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 30, 1996
OR
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 33-11807
JHM ACCEPTANCE CORPORATION III
(Exact name of registrant as specified in its charter)
MARYLAND 52-1439055
State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8300 GREENSBORO DRIVE, SUITE 970, MCLEAN, VA 22102
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, include area code: (703)749-8225
c/o EXECUTIVE OFFICES, INC., 42-C READ'S WAY, NEW CASTLE, DE 19720
(Former name, former address and former fiscal year if changed
from last report)
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 the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
At August 7, 1996, the registrant had 677 shares of common stock
outstanding.
<PAGE>
JHM ACCEPTANCE CORPORATION III
INDEX TO FORM 10-Q
For Quarter Ended June 30, 1996
Page
Number
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements 3
Balance Sheets (unaudited) as of June 30, 1996
and March 31, 1996 4
Statements of Income (unaudited) for the three
months ended June 30, 1996 and June 30, 1995 5
Statements of Cash Flows (unaudited) for the three
months ended June 30, 1996 and June 30, 1995 6
Notes to Financial Statements (unaudited) 7-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 10
SIGNATURES 11
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The financial statements included herein have been prepared by
JHM Acceptance Corporation III ("JMAC III"), without audit, pursuant
to the rules and regulations of the Securities and Exchange
Commission ("SEC"). Certain information and footnote disclosures
normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed
or omitted pursuant to such SEC rules and regulations, although
JMAC III believes that the disclosures are adequate to make the
information presented not misleading.In the opinion of Management,
all adjustments (consisting of normal recurring adjustments)
necessary to fairly present the financial position, results of
operations and cash flows at June 30, 1996, and for all the periods
presented have been made.
It is suggested that these financial statements be read in
conjunction with the financial statements and notes thereto
included in JMAC III's report on Form 10-K for the fiscal year
ended March 31, 1996.
<PAGE>
<TABLE>
JHM ACCEPTANCE CORPORATION III
BALANCE SHEETS
(unaudited)
<CAPTION>
June 30,1996 March 31,1996
------------- -------------
<S> <C> <C>
ASSETS
Cash $ 1,000 $ 1,000
---------- ----------
Total Assets $ 1,000 $ 1,000
========== ==========
STOCKHOLDER'S EQUITY
Common stock - $10 par value,
10,000 shares authorized, 677
shares issued and outstanding 1,000 1,000
Additional paid-in capital 5,000 5,000
Retained deficit (5,000) (5,000)
---------- ----------
Total Stockholder's Equity 1,000 1,000
---------- ----------
Total Liabilities and
Stockholder's Equity $ 1,000 $ 1,000
========== ==========
<FN>
The accompanying notes are an integral part of these balance sheets.
</TABLE>
<PAGE>
<TABLE>
JHM ACCEPTANCE CORPORATION III
STATEMENTS OF INCOME
(unaudited)
<CAPTION>
For the three For the three
months ended months ended
June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
REVENUES
Interest and other income $ 0 $ 0
---------- ----------
Total Revenues 0 0
---------- ----------
EXPENSES
Accounting, legal, administrative
and other expenses 0 0
---------- ----------
Total Expenses 0 0
---------- ----------
Net Income $ 0 $ 0
========== ==========
<FN>
The accopmanying notes are an integral part of these statements.
</TABLE>
<PAGE>
<TABLE>
JHM ACCEPTANCE CORPORATION III
STATEMENTS OF CASH FLOWS
(unaudited)
<CAPTION>
For the three For the three
months ended months ended
June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ 0 $ 0
Adjustments to reconcile net loss
to net cash used in operating activities:
Increase in accounts payable
and accrued liabilities 0 0
---------- ----------
Total Adjustments 0 0
---------- ----------
Net Cash Provided by Operating Activities 0 0
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution 0 0
---------- ----------
Net Cash Provided by Financing Activities 0 0
---------- ----------
Net increase in cash 0 0
Cash, beginning of period 1,000 1,000
---------- ----------
Cash, end of period $ 1,000 $ 1,000
========== ==========
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>
JHM ACCEPTANCE CORPORATION III
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
(unaudited)
Note 1. General
The accompanying financial statements reflect the accounts of JHM Acceptance
Corporation III ("JMAC III"). The unaudited statements as of June 30, 1996
and 1995, respectively, reflect, in the opinion of management, all
adjustments (normal recurring in nature) necessary to present fairly the
financial position as of June 30, 1996 and the results of operations and
cash flows for the three months ended June 30, 1996 and 1995, respectively.
These financial statements have been prepared by JMAC III, without audit,
pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such rules
and regulations, although JMAC III believes that the disclosures are adequate
to make the information presented not misleading. It is suggested that
these financial statements be read in conjunction with the financial
statements and notes thereto included in JMAC III's report on Form 10-K for
the fiscal year ended March 31, 1996.
Note 2. Organization
JHM Acceptance Corporation III was organized as a Maryland corporation on
December 16, 1985. Prior to March 7, 1988, JMAC III was known as Oxford
Acceptance Corporation III and from March 7, 1988 to May 24, 1988,
JMAC III was known as Montgomery Acceptance Corporation III.
JMAC III was organized for the purpose of issuing and selling collateralized
mortgage obligations ("Bonds"), other notes and obligations, and acquiring,
owning, holding, and pledging Mortgage-Backed Certificates guaranteed by
the Government National Mortgage Association ("GNMA Certificates"),
Guaranteed Mortgage Pass-Through Certificates issued by the Federal National
Mortgage Association ("FNMA Certificates"), Mortgage Participation
Certificates issued by the Federal Home Loan Mortgage Corporation
("FHLMC Certificates") (collectively, the "Mortgage Certificates") and
obligations of others which are secured by the types of instruments
referred to above.
Note 3. Basis of Presentation
As of March 31, 1988, JMAC III had sold the residual cash flows for all
outstanding series of Bonds. As a result, JMAC III currently has no sources
of cash flow from operations. All cash flows from the Mortgage
Certificates are restricted and must be paid first to the bondholders and
then any excess (net of expenses) is distributed to the residual interest
holders. JMAC III has no responsibility for expenses related to its remaining
two series of Bonds. An affiliate performs the administration for JMAC III's
issuances, and has agreed to defer fees for such services to the extent that
the fees exceed currently available excess cash flows.
Preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that could affect the amounts represented in the financial statements and
accompanying notes. Actual results could differ from these estimates.
<PAGE>
Note 4. Summary of Significant Accounting Policies
Income Taxes
In accordance with an informal tax sharing plan, JMAC III files a consolidated
tax return with its parent, JDS Capital Corporation, formerly known as JHM
Capital Corporation ("JCC"). Accordingly, JMAC III computes its taxes due
to JCC on a separate company basis with no benefit received for net
operating losses. No significant timing differences exist as of
June 30, 1996. No provision for taxes has been recorded for the three
months ended June 30, 1996 and June 30, 1995 due to net operating losses.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Capital Resources and Liquidity
JMAC III's sources of funds with respect to its Bonds are receipts of principal
and interest on the Mortgage Certificates, pledged as collateral for each
series of Bonds, and the reinvestment income thereon. Management believes
that these sources of funds will be sufficient to pay the Bonds in
accordance with their terms. As of March 31, 1988, JMAC III had sold the
residual cash flows for all of its outstanding series. As a result, JMAC III
currently has (a) no sources of cash flows as all cash flows from the
Mortgage Certificates are restricated and must be paid first to the
bondholders and then any excess (net of expenses) is distributed to the
residual interest holders; and (b) no responsibilty for expenses related
to its two remaining series. An affiliate performs the administration for
JMAC III's issuances, and has agreed to defer fees for such services to the
extent that the fees exceed currently available cash flows.
At June 30, 1996, JMAC III had a remaining balance available for issuance of
additional bonds of $199,000,000 from a previous shelf registration.
Results of Operations
JMAC III issued its Series C Bonds in 1986 and Series F in 1987.
Currently, JMAC III has no plans for issuance of collateralized mortgage
obligations. The dominance of FNMA and FHLMC as issuers of REMIC securities
has reduced the opportunities for JMAC III to issue such securities.
<PAGE>
JHM ACCEPTANCE CORPORATION III
FORM 10-Q
PART II. OTHER INFORMATION
Item 6.Exhibits and Reports on Form 8-K
(a) Exhibits - None
(b) No reports on Form 8-K were filed during the quarter ended
June 30, 1996.
<PAGE>
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.
JHM ACCEPTANCE CORPORATION III
(Registrant)
August 7, 1996 Stephen P. Gavula
Date Stephen P. Gavula
Chairman of the Board of Directors
and Chief Executive Officer
August 7, 1996 Arthur F. Trudel
Date Arthur F. Trudel
Senior Vice President
and Chief Financial and Accounting Officer
<TABLE> <S> <C>
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<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> JUN-30-1996
<CASH> 1000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1000
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<DEPRECIATION> 0
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