
1995 1994 1993
------------ ------------ ---------------
<S> <C> <C> <C>
Advances from affiliates:
Balance at beginning
of year $ 69 $ 0 $ 255
Additions 10,231 34,760 2,310
Reductions (10,536) (34,691) (2,565)
------------ ------------ ---------------
Balance at end
of year $ (236) $ 69 $ 0
============ ============ ===============
</TABLE>
21
<PAGE> 22
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
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, on March 20, 1996.
GUARANTEED MORTGAGE CORPORATION II
By /s/JAMES A. WEISSENBORN
-------------------------------
James A. Weissenborn, President
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Name Title Date
---- ----- ----
<S> <C> <C>
/s/JAMES A. WEISSENBORN President March 20, 1996
----------------------- (Principal Executive Officer)
James A. Weissenborn and Director
/s/BRUCE E. ROBINSON Vice President-Finance and Treasurer March 20, 1996
----------------------- (Principal Financial Officer) and
Bruce E. Robinson Director
/s/ANNA M. CECE Assistant Secretary and Controller March 20, 1996
----------------------- (Principal Accounting Officer)
Anna M. Cece
</TABLE>
22
<PAGE> 23
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
INDEX TO EXHIBITS
-----------------
3.1 Articles of Incorporation and By-Laws
of Guaranteed Mortgage Corporation II, previously filed
as Exhibit 3.1 to the Registrant's Registration
Statement on Form S-3 (Registration No. 2-84696), are
hereby incorporated by reference.
4.1 Indenture between Guaranteed Mortgage
Corporation II and National Bank of Detroit, as trustee,
dated as of July 1, 1983, previously filed as Exhibit
4.1 to the Registrant's Current Report on Form 8-K,
dated as of July 29, 1983, is hereby incorporated by
reference.
4.2 Series 1983-B Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 1,
1983, previously filed as Exhibit 4.1 to the
Registrant's Current Report on Form 8-K, dated as of
October 27, 1983, is hereby incorporated by reference.
4.3 First Amendment to Series 1983-B
Supplement to Indenture between Guaranteed Mortgage
Corporation II and National Bank of Detroit, as trustee,
dated as of February 1, 1984, previously filed as
Exhibit 4.5 to the Registrant's Annual Report on Form
10-K for 1983, is hereby incorporated by reference.
4.4 Series M Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of July 1, 1985,
previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K, dated as of July 30, 1985,
is hereby incorporated by reference.
4.5 Series R Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 1,
1985, previously filed as Exhibit 4.1 to the
Registrant's Current Report on Form 8-K, dated as of
October 29, 1985, is hereby incorporated by reference.
4.6 Series S Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 15,
1985, previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K, dated as of October 29,
1985, is hereby incorporated by reference.
23
<PAGE> 24
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
4.7 Series Q Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of February 1,
1986, previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K, dated as of February 27,
1986, is hereby incorporated by reference.
4.8 Series T Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of April 1, 1986,
previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K dated as of April 30, 1986,
is hereby incorporated by reference.
4.9 Series U Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of May 1, 1986,
previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K dated as of May 29, 1986, is
hereby incorporated by reference.
4.10 Series V Supplement to Indenture
between Guaranteed Mortgage Corporation II and National
Bank of Detroit, as trustee, dated as of October 1,
1986, previously filed as Exhibit 4 to the Registrant's
Current Report on Form 8-K dated as of October 29, 1986,
is hereby incorporated by reference.
9.1 Pledge Agreement between Pulte
Financial Companies, Inc., and First National Bank of
Minneapolis, as pledgee, previously filed as Exhibit 4.4
to the Registrant's Registration Statement on Form S-3
(Registration No. 2-84696), is hereby incorporated by
reference.
10.1 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, as Representative of the Several
Underwriters, on the other, dated October 11, 1983,
previously filed as Exhibit 10.1 to the Registrant's
Current Report on Form 8-K, dated as of October 11,
1983, is hereby incorporated by reference.
24
<PAGE> 25
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
10.2 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, Goldman, Sachs & Co. and Shearson Lehman
Brothers Inc., as Representatives of the Several
Underwriters, on the other, dated June 26, 1985,
previously filed as Exhibit 10 to the Registrant's
Current Report on Form 8-K, dated as of July 30, 1985,
is hereby incorporated by reference.
10.3 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, Goldman,
Sachs & Co. and Shearson Lehman Brothers Inc., as
Representatives of the Several Underwriters, on the
other, dated June 26, 1985, previously filed as Exhibit
10.1 to the Registrant's Current Report on Form 8-K,
dated as of July 30, 1985, is hereby incorporated by
reference.
10.4 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation and Shearson Lehman Brothers Inc., as Sole
Underwriters, on the other, dated September 19, 1985,
previously filed as Exhibit 1.2 to the Registrant's
Current Report on Form 8-K, dated as of October 29,
1985, is hereby incorporated by reference.
10.5 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation and
Shearson Lehman Brothers Inc., as Sole Underwriters, on
the other, dated September 19, 1985, previously filed as
Exhibit 1.3 to the Registrant's Current Report on Form
8-K, dated as of October 29, 1985, is hereby
incorporated by reference.
10.6 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, as Sole Underwriter, on the other, dated
September 26, 1985, previously filed as Exhibit 1 to the
Registrant's Current Report on Form 8-K, dated as of
October 29, 1985, is hereby incorporated by reference.
25
<PAGE> 26
Year Ended
Form 10-K GUARANTEED MORTGAGE CORPORATION II 12/31/95
10.7 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, as Sole
Underwriter, on the other, dated September 26, 1985,
previously filed as Exhibit 1.1 to the Registrant's
Current Report on Form 8-K, dated as of October 29,
1985, is hereby incorporated by reference.
10.8 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and the First Boston Corporation, as Sole
Underwriter, on the other, dated January 23, 1986,
previously filed as Exhibit 1 to the Registrant's
Current Report on Form 8-K, dated as of February 27,
1986, is hereby incorporated by reference.
10.9 Terms Agreement between Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, as Sole
Underwriter, on the other, dated March 20, 1986,
previously filed as Exhibit 1 to the Registrant's
Current Report on Form 8-K dated as of April 30, 1986,
is hereby incorporated by reference.
10.10 Amendment to Terms Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and The First Boston
Corporation, as Sole Underwriter, on the other, dated
April 29, 1986, previously filed as Exhibit 1.1 to the
Registrant's Current Report on Form 8-K, dated as of
April 30, 1986, is hereby incorporated by reference.
10.11 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and The First Boston Corporation, as Sole
Underwriter, on the other, dated April 2, 1986,
previously filed as Exhibit 1 to the Registrant's
Current Report on Form 8-K, dated as of May 29, 1986, is
hereby incorporated by reference.
10.12 Underwriting Agreement among
Guaranteed Mortgage Corporation II and Pulte Home
Corporation, on the one hand, and Shearson Lehman
Brothers Inc. and The First Boston Corporation, as Sole
Underwriters, on the other, dated October 6, 1986,
previously filed as Exhibit 1.1 to the Registrant's
Current Report on Form 8-K, dated as October 29, 1986,
is hereby incorporated by reference.
26
<PAGE> 27
10.13 Terms Agreement among Guaranteed
Mortgage Corporation II and Pulte Home Corporation, on
the one hand, and Shearson Lehman Brothers Inc. and The
First Boston Corporation, as Sole Underwriters, on the
other, dated October 6, 1986, previously filed as
Exhibit 1 to the Registrant's Current Report on Form
8-K, dated as of October 29, 1986, is hereby
incorporated by reference.
27 Financial Data Schedules
27
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 4,018,064
<SECURITIES> 181,868,074
<RECEIVABLES> 1,531,259
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 187,417,397
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 187,417,397
<CURRENT-LIABILITIES> 6,639,776
<BONDS> 170,590,843
0
0
<COMMON> 1,000
<OTHER-SE> 10,185,778
<TOTAL-LIABILITY-AND-EQUITY> 187,417,397
<SALES> 0
<TOTAL-REVENUES> 17,614,050
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 191,563
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 17,566,587
<INCOME-PRETAX> (144,100)
<INCOME-TAX> (57,640)
<INCOME-CONTINUING> (86,460)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (86,460)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
