-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TEa9AsojFyGksQcHryN7HbEOTILd82boThMpkDq8cP+NMnL/khc1wNUl2qz82PtU Frk6owauklrNcf442OhVMA== 0000950149-98-000511.txt : 19980327 0000950149-98-000511.hdr.sgml : 19980327 ACCESSION NUMBER: 0000950149-98-000511 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980326 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SEQUOIA MORTGAGE FUNDING CORP CENTRAL INDEX KEY: 0001033146 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] IRS NUMBER: 911771827 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 333-22681 FILM NUMBER: 98574810 BUSINESS ADDRESS: STREET 1: 591 REDWOOD HWY STREET 2: STE 3120 CITY: MILL VALLEY STATE: CA ZIP: 94941 BUSINESS PHONE: 4153811765 MAIL ADDRESS: STREET 1: 591 REDWOOD HIGHWAY STREET 2: STE 3120 CITY: MILL VALLEY STATE: CA ZIP: 94941 10-K 1 FORM 10-K FOR THE PERIOD ENDED 12/31/97 1 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED: DECEMBER 31, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934 FOR THE TRANSITION PERIOD FROM --------------- TO --------------- . COMMISSION FILE NUMBER: 333-22681-2 SEQUOIA MORTGAGE FUNDING CORPORATION (AS SPONSOR OF THE SEQUOIA MORTGAGE TRUST 2, THE ISSUER OF COLLATERALIZED MORTGAGE BONDS UNDER AN INDENTURE DATED AS OF OCTOBER 1, 1997) SEQUOIA MORTGAGE FUNDING CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 91-1771827 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.) INCORPORATION OR ORGANIZATION) 591 REDWOOD HIGHWAY, SUITE 3100 94941 MILL VALLEY, CALIFORNIA (ZIP CODE) (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(415) 389-7373 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE) SECURITIES REGISTERED PURSUANT SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: TO SECTION 12(g) OF THE ACT: NONE NONE (TITLE OF CLASS) (TITLE OF CLASS)
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] State the aggregate market value of the voting stock held by non-affiliates of Registrant. The aggregate market value shall be computed by reference to the price at which the stock was sold, or the average bid and asked prices of such stock, as of specified date within 60 days prior to the date of filing: Not Applicable DOCUMENTS INCORPORATED BY REFERENCE: Not Applicable ================================================================================ 2 SEQUOIA MORTGAGE TRUST 2 BONDS INDEX
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 STOCK AND RELATED STOCKHOLDER MATTERS..................................................... 1 ITEM 6. SELECTED FINANCIAL DATA..................................... 1 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS................................... 1 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA................. 1 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.................................... 1 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.......... 2 ITEM 11. EXECUTIVE COMPENSATION...................................... 2 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.................................................. 2 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.............. 2 PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K......................................................... 2 SIGNATURES............................................................. 3 INDEX TO EXHIBITS...................................................... 4
i 3 PART I ITEM 1. BUSINESS Not Applicable. ITEM 2. PROPERTIES Sequoia Mortgage Funding Corporation (the "Depositor") will furnish information regarding the Mortgaged Properties by reference to the Annual Compliance Certificates to be filed herein under Item 14. ITEM 3. LEGAL PROCEEDINGS The Depositor is not aware of any material pending legal proceedings involving either the bonds issued by Sequoia Mortgage Trust 2 ("Trust 2" or the "Issuer"), established pursuant to the Deposit Trust Agreement, dated October 1, 1997, by and between the Depositor and Wilmington Trust Company as owner trustee (the "Owner Trustee"); the Master Servicing Agreement, as amended, dated as of June 26, 1997, between Redwood Trust, Inc., as owner (the "Owner") and Merrill Lynch Credit Corporation as master servicer (the "Master Servicer"); the Depositor; the Issuer; the Owner Trustee; the Owner or the Master Servicer which relates to the bonds. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matter has been submitted to a vote of the holders of beneficial interests in Trust 2 through the solicitation of proxies or otherwise. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS To the best knowledge of the Depositor, there is no established public trading market for the Bonds issued under Trust 2. All of the Bonds issued by Trust 2 are held by the Depository Trust Company ("DTC") which in turn maintains records of holders of beneficial interests in such Bonds. Based on information obtained by the Trusts from DTC, as of December 31, 1997, there were fewer than 300 holders of the Bonds issued by Trust 2. ITEM 6. SELECTED FINANCIAL DATA Not Applicable. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Not Applicable. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY INFORMATION Not Applicable. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE There were no changes of accountants or disagreements on accounting or financial disclosures between the Depositor and its accountants. 1 4 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT Not Applicable. ITEM 11. EXECUTIVE COMPENSATION Not Applicable. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The Depositor is a wholly-owned subsidiary of Redwood Trust, Inc., a Maryland corporation. Sequoia Mortgage Trust 2 is a Delaware statutory business trust wholly-owned by the Depositor. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS None. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) The following documents are filed as part of this report: 1. FINANCIAL STATEMENTS: Not applicable. 2. FINANCIAL STATEMENT SCHEDULES: Not applicable. 3. EXHIBITS:
EXHIBIT NO. DESCRIPTION - ----------- ----------- 99.1 Statement of Compliance of the Seller/Servicer of Trust 2 99.2 Annual Report of Independent Accountant with respect to the Seller/Servicer's overall servicing operations under Trust 2
2 5 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Depositor has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. By: SEQUOIA MORTGAGE FUNDING CORPORATION As Depositor By: /s/ GEORGE E. BULL III --------------------------------------- George E. Bull III Chairman of the Board and Chief Executive Officer Date: March 26, 1998. 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 Depositor and in the capacities and on the dates indicated: indicated:
SIGNATURE POSITION DATE --------- -------- ---- /s/ GEORGE E. BULL III Chairman of the Board, March 26, 1998 - -------------------------------------------------------- Director George E. Bull III (Principal Executive Officer /s/ DOUGLAS B. HANSEN* President, Director March 26, 1998 - -------------------------------------------------------- Douglas B. Hansen /s/ FREDERICK H. BORDEN* Secretary, Director March 26, 1998 - -------------------------------------------------------- Frederick H. Borden /s/ VICKIE L. RATH* Treasurer, Assistant March 26, 1998 - -------------------------------------------------------- Secretary Vickie L. Rath (Principal Accounting Officer) (Principal Financial Officer) Director March , 1998 - -------------------------------------------------------- John Connolly IV* Director March , 1998 - -------------------------------------------------------- Craig Severance*
3 6 INDEX TO EXHIBITS ITEM 14(C)
EXHIBIT NO. DESCRIPTION ----------- ----------- 99.1 Statement of Compliance of the Seller/Servicer of Trust 2... 99.2 Annual Report of Independent Accountant with respect to the Seller/Servicer's overall servicing operations under Trust 2...........................................................
4 EX-99.1 2 OFFICER'S CERTIFICATE 1 EXHIBIT 99.1 OFFICER'S CERTIFICATE ANNUAL STATEMENT AS TO COMPLIANCE Re: Norwest Bank, as Trustee for Sequoia Trust 2 ("Issuer"), Merrill Lynch Corporation ("Company"), Servicing Agreement dated as of March 7, 1997 ("Agreement") Pursuant to the above Agreement, the Company hereby states: 1. A review of the activities of the Servicer during the 1997 calendar year and of its performance under the Agreement has been made under the supervision of each of the undersigned officers, and 2. To the best of each such officer's knowledge, based on such review, the Company has fulfilled all of its obligations under the Agreement in all material respects throughout such year. Dated: March 25, 1998 Merrill Lynch Credit Corporation By: /s/ Linzy S. Banks Linzy S. Banks Vice President By: /s John M. Wheeler John M. Wheeler Senior Vice President EX-99.2 3 ACCOUNTANT'S REPORT ON MANAGEMENT'S ASSERTION 1 EXHIBIT 99.2 [DELOTTE & TOUCHE LLP LETTERHEAD] INDEPENDENT ACCOUNTANT'S REPORT ON MANAGEMENT'S ASSERTION ABOUT COMPLIANCE WITH UNIFORM SINGLE ATTESTATION PROGRAM REQUIREMENTS Merrill Lynch Credit Corporation and subsidiaries: We have examined management's assertion about Merrill Lynch Credit Corporation's compliance with the minimum servicing standards identified in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers (USAP) as of and for the fiscal year ended December 26, 1997, included in the accompanying management assertion. Management is responsible for Merrill Lynch Credit Corporation's compliance with those minimum servicing standards. Our responsibility is to express an opinion on management's assertion about the entity's compliance based on our examination. Our examination was made in accordance with standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about Merrill Lynch Credit Corporation's compliance with the minimum servicing standards and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determining on Merrill Lynch Credit Corporation's compliance with the minimum servicing standards. In our opinion, management's assertion that Merrill Lynch Credit Corporation complied with the aforementioned minimum servicing standards as of and for the fiscal year ended December 26, 1997 is fairly stated, in all material respects. /s/ Delotte & Touche LLP February 23, 1998 2 [MERRILL LYNCH CREDIT CORPORATION LETTERHEAD] February 23, 1998 Delotte & Touche LLP 2801 Independent Drive Jacksonville, FL 32202 Ladies and Gentlemen: As of and for the year ended December 26, 1997, Merrill Lynch Credit Corporation and subsidiaries (the "Company") has complied in all material respects with the minimum servicing standards set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers. As of and for the same period, the Company had in effect fidelity bond and errors and omissions insurance coverage in the amounts of $325,000,000 and $11,000,000 respectively. /s/ Michael A. Johnston Michael A. Johnston Chairman/Chief Executive Officer /s/ Kevin M. O'Hanlon Kevin M. O'Hanlon President/Chief Operating Officer /s/ Francis X. Ervin, Jr. Francis X. Ervin, Jr. Senior Vice President/Chief Financial Officer /s/ Steven T. Hardy Steven T. Hardy Vice President/Controller -----END PRIVACY-ENHANCED MESSAGE-----