UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended: September 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: 000-19464
Commercial Mortgage Resources
Corporation
(Exact name of registrant as specified in its charter)
Delaware
86-0686367
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
9636 East Desert Cove Avenue, Scottsdale, Arizona
85260-6216
(Address of principal executive office) (Zip Code)
Registrants telephone number, including area code: (602)
391-0975
(Former name, former address and former fiscal year, if changed
since 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
Applicable only to corporate issuers:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date. As of November 14 10, 1996: 100,000 common
shares.Securities And Exchange Commission
Commercial Mortgage Resources Corporation
Index to Form 10-Q Filing
For the Quarter Ended September 30, 1996
Page
PART I. FINANCIAL INFORMATION Number
Item 1. Financial Statements
Balance Sheets
September 30, 1996 (Unaudited) and March 31, 1996 3
Statement of Operations
For the Six Months Ended September 30, 1996 and 1995
(Unaudited) 4
Statement of Changes in Stockholder's Equity (Deficit)
For the Years Ended March 31, 1996 and 1995 (Audited)
and the Six Months Ended September 30, 1996 (Unaudited) 5
Statement of Cash Flows
For the Six Months Ended September 30, 1996 and 1995
(Unaudited) 6
Notes to Consolidated Financial Statements (Unaudited) 7
Item 2. Management's Discussion and Analysis of Financial
Condition
and Operating Results 9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings None
Item 2. Changes in the Rights of the Company's Security
Holders None
Item 3. Defaults by the Company on its Senior Securities None
Item 4. Results of Votes of Security Holders None
Item 5. Other Information None
Item 6(a). Exhibits None
Item 6(b). Reports on Form 8-K None
Signatures 10
2
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Balance Sheets
ASSETS 1996
September 30, March 31,
(Unaudited) (Audited)
Cash $ 17 $ 17
Deferred registration costs 81,333 81,333
TOTAL ASSETS $ 81,350 $ 81,350
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable $ 11,140 $ 10,890
Due to affiliates - current 85,876 85,876
Total liabilities 97,016 96,766
STOCKHOLDER'S EQUITY (DEFICIT)
Common stock, $.01 par value - authorized 100,000 shares
issued and outstanding, 100,000 shares (Note 3)
1,000 1,000
Retained deficit (16,666) (16,416)
Total stockholder's equity (deficit) (15,666)
(15,416)
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 81,350 $
81,350
See Notes to Financial Statements.
3
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Statement of Operations
For the Six Months Ended September 30, 1996 and 1995
(Unaudited)
September 30,
1996 1995
Revenue $ - $ -
Operating expenses and fees 250
3,250
Net loss $
(250) $ (3,250)
Net loss per share $
(0.00) $ (0.03)
Average common shares outstanding 100,000
100,000
See Notes to Financial Statements.
4
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Statement of Changes in Stockholder's Equity (Deficit)
For the Two Years Ended March 31, 1996 and
the Six Months Ended September 30, 1996
Retained
Common Earnings
Stock (Deficit) Total
Balance March 31, 1994 1,000 (9,375) (8,375)
Net loss (3,791) (3,791)
Balance March 31, 1995 1,000 (13,166) (12,166)
Net loss (3,250) (3,250)
Balance March 31, 1996 1,000 (16,416) (15,416)
Net loss _______ (250)
(250)
Balance September 30, 1995
(Unaudited) $ 1,000 $
(16,666) $(15,666)
See Notes to Financial Statements.
5
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Statement of Cash Flows
For the Six Months Ended September 30, 1996 and 1995
(Unaudited)
September 30,
1996 1995
CASH FLOW FROM OPERATING ACTIVITIES:
NET LOSS $ (250) $ (3,250)
ADJUSTMENTS TO RECONCILE NET LOSS TO
NET CASH USED BY OPERATING ACTIVITIES:
CHANGES IN ASSETS AND LIABILITIES:
Increase in accounts payable 250 3,250
Total adjustments 250 3,250
Net cash (used) by operating activities -
-
Net (decrease) in cash -
-
Cash at beginning of year 17
17
Cash at end of period $ 17 $ 17
See Notes to Financial Statements.
6
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Notes to Financial Statements
For the Six Months Ended September 30, 1996 and 1995
(Unaudited)
1. THE COMPANY
Commercial Mortgage Resources Corporation (the "Company") was
incorporated on August 1, 1991 and is a limited purpose finance
company.
The Company was a 100% owned subsidiary of Commercial Mortgage
Investments Corporation ("CMIC"). During the year ended March
31, 1995, Mr. Marshall, owner of all of the outstanding stock of
CMIC, acquired directly all of the outstanding stock of the
Company from CMIC.
Upon issuance of the mortgage-collateralized bonds, the Company
will reimburse a related party for the costs it has incurred in
the organization of the Company and the preparation and filing
of the registration statement for sale of the
mortgage-collateralized securities. In the event no bonds are
issued by the Company the related party will absorb the costs
incurred.
2. DESCRIPTION OF THE BUSINESS
The purpose of the Company is to facilitate the issuing and
selling through the capital markets of mortgage-collateralized
bonds secured by commercial mortgage loans,
mortgage-collateralized obligations or other interests in
mortgages on commercial property.
The Company intends to either purchase mortgage collateral from
or lend to financial entities or investors the proceeds of the
issuance of its mortgage-collateralized bonds. The Company's
mortgage-collateralized bonds will represent obligations solely
of the Company. The mortgage-collateralized bonds issued by
trusts to which the Company is the depositor will be obligations
solely of the respective trust.
3. STOCKHOLDER'S EQUITY (DEFICIT)
The Company has authorized 100,000 shares of common stock, par
value $.01 of which 100,000 have been issued and are
outstanding. In addition, the Company has authorized 100,000
shares of preferred stock, par value $1.00 per share. No
preferred stock has been issued.
Loss per common share is determined by dividing net loss by the
weighted average number of shares outstanding during the year.
There were 100,000 shares outstanding for each year.
7
4. CONTINGENT LIABILITIES - LITIGATION
On November 8, 1995, Devenir, Inc. the assignee of Beus, Gilbert
& Morrill, P.L.L.C., the former attorneys for the corporation,
filed a law suit against the Company and its stockholders in the
Superior Court of the State Of Arizona, Maricopa County, Case
number CV95-18718 for the collection of legal fees they claim
are owed in the amount $637,776 plus interest and collection
fees. The Company denies liability for substantially all, if
not all, of the claim and the other defendants deny any
liability for this claim and are actively defending this action.
This litigation is currently in the discovery stage.
8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
The Company was incorporated on August 1, 1991, as a limited
purpose financing corporation to facilitate the issuance and
sale of commercial mortgage-collateralized bonds. The
operations of the Company have been confined to this limited
purpose.
Because of the limited purpose and operations of the Company, it
does not have and is not expected to have any significant assets
other than assets which may be acquired and immediately pledged
to secure a specific series of bonds issued by the Company, if
any, and intangible capitalized costs.
The Company does not have significant liquidity, has no need for
liquidity, and does not plan to increase its liquidity. The
Company does not foresee any demands that are likely to have an
effect upon the Company's liquidity. The Company has no
commitments for capital expenditures, and no material capital
resources. Revenues will consist primarily of "other income",
proceeds from the sale of investments, and interest received in
connection with the sale of beneficial interest in the loan pool
created by the Company.
Costs and expenses will consist primarily of management fees,
legal costs, and other costs of the Company's investments in the
segregated mortgage loan pools, and expenses incurred in
conjunction with the anticipated bond offerings.
The Company intends to have an open shelf registration statement
on file with the Securities and Exchange Commission under which
the Company may issue commercial mortgage collateralized bonds
in an aggregate principal amount sufficient to complete
placement of such underlying mortgage pools on an expedited
basis.
9
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 thereunder duly authorized.
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Registrant
/s/James C. Marshall
James C. Marshall, President and
Treasurer (Chief Accounting Officer)
Date: November 14, 1996
10
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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