UNITED STATES
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 (Fee Required)
For the fiscal year ended March 31, 1997
[ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (Fee Required)
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, Scottsdale, Arizona
85260-6216
(Address of principal executive office)
(Zip Code)
Registrants telephone number, including area code (602)
391-0974
Securities Registered Pursuant to Section 12(b) of the Act:
None.
Securities Registered Pursuant to Section 12(g) of the Act:
None.
Indicate by a 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 [ ].
State the aggregate market value of voting stock held by
non-affiliates of the Registrant as of March 31, 1996: None.
Indicate the number of shares of common stock outstanding as of
March 31, 1997 100,000.
Documents incorporated by reference: Not applicable.
Securities and Exchange Commission
Commercial Mortgage Resources Corporation
Index to Form 10-K Filing
For the Years Ended March 31, 1997 and 1996
Page
Part I.
Item 1. Business 1
Item 2. Properties 1
Item 3. Legal Proceedings 1
Item 4. Submission of Matters to a Vote of Security
Holders 1
Part II.
Item 5. Market for Registrant's Common Equity and
Related Stockholder Matters 2
Item 6. Selected Financial Data 2
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations 3
Item 8. Financial Statements and Supplementary Data 3
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 11
Part III.
Item 10. Directors and Executive Officers of the Registrant 12
Item 11. Executive Compensation 12
Item 12. Security Ownership of Certain Beneficial Owners
and Management 13
Item 13. Certain Relationships and Related Transactions 13
Part IV
Item 14. Exhibits, Financial Statement Schedules, and 14
Reports on Form 8-K
SIGNATURES
15
INDEX TO EXHIBITS AND EXHIBITS 16
PART I
Item 1. Business
Commercial Mortgage Resources Corporation was incorporated in
the state of Delaware on August 1, 1991, as a limited purpose
financing corporation (the "Company"). The Company maintains
its principal executive offices at 9636 East Desert Cove,
Scottsdale, Arizona 5260-6216, and its telephone number is (602)
391-0974. The Company will not engage in any activity other
than issuing one or more series of bonds collateralized by
commercial mortgage loans or security interests therein and, in
connection therewith, acquiring, owning, holding, and pledging
commercial mortgage loans. The Company's Articles of
Incorporation limit its activities to the aforementioned
purposes and to any activities incidental thereto and necessary
for such purposes.
Commercial mortgage collateralized bonds issued by the Company
are limited obligations of the Company, payable solely from the
cash flow of the proceeds realized from the segregated
commercial mortgage loan pools created for each series of bonds.
The Company has not issued any commercial mortgage
collateralized bonds in the past. Interest, maturities, and
other definitive terms of the bonds have yet to be determined.
The Company's business is the facilitation and offering of
commercial mortgage collateralized bonds. The Company
anticipates that it will either purchase commercial mortgage
loans for its bonds from banks, savings and loan associations,
investment banking firms, other entities or affiliates.
Proceeds from the issuance of commercial mortgage collateralized
bonds issued by the Company are used to purchase or to fund the
commercial mortgage loans.
The Company has no employees.
Item 2. Properties None
Item 3. Legal Proceedings
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.
There is no other litigation.
Item 4. Submission of Matters to a Vote of Security Holders
None
<PAGE>
PART II
Item 5. Market for Registrant's Common Equity and Related
Stockholder Matters
There is no established public trading market for the common
stock of the Company. At March 31, 1997 all of the Company's
stock was owned by Commercial Mortgage Investments Corporation.
No dividends have been declared or paid with respect to such
stock.
Item 6. Selected Financial Data
Income Statement Data
Period Ended
March 31, March 31,
March 31, March 31, March 31, 1997 1996
1995 1994 1993
Operating Revenues $ - $ - $
- $ - $ -
Net Loss $ (250) $ (3,250) $ (3,791) $
(4,514) $ (4,861)
Net Loss Per Share $ (0.00) $ (0.03) $
(0.04) $ (0.05) $ (0.05)
Cash Dividends None None None None None
Balance Sheet Data
March 31,
1997 1996 1995 1994
1993
Total Assets $ 81,350 $ 81,350 $ 81,350 $ 81,383 $
8,081
Long Term Obligations None None None None
None
Total Stockholders' Equity
(Deficit) $ (15,416) $(15,413) $ (12,166) $ (8,375) $
(3,861)
Item 7. 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. See Item 1,
incorporated herein by reference. 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.
Item 8. Financial Statements and Supplementary Data
The financial statements required by this Item follow:
<PAGE>
ACCOUNTANT'S REPORT
To the Board of Directors and Stockholder
Commercial Mortgage Resources Corporation
We have compiled the accompanying balance sheets of Commercial
Mortgage Resources Corporation as of March 31, 1997 and 1996,
and the related statements of operations, changes in
stockholder's deficit, and cash flows for the years then ended,
in accordance with Statements of Standards for Accounting and
Review Services issued by the American Institute of Certified
Public Accountants.
A compilation is limited to presentation in the form of
financial statements information that is the representation of
management. We have not audited or reviewed the accompanying
financial statements and, accordingly, do not express an
opinion or any form of assurance on them.
We are not independent with respect to Commercial Mortgage
Resources Corporation.
JAMES C. MARSHALL, C.P.A., P.C.
James C. Marshall, C.P.A., P.C.
Scottsdale, Arizona
June 27, 1997
<PAGE>
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Balance Sheets
ASSETS March 31,
1997 1995
Cash $ 17 $ 17
Deferred registration costs 81,333 81,333
TOTAL ASSETS $ 81,350 $ 81,350
LIABILITIES AND STOCKHOLDER'S DEFICIT
LIABILITIES
Accounts Payable $ 11,140 $ 10,890
Due to affiliates - current 85,876 85,876
Total liabilities 97,016 96,766
STOCKHOLDER'S DEFICIT
Common stock, $.01 par value - authorized 100,000 shares
issued and outstanding, 100,000 shares (Note 3)
1,000 1,000
Preferred stock, $1.00 par value - authorized 100,000 shares,
no shares issued or outstanding (Note 3)
- - -
Retained deficit (16,666) (16,416)
Total stockholder's deficit (15,666) (15,416)
TOTAL LIABILITIES AND STOCKHOLDER'S DEFICIT $ 81,350 $
81,350
See Notes to Financial Statements.
<PAGE>
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Statements of Operations
For the Three Years Ended March 31, 1997
March 31,
1997 1996 1995
Revenue $ - $ - $ -
Operating expenses and fees 250 3,250
3,791
Net Loss $ (250) $ (3,250) $ (3,791)
Loss per common share $ (0.00) $ (0.03) $
(0.04)
Average common shares outstanding 100,000 100,000
100,000
See Notes to Financial Statements.<PAGE>
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Statements of Changes in Stockholder's Deficit
For the Three Years Ended March 31, 1997
Common Retained
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 March 31, 1997 $ 1,000 $(16,666) $(15,666)
See Notes to Financial Statements.
<PAGE>
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Statements of Cash Flows
For the Three Years Ended March 31, 1997
March 31,
1997 1996 1995
CASH FLOW FROM OPERATING ACTIVITIES:
NET LOSS $ (250) $ (3,250) $ (3,791)
ADJUSTMENTS to reconcile net loss to
net cash used by operating activities:
CHANGES in assets and liabilities:
Increase (decrease) in accounts payable 250
3,250 258
Total adjustments 250 3,250 258
Net cash used in operating activities -
- (3,533)
CASH FLOW FROM FINANCING ACTIVITIES:
Advances from affiliates - -
3,500
Total cash flow provided by financing activities -
- 3,500
Net increase (decrease) in cash - -
(33)
Cash at beginning of year 17 17
50
Cash at end of year $ 17 $ 17 $ 17
See Notes to Financial Statements.
<PAGE>
COMMERCIAL MORTGAGE RESOURCES CORPORATION
Notes to Financial Statements
As of March 31, 1997 and 1996
and the Three Years ended March 31, 1997
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, Inc.. ("CMRC").
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 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.
<PAGE>
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.
<PAGE>
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure None
<PAGE>
PART III
Item 10. Directors and Executive Officers of the Registrant
The directors and executive officers of Commercial Mortgage
Resources Corporation are as follows:
Name Age Position
James C.
Marshall................................................ 52 Direc
tor, President and Treasurer
Mark L.
Stewart................................................... 40 Dir
ector
H. Maurine
Marshall............................................ 52 Secretary
James C. Marshall has been a Director and the President of
Commercial Mortgage Resources Corporation since its inception.
Mr. Marshall has been President and Director of Residential
Resources, Inc. since its inception in 1986 to June 1993. Mr.
Marshall has been the President of James C. Marshall, P.C., a
professional corporation licensed to practice certified public
accountancy, since March 1985. The firm specializes in
providing auditing, accounting and consulting services to the
real estate, mortgage finance and investment banking industries.
Since November 1985, Mr. Marshall also has been a Director,
President and shareholder of Bond Servicing Corporation, a firm
providing bond administration services to issuers and trustees,
and acting as Manager on behalf of the trusts. Mr. Marshall was
the National Finance Partner of Kenneth Leventhal & Company,
certified public accountants, from March 1984 until March 1985
and the Managing Partner of the Phoenix office of that firm from
1979 until March 1984.
Mark L. Stewart has been a Director of the Company since May 29,
1992. Mr. Stewart is President of Ocean West Funding, and
Director and President of Ocean West Enterprises, Inc. since
their inception in 1988. These firms specialize in real estate
financing and consulting services to the real estate and
mortgage finance industries. During 1987 and 1988, Mr. Stewart
was Vice President of Westport Savings Bank where his main
emphasis was mortgage banking activities. Prior to 1987, Mr.
Stewart was the Vice President in charge of loan production for
Irvine City Savings.
H. Maurine Marshall was elected Secretary of the Company on May
29, 1992. Prior to her election as Corporate Secretary, Ms.
Marshall was a real estate agent in Arizona. Ms. Marshall is
the spouse of Mr. Marshall.
Item 11. Executive Compensation None
Item 12. Security Ownership of Certain Beneficial Owners and
Management
The following table sets forth information regarding the
beneficial owners of more than five percent of Commercial
Mortgage Resources Corporation's voting securities as of June
28, 1997:
Amount of Percent of
Name and Address of Beneficial Beneficial
Beneficial Owners Ownership Ownership
James C. Marshall 100,000 shares 100.00%
9636 East Desert Cove Common Stock
Scottsdale, AZ 85260-6216 Directly Owned
Item 13. Certain Relationships and Related Transactions
Upon the issuance of the mortgage-collateralized bonds, the
Company will reimburse certain related parties for the costs
they have incurred. In the event no bonds are issued by the
Company the related parties will absorb the costs incurred;
accordingly, since bonds have not yet been issued the Company
has not recorded a liability for such costs.
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports
on Form 8-K
(a)(1) and (a)(2) Financial Statements and Financial Statement
Schedules:
The following financial statements required by this Item are
included in this Report: Accountant's Report, balance sheets as
of March 31, 1997 and 1996, related statements of operations,
changes in stockholder's equity (deficit), and cash flows for
the three years ended March 31, 1997 and Notes to Financial
Statements are included at Item 8 of this Form 10-K.
(a)(3) Exhibits:
See Exhibit Index attached hereto.
(b) Reports on Form 8-K None
(c) Exhibits required by Item 601 of Regulation S-X None
(d) Separate financial statements of subsidiaries and
affiliates None
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED
PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE
NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT.
No annual report or proxy material have yet been sent to
security holders. An annual report is to be sent to the
security holders for the Company's last fiscal year, and four
copies of such report shall be furnished to the Securities and
Exchange Commission when it is sent to security holders.
<PAGE>
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 this 30th day of June, 1997.
COMMERCIAL MORTGAGE RESOURCES CORPORATION
By: \s\ James C. Marshall
James C. Marshall
President
(Principal Executive Officer)
(Principal Financial Officer)
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 indicated on
June 30, 1997.
By: \s\ James C. Marshall
James C. Marshall, President
and Director
By: \s\ Mark L. Stewart
Mark L. Stewart
Director
<PAGE>
Commercial Mortgage Resources Corporation
EXHIBITS
INDEX TO EXHIBITS
Page
Number
3. Articles of Incorporation and Bylaws:
Incorporated by reference from Form S-3, filed with the
Securities and Exchange Commission on August 13, 1991.
4. Instruments defining the rights of security holders,
including indentures: None
9. Voting Trust Agreement: None.
10. Material Contracts: None
11. Statement re Computation of Per Share Earnings: None
12. Statement re Computation of ratios: None.
13. Annual Report to Security Holders: None.
16. Letter re Change in Certifying Accountant: None.
18. Letter re Change in Accounting Principles: None.
19. Previously Unfiled Documents: None.
22. Subsidiaries of Registrant: None
23. Published Report Regarding Matters Submitted to Vote of
Security Holders: None.
24. Consents of Experts and Counsel: None.
25. Power of Attorney: None.
28. Additional Exhibits: None.
29. Information from Reports Furnished to State Insurance
Regulatory Authorities: None.
