ITEM 1. BUSINESS:
Ryland Acceptance Corporation Four (the "Company") was incorporated in Virginia on February 12, 1985 and is a wholly owned subsidiary of LPS Holdings Corporation (LPS) and an indirect, wholly owned subsidiary of The Ryland Group, Inc. (Ryland). Ryland is a diversified homebuilding and mortgage- finance company.
The Company was formed solely for the purpose of facilitating the long-term financing of mortgage loans. The Company issues collateralized mortgage- backed bonds (the "bonds") in series and uses the net proceeds from the sale of the bonds to: 1) purchase mortgage collateral from Ryland Mortgage Company (RMC), a wholly owned subsidiary of Ryland, 2) purchase mortgage collateral from other homebuilders or financial institutions and 3) fund loans secured by mortgage collateral to limited-purpose subsidiaries of homebuilders or financial institutions participating in the issuance of the bonds.
The Company has issued and recorded in the financial statements, 43 series of bonds with an initial principal amount of $4.34 billion as of December 31, 1996. In 1988, certain classes within 27 of the original 43 series of bonds with mortgage collateral of $516 million were sold to Resource Mortgage Capital, Inc., formerly RAC Mortgage Investment Corporation, a publicly held real estate investment trust. Also included in the sale were certain residual cash flows of various bond series. The related mortgage collateral and bond balances are not included in the financial statements as described below.
In addition, as of December 31, 1996, the Company has issued 56 series of bonds with an original principal balance of $12.03 billion under a program initiated during 1987 whereby the Company uses its shelf registration to issue bonds on behalf of other companies. These bonds and the associated mortgage collateral are excluded from the consolidated financial statements of the Company since the issuance of these bonds has been accounted for as a sale of the associated mortgage collateral in accordance with generally accepted accounting principles.
It is anticipated that regular payments under the terms of the mortgages, as well as early mortgage retirements, will reduce the number of mortgages and amount of bonds outstanding in future years. The Company does not anticipate the issuance of additional series of bonds.
On February 13, 1985, the Company filed an initial registration statement under the Securities Act of 1933 with the Securities and Exchange Commission (SEC), providing for the issuance of bonds in series. Registration statements have been filed as follows:
At December 31, 1996, the Company had $626.2 million of bonds remaining for issuance under a registration statement filed with the Securities and Exchange Commission. Bonds sold in private placements do not reduce the remaining issuance shelf. Since inception, the amount of bonds issued in private placements was $.9 million.
The bonds are secured by mortgage collateral which is comprised of GNMA certificates guaranteed by the Government National Mortgage Association, mortgage participation certificates issued by the Federal Home Loan Mortgage Corporation, guaranteed mortgage pass-through certificates issued by the Federal National Mortgage Association, other mortgage certificates issued by private companies, mortgage loans secured by first mortgages or deeds of trust and funds held by trustee (collectively, the "mortgage collateral"). The mortgage collateral is pledged to The Bank of New York, (the "Trustee"), under an Indenture. The mortgage loans constituting the mortgage collateral are either insured by the Federal Housing Administration, partially insured by private mortgage insurance or partially guaranteed by the U.S. Veterans Administration. The bonds are not guaranteed or insured by Ryland, RMC, LPS or any other affiliated entities.
Certain series of bonds are secured by mortgage collateral beneficially owned by a finance company. Pursuant to a funding agreement, the finance company pledges mortgage collateral and certain other collateral to the Company to secure a note receivable in an amount equal to the collateral value, as defined in the Indenture, of the pledged mortgage collateral and bearing interest generally at the weighted average interest rate of the applicable bond series. The Company assigns each funding agreement to the Trustee as security for the applicable bond series.
Each series of bonds is secured by mortgage collateral with an aggregate collateral value of not less than the outstanding principal amount of the bonds of that series. Additionally, the bonds of a series may be further secured by one or more of the following: 1) cash or letters of credit to fund a special reserve fund for certain series secured by mortgage loans; 2) mortgage pool insurance; 3) special hazard insurance; 4) mortgagor bankruptcy insurance; 5) master servicing agreement; 6) servicing agreements; 7) cash to fund other accounts and reserves; and 8) additional mortgage collateral.
During 1991, RMC assumed the Company's obligation to maintain cash deposits with the Trustee for mortgagor bankruptcy risk associated with the mortgage collateral. At December 31, 1996 and 1995, cash deposits of $.2 million were maintained by RMC.
The Company competes in a national market with other private conduits, thrift institutions and financial firms. Economic conditions, interest rates, prepayment speeds, regulatory changes and market dynamics all influence the market for collateralized mortgage bonds.
LEGEND:
* These bonds are variable interest rate bonds. These bonds will bear interest at rates based upon the London Inter-bank Offered Rate, as specified in each Series Supplement to the Indenture between the Company and The Bank of New York, as Trustee, dated February 1, 1985, as heretofore supplemented, amended and restated.
** These classes of bonds represent REMIC residual interests and other classes for which varying interest rates, as described in each Series' Supplement, apply.
*** These classes of bonds represent private placements of residual interests which have no stated interest rate.
ITEM 2.
ITEM 2. PROPERTIES:
The Company has no physical properties.
ITEM 3.
ITEM 3. LEGAL PROCEEDINGS:
None.
ITEM 4.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
Information in response to this Item is omitted pursuant to General Instruction J.
PART II
ITEM 5.
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS:
All of the Company's outstanding common stock is owned by LPS. Accordingly, there is no market for its common stock. The Company did not pay any dividends to LPS with respect to its common stock in 1996 and 1995.
ITEM 6.
ITEM 6. SELECTED FINANCIAL DATA:
Information in response to this Item is omitted pursuant to General Instruction J.
ITEM 7.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS:
GENERAL
The consolidated financial statements and related notes should be read in conjunction with the following review.
The Company was formed on January 25, 1985 solely for the purpose of facilitating the long-term financing of mortgage loans through the issuance and sale of mortgage-backed bonds (the "bonds"). Since its inception, the Company has issued and recorded in the financial statements 43 series of bonds. The bond series shown in the financial statements represent obligations solely of the Company, and are secured by mortgage collateral originated by Ryland Mortgage Company (RMC), a wholly owned subsidiary of The Ryland Group, Inc. (Ryland), and by other entities. The bonds are not guaranteed or insured by Ryland, RMC, LPS Holdings Corporation or any other affiliated entities.
The Company issues bonds in series and uses the net proceeds from the sale of the bonds to: (1) purchase mortgage collateral from RMC, (2) purchase mortgage collateral from other homebuilders or financial institutions and (3) fund loans secured by mortgage collateral to limited-purpose subsidiaries of homebuilders or financial institutions participating in the issuance of the bonds. The bonds are structured such that the cash flows from the underlying mortgage collateral will be sufficient to satisfy the bond obligations. As of December 31, 1996, the Company had $626.2 million of collateralized mortgage bonds remaining for issuance under a registration statement filed with the Securities and Exchange Commission.
In addition, the Company uses its shelf registration to issue bonds on behalf of other companies. As of December 31, 1996, the Company had issued 56 series of bonds under these arrangements. These bonds and the associated mortgage collateral are excluded from the consolidated financial statements of the Company since the issuance of these bonds has been accounted for as a sale of the associated mortgage collateral in accordance with generally accepted accounting principles. The Company has relinquished all risks and rewards relating to the bonds payable and associated mortgage collateral. The Company has elected to treat 49 series of these bonds as real estate mortgage investment conduits for tax purposes. During the years ended December 31, 1996 and 1995, the Company did not issue any bonds.
The bonds were reduced during the year for payments and prepayments on the underlying mortgage collateral. A bond series or a class within certain series may be redeemed at par at the earlier of the date specified in the Indenture or when the outstanding collateral value of the mortgage securities securing the bond series or class is less than or equal to a specified percentage of the initial collateral value of such securities. During the year ended December 31, 1996, certain classes within each of 21 series totaling $276.5 million were redeemed. During the year ended December 31, 1995, certain classes within each of 8 series totaling $58.1 million were redeemed.
RESULTS OF OPERATIONS
For the years ended December 31, 1996, 1995 and 1994, revenues consisted primarily of interest on mortgage collateral subject to the bond indebtedness and amortization of deferred items, and totalled $35,469, $44,557 and $58,142, respectively. The amount of revenues reported during each period depends primarily upon the amount of mortgage collateral outstanding during each such period, the related prepayment rates and the interest rates on such mortgage collateral. The Company's average net investment in mortgage collateral (excluding funds held by trustee) and the average effective rate of interest income are as follows (dollars in thousands):
Expenses for the years ended December 31, 1996, 1995 and 1994 consisted primarily of interest on the Company's outstanding bonds and amortization of deferred costs, and totaled $35,469, $44,546 and $58,062, respectively. The amount of expenses reported during each period depends primarily upon the amount of bonds outstanding during each such period and the interest rates on such bonds. The Company's average debt outstanding and average cost of borrowings are as follows (dollars in thousands):
The bonds will decline over time in direct proportion to the decline in the mortgage collateral.
Net cash flows that are generated based upon the differential between the interest rates of the bonds outstanding and the mortgage collateral are described as the net interest spreads. Excluding the impact of the amortization of deferred costs, the net interest spread of a bond generally is higher during the earlier years since bond classes with earlier stated maturities generally have lower interest rates than classes with later stated maturities. Because the weighted average interest rate of the bonds is lower during the earlier years and the interest rates on the underlying collateral are fixed, there is a greater net interest spread in the earlier years. The number of bonds issued by the Company in which a net interest spread is retained has decreased substantially since 1988.
FINANCIAL CONDITION AND LIQUIDITY
Mortgage collateral held by the Company is pledged as collateral for the mortgage-backed bonds, the terms of which provide for the retirement of all bonds from the proceeds of the mortgage collateral. Cash flows from payments on the mortgage collateral, together with proceeds of reinvestment income earned on the mortgage collateral, are intended to provide cash sufficient to make all required payments of principal and interest on each outstanding series of bonds. The Company anticipates that it will require no additional funds to meet the obligation on its outstanding bonds.
During 1991, RMC assumed the Company's obligation to maintain cash deposits with the Trustee for mortgagor bankruptcy risk associated with the mortgage collateral. At December 31, 1996 and 1995, cash deposits of $.2 million were maintained by RMC.
It is anticipated that regular payments under the terms of the mortgages, as well as early mortgage retirements, will reduce the number of mortgages and amount of bonds outstanding in future years. The Company does not anticipate the issuance of additional series of bonds.
ITEM 8.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA:
AUDITED CONSOLIDATED FINANCIAL STATEMENTS
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996
Report of Independent Auditors 26 Consolidated Balance Sheets 27 Consolidated Statements of Earnings 28 Consolidated Statements of Stockholder's Equity 29 Consolidated Statements of Cash Flows 30 Notes to Consolidated Financial Statements 31
REPORT OF INDEPENDENT AUDITORS
Board of Directors Ryland Acceptance Corporation Four
We have audited the accompanying consolidated balance sheets of Ryland Acceptance Corporation Four (a wholly owned subsidiary of LPS Holdings Corporation) and subsidiaries as of December 31, 1996 and 1995, and the related consolidated statements of earnings, stockholder's equity, and cash flows for each of the three years in the period ended December 31, 1996. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements 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.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Ryland Acceptance Corporation Four and subsidiaries at December 31, 1996 and 1995, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 1996, in conformity with generally accepted accounting principles.
/s/ Ernst & Young LLP ---------------------
January 31, 1997
See notes to consolidated financial statements
See notes to consolidated financial statements
See notes to consolidated financial statements
See notes to consolidated financial statements
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Description of Business
Ryland Acceptance Corporation Four (the "Company") is a wholly owned subsidiary of LPS Holdings Corporation (LPS) and an indirect, wholly owned subsidiary of The Ryland Group, Inc. (Ryland). The Company was organized to facilitate the long-term financing of mortgage loans originated by Ryland Mortgage Company (RMC), a wholly owned subsidiary of Ryland, and other entities through the issuance and sale of mortgage-backed bonds.
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, C.C. Holding Company and Brock Acceptance Corporation (BAC). All significant intercompany transactions and balances have been eliminated in consolidation.
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results inevitably will differ from those estimates, and such differences may be material to the financial statements.
Collateral for Bonds Payable
Collateral for bonds payable consists of mortgage-backed securities, mortgage loans receivable, notes receivable from participants, funds held by trustee and various types of insurance. Mortgage-backed securities consist primarily of GNMA certificates, FNMA mortgage pass-through certificates and FHLMC participation certificates. Mortgage loans receivable consists of loans collateralized by first mortgages or first deeds of trust on single family attached or detached houses.
Notes receivable represent funding agreements with unaffiliated entities (the "participants") participating in the Company's bond programs. The Company issues bonds and lends proceeds to the participants in accordance with funding agreements. These funding agreements are fully collateralized by mortgage loans and mortgage-backed securities. The Company has assigned to the Trustee its interest in these funding agreements and the underlying loans and mortgage-backed securities as collateral for a corresponding amount of bonds. Principal and interest on the funding agreements are payable concurrently and at the same rate as such payments on the bonds.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED)
Collateral for Bonds Payable (Continued)
Funds held by trustee represent payments on mortgage collateral and reinvestment earnings on such funds which have not been applied to pay principal and interest on the bonds. These funds are restricted to assure payment in accordance with the Trust Indenture ("the Indenture").
The mortgage collateral securing the bonds may include mortgage loans that are delinquent or non-performing, and real estate owned ("REO") properties. At December 31, 1996, Mortgage loans receivable and Notes receivable include 109 loans in the amount of $10.3 million that are delinquent, non-performing, or REO properties. At December 31, 1995, Mortgage loans receivable and Notes receivable include 145 loans in the amount of $14.2 million that are delinquent, non-performing, or REO properties. Reserves for these loans have not been established as any anticipated losses would be covered by primary mortgage insurance, hazard insurance, mortgagor bankruptcy insurance or mortgage pool insurance policies. Since the Company's inception, the Company has recovered $22.3 million from pool insurance which represents less than 1% of the initial total principal balance of mortgage loans. At December 31, 1996, $256.9 million or 92% of the initial pool insurance coverage remains available for future potential losses. Management believes that this coverage is adequate. As of December 31, 1996, the pool insurer has been rated AAA by a nationally recognized statistical rating agency.
Mortgage loans receivable acquired from an affiliate are valued at the affiliate's net carrying amount which is the lower of cost or market at the time of transfer.
Collateral for bonds payable are reported net of loan origination discount points and purchase price discounts. These discounts are deferred as an adjustment to the carrying value of the related collateral for bonds payable and are amortized into interest income over their respective lives using the interest method adjusted currently for the effects of prepayments.
Deferred Financing Costs
Financing costs incurred in connection with the issuance of bonds are capitalized and amortized over the respective lives of the bonds using the interest method adjusted currently for the effects of prepayments. These costs are included in other assets in the accompanying consolidated financial statements.
Bond Price Discounts
Price discounts incurred in connection with the issuance of bonds are deferred as an adjustment to the carrying value of the bonds and are amortized into interest expense over the lives of the bonds using the interest method adjusted currently for the effects of prepayments.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED)
Income Taxes
The Company is included in the consolidated federal income tax return filed by Ryland. Certain items of income and expense are included in one period for financial reporting purposes and another for income tax purposes. Deferred income taxes are provided in recognition of these differences. Consolidated income taxes are allocated to the Company using the separate return method.
Mortgage Backed Securities
In May 1993, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 115, "Accounting for Certain Investments in Debt and Equity Securities." The Company adopted the provisions of the new standard for investments held as of or acquired after January 1, 1994.
Management determines the appropriate classification of mortgage backed securities at the time of purchase and re-evaluates such designations as of each balance sheet date. The Company has classified its investments in mortgage-backed securities as held-to-maturity and available-for-sale. Securities classified as held-to-maturity are accounted for at amoritized cost. Securities classified as available-for-sale are measured at fair market value with market value changes, net of tax, reflected as a component of stockholder's equity. These fair values cannot be realized unless the corresponding bonds payable are redeemed in accordance with the Indenture.
In November 1995, the Financial Accounting Standards Board issued Special Report No. 155-B, "A Guide to Implementation of Statement 115 on Accounting for Certain Investments in Debt and Equity Securities", as an aid in understanding and implementing Statement 115. The effect of adopting this implementation guidance as of December 31, 1995 resulted in the reclassification of $45,825 of mortgage backed securities from the held-to- maturity classification to the available-for-sale classification. The related unrealized gain recorded in stockholder's equity totaled $1,213, net of deferred taxes of $809. Restatement of prior periods to reflect the effects of initially adopting this implementation guidance is not permitted.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE A--SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (CONTINUED)
The following is a summary of available-for sale and held-to-maturity securities as of:
NOTE B--FAIR VALUES OF FINANCIAL INSTRUMENTS
Statement of Financial Accounting Standards No. 107, "Disclosures about Fair Value of Financial Instruments" (FAS 107), requires disclosure of fair value information about financial instruments, whether or not recognized on the balance sheet.
FAS 107 excludes certain financial instruments and all non-financial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value of the Company. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those fair values are significantly affected by the assumptions used, including the discount rate and estimates of cash flow. In that regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in immediate settlement of the instrument.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE B--FAIR VALUES OF FINANCIAL INSTRUMENTS - (CONTINUED)
The estimated fair values of the company's financial instruments are as follows:
The company used the following methods and assumptions in estmating fair values:
Cash: The carrying amounts of cash approximate fair values.
Mortgage-backed securities and mortgage loans receivable: Fair values are estimated using quoted market prices for similar certificates, loans or securities.
Notes receivable: Fair values are estimated using quoted market prices for securities comparable to those that collateralize the notes receivable.
Funds held by trustee: The carrying amounts of funds held by trustee approximate fair values.
Bonds payable: Fair values are estimated using quoted market prices of comparable securities.
These fair values cannot be realized unless the corresponding bonds payable are redeemed in accordance with the Indenture. As more fully described in Note C, the bonds can be redeemed before maturity by the Company only under certain prescribed conditions.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE C--BONDS PAYABLE
Bonds payable represent mortgage-backed bond series issued by the Company. Neither Ryland, nor any affiliated entities have guaranteed, nor are they otherwise obligated, with respect to these bond issues.
At December 31, 1996 and 1995, mortgage-backed bond series consisted of series with various classes maturing in the years 2006 through 2019. Payments are made on a periodic basis as a result of, and in amounts related to, corresponding payments received on the underlying mortgage collateral. Also, additional payments of the bonds may occur prior to maturity in accordance with certain provisions of the Indenture and related Series Supplements between the Company and the Trustee. At December 31, 1996 and 1995, the classes of each series of bonds bear interest at fixed rates ranging from 7.25% to 12.625%.
Under certain provisions of the Indenture, a bond series or a class within certain series may be redeemed at par prior to the stated maturity date. The redemption may take place at the earlier of specified dates or when the outstanding collateral value (as defined in the Indenture) of the mortgage securities securing the bond series or class is less than or equal to a specified percentage of the initial collateral value of such securities. Certain classes within each of 21 series totaling $276.5 million were redeemed in 1996 and certain classes within each of 8 series totaling $58.1 million were redeemed in 1995.
The Company uses its shelf registration to issue bonds on behalf of other companies. As of December 31, 1996, the Company had issued 56 series of bonds under these arrangements. These bonds and the associated mortgage collateral are excluded from the financial statements of the Company since these transactions have been accounted for as sales of the associated mortgage collateral in accordance with generally accepted accounting principles. The outstanding principal balance at December 31, 1996 and 1995, of bonds issued by the Company which is not included in the accompanying financial statements is $1.5 billion and $2 billion, respectively. During the years ended December 31, 1996 and 1995, the Company did not issue any bonds.
At December 31, 1996, the Company had $626.2 million of collateralized mortgage bonds remaining for issuance under a registration statement filed with the Securities and Exchange Commission.
Also included in bonds payable at December 31, 1996 and 1995 are funding notes payable totaling $.3 million and $.9 million which represent BAC's participation in bond series issued by an unaffiliated entity.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE D--TRANSACTIONS WITH AFFILIATED COMPANIES
The Company records various intercompany transactions with affiliates and Ryland. These transactions include ongoing charges related to the outstanding bonds. The amount of these charges for the year ended December 31, 1996 was $.2 million recorded in interest revenue and $.3 million recorded in other revenue. The amount of these charges for the years ended December 31, 1995 and 1994 was $.2 million and $.4 million, of which $.3 million and $.3 million is recorded in interest revenue and ($.1) million and $.1 million is recorded in other revenue, respectively.
The Company is charged a finance charge which is based on the average outstanding balance of advances made by Ryland and RMC. The amount of finance charge, which has been recorded in interest expense, is $.2 million for the year ended December 31, 1996 and $.3 million for each of the years ended December 31, 1995 and 1994. Interest is calculated at approximate market rates. The carrying values of Due to affiliate were $2,421 and $3,209 at December 31, 1996 and 1995, respectively.
Included in bonds payable are amounts which RMC holds totaling $98,895 and $72,704 at December 31, 1996 and 1995, respectively. Interest incurred on the bonds payable amounted to $7,858 and $7,380 in 1996 and 1995, respectively.
An affiliate performed the administration function through June 30, 1995 for the bonds issued under the Company's shelf registration statement. The business was sold as of June 30, 1995 but continues to provide these functions as an unaffiliated entity. There were no payable balances related to administration fees to affiliated companies at December 31, 1996 or 1995.
In addition, an affiliate performs the loan servicing function for certain mortgage loans collateralizing the bonds. All fees and related expenses in connection with these services are recorded in the affiliates' financial statements.
During 1991, RMC assumed the Company's obligation to maintain cash deposits with the Trustee for mortgagor bankruptcy risk associated with the mortgage collateral. At December 31, 1996 and 1995, cash deposits of $.2 million were maintained by RMC.
NOTE E--INCOME TAXES
The Company accounts for its income taxes under the liability method in accordance with Statement of Financial Accounting Standards No. 109 , "Accounting for Income Taxes" (FAS 109).
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE E--INCOME TAXES - (CONTINUED)
Under the liability method, the deferred tax liability (asset) is determined based on enacted tax rates and is subsequently adjusted for changes in tax rates. A change in the deferred tax liability (asset) results in a charge or credit to deferred tax expense. The Company's provision for income taxes for the years ended December 31, is summarized as follows:
The actual income tax rate differs from the statutory federal income tax rate as follows:
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
RYLAND ACCEPTANCE CORPORATION FOUR AND SUBSIDIARIES
December 31, 1996 (dollars in thousands)
NOTE E--INCOME TAXES - (CONTINUED)
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax liabilities as of December 31, 1996 and December 31, 1995 are as follows (in thousands):
ITEM 9.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE:
None.
PART III
ITEM 10.
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT:
Information in response to this Item is omitted pursuant to General Instruction J.
ITEM 11.
ITEM 11. EXECUTIVE COMPENSATION:
Information in response to this Item is omitted pursuant to General Instruction J.
ITEM 12.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT:
Information in response to this Item is omitted pursuant to General Instruction J.
ITEM 13.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS:
Information in response to this Item is omitted pursuant to General Instruction J.
PART IV
ITEM 14.
ITEM 14. EXHIBITS, CONSOLIDATED FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K:
(a)(1) Consolidated Financial Statements.
The following financial statements are included in Part II, Item 8:
Report of Independent Auditors
Consolidated Balance Sheets-December 31, 1996 and 1995 Consolidated Statements of Earnings-Years ended December 31, 1996, 1995 and 1994
Consolidated Statements of Stockholder's Equity - Years ended December 31, 1996, 1995 and 1994
Consolidated Statements of Cash Flows - Years ended December 31, 1996, 1995 and 1994
Notes to Consolidated Financial Statements
(a)(2) Consolidated Financial Statement Schedules.
All schedules have been omitted because they are either inapplicable or the required information has been given in the consolidated financial statements or the notes thereto.
(A)(3) Exhibits.
3.1 Articles of Incorporation of Ryland Acceptance Corporation Four (incorporated herein by reference to Exhibit to Company's Form 10, filed February 13, 1985).
3.2 By-laws of Ryland Acceptance Corporation Four (incorporated herein by reference to Exhibit to Report on Form 8-K (File No. 0-13199) dated April 22, 1987, filed May 6, 1987).
4.1 Indenture between Ryland Acceptance Corporation Four and S Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended March 31, 1985, filed May 10, 1985).
4.2 Conformed copy of Series 1 Supplemental Indenture, dated as of April 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended March 31, 1985, filed May 10, 1985).
4.3 Conformed copy of Series 2 Supplemental Indenture, dated as of June 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1985, filed August 12, 1985).
4.4 Conformed copy of Series 3 Supplemental Indenture, dated as of August 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33-443, filed September 24, 1985).
4.5 Conformed copy of Series 4 Supplemental Indenture, dated as of October 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended September 30, 1985, filed November 12, 1985).
4.6 Conformed copy of Series 5 Supplemental Indenture, dated as of October 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended September 30, 1985, filed November 12, 1985).
4.7 Conformed copy of Series 6 Supplemental Indenture, dated as of December 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33-2757, filed January 16, 1986).
4.8 Conformed copy of Series 7 Supplemental Indenture, dated as of December 1, 1985, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33-2757, filed January 16, 1986).
4.9 Amended and Restated Indenture for Series 8 Bonds and subsequent Series of Bonds, dated as of February 1, 1986 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0-13199) for period ended December 31, 1985, filed March 31, 1986).
4.10 Conformed copy of Series 8 Supplemental Indenture, dated as of February 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the period ended December 31, 1985, filed March 31, 1986).
4.11 Conformed copy of Series 9 Supplemental Indenture, dated as of February 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the period ended December 31, 1985, filed March 31, 1986).
4.12 Conformed copy of Series 10 Supplemental Indenture, dated as of February 1, 1986, between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0-13199) for the period ended December 31, 1985, filed March 31, 1986).
4.13 Conformed copy of Series 11 Supplemental Indenture, dated as of April 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended March 31, 1986, filed May 15, 1986).
4.14 (Reserved)
4.15 Conformed copy of Series 13 Supplemental Indenture, dated as of April 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended March 31, 1986, filed May 15, 1986).
4.16 Conformed copy of Series 14 Supplemental Indenture, dated as of May 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1986, filed August 12, 1986).
4.17 Conformed copy of Series 15 Supplemental Indenture, dated as of May 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1986, filed August 12, 1986).
4.18 Conformed copy of Series 16 Supplemental Indenture, dated as of June 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended June 30, 1986, filed August 12, 1986).
4.19 Conformed copy of Series 17 Supplemental Indenture, dated as of June 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended June 30, 1986, filed August 12, 1986).
4.20 Conformed copy of Series 18 Supplemental Indenture, dated as of July 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended June 30, 1986, filed August 12, 1986).
4.21 Conformed copy of Series 19 Supplemental Indenture, dated as of August 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 9191, filed September 30, 1986).
4.22 Conformed copy of Series 20 Supplemental Indenture, dated as of September 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 9191, filed September 30, 1986).
4.23 Conformed copy of Series 21 Supplemental Indenture, dated as of September 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 9191, filed September 30, 1986).
4.24 Conformed copy of Series 22 Supplemental Indenture, dated as of September 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 9191, filed September 30, 1986).
4.25 Conformed copy of Series 23 Supplemental Indenture, dated as of October 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended September 30, 1986, filed November 14, 1986).
4.26 Conformed copy of Series 24 Supplemental Indenture, dated as of October 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended September 30, 1986, filed November 14, 1986).
4.27 (Reserved)
4.28 Conformed copy of Series 26 Supplemental Indenture, dated as of November 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.29 Conformed copy of Series 27 Supplemental Indenture, dated as of November 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.30 Conformed copy of Series 28 Supplemental Indenture, dated as of December 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.31 Supplemental Indenture, dated as of December 1, 1986, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33-11654, filed January 30, 1987).
4.32 Conformed copy of Series 29 Supplemental Indenture, dated as of January 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.33 Conformed copy of Series 30 Supplemental Indenture, dated as of February 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.34 Conformed copy of Series 31 Supplemental Indenture, dated as of January 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.35 Conformed copy of Series 32 Supplemental Indenture, dated as of January 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 11654, filed January 30, 1987).
4.36 Supplemental Indenture, dated as of January 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0-13199) for the period ended December 31, 1986, filed March 31, 1987).
4.37 (Reserved)
4.38 Conformed copy of Series 34 Supplemental Indenture, dated as of February 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the period ended December 31, 1986, filed March 31, 1987).
4.39 Conformed copy of Series 35 Supplemental Indenture, dated as of March 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 8-K (File No. 0- 13199) dated April 22, 1987, filed May 6, 1987).
4.40 Conformed copy of Series 36 Supplemental Indenture, dated as of March 25, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 8-K (File No. 0- 13199) dated April 22, 1987, filed May 6, 1987).
4.41 Conformed copy of Series 37 Supplemental Indenture, dated as of March 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 8-K (File No. 0- 13199) dated April 22, 1987, filed May 6, 1987).
4.42 Conformed copy of Supplemental Indenture, dated as of April 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended March 31, 1987 filed May 15, 1987).
4.43 (Reserved)
4.44 (Reserved)
4.45 Conformed copy of Series 40 Supplemental Indenture, dated as of May 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1987 filed August 15, 1987).
4.46 Conformed copy of Series 41 Supplemental Indenture, dated as of May 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1987 filed August 15, 1987).
4.47 Conformed copy of Series 42 Supplemental Indenture, dated as of May 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1987 filed August 15, 1987).
4.48 Conformed copy of Series 43 Supplemental Indenture, dated as of June 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended June 30, 1987 filed August 15, 1987).
4.49 Conformed copy of Series 44 Supplemental Indenture, dated as of June 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended June 30, 1987 filed August 15, 1987).
4.50 Conformed copy of Series 45 Supplemental Indenture, dated as of July 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 15260, filed June 29, 1987).
4.51 (Reserved)
4.52 Conformed copy of Series 47 Supplemental Indenture, dated as of July 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement No. 33- 15260, filed June 29, 1987).
4.53 (Reserved)
4.54 Conformed copy of Series 49 Supplemental Indenture, dated as of August 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated August 27, 1987, filed October 15, 1987).
4.55 Conformed copy of Series 50 Supplemental Indenture, dated as of September 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated August 27, 1987, filed October 15, 1987).
4.56 Conformed copy of Series 51 Supplemental Indenture, dated as of September 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated August 27, 1987, filed October 15, 1987).
4.57 Conformed copy of Series 52 Supplemental Indenture, dated as of September 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated August 27, 1987, filed October 15, 1987).
4.58 Conformed copy of Series 53 Supplemental Indenture, dated as of October 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended September 30, 1987, filed November 13, 1987).
4.59 Conformed copy of Series 54 Supplemental Indenture, dated as of October 1, 1987, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199) for the period ended September 30, 1987, filed November 13, 1987).
4.60 Amended and Restated Indenture between Ryland Acceptance Corporation Four and Sovran Bank, N.A., as trustee, dated as of July 1, 1987 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0-13199) for the year ended December 31, 1987, filed March 30, 1988).
4.61 Conformed copy of Series 55 Supplemental Indenture, dated as of December 1, 1987 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the year ended December 31, 1987, filed March 30, 1988).
4.62 Conformed copy of Series 56 Supplemental Indenture, dated as of December 1, 1987 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the year ended December 31, 1987, filed March 30, 1988).
4.63 (Reserved)
4.64 Conformed copy of Series 58 Supplemental Indenture, dated as of December 1, 1987 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the year ended December 31, 1987, filed March 30, 1988).
4.65 (Reserved)
4.66 Conformed copy of Series 60 Supplemental Indenture, dated as of December 1, 1987 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-K (File No. 0- 13199) for the year ended December 31, 1987, filed March 30, 1988).
4.67 Conformed copy of Series 61 Supplemental Indenture, dated as of February 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33-21612), filed April 29, 1988).
4.68 Conformed copy of Series 62 Supplemental Indenture, dated as of February 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33-21612), filed April 29, 1988).
4.69 Conformed copy of Series 63 Supplemental Indenture, dated as of March 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33-21612), filed April 29, 1988).
4.70 Conformed copy of Series 64 Supplemental Indenture, dated as of March 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33-21612), filed April 29, 1988).
4.71 (Reserved)
4.72 (Reserved)
4.73 Conformed copy of Series 67 Supplemental Indenture, dated as of April 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33-21612), filed April 29, 1988).
4.74 Conformed copy of Supplemental Indenture, dated as of March 1, 1988 for Series 11, 13, 14, 16, 17, 18, 19, 20, 21, 22, 23, 24, 26, 27, 28, 29, 30, 31, 34, 36, 41, 43, 45, 49 and 51 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended March 31, 1988, filed May 16, 1988).
4.75 Conformed copy of Supplemental Indenture, dated as of March 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for the period ended March 31, 1988, filed May 16, 1988).
4.76 Conformed copy of Series 68 Supplemental Indenture, dated as of April 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33-22561), filed June 16, 1988).
4.77 (Reserved)
4.78 Conformed copy of Series 70 Supplemental Indenture, dated as of May 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33- 22561), filed June 16, 1988).
4.79 Conformed copy of Series 71 Supplemental Indenture, dated as of May 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33- 22561), filed June 16, 1988).
4.80 Conformed copy of Series 72 Supplemental Indenture, dated as of June 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33- 23346), filed July 27, 1988).
4.81 (Reserved)
4.82 Conformed copy of Series 74 Supplemental Indenture, dated as of June 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Registration Statement (File No. 33- 23346), filed July 27, 1988).
4.83 Conformed copy of Series 75 Supplemental Indenture, dated as of July 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199), for the period ended June 30, 1988 filed August 15, 1988).
4.84 Conformed copy of Series 76 Supplemental Indenture, dated as of July 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199), for the period ended June 30, 1988 filed August 15, 1988).
4.85 Conformed copy of Series 77 Supplemental Indenture, dated as of July 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0- 13199), for the period ended June 30, 1988 filed August 15, 1988).
4.86 Conformed copy of Series 78 Supplemental Indenture, dated as of August 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated July 28, 1988 filed September 8, 1988).
4.87 Conformed copy of Series 79 Supplemental Indenture, dated as of July 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated July 28, 1988 filed September 24, 1988).
4.88 Conformed copy of Series 80 Supplemental Indenture, dated as of September 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated September 29, 1988 filed October 8, 1988).
4.89 Conformed copy of Series 81 Supplemental Indenture, dated as of August 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated July 28, 1988 filed September 8, 1988).
4.90 Conformed copy of Series 82 Supplemental Indenture, dated as of August 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated July 28, 1988 filed September 8, 1988).
4.91 Conformed copy of Series 83 Supplemental Indenture, dated as of September 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated September 29, 1988 filed October 8, 1988).
4.92 Conformed copy of Series 84 Supplemental Indenture, dated as of September 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K, (File No. 0-13199) dated September 29, 1988 filed October 8, 1988).
4.93 Conformed copy of Series 85 Supplemental Indenture, dated as of October 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to the Registration Statement No. 33- 26428 filed January 9, 1989).
4.94 Conformed copy of Series 86 Supplemental Indenture, dated as of December 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to the Registration Statement No. 33- 26428 filed January 9, 1989).
4.95 Conformed copy of Series 87 Supplemental Indenture, dated as of December 1, 1988 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to the Registration Statement No. 33- 26428 filed January 9, 1989).
4.96 Conformed copy of Series 88 Supplemental Indenture, dated as of December 1, 1988, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to the Registration Statement No. 33- 26428 filed January 9, 1989).
4.97 Conformed copy of Series 89 Supplemental Indenture, dated as of January 1, 1989 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated January 26, 1989, filed February 10, 1989).
4.98 Conformed copy of Series 90 Supplemental Indenture, dated as of January 1, 1989 to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated January 26, 1989, filed February 10, 1989).
4.99 (Reserved)
4.100 Conformed copy of Series 92 Supplemental Indenture, dated as of April 1, 1989, to Indenture between the Registrant and Sovran Bank, N.A., date February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated June 29, 1989, filed July 13, 1989).
4.101 (Reserved)
4.102 Conformed copy of Series 94 Supplemental Indenture, dated as of June 1, 1990, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated June 29, 1989, filed July 12, 1990).
4.103 Conformed copy of Series 95 Supplemental Indenture, dated as of January 1, 1991, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated January 30, 1991, filed February 12, 1991).
4.104 Conformed copy of Series 96 Supplemental Indenture, dated as of January 1, 1991, to Indenture between the Registrant and Sovran Bank, N.A., dated February 1, 1985 (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated January 30, 1991, filed February 12, 1991).
4.105 Conformed copy of Series 97 Supplemental Indenture, dated as of April 30, 1991, to Indenture between the Registrant and Sovran Bank, N.A., dated April 1, 1991, (incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199), filed May 9, 1991).
4.106 Form of Indenture between Registrant and NationsBank of Virginia, N.A., as Trustee (Incorporated herein by reference of Exhibit to Issuer's Post-Effective Amendment No. 1 to Registration Statement on Form S-11 (No. 33-39357), filed June 3, 1993).
4.107 Form of Indenture between Registrant and Texas Commerce Bank National Association, as Trustee (Incorporated herein by reference to Exhibit to Issuer's Post-Effective Amendment No. 1 to Registration Statement on Form S-11 (No. 33-39357), filed June 3, 1993).
4.108 Conformed Copy of Series 98 Supplemental Indenture between the Registrant and NationsBank of Virginia, N.A., as Trustee, dated as of September 1, 1993, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, as Amended and Restated as of July 1, 1987 (Incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199) dated September 30, 1993, filed October 12, 1993).
4.109 Conformed Copy of Series 99 Supplemental Indenture between the Registrant and NationsBank of Virginia, N.A., dated as of October 1, 1993, to Indenture between the Registrant and Sovran Bank, N.A., as Trustee, as Amended and Restated as of July 1, 1987 (Incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199), filed November 12, 1993).
4.110 Conformed Copy of Series 98 Series Second Supplement to Indenture, dated as of July 1, 1994, between the Registrant and NationsBank of Virginia, N.A., as Trustee (Incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199), dated June 1, 1994, filed April 19, 1995).
4.111 Conformed Copy of Series 98 Series Third Supplement to Indenture, dated as of August 1, 1994, between Registrant and NationsBank of Virginia, N.A., as Trustee (Incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199), dated June 1, 1994, filed April 19, 1995).
4.112 Conformed Copy of Series 99 Series Second Supplement to Indenture, dated as of July 1, 1994, between Registrant and NationsBank of Virginia, N.A., as Trustee (Incorporated herein by reference to Exhibit to Current Report on Form 8-K (File No. 0-13199), dated June 1, 1994, filed April 19, 1995).
21.1 Subsidiaries of the Registrant:
C. C. Holding Company was incorporated in Virginia on March 29, 1988 to acquire and hold mortgage collateral subject to the bond liability.
Brock Acceptance Corporation was incorporated in Delaware on December 20, 1984 to acquire and hold mortgage collateral subject to the bond liability.
24.1 Consent of Ernst & Young LLP, Independent Auditors.
25.1 Power of Attorney of Directors of registrant.
27.1 Financial Data Schedule (electronic filing only)
99.1 Form of Guaranty Agreement with respect to Single-Family (level payment) Mortgage-Backed Certificates between Servicer and Government National Mortgage Association (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.2 Form of Guaranty Agreement with respect to Graduated Payment Mortgage-Backed Certificates between Servicer and Government National Mortgage Association (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.3 Form of Mortgage Participation Certificate Agreement Series 700 (March, 1983) (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.4 Federal National Mortgage Association Trust Indenture (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.5 Form of Funding Agreement (Incorporated herein by reference to Exhibit to Amendment No. 1 to Registration Statement No. 2- 95839, filed March 13, 1985) and Funding Note (Incorporated herein by reference to Exhibit to Report on Form 10-Q) (File No. 0-13199) for period ended June 30, 1985, filed August 12, 1985).
99.6 Form of Servicing Agreement and Standard Provisions (Incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for period ended June 30, 1985, filed August 12, 1985).
99.7 Form of Master Servicing Agreement (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18860, filed December 3, 1987).
99.8 Form of Standard Terms to Master Servicing Agreement (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18860, filed December 3, 1987).
99.9 Form of Performance Bond (Incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for period ended June 30, 1985, filed August 12, 1985).
99.10 Form of Prospectus Supplement for Current Interest Bonds (Incorporated herein by reference to Exhibit to Registration Statement No. 33-2757, filed January 16, 1986).
99.11 Form of Prospectus Supplement for Capital Appreciation Bonds (Incorporated herein by reference to Exhibit to Registration Statement No. 33-2757, filed January 16, 1986).
99.12 Form of Primary Mortgage Insurance Policy (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.13 Form of Full Coverage Insurance Policy (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.14 Form of FHA Mortgage Insurance Certificate (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.15 Form of VA Loan Guaranty (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.16 Form of Pool Insurance Policy (Incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for period ended June 30, 1985, filed August 12, 1985).
99.17 Form of Standard Hazard Insurance Policy (Incorporated herein by reference to Exhibit to Registration Statement No. 2-95839, filed February 13, 1985).
99.18 Form of Special Hazard Insurance Policy (Incorporated herein by reference to Exhibit to Registrant's Report on Form 10-Q (File No. 0-13199) for period ended June 30, 1986, filed August 12, 1986).
99.19 Form of Mortgagor Bankruptcy Bond (Incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for period ended June 30, 1985, filed August 12, 1985).
99.20 Form of Surety Bond (Incorporated herein by reference to Exhibit to Registration Statement No. 33-2757, filed January 16, 1986).
99.21 Form of Escrow Agreement for Incomplete Mortgage Loan Files (Incorporated herein by reference to Exhibit to Registration Statement No. 33-1919, filed September 30, 1986).
99.22 Form of Escrow Agreement for Missing Mortgage Certificates (Incorporated herein by reference to Exhibit to Registration Statement No. 33-1919, filed September 30, 1986).
99.23 First Supplement to Standard Provisions to Servicing Agreement (Incorporated herein by reference to Exhibit to Report on Form 10-Q (File No. 0-13199) for period ended September 30, 1985, filed November 12, 1985).
99.24 Second Supplement to Standard Provisions to Servicing Agreement (Incorporated herein by reference to Exhibit to Registration Statement No. 33-2757, filed January 16, 1986).
99.25 Standard Provisions to Servicing Agreement, January, 1986 Edition (Incorporated herein by reference to Exhibit to Registrant's Annual Report on Form 10-K (File No. 0-13199) for the period ended December 31, 1985, filed March 31, 1986).
99.26 First Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated February 1, 1986 (Incorporated herein by reference to Exhibit to Registrant's Annual Report on Form 10-K (File No. 0-13199) for the period ended December 31, 1985, filed March 31, 1986).
99.27 Form of Prospectus Supplement for sale of single class Bonds with Redemption Fund (Incorporated herein by reference to Exhibit to Registration Statement No. 33-4691, filed April 9, 1986).
99.28 Second Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated April 1, 1986 (Incorporated herein by reference to Exhibit to Registrant's Report on Form 10-Q (File No. 0-13199) for period ended March 31, 1986, filed May 15, 1986).
99.29 Third Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated June 1, 1986 (Incorporated herein by reference to Exhibit to Registrant's Report on Form 10-Q (File No. 0-13199) for the period ended June 30, 1986, filed August 12, 1986).
99.30 Fourth Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated September 1, 1986 (Incorporated herein by reference to Exhibit to Registration Statement No. 33-9191, filed September 30, 1986).
99.31 Fifth Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated February 1, 1987 (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18098, filed October 23, 1987).
99.32 Sixth Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated March 1, 1987 (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18098, filed October 23, 1987).
99.33 Seventh Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated July 1, 1987 (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18098, filed October 23, 1987).
99.34 Eighth Supplement to Standard Provisions to Servicing Agreement, January 1986 Edition, dated September 1, 1987 (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18098, filed October 23, 1987).
99.35 First Supplement to Standard Terms to Master Servicing Agreement, dated October 1, 1987 (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-18860, filed December 3, 1987).
99.36 Selected Provisions of the RAC Mortgage Investment Corporation Seller/Servicer Guide (Incorporated herein by reference to Exhibit to Registrant's Report on Form 8-K (File No. 0-13199) dated and filed July 6, 1988).
99.37 Form of Master Servicing Agreement among the Registrant, RAC Mortgage Investment Corporation, and Ryland Mortgage Company and Form of Standard Terms thereto (Incorporated herein by reference to Exhibit to Registrant's Report on Form 8-K (File No. 0-13199) dated and filed July 6, 1988).
99.38 Form of Primary Mortgage Insurance Policy issued by PMI Mortgage Insurance Company (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33- 39357, filed March 1, 1991).
99.39 Form of Primary Mortgage Insurance Company Policy issued by General Electric Mortgage Insurance Company (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-39357, filed March 1, 1991).
99.40 Form of Primary Mortgage Insurance Policy issued by United Guaranty Residential Insurance Company (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-39357, filed March 1, 1991).
99.41 Form of Pool Insurance Policy issued by PMI Mortgage Insurance Company (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-39357, filed March 1, 1991).
99.42 Form of Pool Insurance Policy issued by General Electric Mortgage Insurance Company (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33- 39357, filed March 1, 1991).
99.43 Form of Pool Insurance Policy issued by United Guaranty Residential Insurance Company (Incorporated herein by reference to Exhibit to Registrant's Registration Statement No. 33-39357, filed March 1, 1991).
99.44 Standard Provisions to Servicing Agreement (February 1989 Edition) (Incorporated herein by reference to Exhibit to Ryland Mortgage Securities Corporation's Registration Statement on Form S-11 (No. 33-27345).
99.45 Standard Provisions of the Saxon Mortgage Funding Corporation Seller/Servicer Guide (December 1992 Edition) (Incorporated herein by reference to Exhibit to Saxon Mortgage Securities Corporation's Registration Statement on Form S-11 (No. 33- 57204).
(b) Reports on Form 8-K: None
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.
RYLAND ACCEPTANCE CORPORATION FOUR
By: /s/ Michael C. Brown ------------------------------------ Michael C. Brown, President
Dated: March 26, 1997
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.
/s/ Michael C. Brown ------------------------------------ Michael C. Brown, President
Dated: March 26, 1997
/s/ Patricia S. Gloth ------------------------------------ Patricia S. Gloth, Vice-President, Financial Operations
Dated: March 26, 1997
Sole Director of the Corporation:
By: /s/ Michael C. Brown ------------------------------------ Michael C. Brown, Director
Dated: March 26, 1997
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 OF REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT:
Pursuant to the Registrant's Trust Indenture, the Registrant must furnish all Holders of bonds of a series an Annual Report within 120 days of the Registrant's year end. The Annual Report to bondholders for the year ended December 31, 1996 will be furnished to the bondholders subsequent to the filing of this Annual report on Form 10-K. The Registrant does not provide its security holders with proxy statements or other proxy soliciting material.
INDEX OF EXHIBITS:
PAGE OF SEQUENTIALLY NUMBERED PAGES
24.1 Consent of Ernst & Young LLP, Independent Auditors 59
27.1 Financial Data Schedule 60
EXHIBIT 24.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form S-3 No. 33-39357) of Ryland Acceptance Corporation Four and in the related Prospectus of our report dated January 31, 1997, with respect to the consolidated financial statements of Ryland Acceptance Corporation Four included in this Annual Report (Form 10-K) for the year ended December 31, 1996.
/s/ Ernst & Young LLP ---------------------
Baltimore, Maryland March 26, 1997