FORM 10-Q
Securities and Exchange Commission
Washington, D. C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended: September 30, 1995
Commission File Numbers: 2-97573, 33-12626 and 33-19023
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
(Exact name of registrant as specified in its charter)
Virginia 54-1294217
(State or other Jurisdiction (I.R.S. Employer
of incorporation) Identification number)
823 East Main Street, Richmond, Virginia
(Address of principal executive offices)
23219
(Zip Code)
(804) 775-7904
(Registrant's telephone number, including area code)
Indicate by checkmark 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 of time 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 the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date.
Class A Common Stock: 730 shares
Class B Common Stock: 1,665 shares<PAGE>
Part I:
<PAGE>
FINANCIAL INFORMATION
September 30, 1995
Item 1. Financial Statements
Attached as Appendix A.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of
Operations
Attached as Appendix B.
Part II: OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities - None
Item 3. Defaults on Senior Securities - None
Item 4. Submission of Matters to Vote of Security Holders -
Information regarding election of directors by the
registrant's voting shareholders previously reported in
registrant's report on Form 10-K for its year ending
December 31, 1994, as filed March 29, 1995.
Item 5. Other Information - None
Item 6. Exhibits and Reports on Form 8-K - None
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.
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
(Registrant)
By: ______________________________________________
John Thomas West, IV
Secretary/Treasurer
Principal financial officer and duly
authorized officer
Date: November 8, 1995
<PAGE>
<PAGE>
EXHIBIT INDEX
2. Not Applicable.
4.1 Indenture dated as of May 1, 1985 ("Indenture") between NMAC
and Texas Commerce Bank National Association as trustee
("Trustee"), previously filed as Exhibit 4.1 to Amendment No.
1 to NMAC's Registration Statement on Form S-11, Registration
No. 2-97573 and incorporated by reference.
4.2 General Supplement relating to Subsequent Series dated as of
January 1, 1987, previously filed as Exhibit to NMAC's Form
8-K filed on February 10, 1985, and incorporated by reference.
4.3 Series Supplement to the Indenture, dated as of July 1, 1985,
relating to Series 1985-A Bonds, previously filed as Exhibit
4 to NMAC's Form 8-K filed on July 23, 1985, and incorporated
by reference.
4.4 Series Supplement to the Indenture, dated as of January 20,
1987, relating to Series B Bonds, previously filed as Exhibit
4.3 to NMAC's Form 8-K filed on February 10, 1987, and
incorporated by reference.
4.5 Series Supplement to the Indenture, dated as of March 20,
1987, relating to Series C Bonds, previously filed as Exhibit
4.3 to NMAC's Form 8-K filed on April 8, 1987, and
incorporated by reference.
4.6 Series Supplement to the Indenture, dated as of October 30,
1987, relating to Series D Bonds, previously filed as Exhibit
4.3 to NMAC's form 8-K filed on November 12, 1987, and
incorporated by reference.
4.7 Form of Second General Supplement to Indenture relating to
Subsequent Series previously filed as Exhibit 4.4 to NMAC's
Post-Effective Amendment No. 1 on Form S-3 to S-11
Registration No. 33-19023 and incorporated by reference.
11. Not applicable. Information in Appendix A.
15. Not applicable.
18. Not applicable.
19. Not applicable.
20. Not applicable.
23. Not applicable.
24. Not applicable.
25. Not applicable.
28. Not applicable.
<PAGE>
<PAGE>
APPENDIX A (1/4)
NOTES TO FINANCIAL STATEMENTS
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
September 30, 1995
NOTE A (Unaudited)
These financial statements should be read in conjunction with
the financial statements and notes thereto in National Mortgage
Acceptance Corporation's ("NMAC") Annual Report for the year ended
December 31, 1994. The financial statements for the nine months
ended September 30, 1995, include all adjustments (consisting only
of normal recurring adjustments) necessary for a fair presentation
of the results of operations, financial position, and cash flows for
the interim periods. These amounts are not necessarily indicative
of results for a full year.
<PAGE>
<PAGE>
APPENDIX B
TO FORM 10-Q
Management's Discussion and Analysis of Financial Condition and
Results of Operations
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
September 30, 1995
During the second quarter ended September 30, 1995. National
Mortgage Acceptance Corporation ("NMAC") did not issue any new
series of its TIMCO (Thrift Industry Mortgage Collateralized
Obligation) or Mortgage Collateralized Obligation Bonds.
During the nine (9) month period ending September 30, 1995,
NMAC revenues were $2,665,788, which consisted primarily of i)
interest on loans receivable under funding agreements between NMAC
and the participating borrowers for NMAC's TIMCO Bonds, Series
1985-A (FHLMC Certificates) (the "Series 1985-A Bonds") and Series
C (FHLMC Certificates) (the "Series C Bonds"), and ii) Management
Fees received for the on-going administration of four outstanding
Bonds Series (Series 1985-A, Series B (FHLMC Certificates), Series
C, and Series D (GNMA Certificates). Future revenues are expected
to be provided from interest payments on funding agreements for the
Series A and Series C Bonds, from one or more subsequent series of
NMAC's Bonds, when and if issued, from mortgage collateral acquired
by NMAC and pledged to secure any subsequent series of NMAC's Bonds,
and from amounts received in excess of costs incurred by NMAC in the
issuance of subsequent series of NMAC's Bonds.
NMAC has caused an election to be made under the Internal
Revenue Code of 1986, as amended (the "Code"), to have the Trust
Estates for the Series B Bonds and the Series D Bonds taxed as
separate real estate mortgage investment conduits (each, a "REMIC"),
in which the Series B Bonds and the Series D Bonds are "regular
interests," as defined in the Code, with respect to the related
REMIC. Other than its on-going fees for administration of the
Series B and the Series D Bond REMICs, NMAC has no future economic
benefit in the segregated asset pool comprising either the Series B
Bond REMIC or the Series D Bond REMIC. The "residual interest" in
each of the Series B Bond and Series D Bond REMICs was sold by NMAC
for cash in 1987. Accordingly, neither the collateral for the
Series B Bonds or the Series D Bonds nor the Series B Bonds or
Series D Bonds are recorded as assets or liabilities, respectively,
of NMAC. The interest income on the collateral for, and the related
interest expense on, the Series B Bonds will be recorded only within
the Series B Bond REMIC and the interest income on the collateral
for, and the related interest expense on, the Series D Bonds will be
recorded only within the Series D Bond REMIC. Neither the interest
income nor the related interest expense on either of these REMIC
Series will have an impact on NMAC's financial statements.
Interest on NMAC's outstanding Series 1985-A and Series C
Bonds was the major source of costs and expenses for the period.
Cash flow from payments on the loans receivable securing the Series
1985-A Bonds and the loan receivable securing the Series C Bonds are
anticipated to provide cash sufficient to make all required payments
on the related series of Bonds. Consequently, NMAC anticipates that
it will have no additional cash requirements with respect to any of
its outstanding Bonds.
<PAGE>
NMAC believes sufficient liquidity and capital resources exist
to pay all amounts due on the Series 1985-A and Series C Bonds and
all other expenses of NMAC. Furthermore, because each Series of
Bonds is secured by collateral paying interest at specified or
determinable maximum rates and payments on each Series of Bonds are
designed not to exceed payments received on the collateral for the
related Series, inflationary pressures have not affected, and are
not expected to affect, significantly the ability of NMAC to meet
its obligations as they become due.
NMAC has no salaried employees and has entered into management
and administrative service agreements with Craigie Incorporated
("Craigie"), an affiliate of NMAC, pursuant to which Craigie
provides NMAC with administrative, accounting and clerical services,
office space and the use of the service mark "TIMCO" for the
registrant's Bonds. Under these agreements, Craigie receives fees
from NMAC in connection with each funding agreement executed between
NMAC and the participating borrowers and with respect to the
residual interests with respect to the registrant's Series B and
Series D Bonds. Fees paid to NMAC by participating borrowers with
respect to its Series A and Series C Bonds and the holders of the
residual interest with respect to its Series B and Series D Bonds
are expected by NMAC to be sufficient to provide for all on-going
costs and expenses with respect to the outstanding Series of its
Bonds. NMAC therefore anticipates that it will have no additional
cash or liquidity requirements with respect to its obligations under
any outstanding Series of its Bonds. Payments under the management
and administrative services agreements between NMAC and Craigie are
not expected to exceed the amount received by NMAC as on-going fees
paid to it by participating borrowers under their funding agreements
and/or holders of the residual interest with respect to the Series
B REMIC. Texas Commerce Bank National Association, trustee for all
outstanding Series of NMAC's Bonds, also holds funds in expense
reserve accounts established under the Series Supplements for
certain of NMAC's outstanding Bonds to provide for future expenses
of the Trustee with respect to the related Series Supplement if
other funds are insufficient therefore. Such amounts are held under
the respective Series Supplements and are not recorded in the
financial statements.
The Series 1985-A Working Capital Reserve, established by NMAC
with respect to its Series 1985-A Bonds, is funded by the Series
1985-A participating borrowers from their funding agreements. These
amounts are available solely to pay any fees, charges, taxes,
assessments, impositions or other expenses of NMAC, other than bond
administration expenses, in connection with the Series 1985-A Bonds.
The Series 1985-A Working Capital Reserve is not available to pay
expenses or claims of NMAC other than with respect to the Series
1985-A Bonds, is not pledged to secure the Series 1985-A Bonds and
is not pledged to secure any other Series of NMAC's Bonds.
With respect to certain of its administration duties for the
Series D REMIC, NMAC has contracted with Financial Asset Management
Corporation ("FAMC") (formerly M.D.C. Consulting, Inc.). Amounts
due FAMC for services rendered are paid from amounts received by
NMAC for administrative services from holders of the Series D REMIC
residual interest and are less than the gross amount payable by such
holders to NMAC.
As of September 30, 1995, NMAC's assets were $32,716,970
including $233,277 in unrestricted cash and trading securities.
This cash balance, plus interest earnings from the investment
thereof, is available to pay NMAC's annual operating expenses, and,
if and to the extent necessary, amounts in connection with the
outstanding Bonds of NMAC.
<PAGE>
<TABLE>
Statements of Operations and Retained Earnings
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
REVENUES
Interest on loans $810,898 $ 994,283 $ 2,574,462 $ 3,438,159
Other interest 3,580 3,967 9,328 10,773
Management fees 22,813 21,088 73,803 63,103
Net unrealized securities 2,653 (4,117) 8,195 (9,760)
839,944 1,015,221 2,665,788 3,502,275
COSTS AND EXPENSES
Interest on bonds 810,898 994,283 2,574,462 3,438,159
Management fees 22,813 21,088 73,803 63,103
Other 2,586 3,203 8,174 11,729
836,297 1,018,574 2,656,439 3,512,991
NET INCOME (LOSS)
BEFORE INCOME TAXES 3,647 (3,353) 9,349 (10,716)
INCOME TAX EXPENSE (BENEFIT) 738 (710) 1,883 (2,165)
NET INCOME (LOSS) 2,909 (2,643) 7,466 (8,551)
RETAINED EARNINGS AT
BEGINNING OF PERIOD 38,743 39,846 34,186 45,754
RETAINED EARNINGS AT
END OF PERIOD $ 41,652 $ 37,203 $ 41,652 $ 37,203
EARNINGS (LOSS) PER SHARE $ 1.21 $ (1.10) $ 3.12 $ (3.57)
The accompanying notes are an integral part of these financial statements.
<PAGE>
</TABLE>
<TABLE>
Statements of Financial Condition
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
September 30, 1995 December 31, 1995
(unaudited)
<S> <C> <C>
ASSETS
Cash 3,525 7,174
Trading securities, at market value 229,752 222,491
Restricted cash and investments -
Series 1985-A working capital reserv 816,032 785,442
Loans receivable from affiliates 30,886,106 37,378,026
Accrued interest receivable
from affiliates 762,708 1,676,889
Other assets 18,847 32,162
TOTAL ASSETS 32,716,970 40,102,184
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Bonds payable 30,976,401 37,462,181
Accrued interest payable 672,413 1,592,734
Other liabilities, principally to a 841,544 828,123
TOTAL LIABILITIES 32,490,358 39,883,038
SHAREHOLDERS' EQUITY
Common stock; $1 par value:
Class A (without right to dividend)-
authorized 7,500 shares, issued and
outstanding 730 shares 730 730
Class B (non-voting)-- authorized
7,500 shares, issued and outstanding
1,665 shares 1,665 1,665
Paid-in capital 182,565 182,565
Retained earnings 41,652 34,186
SHAREHOLDERS' EQUIT 226,612 219,146
TOTAL LIABILITIES AND
SHAREHOLDERS' 32,716,970 40,102,184
The accompanying notes are an integral part of these financial statements.
<PAGE>
</TABLE>
<TABLE>
Statements of Cash Flows
NATIONAL MORTGAGE ACCEPTANCE CORPORATION
<CAPTION>
Nine Months Ended Nine Months Ended
September 30, 1995 September 30, 1994
(unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 7,466 $ (8,551)
Adjustments to reconcile net
income (loss) to net cash provided by operating
activities:
Net unrealized securities tradin (8,195) (9,760)
Cash and related investments
restricted - Series 1985-A
Working Capital Reserve (30,590) (22,730)
Accrued interest receivable
from affiliates 914,181 1,613,528
Decrease in accrued interest pa (920,321) (1,619,118)
Interest added to Class A-4 and C-5
bonds payable 112,699 102,600
Trading securities 934 (53,479)
Other assets 13,315 9,850
Other liabilities, principally
to affiliates 13,421 15,205
Total adjustments 95,444 36,096
Net cash provided by
operating activities 102,910 27,545
Cash flows from investing activities:
Payments received on loans to
affiliates 6,491,920 20,492,041
Cash flows from financing activities:
Payments on bonds payable (6,598,479) (20,589,051)
Net decrease in cash (3,649) (69,465)
Cash at beginning of period 7,174 79,051
Cash at end of period $ 3,525 $ 9,586
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 3,525
<SECURITIES> 1,045,784
<RECEIVABLES> 31,648,814
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 18,847
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 32,716,970
<CURRENT-LIABILITIES> 1,513,957
<BONDS> 30,976,401
<COMMON> 184,960
0
0
<OTHER-SE> 41,652
<TOTAL-LIABILITY-AND-EQUITY> 32,716,970
<SALES> 0
<TOTAL-REVENUES> 839,944
<CGS> 0
<TOTAL-COSTS> 836,297
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 810,898
<INCOME-PRETAX> 3,647
<INCOME-TAX> 738
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,909
<EPS-PRIMARY> 1.21
<EPS-DILUTED> 0
</TABLE>
