CALIFORNIA
|
6611
|
94-3158788
|
(State
or other jurisdiction of incorporation or organization)
|
(Primary
Standard Industrial Classification Code Number)
|
(I.R.S.
Employer Identification No.)
|
2007
|
2006
|
|||||||
Cash
and cash equivalents
|
$
|
11,591
|
$
|
18,096
|
||||
Loans
|
||||||||
Loans,
secured by deeds of trust
|
305,568
|
261,097
|
||||||
Loans,
unsecured, net
|
345
|
—
|
||||||
Allowance
for loan losses
|
(4,469
|
)
|
(2,786
|
)
|
||||
Net
loans
|
301,444
|
258,311
|
||||||
Interest
and other receivables
|
||||||||
Accrued
interest and late fees
|
5,600
|
3,384
|
||||||
Due
from affiliate
|
764
|
—
|
||||||
Advances
on loans
|
2,358
|
96
|
||||||
Total
interest and other receivables
|
8,722
|
3,480
|
||||||
Real
estate owned
|
||||||||
Real
estate held
|
20,547
|
16,961
|
||||||
Real
estate held for sale
|
4,479
|
10,618
|
||||||
Allowance
for real estate losses
|
(1,417
|
)
|
(2,348
|
)
|
||||
Net
real estate
|
23,609
|
25,231
|
||||||
Loan
origination fees, net
|
117
|
104
|
||||||
Total
assets
|
$
|
345,483
|
$
|
305,222
|
Liabilities
|
||||||||
Line
of credit
|
$
|
29,450
|
$
|
30,700
|
||||
Accounts
payable
|
62
|
76
|
||||||
Deferred
revenue
|
355
|
—
|
||||||
Payable
to affiliate
|
557
|
481
|
||||||
Total
liabilities
|
30,424
|
31,257
|
||||||
Investors
in applicant status
|
492
|
557
|
||||||
Minority
interest
|
3,240
|
3,017
|
||||||
Partners’
capital
|
||||||||
Limited
partners’ capital, subject to redemption, net of
unallocated
|
||||||||
syndication
costs of $1,791 and $1,743 for 2007 and 2006,
respectively;
|
||||||||
and
net of Formation Loan receivable of $13,497 and $12,693
|
||||||||
2007
and 2006, respectively
|
311,065
|
270,160
|
||||||
General
partners’ capital, net of unallocated syndication costs of
$18
|
||||||||
and
$18 for 2007 and 2006, respectively
|
262
|
231
|
||||||
Total
partners’ capital
|
311,327
|
270,391
|
||||||
Total
liabilities and partners’ capital
|
$
|
345,483
|
$
|
305,222
|
2007
|
2006
|
2005
|
||||||||||
Revenues
|
||||||||||||
Interest
on loans
|
$
|
28,502
|
$
|
26,395
|
$
|
19,203
|
||||||
Interest-interest
bearing accounts
|
87
|
63
|
100
|
|||||||||
Late
fees
|
257
|
241
|
120
|
|||||||||
Imputed
interest on Formation loan
|
680
|
500
|
395
|
|||||||||
Other
|
91
|
126
|
370
|
|||||||||
Total
revenues
|
29,617
|
27,325
|
20,188
|
|||||||||
Expenses
|
||||||||||||
Mortgage
servicing fees
|
1,449
|
2,479
|
1,736
|
|||||||||
Interest
expense
|
1,873
|
2,344
|
278
|
|||||||||
Amortization
of loan origination fees
|
104
|
91
|
65
|
|||||||||
Provision
for losses on loans and real estate owned
|
1,788
|
1,195
|
855
|
|||||||||
Asset
management fees
|
1,143
|
991
|
814
|
|||||||||
Clerical
costs from Redwood Mortgage Corp.
|
333
|
329
|
298
|
|||||||||
Professional
services
|
423
|
231
|
147
|
|||||||||
Amortization
of discount on imputed interest
|
680
|
500
|
395
|
|||||||||
Other
|
252
|
293
|
232
|
|||||||||
Total
expenses
|
8,045
|
8,453
|
4,820
|
|||||||||
Net
income
|
$
|
21,572
|
$
|
18,872
|
$
|
15,368
|
||||||
Net
income
|
||||||||||||
General
partners (1%)
|
$
|
216
|
$
|
188
|
$
|
154
|
||||||
Limited
partners (99%)
|
21,356
|
18,684
|
15,214
|
|||||||||
$
|
21,572
|
$
|
18,872
|
$
|
15,368
|
|||||||
Net
income per $1,000 invested by
|
||||||||||||
limited
partners for entire period
|
||||||||||||
Where
income is reinvested
|
$
|
71
|
$
|
71
|
$
|
70
|
||||||
Where
partner receives income in monthly distributions
|
$
|
69
|
$
|
69
|
$
|
68
|
Limited
Partners
|
||||||||||||||||||||
Investors
|
Capital
|
Total
|
||||||||||||||||||
In
|
Account
|
Unallocated
|
Formation
|
Limited
|
||||||||||||||||
Applicant
|
Limited
|
Syndication
|
Loan,
|
Partners’
|
||||||||||||||||
Status
|
Partners
|
Costs
|
Gross
|
Capital
|
||||||||||||||||
Balances
at December 31, 2004
|
$ | 424 | $ | 194,203 | $ | (1,084 | ) | $ | (9,751 | ) | $ | 183,368 | ||||||||
Contributions
on application
|
39,816 | — | — | — | — | |||||||||||||||
Formation
loan increases
|
— | — | — | (2,978 | ) | (2,978 | ) | |||||||||||||
Formation
loan payments received
|
— | — | — | 1,178 | 1,178 | |||||||||||||||
Interest
credited to partners in applicant status
|
41 | — | — | — | — | |||||||||||||||
Interest
withdrawn
|
(15 | ) | — | — | — | — | ||||||||||||||
Transfers
to partners’ capital
|
(39,490 | ) | 39,490 | — | — | 39,490 | ||||||||||||||
Net
income
|
— | 15,214 | — | — | 15,214 | |||||||||||||||
Syndication
costs incurred
|
— | — | (837 | ) | — | (837 | ) | |||||||||||||
Allocation
of syndication costs
|
— | (257 | ) | 257 | — | — | ||||||||||||||
Partners’
withdrawals
|
— | (7,465 | ) | — | — | (7,465 | ) | |||||||||||||
Early
withdrawal penalties
|
— | (56 | ) | 11 | 45 | — | ||||||||||||||
Balances
at December 31, 2005
|
776 | 241,129 | (1,653 | ) | (11,506 | ) | 227,970 | |||||||||||||
Contributions
on application
|
34,811 | — | — | — | — | |||||||||||||||
Formation
loan increases
|
— | — | — | (2,674 | ) | (2,674 | ) | |||||||||||||
Formation
loan payments received
|
— | — | — | 1,422 | 1,422 | |||||||||||||||
Interest
credited to partners in applicant status
|
21 | — | — | — | — | |||||||||||||||
Interest
withdrawn
|
(7 | ) | — | — | — | — | ||||||||||||||
Transfers
to partners’ capital
|
(35,044 | ) | 35,044 | — | — | 35,044 | ||||||||||||||
Net
income
|
— | 18,684 | — | — | 18,684 | |||||||||||||||
Syndication
costs incurred
|
— | — | (440 | ) | — | (440 | ) | |||||||||||||
Allocation
of syndication costs
|
— | (335 | ) | 335 | — | — | ||||||||||||||
Partners’
withdrawals
|
— | (9,846 | ) | — | — | (9,846 | ) | |||||||||||||
Early
withdrawal penalties
|
— | (80 | ) | 15 | 65 | — | ||||||||||||||
Balances
at December 31, 2006
|
557 | 284,596 | (1,743 | ) | (12,693 | ) | 270,160 | |||||||||||||
Contributions
on application
|
32,570 | — | — | — | — | |||||||||||||||
Formation
loan increases
|
— | — | — | (2,444 | ) | (2,444 | ) | |||||||||||||
Formation
loan payments received
|
— | — | — | 1,564 | 1,564 | |||||||||||||||
Interest
credited to partners in applicant status
|
28 | — | — | — | — | |||||||||||||||
Interest
withdrawn
|
(11 | ) | — | — | — | — | ||||||||||||||
Transfers
to partners’ capital
|
(32,652 | ) | 32,652 | — | — | 32,652 | ||||||||||||||
Net
income
|
— | 21,356 | — | — | 21,356 | |||||||||||||||
Syndication
costs incurred
|
— | — | (418 | ) | — | (418 | ) | |||||||||||||
Allocation
of syndication costs
|
— | (353 | ) | 353 | — | — | ||||||||||||||
Partners’
withdrawals
|
— | (11,805 | ) | — | — | (11,805 | ) | |||||||||||||
Early
withdrawal penalties
|
— | (93 | ) | 17 | 76 | — | ||||||||||||||
Balances
at December 31, 2007
|
$ | 492 | $ | 326,353 | $ | (1,791 | ) | $ | (13,497 | ) | $ | 311,065 |
General
Partners
|
||||||||||||||||
Capital
|
Total
|
|||||||||||||||
Account
|
Unallocated
|
General
|
Total
|
|||||||||||||
General
|
Syndication
|
Partners’
|
Partners’
|
|||||||||||||
Partners
|
Costs
|
Capital
|
Capital
|
|||||||||||||
Balances
at December 31, 2003
|
$ | 174 | $ | (11 | ) | $ | 163 | $ | 183,531 | |||||||
Contributions
on application
|
— | — | — | — | ||||||||||||
Formation
loan increases
|
— | — | — | (2,978 | ) | |||||||||||
Formation
loan payments received
|
— | — | — | 1,178 | ||||||||||||
Interest
credited to partners in applicant status
|
— | — | — | — | ||||||||||||
Interest
withdrawn
|
— | — | — | — | ||||||||||||
Capital
contributed
|
40 | — | 40 | 39,530 | ||||||||||||
Net
income
|
154 | — | 154 | 15,368 | ||||||||||||
Syndication
costs incurred
|
— | (8 | ) | (8 | ) | (845 | ) | |||||||||
Allocation
of syndication costs
|
(3 | ) | 3 | — | — | |||||||||||
Partners’
withdrawals
|
(152 | ) | — | (152 | ) | (7,617 | ) | |||||||||
Early
withdrawal penalties
|
— | — | — | — | ||||||||||||
Balances
at December 31, 2005
|
213 | (16 | ) | 197 | 228,167 | |||||||||||
Contributions
on application
|
— | — | — | — | ||||||||||||
Formation
loan increases
|
— | — | — | (2,674 | ) | |||||||||||
Formation
loan payments received
|
— | — | — | 1,422 | ||||||||||||
Interest
credited to partners in applicant status
|
— | — | — | — | ||||||||||||
Interest
withdrawn
|
— | — | — | — | ||||||||||||
Capital
contributed
|
35 | — | 35 | 35,079 | ||||||||||||
Net
income
|
188 | — | 188 | 18,872 | ||||||||||||
Syndication
costs incurred
|
— | (5 | ) | (5 | ) | (445 | ) | |||||||||
Allocation
of syndication costs
|
(3 | ) | 3 | — | — | |||||||||||
Partners’
withdrawals
|
(184 | ) | — | (184 | ) | (10,030 | ) | |||||||||
Early
withdrawal penalties
|
— | — | — | — | ||||||||||||
Balances
at December 31, 2006
|
249 | (18 | ) | 231 | 270,391 | |||||||||||
Contributions
on application
|
— | — | — | — | ||||||||||||
Formation
loan increases
|
— | — | — | (2,444 | ) | |||||||||||
Formation
loan payments received
|
— | — | — | 1,564 | ||||||||||||
Interest
credited to partners in applicant status
|
— | — | — | — | ||||||||||||
Interest
withdrawn
|
— | — | — | — | ||||||||||||
Capital
contributed
|
31 | — | 31 | 32,683 | ||||||||||||
Net
income
|
216 | — | 216 | 21,572 | ||||||||||||
Syndication
costs incurred
|
— | (4 | ) | (4 | ) | (422 | ) | |||||||||
Allocation
of syndication costs
|
(4 | ) | 4 | — | — | |||||||||||
Partners’
withdrawals
|
(212 | ) | — | (212 | ) | (12,017 | ) | |||||||||
Early
withdrawal penalties
|
— | — | — | — | ||||||||||||
Balances
at December 31, 2007
|
$ | 280 | $ | (18 | ) | $ | 262 | $ | 311,327 |
2007
|
2006
|
2005
|
||||||||||
Cash
flows from operating activities
|
||||||||||||
Net
income
|
$
|
21,572
|
$
|
18,872
|
$
|
15,368
|
||||||
Adjustments
to reconcile net income to
|
||||||||||||
net
cash provided by operating activities
|
||||||||||||
Amortization
of loan origination fees
|
104
|
91
|
65
|
|||||||||
Imputed
interest income
|
(680
|
)
|
(500
|
)
|
(395
|
)
|
||||||
Amortization
of discount
|
680
|
500
|
395
|
|||||||||
Provision
for losses on loans and real estate owned
|
1,788
|
1,195
|
855
|
|||||||||
Realized
(gain) loss on sale of real estate
|
—
|
—
|
(183
|
)
|
||||||||
Change
in operating assets and liabilities
|
||||||||||||
Accrued
interest and late fees
|
(2,749
|
)
|
(578
|
)
|
1,040
|
|||||||
Advances
on loans
|
(2,317
|
)
|
(109
|
)
|
(63
|
)
|
||||||
Due
from affiliate
|
(764)
|
|||||||||||
Loan
origination fees
|
(117
|
)
|
(122
|
)
|
(75
|
)
|
||||||
Accounts
payable
|
(14)
|
66
|
(15
|
)
|
||||||||
Deferred
revenue
|
355
|
-
|
-
|
|||||||||
Payable
to affiliate
|
76
|
(8
|
)
|
(149
|
)
|
|||||||
Net
cash provided by operating activities
|
17,934
|
19,407
|
16,843
|
|||||||||
Cash
flows from investing activities
|
||||||||||||
Loans
originated
|
(137,635
|
)
|
(159,745
|
)
|
(169,460
|
)
|
||||||
Principal
collected on loans
|
91,134
|
107,656
|
118,772
|
|||||||||
Unsecured
loans
|
—
|
—
|
34
|
|||||||||
Payments
for development of real estate
|
(2,096
|
)
|
(520
|
)
|
(939
|
)
|
||||||
Proceeds
from disposition of real estate
|
5,886
|
635
|
1,541
|
|||||||||
Net
cash used in investing activities
|
(42,711
|
)
|
(51,974
|
)
|
(50,052
|
)
|
||||||
Cash
flows from financing activities
|
||||||||||||
Borrowings
(repayments) on line of credit, net
|
(1,250
|
)
|
(1,300
|
)
|
16,000
|
|||||||
Contributions
by partner applicants
|
32,618
|
34,862
|
39,882
|
|||||||||
Partners’
withdrawals
|
(12,017
|
)
|
(10,030
|
)
|
(7,617
|
)
|
||||||
Syndication
costs paid
|
(422
|
)
|
(445
|
)
|
(845
|
)
|
||||||
Formation
loan lending
|
(2,444
|
)
|
(2,674
|
)
|
(2,978
|
)
|
||||||
Formation
loan collections
|
1,564
|
1,422
|
1,178
|
|||||||||
Increase
to (distribution from) minority interest
|
223
|
(25
|
)
|
141
|
||||||||
Net
cash provided by financing activities
|
18,272
|
21,810
|
45,761
|
|||||||||
Net
increase (decrease) in cash and cash equivalents
|
(6,505
|
)
|
(10,757
|
)
|
12,552
|
|||||||
Cash
and cash equivalents - beginning of year
|
18,096
|
28,853
|
16,301
|
|||||||||
Cash
and cash equivalents - end of year
|
$
|
11,591
|
$
|
18,096
|
$
|
28,853
|
||||||
Supplemental
disclosures of cash flow information
|
||||||||||||
Cash
paid for interest
|
$
|
1,873
|
$
|
2,344
|
$
|
278
|
Initial
|
Subsequent
|
Third
|
Fourth
|
Fifth
|
Sixth
|
|||||||||||||||||||||||
Offering
of
|
Offering
of
|
Offering
of
|
Offering
of
|
Offering
of
|
Offering
of
|
|||||||||||||||||||||||
$ | 15,000 | $ | 30,000 | $ | 30,000 | $ | 50,000 | $ | 75,000 | $ | 100,000 |
Total
|
||||||||||||||||
Limited
Partner
|
||||||||||||||||||||||||||||
contributions
|
$ | 14,932 | $ | 29,993 | $ | 29,999 | $ | 49,985 | $ | 74,904 | $ | 79,607 | $ | 279,420 | ||||||||||||||
Formation
Loan made
|
$ | 1,075 | $ | 2,272 | $ | 2,218 | $ | 3,777 | $ | 5,661 | $ | 6,006 | $ | 21,009 | ||||||||||||||
Unamortized
discount
|
||||||||||||||||||||||||||||
on
imputed interest
|
— | (263 | ) | (323 | ) | (691 | ) | (2,567 | ) | (2,692 | ) | (6,536 | ) | |||||||||||||||
Formation
Loan
|
||||||||||||||||||||||||||||
made,
net
|
1,075 | 2,009 | 1,895 | 3,086 | 3,094 | 3,314 | 14,473 | |||||||||||||||||||||
Repayments
to date
|
(991 | ) | (1,586 | ) | (1,122 | ) | (1,538 | ) | (1,385 | ) | (441 | ) | (7,063 | ) | ||||||||||||||
Early
withdrawal
|
||||||||||||||||||||||||||||
penalties
applied
|
(84 | ) | (142 | ) | (107 | ) | (50 | ) | (66 | ) | — | (449 | ) | |||||||||||||||
Formation
Loan, net
|
||||||||||||||||||||||||||||
at
December 31, 2007
|
— | 281 | 666 | 1,498 | 1,643 | 2,873 | 6,961 | |||||||||||||||||||||
Unamortized
discount
|
||||||||||||||||||||||||||||
on
imputed interest
|
— | 263 | 323 | 691 | 2,567 | 2,692 | 6,536 | |||||||||||||||||||||
Balance,
|
||||||||||||||||||||||||||||
December
31, 2007
|
$ | — | $ | 544 | $ | 989 | $ | 2,189 | $ | 4,210 | $ | 5,565 | $ | 13,497 | ||||||||||||||
Percent
loaned
|
7.2 | % | 7.6 | % | 7.4 | % | 7.6 | % | 7.6 | % | 7.5 | % | 7.5 | % |
Costs
incurred
|
$
|
4,685
|
||
Early
withdrawal penalties applied
|
(146
|
)
|
||
Allocated
to date
|
(2,730
|
)
|
||
December
31, 2007 balance
|
$
|
1,809
|
|
Syndication costs
(continued)
|
December
31,
|
||||||||||||
2007
|
2006
|
2005
|
||||||||||
Amount
|
Percent
of loans in each category to total loans
|
Amount
|
Percent
of loans in each category to total loans
|
Amount
|
Percent
of loans in each category to total loans
|
|||||||
Balance
at End of Year
|
||||||||||||
Applicable
to:
|
||||||||||||
Domestic
|
||||||||||||
Real
estate –
|
||||||||||||
mortgage
|
||||||||||||
Single
family
|
||||||||||||
(1-4
units)
|
$ 3,028
|
62.71%
|
$ 1,673
|
73.10%
|
$ 1,598
|
54.64%
|
||||||
Apartments
|
158
|
3.07%
|
160
|
5.71%
|
145
|
8.98%
|
||||||
Commercial
|
1,210
|
33.03%
|
887
|
20.40%
|
1,140
|
30.45%
|
||||||
Land
|
73
|
1.20%
|
66
|
0.79%
|
255
|
5.93%
|
||||||
Total
real estate-mortgage
|
4,387
|
100.00%
|
2,786
|
100.00%
|
3,138
|
100.00%
|
||||||
Unsecured
|
82
|
100.00%
|
||||||||||
Total
|
$ 4,469
|
100.00%
|
$ 2,786
|
100.00%
|
$ 3,138
|
100.00%
|
Years
Ended December 31,
|
||||||||||||
2007
|
2006
|
2005
|
||||||||||
Balance
at beginning of year
|
$
|
2,786
|
$
|
3,138
|
$
|
2,343
|
||||||
Charge-offs
|
||||||||||||
Domestic
|
||||||||||||
Real
estate - mortgage
|
||||||||||||
Single
family (1-4 units)
|
(13
|
)
|
(112
|
)
|
(26
|
)
|
||||||
Apartments
|
(11
|
)
|
—
|
—
|
||||||||
Commercial
|
(363
|
)
|
(15
|
)
|
(34
|
)
|
||||||
Land
|
(46
|
)
|
—
|
—
|
||||||||
(433
|
)
|
(127
|
)
|
(60
|
)
|
|||||||
Recoveries
|
||||||||||||
Domestic
|
||||||||||||
Real
estate - mortgage
|
||||||||||||
Single
family (1-4 units)
|
—
|
—
|
—
|
|||||||||
Apartments
|
—
|
—
|
—
|
|||||||||
Commercial
|
—
|
—
|
—
|
|||||||||
Land
|
—
|
—
|
—
|
|||||||||
—
|
—
|
—
|
||||||||||
Net
charge-offs
|
(433
|
)
|
(127
|
)
|
(60
|
)
|
||||||
Additions
charge to operations
|
1,788
|
927
|
855
|
|||||||||
Transfer
from (to) real estate owned reserve
|
328
|
(1,152
|
)
|
—
|
||||||||
Balance
at end of year
|
$
|
4,469
|
$
|
2,786
|
$
|
3,138
|
||||||
Ratio
of net charge-offs during
|
||||||||||||
the
period to average secured loans
|
||||||||||||
outstanding
during the period
|
0.14
|
%
|
0.05
|
%
|
0.03
|
%
|
3.
|
Other Partnership
Provisions
|
|
Applicant
status
|
|
Subscription
funds received from purchasers of Partnership units are not admitted to
the Partnership until subscription funds are required to fund a loan, fund
the formation loan, create appropriate cash reserves, or to pay
organizational expenses or other proper partnership
purposes. During the period prior to the time of admission,
which is anticipated to be between 1 - 90 days, purchasers’ subscriptions
will remain irrevocable and will earn interest at money market rates,
which are lower than the anticipated return on the Partnership’s loan
portfolio.
|
3.
|
Other Partnership
Provisions (continued)
|
4.
|
General Partners and
Related Parties
|
4.
|
General Partners and
Related Parties (continued)
|
|
REDWOOD
MORTGAGE INVESTORS VIII
|
5.
|
Real Estate
Owned
|
2007
|
2006
|
|||||||
Real
estate held
|
||||||||
Costs
of properties
|
$
|
20,547
|
$
|
16,961
|
||||
Reduction
in value
|
(917
|
)
|
(929
|
)
|
||||
Real
estate held , net
|
$
|
19,630
|
$
|
16,032
|
5.
|
Real Estate Owned
(continued)
|
2007
|
2006
|
|||||||
Real
estate held for sale
|
||||||||
Costs
of properties
|
$
|
4,479
|
$
|
10,618
|
||||
Reduction
in value
|
(500
|
)
|
(1,419
|
)
|
||||
Real
estate held for sale, net
|
$
|
3,979
|
$
|
9,199
|
|
6.
|
Income
Taxes
|
2007
|
2006
|
|||||||
Partners’
capital per consolidated
|
||||||||
financial
statements
|
$
|
311,327
|
$
|
270,391
|
||||
Unallocated
syndication costs
|
1,809
|
1,761
|
||||||
Allowance
for loan losses and
|
||||||||
real
estate owned
|
5,886
|
5,134
|
||||||
Formation
loans receivable
|
13,497
|
12,693
|
||||||
Partners’
capital - tax basis
|
$
|
332,519
|
$
|
289,979
|
|
8.
|
Fair Value of
Financial Instruments
|
|
(a)
|
Cash
and cash equivalents. The carrying amount equals fair
value. All amounts, including interest bearing, are subject to
immediate withdrawal.
|
|
(b)
|
Secured
loans carrying value was $305,568,000 and $261,097,000 at December 31,
2007 and 2006, respectively. The fair value of these loans of
$307,654,000 and $261,692,000, respectively, was estimated based upon
projected cash flows discounted at the estimated current interest rates at
which similar loans would be made. The applicable amount of the
allowance for loan losses along with accrued interest and advances related
thereto should also be considered in evaluating the fair value versus the
carrying value.
|
|
(c)
|
Line
of credit and loan commitments. The carrying amount equals fair
value. All amounts, including interest payable, are subject to
immediate repayment.
|
|
9.
|
Non-Cash
Transactions
|
10.
|
Loan Concentrations
and Characteristics
|
|
Most
loans are secured by recorded deeds of trust. At December 31, 2007 and
2006, there were 116 and 105 secured loans outstanding, respectively, with
the following characteristics (dollars in
thousands):
|
2007
|
2006
|
|||||||
Number
of secured loans outstanding
|
116
|
105
|
||||||
Total
secured loans outstanding
|
$
|
305,568
|
$
|
261,097
|
||||
Average
secured loan outstanding
|
$
|
2,634
|
$
|
2,487
|
||||
Average
secured loan as percent of total
|
||||||||
secured
loans
|
0.86
|
%
|
0.95
|
%
|
||||
Average
secured loan as percent
|
||||||||
of
partners’ capital
|
0.85
|
%
|
0.92
|
%
|
||||
Largest
secured loan outstanding
|
$
|
34,383
|
$
|
32,156
|
||||
Largest
secured loan as percent of total
|
||||||||
secured
loans
|
11.25
|
%
|
12.32
|
%
|
||||
Largest
secured loan as percent
|
||||||||
of
partners’ capital
|
11.04
|
%
|
11.89
|
%
|
||||
Largest
secured loan as percent of total assets
|
9.95
|
%
|
10.54
|
%
|
||||
Number
of counties where security
|
||||||||
is
located (all California)
|
32
|
24
|
||||||
Largest
percentage of secured loans
|
||||||||
in
one county
|
23.63
|
%
|
25.36
|
%
|
||||
Number
of secured loans in foreclosure status
|
5
|
2
|
||||||
Amount
of secured loans in foreclosure
|
$
|
5,169
|
$
|
2,108
|
||||
10.
|
Asset Concentrations
and Characteristics
(continued)
|
2007
|
2006
|
|||||||
First
trust deeds
|
$
|
138,965
|
$
|
125,061
|
||||
Second
trust deeds
|
166,103
|
133,623
|
||||||
Third
trust deeds
|
500
|
2,413
|
||||||
Total
loans
|
305,568
|
261,097
|
||||||
Prior
liens due other lenders at time of loan
|
433,797
|
329,554
|
||||||
Total
debt
|
$
|
739,365
|
$
|
590,651
|
||||
Appraised
property value at time of loan
|
$
|
1,098,743
|
$
|
895,621
|
||||
Average
secured loan to appraised value
|
||||||||
of
security based on appraised values and
|
||||||||
prior
liens at time loan was consummated
|
67.29
|
%
|
65.95
|
%
|
||||
Secured
loans by type of property
|
||||||||
Single
family (1-4 units)
|
$
|
191,608
|
$
|
190,859
|
||||
Apartments
|
9,369
|
14,914
|
||||||
Commercial
|
100,933
|
53,262
|
||||||
Land
|
3,658
|
2,062
|
||||||
$
|
305,568
|
$
|
261,097
|
Year
Ending December 31,
|
||||
2008
|
$
|
186,715
|
||
2009
|
61,384
|
|||
2010
|
36,713
|
|||
2011
|
6,935
|
|||
2012
|
12,049
|
|||
Thereafter
|
1,772
|
|||
$
|
305,568
|
10.
|
Loan Concentrations
and Characteristics
(continued)
|
11.
|
Commitments and
Contingencies
|
12.
|
Selected Financial
Information (Unaudited)
|
Calendar
Quarter
|
|
(in
thousands, except for per limited partner
amounts)
|
First
|
Second
|
Third
|
Fourth
|
Annual
|
||||||||||||||||
Revenues
|
||||||||||||||||||||
2007
|
$ | 7,098 | $ | 7,200 | $ | 7,620 | $ | 7,699 | $ | 29,617 | ||||||||||
2006
|
$ | 6,659 | $ | 6,997 | $ | 6,847 | $ | 6,822 | $ | 27,325 | ||||||||||
Expenses
|
||||||||||||||||||||
2007
|
$ | 1,958 | $ | 1,880 | $ | 2,068 | $ | 2,139 | $ | 8,045 | ||||||||||
2006
|
$ | 2,247 | $ | 2,371 | $ | 2,017 | $ | 1,818 | $ | 8,453 | ||||||||||
Net
income allocated
|
||||||||||||||||||||
to
general partners
|
||||||||||||||||||||
2007
|
$ | 51 | $ | 54 | $ | 55 | $ | 56 | $ | 216 | ||||||||||
2006
|
$ | 44 | $ | 46 | $ | 48 | $ | 50 | $ | 188 | ||||||||||
Net
income allocated
|
||||||||||||||||||||
to
limited partners
|
||||||||||||||||||||
2007
|
$ | 5,089 | $ | 5,266 | $ | 5,497 | $ | 5,504 | $ | 21,356 | ||||||||||
2006
|
$ | 4,368 | $ | 4,580 | $ | 4,782 | $ | 4,954 | $ | 18,684 | ||||||||||
Net
income per $1,000
|
||||||||||||||||||||
invested
where income is
|
||||||||||||||||||||
Compounded
|
||||||||||||||||||||
2007
|
$ | 17 | $ | 18 | $ | 18 | $ | 18 | $ | 71 | ||||||||||
2006
|
$ | 17 | $ | 17 | $ | 17 | $ | 20 | $ | 71 | ||||||||||
Withdrawn
|
||||||||||||||||||||
2007
|
$ | 17 | $ | 17 | $ | 17 | $ | 18 | $ | 69 | ||||||||||
2006
|
$ | 17 | $ | 17 | $ | 17 | $ | 18 | $ | 69 |
B
|
C
|
|||||||||
Balance
at
|
Additions
|
E
|
||||||||
Beginning
|
Charged
to
|
Charged
|
Balance
|
|||||||
A
|
of
|
Costs
and
|
to
Other
|
D
|
at
End
|
|||||
Description
|
Period
|
Expenses
|
Accounts
|
Deductions
|
of
Period
|
|||||
Year
Ended December 31, 2005
|
||||||||||
Deducted
from asset accounts
|
||||||||||
Allowance
for loan losses
|
$ 2,343
|
$ 855
|
$ —
|
$ (60)
|
(a)
|
$ 3,138
|
||||
Cumulative
write-down of
|
||||||||||
real
estate owned (REO)
|
1,000
|
—
|
—
|
—
|
1,000
|
|||||
$ 3,343
|
$ 855
|
$ —
|
$ (60)
|
(a)
|
$ 4,138
|
|||||
Year
Ended December 31, 2006
|
||||||||||
Deducted
from asset accounts
|
||||||||||
Allowance
for loan losses
|
$ 3,138
|
$ 927
|
$ —
|
$ (1,279)
|
(a)
|
$ 2,786
|
||||
Cumulative
write-down of
|
||||||||||
real
estate owned (REO)
|
1,000
|
268
|
—
|
1,080
|
(a)
|
2,348
|
||||
$ 4,138
|
$ 1,195
|
$ —
|
$ (199)
|
(a)
|
$ 5,134
|
|||||
Year
Ended December 31, 2007
|
||||||||||
Deducted
from asset accounts
|
||||||||||
Allowance
for loan losses
|
$ 2,786
|
$ 1,788
|
$ —
|
$ (105)
|
(a)
|
$ 4,469
|
||||
Cumulative
write-down of
|
||||||||||
real
estate owned (REO)
|
2,348
|
—
|
—
|
(931)
|
(a)
|
1,417
|
||||
$ 5,134
|
$ 1,788
|
$ —
|
$ (1,036)
|
(a)
|
$ 5,886
|
Col
H
|
|||||||||||||||||||||||||||
Principal
|
|||||||||||||||||||||||||||
Col.
F
|
Amount
of
|
||||||||||||||||||||||||||
Face
|
Col.
G
|
Loans
|
|||||||||||||||||||||||||
Col.
C
|
Col.
D
|
Amount
of
|
Carrying
|
Subject
to
|
Col.
J
|
||||||||||||||||||||||
Col.
B
|
Final
|
Periodic
|
Col.
E
|
Mortgage
|
Amount
of
|
Delinquent
|
Col.
I
|
California
|
|||||||||||||||||||
Col.
A
|
Interest
|
Maturity
|
Payment
|
Prior
|
Original
|
Mortgage
|
Principal
|
Type
of
|
Geographic
|
||||||||||||||||||
Descrip.
|
Rate
|
Date
|
Terms
|
Liens
|
Amount
|
Investments
|
or
Interest
|
Lien
|
Location
|
||||||||||||||||||
Comm.
|
11.75 | % |
12/01/09
|
$ | 3 | $ | — | $ | 148 | $ | 61 | $ | — |
1st
|
Yuba
|
||||||||||||
Res.
|
12.00 | % |
05/01/03
|
12 | — | 1,210 | 1,210 | 1,210 |
1st
|
Marin
|
|||||||||||||||||
Apts.
|
12.50 | % |
02/14/10
|
4 | 53 | 39 | 304 | — |
2nd
|
Contra
Costa
|
|||||||||||||||||
Land
|
9.50 | % |
07/01/09
|
8 | — | 987 | 986 | — |
1st
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
13.00 | % |
11/01/06
|
44 | 8,100 | 4,550 | 4,072 | 4,072 |
2nd
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
11.25 | % |
04/01/08
|
9 | — | 900 | 747 | — |
1st
|
El
Dorado
|
|||||||||||||||||
Comm.
|
12.00 | % |
07/01/09
|
25 | — | 2,500 | 2,500 | — |
1st
|
Sacramento
|
|||||||||||||||||
Apts.
|
9.50 | % |
01/01/09
|
4 | — | 413 | 395 | — |
1st
|
San
Joaquin
|
|||||||||||||||||
Res.
|
8.50 | % |
10/01/10
|
4 | 189 | 500 | 484 | — |
2nd
|
Alameda
|
|||||||||||||||||
Res.
|
8.50 | % |
02/01/09
|
1 | 42 | 85 | 82 | — |
3rd
|
San
Mateo
|
|||||||||||||||||
Comm.
|
9.00 | % |
06/01/09
|
4 | 2,850 | 500 | 487 | — |
2nd
|
Santa
Clara
|
|||||||||||||||||
Res.
|
9.25 | % |
07/01/09
|
6 | 16 | 690 | 673 | — |
2nd
|
San
Mateo
|
|||||||||||||||||
Comm.
|
9.00 | % |
08/01/09
|
12 | — | 2,000 | 1,600 | — |
1st
|
San
Francisco
|
|||||||||||||||||
Comm.
|
9.50 | % |
08/01/09
|
16 | — | 1,947 | 1,902 | — |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
8.75 | % |
09/01/06
|
88 | — | 11,684 | 11,684 | — |
1st
|
Contra
Costa
|
|||||||||||||||||
Res.
|
10.00 | % |
12/31/07
|
75 | 11,684 | 15,288 | 8,701 | — |
2nd
|
Contra
Costa
|
|||||||||||||||||
Comm.
|
9.50 | % |
01/01/09
|
25 | — | 3,113 | 3,113 | — |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
8.50 | % |
03/15/10
|
10 | 2,097 | 450 | 438 | — |
2nd
|
Napa
|
|||||||||||||||||
Comm.
|
10.00 | % |
02/01/08
|
16 | 2,200 | 2,335 | 1,857 | — |
1st
|
Amador
|
|||||||||||||||||
Comm.
|
9.00 | % |
03/01/10
|
2 | 179 | 204 | 196 | — |
2nd
|
Monterey
|
|||||||||||||||||
Res.
|
9.25 | % |
07/01/08
|
7 | — | 4,464 | 889 | — |
1st
|
Sutter
|
|||||||||||||||||
Res.
|
9.25 | % |
05/01/10
|
1 | 411 | 160 | 157 | — |
2nd
|
San
Mateo
|
|||||||||||||||||
Res.
|
10.00 | % |
03/01/09
|
77 | 36,000 | 8,165 | 8,983 | — |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.00 | % |
05/01/10
|
1 | 286 | 70 | 69 | — |
2nd
|
El
Dorado
|
|||||||||||||||||
Res.
|
8.50 | % |
10/01/10
|
2 | 379 | 325 | 318 | — |
3rd
|
Alameda
|
|||||||||||||||||
Comm.
|
8.42 | % |
10/01/08
|
37 | 5,731 | 5,341 | 5,341 | — |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
12.50 | % |
07/01/08
|
44 | 19,700 | 4,250 | 4,112 | — |
2nd
|
San
Mateo
|
|||||||||||||||||
Comm.
|
9.00 | % |
08/01/15
|
13 | 9,500 | 1,000 | 913 | 913 |
2nd.
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.00 | % |
08/01/10
|
1 | — | 140 | 138 | — |
1st
|
Ventura
|
|||||||||||||||||
Res.
|
8.50 | % |
04/01/09
|
3 | — | 3,450 | 441 | — |
1st
|
Sacramento
|
|||||||||||||||||
Res.
|
9.00 | % |
04/01/09
|
22 | 2,033 | 2,325 | 2,812 | — |
2nd
|
Sacramento
|
|||||||||||||||||
Res.
|
9.25 | % |
07/01/08
|
24 | — | 3,555 | 3,272 | — |
1st
|
San
Joaquin
|
|||||||||||||||||
Comm.
|
9.50 | % |
10/01/10
|
11 | 105 | 1,250 | 1,232 | — |
2nd.
|
Alameda
|
|||||||||||||||||
Res.
|
9.25 | % |
07/01/08
|
8 | — | 1,265 | 1,177 | — |
1st
|
San
Joaquin
|
|||||||||||||||||
Res.
|
11.00 | % |
05/01/08
|
38 | 18,744 | 4,080 | 4,031 | — |
2nd
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
9.50 | % |
10/01/10
|
37 | — | 4,200 | 4,110 | — |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
10.00 | % |
11/01/07
|
20 | 11,500 | 2,564 | 2,407 | 2,407 |
2nd
|
Contra
Costa
|
|||||||||||||||||
Res.
|
12.00 | % |
12/01/07
|
13 | 3,797 | 1,265 | 1,265 | 1,265 |
2nd
|
San
Diego
|
|||||||||||||||||
Comm.
|
9.50 | % |
04/01/08
|
23 | — | 2,900 | 2,898 | — |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
10.00 | % |
01/01/08
|
14 | 2,187 | 4,500 | 1,684 | — |
2nd
|
Alameda
|
|||||||||||||||||
Res.
|
9.00 | % |
02/01/08
|
68 | — | 15,188 | ,120 | 9,120 |
1st
|
Los
Angeles
|
|||||||||||||||||
Res.
|
10.25 | % |
02/01/08
|
102 | 14,632 | 11,529 | 11,529 | 11,529 |
2nd
|
Los
Angeles
|
|||||||||||||||||
Res.
|
9.00 | % |
02/01/11
|
11 | — | 1,350 | 1,332 | — |
1st
|
Placer
|
|||||||||||||||||
Res.
|
10.25 | % |
09/01/07
|
88 | 39,000 | 8,350 | 10,338 | 10,338 |
2nd
|
Los
Angeles
|
|||||||||||||||||
Res.
|
9.25 | % |
04/01/08
|
271 | 22,876 | 40,444 | 34,383 | — |
2nd
|
Sacramento
|
|||||||||||||||||
Res.
|
10.00 | % |
05/01/08
|
31 | 22,155 | 4,184 | 3,566 | — |
2nd
|
Alameda
|
|||||||||||||||||
Res.
|
10.00 | % |
05/01/08
|
17 | 12,512 | 2,200 | 1,988 | 1,988 |
2nd
|
Alameda
|
Col
H
|
|||||||||||
Principal
|
|||||||||||
Col.
F
|
Amount
of
|
||||||||||
Face
|
Col.
G
|
Loans
|
|||||||||
Col.
C
|
Col.
D
|
Amount
of
|
Carrying
|
Subject
to
|
Col.
J
|
||||||
Col.
B
|
Final
|
Periodic
|
Col.
E
|
Mortgage
|
Amount
of
|
Delinquent
|
Col.
I
|
California
|
|||
Col.
A
|
Interest
|
Maturity
|
Payment
|
Prior
|
Original
|
Mortgage
|
Principal
|
Type
of
|
Geographic
|
||
Descrip.
|
Rate
|
Date
|
Terms
|
Liens
|
Amount
|
Investments
|
or
Interest
|
Lien
|
Location
|
||
Res.
|
10.00%
|
05/01/08
|
12
|
9,576
|
1,696
|
1,379
|
1,379
|
2nd
|
Alameda
|
||
Res.
|
9.50%
|
06/01/07
|
37
|
—
|
6,796
|
4,496
|
—
|
1st
|
Fresno
|
||
Res.
|
10.00%
|
08/01/09
|
85
|
32,200
|
10,175
|
9,847
|
—
|
2nd
|
San
Francisco
|
||
Res.
|
8.88%
|
07/01/11
|
16
|
4,550
|
2,100
|
2,100
|
—
|
2nd
|
San
Francisco
|
||
Res.
|
8.75%
|
07/01/08
|
40
|
—
|
5,520
|
5,520
|
—
|
1st.
|
Contra
Costa
|
||
Res.
|
10.00%
|
07/01/08
|
63
|
5,520
|
6,225
|
7,344
|
—
|
2nd
|
Contra
Costa
|
||
Comm.
|
12.00%
|
7/1/2009
|
39
|
2,500
|
3,858
|
3,763
|
—
|
2nd
|
Sacramento
|
||
Res.
|
9.75%
|
8/1/2011
|
1
|
165
|
66
|
66
|
—
|
2nd
|
Stanislaus
|
||
Res.
|
9.75%
|
09/01/11
|
1
|
120
|
120
|
119
|
119
|
2nd
|
San
Bernardino
|
||
Res.
|
9.75%
|
09/01/11
|
7
|
2,550
|
850
|
844
|
—
|
2nd
|
San
Francisco
|
||
Res.
|
9.25%
|
09/01/11
|
7
|
—
|
800
|
793
|
—
|
1st
|
San
Joaquin
|
||
Res.
|
9.75%
|
09/01/11
|
1
|
120
|
80
|
79
|
80
|
2nd
|
Humboldt
|
||
Res.
|
10.25%
|
10/01/08
|
20
|
—
|
3,949
|
2,220
|
—
|
1st
|
Contra
Costa
|
||
Land
|
7.00%
|
10/01/09
|
3
|
—
|
928
|
588
|
—
|
1st
|
Stanislaus
|
||
Res.
|
9.25%
|
11/01/11
|
1
|
—
|
125
|
149
|
—
|
1st
|
San
Francisco
|
||
Res.
|
9.00%
|
11/01/11
|
1
|
769
|
100
|
99
|
99
|
2nd
|
Los
Angeles
|
||
Apts.
|
10.25%
|
11/01/11
|
4
|
—
|
450
|
447
|
—
|
1st
|
Butte
|
||
Res.
|
9.50%
|
11/01/12
|
34
|
—
|
6,200
|
3,629
|
—
|
1st
|
San
Mateo
|
||
Res.
|
10.00%
|
12/01/11
|
3
|
—
|
345
|
345
|
345
|
1st
|
Alameda
|
||
Comm.
|
10.25%
|
12/01/08
|
2
|
—
|
275
|
275
|
—
|
1st
|
Kern
|
||
Res.
|
10.25%
|
01/01/09
|
30
|
—
|
3,550
|
3,550
|
—
|
1st
|
Napa
|
||
Res.
|
9.25%
|
01/01/12
|
1
|
238
|
130
|
129
|
—
|
2nd
|
Riverside
|
||
Res.
|
9.75%
|
01/01/11
|
5
|
330
|
561
|
560
|
560
|
2nd
|
San
Diego
|
||
Res.
|
10.25%
|
01/01/09
|
3
|
—
|
1,372
|
359
|
—
|
1st
|
Santa
Clara
|
||
Apts.
|
9.25%
|
01/01/10
|
3
|
—
|
345
|
345
|
—
|
1st
|
San
Francisco
|
||
Res.
|
9.75%
|
02/01/12
|
1
|
245
|
73
|
73
|
73
|
2nd
|
Yolo
|
||
Comm.
|
10.50%
|
01/01/10
|
24
|
—
|
2,750
|
2,750
|
2,750
|
1st
|
San
Francisco
|
||
Res.
|
9.75%
|
03/01/12
|
1
|
—
|
128
|
127
|
—
|
1st
|
Kern
|
||
Res.
|
10.00%
|
02/01/12
|
2
|
—
|
231
|
230
|
—
|
1st
|
Los
Angeles
|
||
Res.
|
10.25%
|
02/01/10
|
5
|
—
|
630
|
630
|
—
|
1st
|
San
Joaquin
|
||
Apts.
|
9.75%
|
02/01/08
|
3
|
—
|
420
|
420
|
—
|
1st
|
Solano
|
||
Res.
|
12.00%
|
09/01/08
|
54
|
30,277
|
4,443
|
7,068
|
—
|
2nd
|
San
Francisco
|
||
Res.
|
9.25%
|
02/01/12
|
1
|
—
|
100
|
100
|
—
|
1st
|
San
Bernardino
|
||
Res.
|
9.25%
|
02/01/12
|
2
|
800
|
300
|
298
|
—
|
2nd
|
Solano
|
||
Res.
|
10.00%
|
03/01/09
|
12
|
—
|
8,365
|
1,350
|
—
|
1st
|
San
Francisco
|
||
Comm.
|
10.00%
|
04/01/12
|
3
|
2,256
|
300
|
300
|
—
|
2nd
|
Butte
|
||
Res.
|
10.00%
|
09/01/08
|
11
|
—
|
1,272
|
1,272
|
—
|
1st
|
Solano
|
||
Apts.
|
10.50%
|
04/01/09
|
26
|
—
|
3,015
|
3,015
|
—
|
1st.
|
San
Francisco
|
||
Apts.
|
10.50%
|
04/01/10
|
6
|
826
|
700
|
693
|
—
|
2nd
|
Napa
|
||
Apts.
|
10.25%
|
12/01/08
|
13
|
7,560
|
1,540
|
1,462
|
—
|
2nd
|
Santa
Clara
|
||
Land
|
10.00%
|
05/01/08
|
7
|
—
|
833
|
833
|
—
|
1st
|
Alameda
|
||
Res.
|
9.75%
|
05/01/10
|
30
|
13,944
|
3,750
|
3,750
|
—
|
2nd
|
Riverside
|
||
Res.
|
9.25%
|
06/01/09
|
44
|
1,650
|
5,750
|
5,750
|
—
|
1st
|
San
Diego
|
||
Comm.
|
10.00%
|
06/01/10
|
138
|
4,000
|
16,500
|
16,500
|
—
|
1st
|
San
Francisco
|
Col
H
|
|||||||||||||||||||||||||||
Principal
|
|||||||||||||||||||||||||||
Col.
F
|
Amount
of
|
||||||||||||||||||||||||||
Face
|
Col.
G
|
Loans
|
|||||||||||||||||||||||||
Col.
C
|
Col.
D
|
Amount
of
|
Carrying
|
Subject
to
|
Col.
J
|
||||||||||||||||||||||
Col.
B
|
Final
|
Periodic
|
Col.
E
|
Mortgage
|
Amount
of
|
Delinquent
|
Col.
I
|
California
|
|||||||||||||||||||
Col.
A
|
Interest
|
Maturity
|
Payment
|
Prior
|
Original
|
Mortgage
|
Principal
|
Type
of
|
Geographic
|
||||||||||||||||||
Descrip.
|
Rate
|
Date
|
Terms
|
Liens
|
Amount
|
Investments
|
or
Interest
|
Lien
|
Location
|
||||||||||||||||||
Res.
|
9.75 | % |
07/01/12
|
30 | 11,397 | 3,677 | 3,677 | — |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
10.00 | % |
07/01/12
|
2 | — | 205 | 205 | — |
1st
|
Riverside
|
|||||||||||||||||
Res.
|
10.00 | % |
07/01/12
|
2 | — | 263 | 262 | 262 |
1st
|
Los
Angeles
|
|||||||||||||||||
Res.
|
9.50 | % |
07/01/12
|
3 | — | 374 | 373 | — |
1st
|
Madera
|
|||||||||||||||||
Comm.
|
10.50 | % |
08/01/08
|
7 | 8,000 | 1,000 | 814 | — |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.75 | % |
08/01/12
|
10 | — | 1,163 | 1,163 | 1,163 |
1st
|
Riverside
|
|||||||||||||||||
Comm.
|
10.50 | % |
08/01/08
|
55 | — | 6,240 | 6,240 | — |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
10.00 | % |
08/01/12
|
3 | 613 | 350 | 349 | — |
2nd
|
Contra
Costa
|
|||||||||||||||||
Comm.
|
9.50 | % |
09/01/10
|
36 | 19,700 | 4,600 | 4,600 | — |
2nd
|
Sonoma
|
|||||||||||||||||
Res.
|
10.00 | % |
11/01/12
|
2 | — | 263 | 263 | — |
1st
|
Sacramento
|
|||||||||||||||||
Res.
|
9.25 | % |
11/01/12
|
1 | 506 | 100 | 100 | — |
1st
|
San
Diego
|
|||||||||||||||||
Res.
|
10.00 | % |
11/01/09
|
14 | — | 1,648 | 1,648 | — |
1st
|
San
Mateo
|
|||||||||||||||||
Res.
|
9.25 | % |
11/01/12
|
3 | — | 377 | 377 | — |
1st
|
Orange
|
|||||||||||||||||
Res.
|
10.25 | % |
12/01/09
|
1 | 335 | 100 | 100 | — |
3rd
|
Contra
Costa
|
|||||||||||||||||
Comm.
|
10.50 | % |
11/01/09
|
55 | — | 7,250 | 6,129 | — |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
9.50 | % |
11/01/08
|
2 | — | 275 | 275 | — |
1st
|
Alameda
|
|||||||||||||||||
Land
|
10.50 | % |
12/01/09
|
2 | — | 250 | 250 | — |
1st
|
Lake
|
|||||||||||||||||
Comm.
|
10.50 | % |
11/01/08
|
100 | 22,300 | 12,000 | 11,375 | — |
2nd
|
Alameda
|
|||||||||||||||||
Res.
|
10.00 | % |
11/01/12
|
2 | — | 209 | 209 | — |
1st
|
Calaveras
|
|||||||||||||||||
Res.
|
9.25 | % |
12/01/12
|
2 | 385 | 186 | 186 | — |
2nd
|
Los
Angeles
|
|||||||||||||||||
Land
|
10.50 | % |
12/01/09
|
9 | — | 1,000 | 1,000 | — |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
9.00 | % |
01/01/13
|
2 | 358 | 204 | 204 | — |
2nd
|
San
Mateo
|
|||||||||||||||||
Res.
|
10.00 | % |
01/01/13
|
1 | 349 | 100 | 100 | — |
2nd
|
Santa
Clara
|
|||||||||||||||||
Res.
|
10.00 | % |
01/01/13
|
5 | — | 556 | 556 | — |
1st
|
Contra
Costa
|
|||||||||||||||||
Comm.
|
10.00 | % |
07/01.08
|
79 | — | 9,450 | 9,450 | — |
1st
|
Los
Angeles
|
|||||||||||||||||
$ | 2,852 | $ | 433,797 | $ | 347,613 | $ | 305,568 | $ | 49,672 |
Year
ended December 31,
|
||||||||||||
2007
|
2006
|
2005
|
||||||||||
Balance
at beginning of year
|
$
|
261,097
|
$
|
214,012
|
$
|
171,745
|
||||||
Additions
during period
|
||||||||||||
New
loans
|
137,635
|
159,745
|
169,460
|
|||||||||
Other
|
—
|
588
|
—
|
|||||||||
Total
additions
|
137,635
|
160,333
|
169,460
|
|||||||||
Deductions
during period
|
||||||||||||
Collections
of principal
|
91,134
|
107,656
|
118,772
|
|||||||||
Foreclosures
|
1,320
|
5,464
|
8,361
|
|||||||||
Cost
of loans sold
|
—
|
—
|
—
|
|||||||||
Amortization
of premium
|
—
|
—
|
—
|
|||||||||
Other
|
710
|
128
|
60
|
|||||||||
Total
deductions
|
93,164
|
113,248
|
127,193
|
|||||||||
Balance
at close of year
|
$
|
305,568
|
$
|
261,097
|
$
|
214,012
|
ASSETS
|
Cash
and cash equivalents
|
$ | 333,413 | ||
Investment
in partnerships
|
||||
Redwood
Mortgage Investors IV
|
7,500 | |||
Redwood
Mortgage Investors V
|
5,000 | |||
Redwood
Mortgage Investors VI
|
9,773 | |||
Redwood
Mortgage Investors VII
|
11,998 | |||
Redwood
Mortgage Investors VIII
|
279,465 | |||
313,736 | ||||
$ | 647,149 |
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
Liabilities
|
||||
Accounts
payable
|
$ | 3,202 | ||
Accrued
income taxes
|
24,879 | |||
Total
current liabilities
|
28,081 | |||
Stockholders'
equity
|
||||
Common
stock, no par, authorized 1,000,000
|
||||
shares;
issued and outstanding 500 shares
|
12,500 | |||
Retained
earnings
|
606,568 | |||
Total
stockholders' equity
|
619,068 | |||
$ | 647,149 |
1.
|
Organization
|
2.
|
Summary of Significant
Accounting Policies
|
3.
|
Investment in
Partnerships
|
Gymno
|
||||||||||||||||
Gymno
|
Corporation
|
|||||||||||||||
Corporation
|
Investment
|
|||||||||||||||
Partnership
|
Partnership
|
Partnership
|
Percent
of
|
|||||||||||||
Net
Assets
|
Net
Income
|
Investment
|
Net
Assets
|
|||||||||||||
RMI
IV
|
$ | 5,911,893 | $ | 296,241 | $ | 7,500 | 0.13 | % | ||||||||
RMI
V
|
1,906,499 | 111,543 | 5,000 | 0.26 | % | |||||||||||
RMI
VI
|
6,116,614 | 382,462 | 9,773 | 0.16 | % | |||||||||||
RMI
VII
|
9,266,896 | 505,437 | 11,998 | 0.13 | % | |||||||||||
RMI
VIII
|
314,566,856 | 21,571,823 | 279,465 | 0.09 | % | |||||||||||
$ | 337,768,758 | $ | 22,867,506 | $ | 313,736 |
|
GYMNO
CORPORATION
|
5.
|
Guarantees
|
|
Redwood
Mortgage Corp
|
|
Balance
Sheet
|
Cash
and equivalents
|
$ | 10,342,369 | ||
Investment
in partnership
|
50,000 | |||
Due
from related parties
|
629,893 | |||
Prepaid
expenses
|
15,933 | |||
Other
receivables
|
6,535 | |||
Loans,
unsecured, net of discount of $10,451
|
312,508 | |||
Income-producing
property, net
|
1,078,003 | |||
Fixed
assets, net
|
195,981 | |||
Deferred
costs of brokerage related rights, net
|
10,182,524 | |||
Total
assets
|
$ | 22,813,746 |
Liabilities
|
||||
Accounts
payable and accrued liabilities
|
$ | 119,386 | ||
Due
to related parties
|
667,378 | |||
Accrued
compensated absences
|
231,576 | |||
Accrued
profit-sharing
|
59,960 | |||
Deferred
compensation
|
381,183 | |||
Note
payable
|
23,613 | |||
Advances
from partnerships, net
|
10,300,290 | |||
Deferred
income taxes
|
4,441,000 | |||
Total
liabilities
|
16,224,386 | |||
Stockholder's
equity
|
||||
Common
stock, wholly-owned by The Redwood Group, Ltd.,
|
||||
at
$4 per share stated value (1,000 shares authorized,
|
||||
issued
and outstanding)
|
4,000 | |||
Retained
earnings
|
6,585,360 | |||
Total
stockholder's equity
|
6,589,360 | |||
Total
liabilities and stockholder's equity
|
$ | 22,813,746 |
|
Redwood
Mortgage Corp
|
|
Notes
to Balance Sheet
|
|
September
30, 2007
|
1.
|
Organization
|
2.
|
Summary of Significant
Accounting Policies
|
|
Fixed assets and
income-producing property
|
|
Fixed
assets and income-producing property are stated at
cost. Depreciation and amortization are computed primarily
using straight-line and accelerated methods over estimated useful lives
ranging from 3 to 39 years. The Company reviews long-lived
assets for impairment when circumstances indicate the carrying amount of
an asset may not be recoverable. Impairment is recognized if
the sum of undiscounted estimated future cash flows expected to result
from the use of the asset is less than the carrying value. When
an impairment loss is recognized, the asset's carrying value is reduced to
its estimated fair value.
|
|
Redwood
Mortgage Corp
|
|
Notes
to Balance Sheet
|
|
September
30, 2007
|
2.
|
Summary of Significant
Accounting Policies
(continued)
|
|
Deferred costs of
brokerage related rights
|
|
Consistent
with Statement of Financial Accounting Standards No. 141, Business Combinations,
and 142, Goodwill and
Other Intangibles, the Company has recognized as an asset rights to
act as the mortgage loan broker for several of its affiliated limited
partnerships. Such rights result in brokerage commissions to
the Company. The initial costs of these rights include fees
paid to broker-dealers on behalf of affiliated
partnerships. Such costs are being amortized over the
anticipated 25-year period that brokerage fee net cash flows are expected
to be received in proportion to the expected receipt of these cash
flows.
|
3.
|
Partnership
Services
|
|
Redwood
Mortgage Corp
|
|
Notes
to Balance Sheet
|
3.
|
Partnership Services
(continued)
|
4.
|
Unsecured
Loans
|
Year
Ending September 30:
|
||||
2008
|
$ | 302,511 | ||
2009
|
2,583 | |||
2010
|
2,726 | |||
2011
|
3,372 | |||
2012
|
3,444 | |||
Thereafter
|
8,323 | |||
322,959 | ||||
Discount
on unsecured loans
|
(10,451 | ) | ||
Loans,
unsecured, net of discount
|
$ | 312,508 |
5.
|
Income-Producing
Property
|
Building
and improvements
|
$ | 602,832 | ||
Land
|
547,168 | |||
1,150,000 | ||||
Less
accumulated depreciation and amortization
|
(71,997 | ) | ||
Income-producing
property, net
|
$ | 1,078,003 |
|
Redwood
Mortgage Corp
|
|
Notes
to Balance Sheet
|
|
September
30, 2007
|
6.
|
Fixed
Assets
|
Furniture
and equipment
|
$ | 429,410 | ||
Computer
software
|
57,944 | |||
Leasehold
Improvements
|
19,338 | |||
506,692 | ||||
Less
accumulated depreciation and amortization
|
(310,711 | ) | ||
Fixed
assets, net
|
$ | 195,981 |
7.
|
Deferred Costs of
Brokerage Related Rights
|
Deferred
costs of brokerage related rights
|
$ | 14,736,726 | ||
Less
accumulated amortization
|
(4,554,202 | ) | ||
Deferred
costs of brokerage related rights, net
|
$ | 10,182,524 |
Year
Ending September 30:
|
||||
2008
|
$ | 1,049,611 | ||
2009
|
$ | 1,002,799 | ||
2010
|
$ | 912,781 | ||
2011
|
$ | 828,513 | ||
2012
|
$ | 724,650 |
Deferred
costs of brokerage related rights
|
$ | 5,666,964 | ||
Net
operating loss carry forwards
|
(532,661 | ) | ||
State
deferred taxes
|
(375,595 | ) | ||
Cash
to accrual differences
|
(334,333 | ) | ||
Other
|
16,625 | |||
Net
deferred tax liability
|
$ | 4,441,000 |
9.
|
Advances from
Partnerships
|
Year
Ending September 30:
|
||||
2008
|
$ | 1,797,967 | ||
2009
|
1,797,967 | |||
2010
|
1,797,967 | |||
2011
|
1,597,336 | |||
2012
|
1,597,336 | |||
Thereafter
|
4,757,401 | |||
13,345,974 | ||||
Less
discount on imputed interest
|
(3,045,684 | ) | ||
Advances
from partnerships, net
|
$ | 10,300,290 |
2008
|
$ | 15,511 | ||
2009
|
8,102 | |||
Total
|
$ | 23,613 |
|
Redwood
Mortgage Corp
|
|
Notes
to Balance Sheet
|
|
September
30, 2007
|
2008
|
$ | 229,308 | ||
2009
|
195,980 | |||
Total
|
$ | 425,288 |
12.
|
Profit-Sharing
Plan
|
Due
from related parties
|
||||
Related
party advances to A & B
|
$ | 20,853 | ||
Partnership
services fees due from RMI VIII, RMI VII and RMI VI
|
609,040 | |||
$ | 629,893 | |||
Due
to related parties
|
||||
Reimbursement
of service fee from RMI VIII (see Note 3)
|
$ | 667,378 |
|
Redwood
Mortgage Corp
|
|
Notes
to Balance Sheet
|
|
September
30, 2007
|
14.
|
Deferred Compensation
Agreement
|
1st
Offering
|
2nd
Offering
|
3rd
Offering
|
4th
Offering
|
|||||||||||||
Dollar
Amount Offered
|
$ | 15,000 | $ | 30,000 | $ | 30,000 | $ | 50,000 | ||||||||
Dollar
Amount Raised
|
$ | 14,932 | $ | 29,993 | $ | 29,999 | $ | 49,985 | ||||||||
Percentage
of Amount Raised
|
99.55 | % | 99.98 | % | 100 | % | 99.97 | % | ||||||||
Less
Offering Expenses:
|
||||||||||||||||
Organization
Expense
|
3.90 | % | 2.00 | % | 2.05 | % | 1.30 | % | ||||||||
Selling
Commissions Paid to
|
||||||||||||||||
Non
Affiliates (1)
|
0 | 0 | 0 | 0 | ||||||||||||
Selling
Commissions Paid to Affiliates
|
0 | 0 | 0 | 0 | ||||||||||||
Percentage
Available for Investment
|
||||||||||||||||
Net
of Offering Expenses
|
96.10 | % | 98.00 | % | 97.95 | % | 98.70 | % | ||||||||
Loans
Funded from Offering Proceeds
|
||||||||||||||||
Secured
by Deeds of Trust
|
87.90 | % | 89.40 | % | 89.55 | % | 90.10 | % | ||||||||
Formation
Loan
|
7.20 | % | 7.60 | % | 7.40 | % | 7.60 | % | ||||||||
Loan
Commitments
|
0 | 0 | 0 | 0 | ||||||||||||
Loan
Application or Mortgage
|
||||||||||||||||
Processing
Fees
|
0 | 0 | 0 | 0 | ||||||||||||
Funds
Available for Future
|
||||||||||||||||
Commitments
|
0 | 0 | 0 | 0 | ||||||||||||
Reserve
|
1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | ||||||||
Total
|
96.10 | % | 98.00 | % | 97.95 | % | 98.70 | % | ||||||||
Date
Offering Commenced
|
03/03/93
|
12/4/96
|
08/31/00
|
10/31/02
|
||||||||||||
Length
of Offering
|
44
months
|
44
months
|
20
months
|
11
months
|
||||||||||||
Months
to Commit 90% of Amount
|
||||||||||||||||
Available
for Investment (Measured
|
||||||||||||||||
from
Beginning of Offering)
|
45
months
|
45
months
|
21
months
|
12
months
|
(1)
|
Commissions
are paid by Redwood Mortgage Corp. through the Formation Loan (See” PLAN
OF DISTRIBUTION - Formation Loan” at Page 88 of the
Prospectus).
|
5th
Offering
|
6th
Offering
|
|||||||
Dollar
Amount Offered
|
$ | 75,000 | $ | 100,000 | ||||
Dollar
Amount Raised
|
$ | 74,904 | $ | 79,607 | ||||
Percentage
of Amount Raised
|
99.87 | % | 79.61 | % | ||||
Less
Offering Expenses:
|
||||||||
Organization
Expense
|
1.10 | % | 1.79 | % | ||||
Selling
Commissions Paid to
|
||||||||
Non
Affiliates (1)
|
0 | 0 | ||||||
Selling
Commissions Paid to Affiliates
|
0 | 0 | ||||||
Percentage
Available for Investment
|
||||||||
Net
of Offering Expenses
|
98.90 | % | 98.21 | % | ||||
Loans
Funded from Offering Proceeds
|
||||||||
Secured
by Deeds of Trust
|
90.40 | % | 89.71 | % | ||||
Formation
Loan
|
7.50 | % | 7.50 | % | ||||
Loan
Commitments
|
0 | 0 | ||||||
Loan
Application or Mortgage
|
||||||||
Processing
Fees
|
0 | 0 | ||||||
Funds
Available for Future
|
||||||||
Commitments
|
0 | 0 | ||||||
Reserve
|
1.00 | % | 1.00 | % | ||||
Total
|
98.90 | % | 98.21 | % | ||||
Date
Offering Commenced
|
10/07/03
|
08/04/05
|
||||||
Length
of Offering
|
22
months
|
|||||||
Months
to Commit 90% of Amount
|
||||||||
Available
for Investment (Measured
|
||||||||
from
Beginning of Offering)
|
23
months
|
(1)
|
Commissions
are paid by Redwood Mortgage Corp. through the Formation Loan (See” PLAN
OF DISTRIBUTION - Formation Loan” at Page 88 of the
Prospectus).
|
RMI
VIII
(In
thousands)
|
||||
Date
Offering Commenced (1)
|
03/03/93
|
|||
Dollar
Amount Raised (2)
|
$ | 279,420 | ||
Amount
Paid to General Partners and
|
||||
Affiliates
from:
|
||||
Offering
Proceeds
|
0 | |||
Selling
Commissions
|
0 | |||
Loan
Application or Loan Processing Fees
|
0 | |||
Reimbursement
of Expenses, at Cost
|
182 | |||
Acquisition
Fees
|
0 | |||
Advisory
Fees
|
0 | |||
Other
|
0 | |||
Loan
Points, Processing and Other Fees Paid
|
||||
by
the Borrowers to Affiliates:
|
||||
Points
(3)
|
$ | 20,450 | ||
Processing
Fees (3)
|
287 | |||
Other
(3)
|
91 | |||
Dollar
Amount of Cash Generated from
|
||||
Operations
Before Deducting
|
||||
Payments
to General Partners and Affiliates:
|
148,204 | |||
Amount
Paid to General Partners and Affiliates
|
||||
from
Operations:
|
||||
Partnership
Management Fees
|
4724 | |||
Earnings
Fee
|
1,042 | |||
Mortgage
Servicing Fee
|
11,562 | |||
Reimbursement
of Expenses, at Cost
|
2,459 | |||
Early
Withdrawal
|
447 | |||
Reconveyance
Fees
|
86 |
(2)
|
Indicated
the aggregate dollar amount raised in all five prior and the current sixth
offering of the partnership as of December 31,
2007.
|
$’s
in thousands except for cash distribution per $1,000
|
||||||||||||||||
1993
|
1994
|
1995
|
1996
|
|||||||||||||
Gross
Revenues
|
$ | 119 | $ | 498 | $ | 1,050 | $ | 1,727 | ||||||||
Less:
General Partners' Mgmt Fee
|
0 | 6 | 12 | 17 | ||||||||||||
Loan
Servicing Fee
|
6 | 29 | 85 | 156 | ||||||||||||
Administrative
Expenses/General
|
||||||||||||||||
Partners’
Fees
|
4 | 27 | 51 | 86 | ||||||||||||
Provision
for Uncollected Accts
|
0 | 13 | 26 | 55 | ||||||||||||
Amortization
of Organization Costs
|
1 | 3 | 3 | 3 | ||||||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
4 | 14 | 19 | 2 | ||||||||||||
Interest
Expense
|
0 | 0 | 26 | 189 | ||||||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||||||
Limited
Partners
|
$ | 104 | $ | 406 | $ | 828 | $ | 1,219 | ||||||||
Federal
Taxable Income
|
$ | 109 | $ | 433 | $ | 873 | $ | 1,299 | ||||||||
Sources
of Funds - Net Income
|
||||||||||||||||
distributable
to limited partners
|
$ | 104 | $ | 406 | $ | 828 | $ | 1,219 | ||||||||
Reduction
in Assets
|
0 | 0 | 0 | 0 | ||||||||||||
Increase
in Liabilities
|
0 | 0 | 1,914 | 0 | ||||||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||||||
Syndication
Costs
|
0 | 0 | 0 | 4 | ||||||||||||
Increase
in Applicant's Deposit
|
129 | 61 | 0 | 311 | ||||||||||||
Increase
in Partners' Capital
|
||||||||||||||||
Collection
on Formation Loan
|
0 | 0 | 0 | 17 | ||||||||||||
Admittance
of New Partners
|
2,766 | 4,514 | 3,843 | 3,864 | ||||||||||||
Cash
generated from Operations
|
||||||||||||||||
and
Financing
|
2,999 | 4,981 | 6,585 | 5,415 | ||||||||||||
Use
of Funds-Increase in Assets
|
(2,364 | ) | (4,192 | ) | (5,671 | ) | (3,860 | ) | ||||||||
Reduction
in Liabilities
|
(0 | ) | (0 | ) | (0 | ) | (176 | ) | ||||||||
Decrease
in Applicant's Deposit
|
(0 | ) | (0 | ) | (189 | ) | (0 | ) | ||||||||
Decrease
in Partner’s Capital
|
||||||||||||||||
Formation
Loan
|
(206 | ) | (319 | ) | (250 | ) | (315 | ) | ||||||||
Syndication
Costs
|
(200 | ) | (81 | ) | (175 | ) | (214 | ) | ||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
(2 | ) | (6 | ) | (8 | ) | (1 | ) | ||||||||
Investment
Income Paid to LP's
|
(47 | ) | (166 | ) | (303 | ) | (418 | ) | ||||||||
Return
of Capital to LP's
|
(0 | ) | (0 | ) | (6 | ) | (147 | ) | ||||||||
Net
Increase (Decrease) in Cash
|
180 | 217 | (17 | ) | 284 | |||||||||||
Cash
at the beginning of the year
|
0 | 180 | 397 | 380 | ||||||||||||
Cash
at the end of the year
|
$ | 180 | $ | 397 | $ | 380 | $ | 664 |
1993
|
1994
|
1995
|
1996
|
|||||||||||||
Cash
Distribution Credited on
|
||||||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 83 | $ | 81 | $ | 83 | $ | 84 | ||||||||
Cash
Distribution Data paid for
|
||||||||||||||||
$1,000
Invested for a Limited
|
||||||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||||||
Distribution
(GAAP Basis)
|
$ | 80 | $ | 79 | $ | 80 | $ | 81 | ||||||||
Cash
Distribution to All Investors for
|
||||||||||||||||
$1,000
Invested (2)
|
||||||||||||||||
Income
(1)
|
$ | 36 | $ | 33 | $ | 32 | $ | 31 | ||||||||
Capital
(1)
|
$ | 0 | $ | 0 | $ | 0.60 | $ | 11 | ||||||||
Federal
Income Tax Results for
|
||||||||||||||||
$1,000
Invested Capital for a
|
||||||||||||||||
Compounding
Limited Partner
|
$ | 96 | $ | 92 | $ | 96 | $ | 99 | ||||||||
Federal
Income Tax Results for $1,000
|
||||||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||||||
Monthly
Earnings Distributions
|
$ | 93 | $ | 89 | $ | 92 | $ | 95 |
|
(2)
|
Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
$’s
in thousands except for cash distribution per $1,000
|
||||||||||||||||
1997
|
1998
|
1999
|
2000
|
|||||||||||||
Gross
Revenues
|
$ | 2,630 | $ | 3,406 | $ | 4,426 | $ | 6,349 | ||||||||
Less:
General Partners' Mgmt Fee
|
25 | 32 | 42 | 61 | ||||||||||||
Loan
Servicing Fee
|
190 | 295 | 359 | 506 | ||||||||||||
Administrative
Expenses/General
|
||||||||||||||||
Partners’
Fees
|
144 | 147 | 174 | 270 | ||||||||||||
Provision
for Uncollected Accts
|
140 | 163 | 409 | 375 | ||||||||||||
Amortization
of Organization Costs
|
0 | 0 | 0 | 0 | ||||||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
9 | 4 | 2 | 5 | ||||||||||||
Interest
Expense
|
341 | 514 | 527 | 887 | ||||||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||||||
Limited
Partners
|
$ | 1,781 | $ | 2,251 | $ | 2,913 | $ | 4,245 | ||||||||
Federal
Taxable Income
|
$ | 1,929 | $ | 2,411 | $ | 3,331 | $ | 4,755 | ||||||||
Sources
of Funds - Net Income
|
||||||||||||||||
distributable
to limited partners
|
$ | 1,781 | $ | 2,251 | $ | 2,913 | $ | 4,245 | ||||||||
Reduction
in Assets
|
0 | 0 | 0 | 0 | ||||||||||||
Increase
in Liabilities
|
3,988 | 348 | 0 | 16,269 | ||||||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||||||
Syndication
Costs
|
5 | 8 | 13 | 10 | ||||||||||||
Increase
in Applicant's Deposit
|
0 | 0 | 330 | 0 | ||||||||||||
Increase
in Partners' Capital
|
||||||||||||||||
Collection
on Formation Loan
|
108 | 150 | 191 | 250 | ||||||||||||
Admittance
of New Partners
|
5,572 | 5,110 | 9,202 | 14,997 | ||||||||||||
Cash
generated from Operations
|
||||||||||||||||
and
Financing
|
11,454 | 7,867 | 12,649 | 35,771 | ||||||||||||
Use
of Funds-Increase in Assets
|
(9,905 | ) | (6,598 | ) | (3,439 | ) | (32,472 | ) | ||||||||
Reduction
in Liabilities
|
(0 | ) | (0 | ) | (5,832 | ) | (0 | ) | ||||||||
Decrease
in Applicant's Deposit
|
(311 | ) | (0 | ) | (0 | ) | (105 | ) | ||||||||
Decrease
in Partner’s Capital
|
||||||||||||||||
Formation
Loan
|
(420 | ) | (404 | ) | (708 | ) | (1,102 | ) | ||||||||
Syndication
Costs
|
(189 | ) | (126 | ) | (177 | ) | (227 | ) | ||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
(2 | ) | (2 | ) | (1 | ) | (1 | ) | ||||||||
Investment
Income Paid to LP's
|
(495 | ) | (614 | ) | (826 | ) | (1,245 | ) | ||||||||
Return
of Capital to LP's
|
(133 | ) | (257 | ) | (592 | ) | (762 | ) | ||||||||
Net
Increase (Decrease) in Cash
|
$ | (1 | ) | $ | (134 | ) | $ | 1,074 | $ | (143 | ) | |||||
Cash
at the beginning of the year
|
664 | 663 | 529 | 1,603 | ||||||||||||
Cash
at the end of the year
|
$ | 663 | $ | 529 | $ | 1,603 | $ | 1,460 |
1997
|
1998
|
1999
|
2000
|
|||||||||||||
Cash
Distribution Credited on
|
||||||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 84 | $ | 84 | $ | 84 | $ | 86 | ||||||||
Cash
Distribution Paid for
|
||||||||||||||||
$1,000
Invested for a Limited
|
||||||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||||||
Distribution
(GAAP Basis)
|
$ | 81 | $ | 81 | $ | 81 | $ | 83 | ||||||||
Cash
Distribution to All Investors for
|
||||||||||||||||
$1,000
Invested (2)
|
||||||||||||||||
Income
(1)
|
$ | 31 | $ | 29 | $ | 31 | $ | 34 | ||||||||
Capital
(1)
|
8 | 12 | $ | 22 | $ | 21 | ||||||||||
Federal
Income Tax Results for
|
||||||||||||||||
$1,000
Invested Capital for a
|
||||||||||||||||
Compounding
Limited Partner
|
$ | 100 | $ | 98 | $ | 102 | $ | 102 | ||||||||
Federal
Income Tax Results for $1,000
|
||||||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||||||
Monthly
Earnings Distributions
|
$ | 97 | $ | 95 | $ | 99 | $ | 98 |
|
(2)
|
Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
$’s
in thousands except for cash distribution per $1,000
|
||||||||||||||||
2001
|
2002
|
2003
|
2004
|
|||||||||||||
Gross
Revenues
|
$ | 9,088 | $ | 11,691 | $ | 12,958 | $ | 17,133 | ||||||||
Less:
General Partners' Mgmt Fee
|
158 | 325 | 468 | 630 | ||||||||||||
Loan
Servicing Fee
|
552 | 1,098 | 1,057 | 1,565 | ||||||||||||
Administrative
Expenses/General
|
||||||||||||||||
Partners’
Fees
|
416 | 1,060 | 1,045 | 1,139 | ||||||||||||
Provision
for Uncollected Accts
|
957 | 1,280 | 782 | 1,146 | ||||||||||||
Amortization
of Organization Costs
|
0 | 0 | 0 | 0 | ||||||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
1 | 1 | 37 | 20 | ||||||||||||
Interest
Expense
|
972 | 516 | 71 | 622 | ||||||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||||||
Limited
Partners
|
$ | 6,032 | $ | 7,411 | $ | 9,498 | $ | 12,011 | ||||||||
Federal
Taxable Income
|
$ | 6,926 | $ | 8,719 | $ | 9,072 | $ | 12,212 | ||||||||
Sources
of Funds - Net Income
|
||||||||||||||||
distributable
to limited partners
|
$ | 6,032 | $ | 7,411 | $ | 9,498 | $ | 12,011 | ||||||||
Reduction
in Assets
|
0 | 0 | 0 | 0 | ||||||||||||
Increase
in Liabilities
|
0 | 0 | 18,822 | 0 | ||||||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||||||
Syndication
Costs
|
24 | 7 | 17 | 16 | ||||||||||||
Increase
in Applicant's Deposit
|
448 | 1,905 | 0 | 0 | ||||||||||||
Increase
in Partners' Capital
|
||||||||||||||||
Collection
on Formation Loan
|
346 | 546 | 637 | 916 | ||||||||||||
Admittance
of New Partners
|
$ | 19,266 | $ | 19,681 | $ | 41,461 | $ | 41,793 | ||||||||
Cash
generated from Operations
|
||||||||||||||||
and
Financing
|
26,116 | 29,550 | 70,435 | 54,736 | ||||||||||||
Use
of Funds-Increase in Assets
|
(15,480 | ) | (10,923 | ) | (58,715 | ) | (30,583 | ) | ||||||||
Reduction
in Liabilities
|
(5,038 | ) | (7,733 | ) | (0 | ) | (6,009 | ) | ||||||||
Decrease
in Applicant's Deposit
|
(0 | ) | (0 | ) | (1,368 | ) | (786 | ) | ||||||||
Decrease
in Partner’s Capital
|
||||||||||||||||
Formation
Loan
|
(1,462 | ) | (1,677 | ) | (2,929 | ) | (3,117 | ) | ||||||||
Syndication
Costs
|
(291 | ) | (381 | ) | (483 | ) | (421 | ) | ||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
(0 | ) | (0 | ) | (0 | ) | (0 | ) | ||||||||
Investment
Income Paid to LP's
|
(1,962 | ) | (2,516 | ) | (3,362 | ) | (4,452 | ) | ||||||||
Return
of Capital to LP's
|
(1,426 | ) | (1,049 | ) | (1,845 | ) | (1,988 | ) | ||||||||
Net
Increase (Decrease) in Cash
|
457 | 5,271 | 1,733 | 7,380 | ||||||||||||
Cash
at the beginning of the year
|
1,460 | 1,917 | 7,188 | 8,921 | ||||||||||||
Cash
at the end of the year
|
$ | 1,917 | $ | 7,188 | $ | 8,921 | $ | 16,301 |
2001
|
2002
|
2003
|
2004
|
|||||||||||||
Cash
Distribution Credited on
|
||||||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 90 | $ | 87 | $ | 78 | $ | 72 | ||||||||
Cash
Distribution Paid for
|
||||||||||||||||
$1,000
Invested for a Limited
|
||||||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||||||
Distribution
(GAAP Basis)
|
$ | 87 | $ | 84 | $ | 75 | $ | 70 | ||||||||
Cash
Distribution to All Investors for
|
||||||||||||||||
$1,000
Invested (2)
|
||||||||||||||||
Income
(1)
|
$ | 37 | $ | 34 | $ | 35 | $ | 32 | ||||||||
Capital
(1)
|
$ | 27 | $ | 19 | $ | 19 | $ | 14 | ||||||||
Federal
Income Tax Results for
|
||||||||||||||||
$1,000
Invested Capital for a
|
||||||||||||||||
Compounding
Limited Partner
|
$ | 106 | $ | 105 | $ | 76 | $ | 75 | ||||||||
Federal
Income Tax Results for $1,000
|
||||||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||||||
Monthly
Earnings Distributions
|
$ | 103 | $ | 101 | $ | 73 | $ | 72 |
|
(2) Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
$’s
in thousands except for cash distribution per $1,000
|
||||||||||||
2005
|
2006
|
2007
|
||||||||||
Gross
Revenues
|
$ | 20,188 | $ | 27,324 | $ | 29,617 | ||||||
Less:
General Partners' Mgmt Fee
|
814 | 991 | 1,143 | |||||||||
Loan
Servicing Fee
|
1,736 | 2,479 | 1,449 | |||||||||
Administrative
Expenses/General
|
||||||||||||
Partners’
Fees
|
1,250 | 1,610 | 1,980 | |||||||||
Provision
for Uncollected Accts
|
855 | 1,195 | 1,788 | |||||||||
Amortization
of Organization Costs
|
0 | 0 | 0 | |||||||||
Offering
Period Interest Expense to
|
||||||||||||
Limited
Partners
|
41 | 21 | 28 | |||||||||
Interest
Expense
|
278 | 2,344 | 1,873 | |||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||
Limited
Partners
|
$ | 15,214 | $ | 18,684 | $ | 21,356 | ||||||
Federal
Taxable Income
|
$ | 15,995 | $ | 19,671 | $ | 22,679 | ||||||
Sources
of Funds - Net Income
|
||||||||||||
distributable
to limited partners
|
$ | 15,214 | $ | 18,684 | $ | 21,356 | ||||||
Reduction
in Assets
|
0 | 0 | 0 | |||||||||
Increase
in Liabilities
|
18,879 | 0 | 0 | |||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||
Syndication
Costs
|
11 | 15 | 17 | |||||||||
Increase
in Applicant's Deposit
|
352 | 0 | 0 | |||||||||
Increase
in Partners' Capital
|
||||||||||||
Collection
on Formation Loan
|
1,223 | 1,487 | 1,640 | |||||||||
Admittance
of New Partners
|
39,530 | 35,079 | 32,683 | |||||||||
Cash
generated from Operations
|
||||||||||||
and
Financing
|
75,209 | 55,265 | 55,696 | |||||||||
Use
of Funds-Increase in Assets
|
(51,313 | ) | (51,495 | ) | (46,766 | ) | ||||||
Reduction
in Liabilities
|
0 | (1,267 | ) | (605 | ) | |||||||
Decrease
in Applicant's Deposit
|
0 | (216 | ) | (65 | ) | |||||||
Decrease
in Partner’s Capital
|
||||||||||||
Formation
Loan
|
(2,978 | ) | (2,674 | ) | (2,444 | ) | ||||||
Syndication
Costs
|
(845 | ) | (445 | ) | (422 | ) | ||||||
Offering
Period Interest Expense to
|
||||||||||||
Limited
Partners
|
(0 | ) | (0 | ) | 0 | |||||||
Investment
Income Paid to LP's
|
(5,480 | ) | (6,887 | ) | (8,132 | ) | ||||||
Return
of Capital to LP's
|
(2,041 | ) | (3,038 | ) | (3,767 | ) | ||||||
Net
Increase (Decrease) in Cash
|
12,552 | (10,757 | ) | (6,505 | ) | |||||||
Cash
at the beginning of the year
|
16,301 | 28,853 | 18,096 | |||||||||
Cash
at the end of the year
|
$ | 28,853 | $ | 18,096 | $ | 11,591 |
2005
|
2006
|
2007
|
||||||||||
Cash
Distribution Credited on
|
||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 70 | $ | 71 | $ | 71 | ||||||
Cash
Distribution Paid for
|
||||||||||||
$1,000
Invested for a Limited
|
||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||
Distribution
(GAAP Basis)
|
$ | 68 | $ | 69 | $ | 69 | ||||||
Cash
Distribution to All Investors for
|
||||||||||||
$1,000
Invested (2)
|
||||||||||||
Income
(1)
|
$ | 30 | $ | 30 | $ | 30 | ||||||
Capital
(1)
|
$ | 11 | $ | 13 | $ | 14 | ||||||
Federal
Income Tax Results for
|
||||||||||||
$1,000
Invested Capital for a
|
||||||||||||
Compounding
Limited Partner
|
$ | 75 | $ | 76 | $ | 76 | ||||||
Federal
Income Tax Results for $1,000
|
||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||
Monthly
Earnings Distributions
|
$ | 73 | $ | 74 | $ | 73 |
|
(2) Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
Corporate
|
Redwood
|
Redwood
|
Redwood
|
|||||||||||||
Mortgage
|
Mortgage
|
Mortgage
|
Mortgage
|
|||||||||||||
Investors
|
Investors
|
Investors
II
|
Investors
III
|
|||||||||||||
Dollar
amount raised (1) (2)
|
$ | 8,844,444.00 | $ | 1,090,916.00 | $ | 1,282,802.00 | $ | 2,288,424.00 | ||||||||
Number
of properties purchased (3)
|
- | - | - | - | ||||||||||||
Date
of Closing of offering (2)
|
12/31/86
|
07/31/82
|
06/30/83
|
12/31/96
|
||||||||||||
Date
of first sale of property (4)
|
- | - | - | - | ||||||||||||
Date
of final sale of property (5)
|
12/09/05
|
12/09/05
|
12/09/05
|
12/09/05
|
||||||||||||
Tax
and Distribution Data per
|
||||||||||||||||
$1,000
investment through
|
||||||||||||||||
Ordinary
income (loss)
|
||||||||||||||||
-from
operations (6)
|
$ | 7,795.44 | $ | 8,967.06 | $ | 5,045.26 | $ | 4,813.73 | ||||||||
-from
recapture
|
- | - | - | - | ||||||||||||
Capital
gain (loss)
|
- | - | - | - | ||||||||||||
Deferred
gain
|
||||||||||||||||
-Capital
|
- | - | - | - | ||||||||||||
-Ordinary
|
- | - | - | - | ||||||||||||
Cash
distribution to investors
|
||||||||||||||||
Source
(on GAAP basis)
|
||||||||||||||||
-Investment
income
|
$ | 6,658,655.00 | $ | 2,428,735.00 | $ | 1,716,094.00 | $ | 2,801,923.00 | ||||||||
-Return
of capital
|
$ | 8,844,444.00 | $ | 1,090,916.00 | $ | 1,282,802.00 | $ | 2,288,424.00 | ||||||||
Source
(on cash basis)
|
||||||||||||||||
-Sales
|
- | - | - | - | ||||||||||||
-Refinancing
|
- | - | - | - | ||||||||||||
-Operations
|
$ | 6,658,655.00 | $ | 2,428,735.00 | $ | 1,716,094.00 | $ | 2,801,923.00 | ||||||||
-Other
|
$ | 8,844,444.00 | $ | 1,090,916.00 | $ | 1,282,802.00 | $ | 2,288,424.00 | ||||||||
Receivable
on net purchase
|
||||||||||||||||
money
financing (3)(5)
|
- | - | - | - |
(1)
|
Represents
the amount of capital raised in each limited partnership. Each
of the limited partnerships is similar in that the limited partners may
elect to have their earnings added to their capital accounts or
distributed, subject to restrictions. Earnings added to limited
partners’ capital accounts were not included in the total of capital
raised.
|
(2)
|
Corporate
Mortgage Investors began offering units in April 1978 and closed the
initial offering of units in December 1983. Subsequently, the
partnership began offering additional units in January 1984 and closed the
offering in December 1986. Redwood Mortgage Investors III began
offering units in February 1984 and closed the initial offering in June
1984. Subsequently, a second offering of units commenced in
July 1992 and closed in December 1996. Each of Redwood Mortgage
Investors and Redwood Mortgage Investors II had only one offering of
units.
|
(3)
|
The
partnerships were in the business of making mortgage loans secured by real
estate. Funds raised in the offerings were not used to purchase
property.
|
(4)
|
The
limited partnerships invest in loans secured by real
estate. The partnerships began making loans shortly after
commencement of the offerings. Borrowers had the ability to
prepay the loans prior to maturity at any time. Upon repayment,
the partnerships made additional new loans with the repaid
funds. Records are not available for the date of the first loan
payoff. Loans were primarily of short duration with typical
maturity dates of one to five
years.
|
(5)
|
The
remaining loans at December 9, 2005 owned by the limited partnerships were
sold for cash to affiliates of the limited
partnerships.
|
(6)
|
Limited
partners had the option to have their earnings added to their capital
accounts and could choose to liquidate from the partnership with certain
restrictions. The income per $1000 reflects the results of a
limited partner who invested at inception, elected to have their earnings
added to their capital account and did not liquidate until operations
terminated at December 9, 2005. Results of limited partners
investing after inception but before the offering closed, choosing not to
have their earnings added to their capital accounts and not staying
through the life of the partnership will be
different.
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
06/06/03
|
01/31/05
|
100,000.00
|
17,957.81
|
117,957.81
|
Fresno
|
08/31/91
|
02/18/05
|
86,500.00
|
122,093.39
|
208,593.39
|
Contra
Costa
|
03/16/04
|
03/16/05
|
100,000.00
|
9,635.93
|
109,635.93
|
Sacramento
|
07/02/04
|
10/07/05
|
42,500.00
|
8,445.88
|
50,945.88
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Contra
Costa
|
06/12/05
|
08/16/05
|
100,000.00
|
2,506.94
|
102,506.94
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
06/06/03
|
01/31/05
|
50,000.00
|
8,978.91
|
58,978.91
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
03/14/02
|
11/10/05
|
249,600.00
|
74,917.35
|
324,517.35
|
Santa
Clara
|
03/14/02
|
11/10/05
|
272,285.33
|
81,571.58
|
353,856.91
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
03/14/02
|
11/10/05
|
166,400.00
|
49,944.90
|
216,344.90
|
Santa
Clara
|
03/14/02
|
11/10/05
|
142,061.33
|
52,558.91
|
194,620.24
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
06/06/03
|
01/31/05
|
50,000.00
|
8,987.91
|
58,987.91
|
Santa
Clara
|
12/02/03
|
02/17/05
|
87,000.00
|
10,180.02
|
97,180.02
|
Contra
Costa
|
03/16/04
|
03/16/05
|
50,000.00
|
4,818.02
|
54,818.02
|
Santa
Clara
|
04/14/04
|
04/01/05
|
112,000.00
|
20,530.62
|
132,530.62
|
San
Mateo
|
03/13/01
|
04/07/05
|
125,000.00
|
61,201.83
|
186,201.83
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
03/14/02
|
11/10/05
|
249,600.00
|
74,917.35
|
324,517.35
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
01/10/05
|
10/26/05
|
125,000.00
|
9,209.65
|
134,209.65
|
Los
Angles
|
03/29/05
|
11/01/05
|
200,000.00
|
10,389.06
|
210,389.06
|
Sacramento
|
01/31/05
|
01/31/06
|
147,000.00
|
14,102.66
|
161,102.66
|
Santa
Clara
|
06/06/06
|
07/31/06
|
100,000.00
|
892.70
|
100,892.70
|
San
Diego
|
02/08/06
|
08/02/06
|
300,000.00
|
13,128.25
|
313,128.25
|
San
Franciso
|
01/11/06
|
12/07/07
|
300,000.00
|
48,706.16
|
348,706.16
|
Marin
|
01/22/90
|
11/07/07
|
71,725.53
|
237,803.51
|
309,529.04
|
Santa
Clara
|
02/22/06
|
04/30/07
|
100,000.00
|
11,366.72
|
111,366.72
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
12/23/03
|
05/03/05
|
550,000.00
|
70,564.12
|
620,564.12
|
Contra
Costa
|
06/12/05
|
08/16/05
|
75,000.00
|
1,880.21
|
76,880.21
|
Santa
Clara
|
02/17/06
|
04/06/07
|
400,000.00
|
43,172.27
|
443,172.27
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
06/13/01
|
09/12/05
|
109,768.75
|
46,031.17
|
155,799.92
|
San
Francisco
|
11/04/04
|
09/30/05
|
325,000.00
|
30,807.29
|
355,807.29
|
Alameda
|
03/14/02
|
11/10/05
|
956,800.00
|
287,183.19
|
1,243,983.19
|
Santa
Clara
|
03/14/02
|
11/10/05
|
1,026,000.00
|
307,370.36
|
1,333,370.36
|
Stanislaus
|
12/04/00
|
06/27/06
|
30,417.55
|
19,495.75
|
49,913.30
|
Stanislaus
|
12/04/00
|
06/27/06
|
142,893.10
|
89,668.79
|
232,561.89
|
Stanislaus
|
12/04/00
|
06/27/06
|
11,406.58
|
7,310.83
|
18,717.41
|
Stanislaus
|
12/04/00
|
06/27/06
|
53,584.90
|
33,625.45
|
87,210.35
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Solano
|
06/02/05
|
05/25/06
|
99,790.53
|
5,307.55
|
105,098.08
|
Napa
|
07/12/05
|
07/28/06
|
75,000.00
|
7,325.10
|
82,325.10
|
Santa
Clara
|
06/06/06
|
07/31/06
|
200,000.00
|
1,785.40
|
201,785.40
|
San
Diego
|
02/08/06
|
08/02/06
|
139,500.00
|
6,104.64
|
145,604.64
|
Placer
|
10/11/06
|
08/14/07
|
142,500.00
|
11,752.85
|
154,252.85
|
San
Mateo
|
06/08/05
|
05/31/07
|
150,000.00
|
25,840.58
|
175,840.58
|
Napa
|
05/08/08
|
02/21/07
|
100,000.00
|
6,714.61
|
106,714.61
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Sacramento
|
06/15/93
|
11/14/05
|
300,000.00
|
408,980.51
|
708,980.51
|
Santa
Clara
|
02/17/06
|
04/06/07
|
175,000.00
|
18,887.90
|
193,887.90
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
03/14/02
|
11/10/05
|
158,080.00
|
47,447.66
|
205,527.66
|
Santa
Clara
|
03/14/02
|
11/10/05
|
256,500.00
|
76,842.59
|
333,342.59
|
San
Mateo
|
09/13/02
|
06/18/07
|
147,000.00
|
73,286.13
|
220,286.13
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
12/03/03
|
02/03/05
|
285,000.00
|
29,790.64
|
314,790.64
|
Alameda
|
09/13/04
|
11/01/05
|
70,000.00
|
7,927.47
|
77,927.47
|
Los
Angeles
|
03/29/05
|
11/01/05
|
200,000.00
|
10,389.05
|
210,389.05
|
San
Mateo
|
01/11/05
|
12/27/05
|
150,000.00
|
13,316.31
|
163,316.31
|
Santa
Clara
|
06/06/06
|
07/31/06
|
400,000.00
|
3,570.80
|
403,570.80
|
San
Diego
|
02/08/06
|
08/02/06
|
200,000.00
|
8,752.18
|
208,752.18
|
Alameda
|
07/26/04
|
09/21/06
|
155,000.00
|
31,490.15
|
186,490.15
|
Los
Angles
|
05/30/06
|
12/05/06
|
100,000.00
|
4,821.71
|
104,821.71
|
Los
Angeles
|
05/29/06
|
02/13/07
|
128,620.00
|
8,734.61
|
137,354.61
|
Napa
|
05/08/08
|
02/21/07
|
400,000.00
|
26,858.45
|
426,858.45
|
Alameda
|
03/15/06
|
02/26/07
|
153,000.00
|
10,328.39
|
163,328.39
|
San
Mateo
|
06/08/05
|
05/31/07
|
400,000.00
|
68,908.21
|
468,908.21
|
Placer
|
10/11/06
|
08/14/07
|
142,500.00
|
11,752.85
|
154,252.85
|
Alameda
|
05/22/07
|
11/19/07
|
125,000.00
|
6,283.98
|
131,283.98
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
12/23/03
|
05/03/05
|
650,000.00
|
83,393.96
|
733,393.96
|
Sacramento
|
06/15/93
|
11/14/05
|
75,000.00
|
102,245.13
|
177,245.13
|
Santa
Clara
|
02/17/06
|
04/06/07
|
500,000.00
|
53,965.23
|
553,965.23
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
||
Santa
Clara
|
06/13/01
|
09/12/05
|
109,768.75
|
46,031.17
|
155,799.92
|
||
San
Francisco
|
11/04/04
|
09/30/05
|
325,000.00
|
30,807.30
|
355,807.30
|
||
Alameda
|
03/14/02
|
11/10/05
|
956,800.00
|
287,183.19
|
1,243,983.19
|
||
Santa
Clara
|
03/14/02
|
11/10/05
|
2,103,300.00
|
630,109.23
|
2,733,409.23
|
||
Stanislaus
|
12/04/00
|
06/27/06
|
30,417.55
|
19,495.75
|
49,913.30
|
||
Stanislaus
|
12/04/00
|
06/27/06
|
142,893.10
|
89,668.79
|
232,561.89
|
||
San
Mateo
|
09/13/02
|
06/18/07
|
147,000.00
|
73,286.13
|
220,286.13
|
||
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Sacramento
|
03/09/04
|
01/05/05
|
193,000.00
|
15,108.36
|
208,108.36
|
San
Francisco
|
06/06/03
|
01/31/05
|
100,000.00
|
17,957.81
|
117,957.81
|
Alameda
|
12/03/03
|
02/03/05
|
285,000.00
|
29,790.64
|
314,790.64
|
Contra
Costa
|
03/16/04
|
03/16/05
|
131,250.00
|
12,647.22
|
143,897.22
|
Santa
Clara
|
04/14/04
|
04/01/05
|
112,000.00
|
20,530.62
|
132,530.62
|
Santa
Clara
|
06/09/05
|
07/18/05
|
260,000.00
|
2,503.84
|
262,503.84
|
Madera
|
06/21/04
|
08/11/05
|
110,000.00
|
12,023.54
|
122,023.54
|
Sacramento
|
10/04/04
|
09/08/05
|
225,000.00
|
19,216.20
|
244,216.20
|
Sacramento
|
10/19/04
|
09/13/05
|
175,000.00
|
14,834.86
|
189,834.86
|
Solano
|
09/29/04
|
11/30/06
|
160,000.00
|
17,190.16
|
177,190.16
|
Sacramento
|
11/18/04
|
12/02/05
|
177,500.00
|
18,165.50
|
195,665.50
|
San
Mateo
|
01/12/05
|
12/08/05
|
412,605.16
|
16,983.95
|
429,589.11
|
Merced
|
03/15/04
|
12/27/05
|
146,000.00
|
23,253.12
|
169,253.12
|
Solano
|
07/20/05
|
01/03/06
|
75,000.00
|
3,175.14
|
78,175.14
|
San
Mateo
|
11/06/05
|
05/15/06
|
125,000.00
|
5,235.50
|
130,235.50
|
Solano
|
06/02/05
|
05/25/06
|
204,569.61
|
10,880.46
|
215,450.07
|
Tulare
|
10/27/05
|
06/21/06
|
122,000.00
|
7,343.17
|
129,343.17
|
Contra
Costa
|
06/17/04
|
07/05/06
|
230,000.00
|
43,074.88
|
273,074.88
|
San
Mateo
|
01/24/05
|
07/26/06
|
150,000.00
|
19,983.27
|
169,983.27
|
Santa
Clara
|
06/06/06
|
07/31/06
|
380,000.00
|
3,392.24
|
383,392.24
|
San
Diego
|
02/08/06
|
08/02/06
|
200,000.00
|
8,752.18
|
208,752.18
|
Alameda
|
08/24/05
|
08/23/06
|
60,000.00
|
5,744.04
|
65,744.04
|
Santa
Barbara
|
07/19/05
|
11/01/06
|
160,000.00
|
19,464.56
|
179,464.56
|
Napa
|
05/08/08
|
02/21/07
|
550,000.00
|
36,930.37
|
586,930.37
|
San
Mateo
|
10/05/04
|
03/29/07
|
150,000.00
|
34,241.81
|
184,241.81
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
12/23/03
|
05/03/05
|
1,000,000.00
|
128,298.40
|
1,128,298.40
|
San
Diego
|
09/30/04
|
06/15/05
|
800,000.00
|
66,266.67
|
866,266.67
|
Alameda
|
05/02/03
|
06/20/05
|
100,000.00
|
22,351.42
|
122,351.42
|
Contra
Costa
|
06/12/05
|
08/16/05
|
725,000.00
|
18,175.35
|
743,175.35
|
Contra
Costa
|
09/14/05
|
07/27/06
|
570,000.00
|
47,080.42
|
617,080.42
|
Santa
Clara
|
02/17/06
|
04/06/07
|
500,000.00
|
53,965.23
|
553,965.23
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
06/13/01
|
09/12/05
|
219,537.50
|
92,062.34
|
311,599.84
|
Alameda
|
03/14/02
|
11/10/05
|
686,400.00
|
206,022.73
|
892,422.73
|
Santa
Clara
|
03/14/02
|
11/10/05
|
560,353.34
|
167,871.35
|
728,224.69
|
Marin
|
11/16/05
|
02/24/06
|
635,000.00
|
16,243.76
|
651,243.76
|
Stanislaus
|
12/04/00
|
06/27/06
|
11,216.45
|
7,188.99
|
18,405.44
|
Stanislaus
|
12/04/00
|
06/27/06
|
52,691.81
|
33,065.07
|
85,756.88
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
09/20/05
|
09/21/07
|
475,000.00
|
55,853.15
|
530,853.15
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Mateo
|
02/17/05
|
04/15/05
|
1,755,000.00
|
2,268.71
|
1,757,268.71
|
Marin
|
10/29/04
|
05/27/05
|
2,000,000.00
|
98,230.19
|
2,098,230.19
|
San
Francisco
|
12/27/04
|
06/08/05
|
424,980.00
|
17,050.87
|
442,030.87
|
San
Francisco
|
03/31/04
|
06/08/05
|
1,180,000.00
|
129,767.18
|
1,309,767.18
|
San
Mateo
|
04/30/04
|
06/20/05
|
1,085,000.00
|
113,840.54
|
1,198,840.54
|
Contra
Costa
|
05/11/04
|
09/19/05
|
402,800.00
|
52,578.01
|
455,378.01
|
San
Mateo
|
05/14/04
|
09/23/05
|
50,000.00
|
6,356.14
|
56,356.14
|
San
Mateo
|
08/22/02
|
11/04/05
|
269,000.00
|
90,988.21
|
359,988.21
|
San
Francisco
|
04/15/05
|
11/15/05
|
960,000.00
|
52,490.67
|
1,012,490.67
|
Alameda
|
08/16/02
|
12/20/05
|
1,300,000.00
|
549,857.20
|
1,849,857.20
|
placer
|
12/12/03
|
01/27/06
|
1,070,000.00
|
193,426.45
|
1,263,426.45
|
San
Joaquin
|
05/18/04
|
02/22/06
|
187,500.00
|
31,393.77
|
218,893.77
|
Monterey
|
02/15/06
|
05/02/06
|
115,000.00
|
2,080.38
|
117,080.38
|
Santa
Clara
|
12/05/03
|
05/04/06
|
130,000.00
|
29,161.36
|
159,161.36
|
San
Francisco
|
04/20/04
|
05/10/06
|
335,000.00
|
61,915.92
|
396,915.92
|
Solano
|
12/09/05
|
05/25/06
|
199,580.00
|
10,615.11
|
210,195.11
|
Santa
Clara
|
07/09/02
|
06/01/06
|
262,500.00
|
91,449.33
|
353,949.33
|
San
Mateo
|
08/10/05
|
06/16/06
|
71,000.00
|
5,793.45
|
76,793.45
|
San
Mateo
|
09/05/02
|
07/25/06
|
1,781,000.00
|
691,874.21
|
2,472,874.21
|
Santa
Clara
|
08/08/02
|
08/02/06
|
1,272,010.00
|
22,091.53
|
1,294,101.53
|
San
Mateo
|
11/10/05
|
09/12/06
|
2,555,000.00
|
190,776.18
|
2,745,776.18
|
Santa
Clara
|
04/02/04
|
09/21/06
|
800,000.00
|
193,219.44
|
993,219.44
|
San
Francisco
|
09/28/04
|
09/27/06
|
385,000.00
|
71,029.91
|
456,029.91
|
San
Francisco
|
08/31/05
|
11/17/06
|
3,023,361.50
|
220,367.71
|
3,243,729.21
|
Santa
Cruz
|
12/09/05
|
11/22/06
|
55,000.00
|
8,353.35
|
63,353.35
|
Orange
|
08/31/06
|
12/06/06
|
70,000.00
|
1,704.88
|
71,704.88
|
San
Francisco
|
06/27/05
|
12/08/06
|
1,560,000.00
|
210,678.00
|
1,770,678.00
|
San
Francisco
|
09/20/06
|
12/18/06
|
850,000.00
|
20,601.16
|
870,601.16
|
San
Francisco
|
10/19/05
|
02/07/07
|
1,031,250.00
|
124,802.75
|
1,156,052.75
|
Napa
|
05/08/08
|
02/21/07
|
2,915,000.00
|
195,730.96
|
3,110,730.96
|
Kern
|
11/07/06
|
02/23/07
|
165,000.00
|
4,804.21
|
169,804.21
|
San
Mateo
|
05/13/02
|
03/01/07
|
318,228.50
|
111,586.76
|
429,815.26
|
San
Mateo
|
02/21/07
|
03/16/07
|
200,000.00
|
1,216.44
|
201,216.44
|
Los
Angeles
|
10/27/06
|
03/22/07
|
100,000.00
|
3,767.57
|
103,767.57
|
Marin
|
08/29/00
|
08/02/07
|
1,325,000.00
|
1,145,876.38
|
2,470,876.38
|
Placer
|
11/17/05
|
08/17/07
|
740,000.00
|
136,138.33
|
876,138.33
|
San
Mateo
|
12/07/04
|
09/20/07
|
75,000.00
|
18,984.34
|
93,984.34
|
San
Mateo
|
10/28/05
|
12/14/07
|
120,000.00
|
22,019.51
|
142,019.51
|
San
Mateo
|
06/25/04
|
12/14/07
|
100,000.00
|
28,995.53
|
128,995.53
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
06/03/04
|
01/28/05
|
15,538,545.06
|
649,333.15
|
16,187,878.21
|
Contra
Costa
|
05/22/03
|
04/19/05
|
1,950,000.00
|
379,769.83
|
2,329,769.83
|
Alameda
|
01/15/04
|
04/22/05
|
5,890,761.88
|
372,865.95
|
6,263,627.83
|
Alameda
|
12/23/03
|
05/03/05
|
16,010,000.00
|
2,054,057.38
|
18,064,057.38
|
San
Francisco
|
03/04/04
|
05/24/05
|
5,200,000.00
|
497,813.26
|
5,697,813.26
|
San
Diego
|
09/30/04
|
06/15/05
|
1,600,000.00
|
174,533.33
|
1,774,533.33
|
Sacramento
|
09/16/04
|
07/29/05
|
10,471,312.31
|
519,156.24
|
10,990,468.55
|
Contra
Costa
|
06/12/05
|
08/16/05
|
600,000.00
|
15,041.67
|
615,041.67
|
Contra
Costa
|
05/11/05
|
08/16/05
|
2,625,000.00
|
65,807.29
|
2,690,807.29
|
Contra
Costa
|
12/08/04
|
10/10/05
|
6,900,000.00
|
394,259.45
|
7,294,259.45
|
San
Francisco
|
05/21/04
|
11/17/05
|
816,250.00
|
101,817.37
|
918,067.37
|
Contra
Costa
|
12/08/04
|
12/15/05
|
1,647,280.56
|
190,761.07
|
1,838,041.63
|
Sacramento
|
05/23/06
|
03/01/06
|
1,500,000.00
|
98,104.17
|
1,598,104.17
|
Solano
|
04/14/05
|
04/20/06
|
5,200,000.00
|
338,962.34
|
5,538,962.34
|
Fresno
|
07/21/03
|
05/25/06
|
4,229,212.23
|
989,671.25
|
5,218,883.48
|
San
Francisco
|
10/31/05
|
09/28/06
|
1,050,000.00
|
88,761.46
|
1,138,761.46
|
San
Francisco
|
06/12/06
|
09/28/06
|
637,826.72
|
20,159.21
|
657,985.93
|
Butte
|
07/01/05
|
10/25/06
|
3,000,000.00
|
281,035.44
|
3,281,035.44
|
San
Francisco
|
12/10/04
|
11/02/06
|
1,090,910.00
|
198,141.89
|
1,289,051.89
|
San
Francisco
|
05/07/04
|
11/02/06
|
875,000.00
|
202,703.42
|
1,077,703.42
|
San
Francisco
|
05/18/04
|
12/22/06
|
881,250.00
|
213,978.00
|
1,095,228.00
|
San
Francisco
|
12/09/04
|
12/22/06
|
636,500.00
|
100,047.88
|
736,547.88
|
Solano
|
04/14/05
|
12/29/06
|
4,000,299.79
|
410,690.68
|
4,410,990.47
|
Santa
Clara
|
06/26/03
|
02/20/07
|
2,970,000.00
|
1,477,463.42
|
4,447,463.42
|
Santa
Clara
|
08/16/05
|
02/09/07
|
10,288,391.62
|
1,954,558.48
|
12,242,950.10
|
Alameda
|
12/21/05
|
03/21/07
|
5,625,000.00
|
574,608.39
|
6,199,608.39
|
San
Francisco
|
06/23/05
|
03/26/07
|
2,200,000.00
|
358,386.04
|
2,558,386.04
|
San
Francisco
|
03/17/06
|
04/23/07
|
790,250.00
|
63,971.57
|
854,221.57
|
Butte
|
07/01/05
|
04/05/07
|
2,829,423.74
|
391,469.06
|
3,220,892.80
|
San
Francisco
|
09/23/05
|
04/24/07
|
1,050,000.00
|
154,320.83
|
1,204,320.83
|
San
Francisco
|
09/07/06
|
05/11/07
|
450,000.00
|
31,518.75
|
481,518.75
|
Sacramento
|
05/23/05
|
05/18/07
|
1,800,000.00
|
304,300.00
|
2,104,300.00
|
San
Francisco
|
07/06/05
|
06/01/07
|
2,200,000.00
|
137,928.32
|
2,337,928.32
|
San
Francisco
|
05/25/05
|
08/31/07
|
2,080,000.00
|
441,451.04
|
2,521,451.04
|
San
Francisco
|
04/12/05
|
10/05/07
|
1,040,000.00
|
241,890.11
|
1,281,890.11
|
San
Francisco
|
03/31/05
|
10/05/07
|
1,620,000.00
|
378,742.50
|
1,998,742.50
|
San
Francisco
|
04/25/07
|
10/05/07
|
1,050,000.00
|
47,833.33
|
1,097,833.33
|
San
Francisco
|
03/09/06
|
10/05/07
|
765,000.00
|
103,600.04
|
868,600.04
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
06/08/04
|
02/16/05
|
2,212,148.79
|
147,333.51
|
2,359,482.30
|
San
Joaquin
|
12/04/03
|
04/15/05
|
3,375,000.00
|
415,125.00
|
3,790,125.00
|
San
Francisco
|
02/20/03
|
05/12/05
|
10,440,000.00
|
2,574,180.00
|
13,014,180.00
|
San
Mateo
|
03/15/05
|
05/13/05
|
5,366,518.79
|
94,241.15
|
5,460,759.94
|
San
Francisco
|
04/30/04
|
06/27/05
|
375,000.00
|
41,320.28
|
416,320.28
|
San
Francisco
|
12/14/04
|
07/15/05
|
100,000.00
|
6,799.80
|
106,799.80
|
Alameda
|
06/20/03
|
09/30/05
|
3,570,000.00
|
907,992.22
|
4,477,992.22
|
Riverside
|
10/29/03
|
09/30/05
|
3,650,000.00
|
666,530.48
|
4,316,530.48
|
San
Mateo
|
07/27/01
|
10/03/05
|
350,000.00
|
144,500.27
|
494,500.27
|
Alameda
|
03/14/02
|
11/10/05
|
320,320.00
|
96,143.94
|
416,463.94
|
Santa
Clara
|
03/14/02
|
11/10/05
|
769,500.00
|
230,527.77
|
1,000,027.77
|
Marin
|
07/21/04
|
11/18/05
|
300,000.00
|
35,925.82
|
335,925.82
|
San
Francisco
|
11/14/03
|
11/30/05
|
2,750,000.00
|
540,641.69
|
3,290,641.69
|
Alameda
|
04/06/05
|
12/14/05
|
1,975,000.00
|
100,910.22
|
2,075,910.22
|
Santa
Clara
|
07/19/02
|
01/30/06
|
3,600,000.00
|
1,627,716.24
|
5,227,716.24
|
Los
Angeles
|
03/28/03
|
04/14/06
|
6,666,158.36
|
1,885,009.88
|
8,551,168.24
|
Marin
|
03/24/06
|
05/01/06
|
2,850,805.69
|
28,555.55
|
2,879,361.24
|
San
Francisco
|
02/16/05
|
05/12/06
|
1,305,000.00
|
144,528.75
|
1,449,528.75
|
San
Francisco
|
06/15/05
|
05/12/06
|
4,396,838.48
|
339,577.06
|
4,736,415.54
|
San
Francisco
|
01/06/06
|
05/12/06
|
4,155,000.00
|
146,579.16
|
4,301,579.16
|
Napa
|
05/13/05
|
08/15/06
|
9,000,000.00
|
912,632.00
|
9,912,632.00
|
Napa
|
02/06/07
|
02/21/07
|
1,000,000.00
|
3,854.16
|
1,003,854.16
|
Napa
|
12/30/03
|
02/21/07
|
1,610,000.00
|
481,367.51
|
2,091,367.51
|
Riverside
|
12/20/02
|
02/21/07
|
1,500,000.00
|
626,250.00
|
2,126,250.00
|
San
Mateo
|
01/04/07
|
02/27/07
|
2,801,350.00
|
45,118.48
|
2,846,468.48
|
Santa
Clara
|
07/28/00
|
03/01/07
|
428,081.80
|
428,081.80
|
856,163.60
|
San
Mateo
|
09/21/06
|
04/04/07
|
696,500.00
|
38,988.54
|
735,488.54
|
Marin
|
05/28/04
|
05/25/07
|
4,650,000.00
|
1,392,416.75
|
6,042,416.75
|
San
Mateo
|
09/13/02
|
06/18/07
|
441,000.00
|
219,858.38
|
660,858.38
|
Alameda
|
01/25/07
|
09/27/07
|
4,045,125.00
|
313,899.44
|
4,359,024.44
|
Alameda
|
10/30/07
|
12/13/07
|
4,500,000.00
|
59,062.50
|
4,559,062.50
|
Los
Angeles
|
04/14/06
|
12/28/07
|
8,292,002.04
|
1,393,527.55
|
9,685,529.59
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Joaquin
|
06/29/04
|
07/29/05
|
750,000.00
|
73,417.85
|
823,417.85
|
San
Francisco
|
06/09/05
|
10/04/05
|
5,800,000.00
|
221,720.22
|
6,021,720.22
|
San
Francisco
|
09/26/05
|
04/24/06
|
3,687,752.52
|
200,903.23
|
3,888,655.75
|
San
Francisco
|
05/26/05
|
05/12/06
|
7,967,264.98
|
630,911.53
|
8,598,176.51
|
Santa
Clara
|
09/20/05
|
09/21/07
|
475,000.00
|
55,853.15
|
530,853.15
|
CALIFORNIA
|
6611
|
94-3158788
|
(State
or other jurisdiction of incorporation or organization)
|
(Primary
Standard Industrial Classification Code Number)
|
(I.R.S.
Employer Identification No.)
|
Proposed
|
||||
Title
of Each
|
Proposed
|
Maximum
|
||
Class
of Securities
|
Amount
|
Maximum
|
Aggregate
|
Amount
of
|
to be Registered
|
Being Registered
|
Offering Per Unit (2)
|
Offering Price
|
Registration Fee
|
Limited
|
||||
Partnership
|
||||
Interests
(1)
|
100,000,000
|
$1.00
|
$100,000,000
|
$11,770
|
|
(2)
|
Subscriptions
will be accepted in the minimum amount of two thousand (2,000) units
($2,000) for initial investments and 1,000 units ($1,000) for additional
investments for existing limited partners and for greater amounts in
multiples of one (1) unit ($1)
each.
|
Registration Statement Item
|
Prospectus Caption
|
|||
Number and Caption
|
||||
1.
|
Forepart
of the Registration Statement and Outside Front Cover Page of
Prospectus
|
Front
Cover Page of Prospectus
|
||
2.
|
Inside
Front and Outside Back Cover Pages of Prospectus
|
Inside
Front and Outside Back Cover Page
|
||
3.
|
Summary
Information, Risk Factors and Ratio of Earnings to Fixed
Charges
|
Summary
of the Offering; Inside Front Cover Page; Risks and Other
Factors
|
||
4.
|
Determination
of Offering Price
|
Inapplicable
|
||
5.
|
Dilution
|
Inapplicable
|
||
6.
|
Selling
Security Holders
|
Inapplicable
|
||
7.
|
Plan
of Distribution
|
Plan
of Distribution
|
||
8.
|
Use
of Proceeds
|
Estimated
Use of Proceeds
|
||
9.
|
Selected
Financial Data
|
Inapplicable
|
||
10.
|
Management's
Discussion and Analysis of Financial Condition and Results of
Operations
|
Management's
Discussion and Analysis of Financial Condition of the
Partnership
|
||
11.
|
General
Information as to Registrant
|
Summary
of the Offering
|
||
12.
|
Policy
with Respect to Certain Activities
|
Inapplicable
|
||
13.
|
Investment
Policies of Registrant
|
|||
a.
|
Investments
in real estate or interests in real estate
|
Inapplicable
|
||
b.
|
Investments
in real estate mortgages
|
Risk
Factors; Investment Objectives and Criteria; Estimated Use of
Proceeds
|
||
c.
|
Securities
of or interests in persons primarily engaged in real estate
activities
|
Inapplicable
|
||
d.
|
Investments
in other securities
|
Inapplicable
|
||
14.
|
Description
of Real Estate
|
Inapplicable
|
||
15.
|
Operating
Data
|
Inapplicable
|
||
16.
|
Tax
Treatment of Registrant and Its Security Holder
|
Federal
Income Tax Consequences
|
||
17.
|
Market
Price of and Dividends on the Registrant's Common Equity and Related
Stockholder Matters
|
Inapplicable
|
||
18.
|
Description
of Registrant's Securities
|
Terms
of the Offering; Description of Units; Summary of Limited Partnership
Agreement
|
||
19.
|
Legal
Proceedings
|
Inapplicable
|
20.
|
Security
Ownership of Certain Beneficial Owners and Management
|
Inapplicable
|
|
21.
|
Directors
and Executive Officers
|
Management
|
|
22.
|
Executive
Compensation
|
Compensation
of the General Partners and Affiliates
|
|
23.
|
Certain
Relationships and Related Transactions
|
Management;
Compensation of the General Partners and Affiliates; Conflicts of
Interest
|
|
24.
|
Selection,
Management and Custody of Registrant's Investment
|
Conflicts
of Interest; Investment Objectives and Criteria
|
|
25.
|
Policies
with Respect to Certain Transactions
|
Conflicts
of Interest; Investment Objectives and Criteria
|
|
26.
|
Limitations
of Liability
|
Fiduciary
Duty of General Partners
|
|
27.
|
Financial
Statements and Information
|
Financial
Statements
|
|
28.
|
Interests
of Named Experts and Counsel
|
Legal
Opinion; Experts
|
|
29.
|
Disclosure
of Commission Position on Indemnification for Securities Act
Liabilities
|
Fiduciary
Duty of General Partners
|
·
|
Yield
a high rate of return from mortgage
lending
|
·
|
Preserve
and protect our capital
|
·
|
We
have not identified any specific loans to make with the proceeds of this
offering and this adds additional
uncertainty.
|
·
|
We
will be subject to various conflicts of interest arising out of our
relationship to the general partners and their
affiliates.
|
·
|
Due
to the speculative nature of the investment, there is a risk that you
could lose your entire investment.
|
·
|
The
formation loan to be made to Redwood Mortgage Corp. to pay sales
commissions will be unsecured and non-interest bearing and repayment is
not guaranteed.
|
·
|
An
investment in units involves material tax
risks.
|
·
|
Transfer
of units is restricted; no public market for the units exists and none is
likely to develop.
|
·
|
You
will have a limited ability to liquidate your investment; you will be
subject to early withdrawal penalties and other restrictions and may be
required to accept less than you paid for your units (see “TRANSFER OF
UNITS” at page 84).
|
·
|
Our
use of leverage may reduce the partnership’s profitability or cause losses
through liquidation.
|
·
|
We
will rely on appraisals which may not be accurate to determine the fair
market value of the real property used to secure loans made by the
partnership.
|
·
|
Loan
defaults and foreclosures may adversely affect the
partnership.
|
·
|
You
have no right to participate in the management of the partnership and may
only vote on those matters which are set forth in the limited partnership
agreement; all decisions with respect to the management of the partnership
will be made exclusively by the general
partners.
|
Price
to Public
|
Underwriting
commission (1)
|
Proceeds
to partnership
|
|
Per
Unit (Minimum
|
|||
Investment
2,000 units)
|
$1
|
$0
|
$1
|
Total
Maximum
|
$100,000,000
|
$0
|
$100,000,000
|
(1)
|
Underwriting
sales commissions will be paid by Redwood Mortgage Corp. from proceeds
borrowed from the partnership. This loan is called the
formation loan and will be repaid by Redwood Mortgage Corp. over
time.
|
Minimum
Suitability Standards
|
We
have established a minimum suitability standard which requires that you
have either:
· a
net worth (exclusive of home, furnishings and automobiles) of at least
$60,000 plus an annual gross income of at least $60,000, or
· irrespective
of annual gross income, a net worth of $225,000 (determined with the same
exclusions). In the case of sales to fiduciary accounts, such
conditions must be met by the fiduciary, by the fiduciary account or by
the donor who directly and indirectly supplied the funds for the purchase
of units.
We
have established these standards because the purchase of units is an
illiquid investment. You will be required to represent to us
that:
· you
comply with the applicable standards; or
· you
are purchasing in a fiduciary capacity for a person meeting such
standards; or
· the
standards are met by a donor who directly or indirectly supplies the funds
for the purchase of units.
The
participating broker dealers will make reasonable inquiry to assure that
every prospective investor complies with the investor suitability
standards. The general partners will not accept subscriptions
from you if you are unable to represent in your subscription agreement
that you meet such standards. Under the laws of certain states,
transferees may be required to comply with the suitability standards set
forth herein as a condition to substitution as a limited
partner. We will require certain assurances that such standards
are met before agreeing to any transfer of the units.
You
should only purchase units if you have adequate financial means, desire a
relatively long term investment, and do not anticipate any need for
immediate liquidity.
|
Suitable
Investors
|
Investment
in the partnership involves certain risks and, accordingly, is suitable
only for entities or persons of adequate means. Due to the
nature of the partnership loans, it is likely that all or substantially
all of the income of the partnership will be taxable to you as ordinary
income (See “MATERIAL FEDERAL INCOME TAX CONSEQUENCES” at page
70). The units may, therefore, be suitable for:
· Corporate
pension or profit sharing plan
· A
Keogh Plan account
· Individual
retirement account
· A
simplified employee pension
· Persons
seeking current, taxable income
An
investment in units may not be suitable for Charitable Remainder Trusts or
other entities exempt from federal income taxation, including certain
foundations and other charitable organizations.
|
All
persons or entities considering an investment in units should consult
their own legal and/or financial advisor with respect to whether an
investment in units is appropriate.
|
Minimum
Purchase Amount
|
The
general partners have established the minimum initial purchase at 2,000
units ($2,000). The general partners may accept subscriptions
in excess of $2,000. The minimum purchase for existing limited
partners in the partnership is 1,000 units ($1,000). No person
may become an assignee of record or a substituted limited partner unless
he is the owner of a minimum of 2,000 units ($2,000). If you
are seeking to transfer your units, you will be subject to the securities
or “blue sky” laws of the state in which the transfer is to take place
(See “DESCRIPTION OF UNITS” at page 81 and “SUMMARY OF THE LIMITED
PARTNERSHIP AGREEMENT - Restrictions on Transfer” at page
83).
|
IRA
Investors
|
A
minimum of 2,000 units ($2,000) may be purchased, transferred, assigned or
retained by an Individual Retirement Account (“IRA”) and incremental
amounts in excess thereof for spousal IRA’s established under Section 408
of the Internal Revenue Code of 1986, as amended (“Code”). You
should be aware, however, that an investment in the partnership will not,
in and of itself, create an IRA for you and that, in order to create an
IRA, you must comply with the provisions of Section 408 of the
Code.
|
ERISA
Investors
|
The
investment objectives and policies of the partnership have been designed
to make the units suitable investments for employee benefit plans under
current law. In this regard, the Employee Retirement Income
Security Act of 1974 (“ERISA”) provides a comprehensive regulatory scheme
for “plan assets.” The general partners will manage the
partnership so as to assure that an investment in the partnership by a
qualified plan subject to ERISA or to the prohibited transaction
provisions of Section 4975 of the Code (a “Benefit Plan Investor”),
including tax-qualified pension and 401(k) plans and IRAs, will not,
solely by reason of such investment, be considered to be an investment in
the underlying assets of the partnership so as to make the assets of the
partnership “plan assets.” The final regulations are also
applicable to an IRA. (See “ERISA RISKS –Risks of Investment by
Benefit Plan Investors and Other Tax-Exempt Investors.” at page
20)
The
general partners are not permitted to allow the purchase of units with
assets of any Benefit Plan Investors if the general partners (i) have
investment discretion with respect to the assets of the Benefit Plan
Investor in the partnership, or (ii) regularly give individualized
investment advice that serves as the primary basis for the investment
decisions made with respect to such assets. This prohibition is
designed to prevent violation of certain provisions of ERISA.
|
Blue
Sky Requirements
|
If
we qualify units for sale in states which have established suitability
standards and minimum purchase requirements different from those set by
the partnership, such suitability standards and minimum purchase
requirements shall be set forth in a supplement to this
prospectus. No such additional requirements exist at this
time.
|
Subscription
Agreement Warranties
|
The
subscription agreement requires that you warrant that:
· you
have received, read and understood the prospectus and that you are relying
on it for your investment;
· you
meet the applicable suitability standards set forth in the
prospectus;
· you
are aware that the subscription may be rejected by the general
partners;
· your
investment is subject to certain risks described in the prospectus and
there will be no public market for the units;
· you
have been informed by your participating broker dealer of all facts
relating to lack of liquidity or marketability;
· you
understand the restrictions on transferability;
· you
have sufficient liquid assets to provide for current needs and personal
contingencies or, if a trustee, that limited liquidity will not affect its
ability to make timely distributions;
· you
have the power, capacity and authority to make the
investment;
· you
are capable of evaluating the risks and merits of the investment;
and
· you
are making the investment for your own account or your family’s or in your
fiduciary capacity and not as an agent for another.
|
The
purpose of the warranties is to ensure that you fully understand the terms
of our offering, the risks of an investment with us and that you have the
capacity to enter into a subscription agreement. The general
partners, on behalf of the partnership, intend to rely on the warranties
in accepting a subscription. In any claim or action against the
general partners or partnership, the general partners or partnership may
use the warranties against you as a defense or basis for seeking indemnity
from you.
|
|
Subscription
Procedure
|
In
order to subscribe to units in the partnership, you must read carefully
and execute the “SUBSCRIPTION AGREEMENT AND POWER OF
ATTORNEY.” For each unit subscribed, you must tender the sum of
$1 per unit. The minimum initial investment is 2,000 units
($2,000). The minimum additional investment for existing
limited partners is 1,000 units ($1,000).
|
The
Partnership
|
We
are Redwood Mortgage Investors VIII and we commenced operations on or
about April 12, 1993. We are located at 900 Veterans Blvd.,
Suite 500, Redwood City, California 94063 and our telephone number is
(650) 365-5341.
We
are engaged in business as a mortgage lender. We make loans to
individuals and business entities secured by residential, investment or
commercial property. In order to secure repayment of the loans,
the loans are secured by first and second, and in some limited cases,
third deeds of trust on the property. While we have an existing
portfolio of loans, we have not committed to or identified any loans that
will be made from the proceeds of this offering.
|
General
Partners
|
The
general partners of the partnership are Michael R. Burwell, an
individual, Gymno Corporation, a California corporation and Redwood
Mortgage Corp., a California corporation. The general partners
manage and control the partnership affairs and will make all investment
decisions for us. The loans are arranged and serviced by
Redwood Mortgage Corp. The general partners’ offices are
located at 900 Veterans Blvd., Suite 500, Redwood City,
CA 94063 and their telephone number is (650)
365-5341.
|
Risk
Factors
|
An
investment in the partnership involves certain risks. The
following are the most significant risks relating to an investment in the
partnership:
· Although
you will have an opportunity to review the partnership’s existing
portfolio, you will not have an opportunity to review loans to be made by
the partnership from the proceeds of this offering until after the loans
have been made. Such decisions will be made exclusively by the
general partners.
· No
escrow will be established. All proceeds from the sale of units
will be immediately available for investment in loans.
· The
general partners and their affiliates will receive fees from the
partnership. Most fees will be paid regardless of the economic
return to you and other limited partners or how successful the partnership
is. The compensation to be received by the general partners and
their affiliates is based in large part upon the net asset value of the
partnership and upon the principal balances of the loans. The
principal balances of the loans and the net asset value of the partnership
will be continually changing as new investments are made and as income is
allocated to your capital account or as cash distributions are made to
you.
|
· There
are limits on your ability to transfer units. No public market
exists for units and none is likely to develop.
Thus
you may not be able to sell your units quickly or profitably if the need
arises. Before you invest in the partnership, you should see the complete
discussion of the “Risk Factors” beginning on page 8 of this
prospectus.
|
|
Terms
of the Offering
|
Up
to 100,000,000 units ($100,000,000) of limited partnership interest in the
partnership are offered in units of $1 each. The units are
being offered by selected registered broker dealers who are members of the
National Association of Securities Dealers, Inc. (the “participating
broker dealers”). They are being offered on a “best efforts”
basis, which means that no one is guaranteeing that any minimum number of
units will be sold. We may also accept orders from you if you
utilize the services of a registered investment advisor. This
offering will terminate one year from the effective date of this
prospectus unless, the general partners in their discretion, terminate the
offering earlier or extend the offering for additional one year
periods.
|
Estimated
Use of Proceeds.
|
The
partnership will use the proceeds from the sale of its units to make loans
and pay expenses relating to this offering. After the repayment
of the formation loan, we estimate that approximately 96% of the proceeds
of this offering will be used to make loans or be held as cash
reserves. The remaining proceeds will be used to pay expenses
relating to this offering. A portion of the proceeds of this offering will
be used to fund the formation loan. Consequently, until the
formation loan is repaid, not all of such 96% of the proceeds will be
available to make loans or be held as cash reserves and, until such
repayment, a minimum of 87% of the proceeds will be used to make loans or
be held as cash reserves. If all of the units we are offering
are not sold, the amount of proceeds available to make loans will be
less. Historically, our offering expenses have been below the
estimated 4% resulting in greater than 96% of offering proceeds being used
to make loans or held in cash reserves. 96.10% (first
offering), 98.00% (second offering), 97.95% (third offering), 98.70%
(fourth offering) and as of December 31, 2004, 98.9% (the then ongoing
fifth offering) of the respective offerings were available to be used to
make loans or to be held in cash reserves after the repayment of the
formation loan. We are permitted under the terms of the
partnership agreement to borrow money for the purpose of making loans and
have done so to date. The maximum amount that we may borrow is
50% of the outstanding principal balance of our loan
portfolio.
The
table below sets forth the gross proceeds, the resulting cash available
for extension of loans and other items in the event that (i) all
$100,000,000 of partnership units to which this prospectus pertains are
sold and (ii) only $50,000,000 of such partnership units are
sold.
|
Estimated
|
50 | % | ||||||||||||||
Maximum
Offering (1)
|
Offering
Sold (1)(2)
|
|||||||||||||||
100,000,000
Units
|
50,000,000
Units
|
|||||||||||||||
($100,000,000)
sold
|
($50,000,000)
sold
|
|||||||||||||||
Dollar
Amount
|
%
|
Dollar
Amount
|
%
|
|||||||||||||
Gross
Proceeds
|
$ | 100,000,000 | 100 | % | $ | 50,000,000 | 100 | % | ||||||||
Leveraged
Funds
|
0 | 0 | 0 | 0 | ||||||||||||
Total
Partnership Funds
|
$ | 100,000,000 | 100 | % | $ | 50,000,000 | 100 | % | ||||||||
Less: Public
Offering Expenses (3)
|
$ | 4,000,000 | 4 | % | $ | 4,000,000 | 8 | % | ||||||||
Amount
Available for Investment
|
$ | 96,000,000 | 96 | % | $ | 46,000,000 | 92 | % | ||||||||
Less:
|
||||||||||||||||
Formation
Loan to pay sales commissions (4)
|
$ | 9,000,000 | 9 | % | $ | 4,500,000 | 9 | % | ||||||||
Reserve
Liquidity Fund (5)
|
$ | 2,000,000 | 2 | % | $ | 1,000,000 | 2 | % | ||||||||
Cash
Available for Extension of Loans (6)
|
$ | 85,000,000 | 85 | % | $ | 40,500,000 | 81 | % | ||||||||
|
____________________
|
|
(1)
|
Does
not include a capital contribution of the general partners in the amount
of 1/10th of 1% of the gross proceeds (See “SUMMARY OF THE LIMITED
PARTNERSHIP AGREEMENT - Capital Contributions” at page
82).
|
(2)
|
Although
there is no minimum offering amount, this column represents how the gross
offering proceeds will be utilized assuming that only 50% of the amount
being offered is sold.
|
(3)
|
Consists
of expenses incurred in connection with offering of the
units. These expenses include legal and accounting fees and
expenses, printing costs, filing fees and other disbursements in
connection with the sale and distribution of units. These
expenses also include reimbursements to participating broker dealers for
bona fide expenses incurred for due diligence purposes in a maximum amount
of one-half of one percent (.5%) of gross proceeds and up to an additional
five percent (5%) of gross proceeds if investors elect to receive cash
distributions or up to one percent (1%) of gross proceeds if investors
elect to reinvest their earnings for certain other expense reimbursements,
including reimbursements for education meetings for associated persons of
an NASD member, payable by the partnership. In no event will
all compensation payable to participating broker dealers, including sales
commissions, (see footnote 4 below), expense reimbursements, including
reimbursements for training and education meetings for associated persons
of an NASD member (estimated to be $700,000) and or due diligence expenses
exceed the ten and one-half percent (10.5%) compensation limitation set
forth in Rule 2810 of the NASD conduct rules (See “COMPENSATION OF THE
GENERAL PARTNERS AND AFFILIATES” at page
23).
|
|
(4)
|
The
amount of the formation loan payable to Redwood Mortgage Corp. set forth
in this table is based upon the maximum sales commissions allowable of
9%. Consequently, as the maximum sales commission is 9%, the
formation loan will not exceed nine percent (9%) of the total gross
proceeds of the offering, (See “PLAN OF DISTRIBUTION - Formation Loan” at
page 88). The formation loan is a loan made to Redwood Mortgage
Corp. in an amount equal to the amount of the sales commissions to be paid
in connection with the offering. Although the exact amount of
sales commissions is not known, we have assumed the maximum amount payable
of 9% or $9,000,000. From the proceeds of the formation loan,
Redwood Mortgage Corp. pays the participating broker dealers all amounts
as sales commissions owed. The partnership does not pay any
sales commissions directly. Redwood Mortgage Corp. is required
to repay the formation loan to the partnership. The terms of
repayment of the formation loan are as follows. During the
offering period, Redwood Mortgage Corp. will repay annually, one tenth of
the principal balance of the formation loan as of December 31 of each
year. Upon completion of the offering, the formation loan will
be amortized over 10 years and repaid in 10 equal annual
installments. The formation loan is unsecured, non-interest
bearing and is not guaranteed. The amount of the formation loan
and thus the amount repaid to the partnership is reduced partially by a
portion of the early withdrawal penalties paid to the
partnership. With respect to this offering, the formation loan
could range from a minimum of $5,000,000 assuming all investors elected to
receive current cash distributions to a maximum of $9,000,000 assuming all
investors elected to compound their
earnings.
|
|
(5)
|
The
partnership anticipates maintaining an average balance of a reserve
liquidity fund equal to the lesser of two percent (2%) of the gross
proceeds of the offering and two percent (2%) of the net capital of the
partnership.
|
|
(6)
|
These
proceeds will be used to make loans (See “INVESTMENT OBJECTIVES AND
CRITERIA” at page 40). The exact amount of the cash available for
extension of loans will depend upon the amount of the formation loan, the
amount of the offering expenses, use of leveraged funds and cash
reserves.
|
Compensation
of the General Partners and Affiliates
|
The
general partners and their affiliates have received and will continue to
receive substantial compensation in connection with the offering and the
investment and management of the partnership’s assets. An
affiliate of a general partner includes generally any entity in which a
general partner owns 10% or more or otherwise controls such entity, any
person owning directly or indirectly 10% or more of a general partner and
any officer, director or partner of a general partner. The
receipt of this compensation is not the result of arms length negotiations
(See “COMPENSATION OF THE GENERAL PARTNERS AND AFFILIATES” at page
23). The amount of compensation to be paid to the general
partners and their affiliates are estimates and actual amounts paid may
vary. Except as noted, there is no limit on the dollar amount
of compensation and fees to be paid to the general partners and their
affiliates. These fees include the following:
· Loan
brokerage commissions paid by the borrowers
· Processing
and escrow fees paid by the borrowers
· Loan
servicing fees paid by the partnership from operations
· Asset
management fee paid by the partnership from operations
· Reimbursement
of expenses relating to the administration of the partnership
· Reconveyance
fees paid by the borrowers
· Assumption
fees paid by the borrowers
· Extension
fees paid by the borrowers
· Interest
earned on borrowers’ funds held in escrow
· 1%
interest in profits, losses and distributions
· Reduction
in the amount of the formation loan due to early withdrawal
penalties
|
Conflicts
of Interest
|
The
general partners and their affiliates will experience conflicts of
interest in connection with the management of the partnership, including
the following:
· The
general partners and their affiliates have legal and financial obligations
with respect to other partnerships which are similar to their obligations
with respect to the partnership.
· The
general partners and their affiliates have to allocate their time between
the partnership and other activities, including other real estate
partnerships in which they are involved.
· The
amount of the loan brokerage commission payable to affiliates of the
general partners will affect the overall rate of return to the limited
partners.
· In
the event of default of the formation loan, a conflict of interest would
arise on the general partners’ part in connection with the enforcement of
the formation loan and continued payment of other fees and compensation to
Redwood Mortgage Corp., including, but not limited to, the loan servicing
fees and asset management fees.
|
Prior
Performance Summary
|
We
have previously sponsored 8 prior partnerships with investment objectives
similar to the partnership. We have made 5 prior offerings
in the partnership with
contributed
|
capital
as of December 31, 2004 totaling $172,223,000. Total
contributed capital as of March 31, 2005 equaled
$182,356,000. We have been engaged in mortgage lending in the
San Francisco Bay Area since 1977. For a description of
operations of the partnership and prior programs of the general partners
and their affiliates, see “PRIOR PERFORMANCE SUMMARY” at page
32. Certain statistical data relating to prior partnerships
with investment objectives similar to ours is also provided in the “Prior
Performance Tables” included at the end of this
prospectus.
|
|
Investment
Objectives and
Criteria
|
Our
investment objectives are:
To
yield a high rate of return from mortgage lending, after the payment of
certain fees and expenses to the general partners and their affiliates,
and
Preserve
and protect the partnership’s capital.
|
Federal
Income Tax
Consequences
|
The
section of this prospectus entitled “MATERIAL FEDERAL INCOME TAX
CONSEQUENCES” at page 70 contains a discussion of the most significant
federal income tax issues pertinent to the
partnership. Prospective investors should consult their tax
advisors concerning the tax consequences of an investment in the
partnership in light of the investor’s particular
circumstances.
|
Liquidity,
Capital Withdrawals and Early Withdrawals
|
You
have no right to withdraw from the partnership or to obtain the return of
all or any portion of sums paid for the purchase of units (or reinvested
earnings with respect thereto) for one (1) year after the date such units
are purchased. In order to provide a certain degree of
liquidity, after the one year period, you may withdraw all or part of your
capital accounts from the partnership in four equal quarterly installments
beginning the last day of the calendar quarter following the quarter in
which the notice of withdrawal is given. Such notice must be
given thirty (30) days prior to the end of the preceding quarter subject
to a ten percent (10%) early withdrawal penalty. The ten
percent (10%) penalty is applicable to the amount withdrawn as stated in
the notice of withdrawal. The ten percent (10%) penalty will be
deducted, pro rata, from the four quarterly installments paid to the
limited partner. Withdrawal after the one year holding period
and before the five year holding period (described below) will be
permitted only upon the terms set forth above.
You
will also have the right after five years from the date of purchase of the
units to withdraw from the partnership. This will be done on an
installment basis, generally, over a five-year period (in 20 equal
quarterly installments), or over such longer period of time as the limited
partner may desire or as may be required in light of partnership cash
flow. During this five-year (or longer) period, we will pay any
distributions with respect to units being liquidated directly to the
withdrawing limited partner. No penalty will be imposed on
withdrawals made in twenty quarterly installments or
longer. However, withdrawals exceeding 20% per year are subject
to a 10% penalty even after the five year waiting period. There
is also a limited right of liquidation for your heirs upon your
death.
|
Summary
of Limited
Partnership
Agreement and
Limited
Partnership Units
|
Your
rights and obligations in the partnership and your relationship with the
general partners will be governed by the partnership
agreement. Please refer to the “SUMMARY OF LIMITED PARTNERSHIP
AGREEMENT” section at page 81 of this prospectus for more detailed
information concerning the terms of the partnership
agreement. A complete copy of the partnership agreement is
attached as Exhibit A to this prospectus. Some of the
significant features of the partnership agreement include:
A
majority of the limited partners may vote to:
· terminate
the partnership;
· amend
the partnership agreement, subject to certain limitations;
· remove
and replace the general partner; and
· approve
or disapprove the sale of all or substantially all of the partnership’s
assets.
|
In
the event of any such vote, you will be bound by the majority vote even if
you did not vote with the majority.
Mergers
and Consolidations. We may not merge
or consolidate without approval by a majority of limited
partners.
Once
you have been accepted as an investor in the partnership, you will be
entitled to receive distributions which you may elect to receive in cash
distributions or retain in your capital account. You are also
entitled to receive distributions from the partnership based on your
percentage ownership, after payment of certain expenses including fees
payable to the general partners and the set aside for
reserves. Although anticipated, there is no guarantee that
there will be sufficient cash to make such distributions (See ‘RISK
FACTORS” below). There is no assurance you will receive
distributions. On average, the estimated time from the date
your subscription is accepted until you receive distributions is 60
days.
|
|
Additional
Information
|
We
have filed a registration statement under the Securities Act of 1933, as
amended. The partnership has filed with the Securities and
Exchange Commission, Washington, D.C. 20549, as amended, with
respect to the units offered pursuant to this prospectus. For
further information regarding the partnership, the general partners and
their activities, you should review the registration statement and the
exhibits thereto which are available for inspection at no fee in the
Office of the Commission in Washington,
D.C. 20549. Additionally, the Commission maintains a
website that contains reports, proxy information statements and other
information regarding registrants such as the partnership who file
electronically. The address of the Commission website is
http://www.sec.gov.
|
Subscription
Procedures
|
In
order to subscribe for units, you will be required to deliver the
following:
1. One
executed copy of the subscription agreement, which incorporates a power of
attorney to the general partners.
2. The
minimum purchase is 2,000 units ($2,000) for initial investments and 1,000
units ($1,000) for additional investments by existing limited
partners. All checks should be made payable to “Redwood
Mortgage Investors VIII,” and should be delivered to the partnership’s
offices.
|
The
subscription documents referred to above are contained in the “Investor
Subscription Documents” provided to prospective investors under separate
cover herewith.
|
We
Have Not Identified Any New Loans From Additional Proceeds of This
Offering
|
We
have not yet identified any specific loans with respect to the additional
proceeds we will receive from this offering. This
means:
· You
must rely entirely on the judgment of the general partners in investing
the proceeds of this offering.
· You
will be unable to evaluate, in advance, any of the terms of the loans
including the selection of borrowers, and the terms of the loans that will
be made.
· You
will have no ability to evaluate the identification or location of, or any
other important economic and financial data pertaining to, the underlying
properties that secure the loans. Our current loan portfolio is
summarized in the sections of the prospectus entitled “BUSINESS” at page
46 and “MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OF THE
PARTNERSHIP” at page 49 of this prospectus.
|
Suitable
Mortgage Loans May Not be Available From Time to Time
|
The
general partners receive referrals from a variety of
sources. The general partners only make loans that satisfy the
partnership objectives (See “Investment Objectives and Criteria” at page
7). The ability to find suitable loans is more difficult when
the economy is weaker and there is less activity in the real estate
market. Although the real estate market in the San Francisco
Bay Area, which is where most of our loans are placed, strengthened during
2004, there was increased competition for the type of loans that we
make. In addition, as we continue to make offerings of
partnership units, and the size of our capital continues to grow, we must
find more and more loans and/or loans of larger sizes in order to deploy
such capital. It is also more difficult to find suitable loans when the
interest rates are low as they are now when many borrowers can obtain the
financing they need from traditional banks and lending
institutions. Such decreases in demand for loans could leave
the partnership with excess cash. In such event, the
partnership makes short term, interim investments with proceeds pending
investment in suitable loans. Interest returns on these
investments are usually lower than on mortgage loans, which may reduce the
yield to holders of units, depending on how long these investments are
held.
|
Loan
Defaults and Foreclosures By Borrowers May Adversely Affect
Partnership
|
We
are in the business of lending money and, as such, take the risk that
borrowers may be unable to repay the loans we have made to
them. Most loans will be interest only or interest with small
repayments of principal. This means:
· the
loans are structured to provide for relatively small monthly payments with
a large “balloon” payment of principal due at the end of the
term. Many borrowers are unable to repay such loans at maturity
out of their own funds and are compelled to refinance or sell their
property.
· Defaults
and foreclosures may increase if the economy weakens or if there is an
interest rate increase, which may make it more difficult for borrowers to
refinance their loans at maturity or sell their
property. Interest rates have increased recently as the Federal
Reserve Board, commencing in July 2004, has increased its federal funds
rate. The effect of such increase has been offset by a general
strengthening, during 2004, of the California economy and the Northern
California real estate market. As of March 31, 2005, the
partnership had twelve loans, totaling $27,932,000 that were past due by
90 days or more on interest payments or past
maturity. Continued increases in interest rates, or a weakening
in the economy, could increase the number of such overdue
loans.
· If
a borrower is unable to repay the loan and defaults, we may be forced to
purchase the property at a foreclosure sale. If we cannot
quickly sell or refinance such property, and the property does not produce
any significant income, the partnership’s profitability will be adversely
affected.
|
We
Must Rely On Appraisals Which May Not Be Accurate or May Be Affected By
Subsequent Events
|
We
are an “asset” rather than a “credit” lender. We are relying
primarily on the real property securing the loans to protect our
investment and not the credit worthiness of the borrower. We
rely on appraisals, prepared by unrelated third parties, to determine the
fair market value of real property used to secure our loans. We
cannot guarantee that such appraisals will, in any or all cases, be
accurate. If an appraisal is not accurate or subsequent events
adversely affect the value of the property, our loan would not be as
secure as we anticipated. In the event of foreclosure, we may
not be able to recover our entire investment. Additionally,
since an appraisal fixes the value of real property at a given point in
time, subsequent events could adversely affect the value of real property
used to secure a loan.
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Competition
Risks
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Increased
competition for mortgage loans could lead to reduced yields and fewer
investment opportunities. The mortgage lending business is
highly competitive, and the partnership competes with numerous established
entities some of which have more financial resources and experience in the
mortgage lending business than the general partners. Recently,
due to the Federal Reserve’s increasing interest rates, upward pressure on
longer term rates, and a healthy real estate market, we have experienced
increased competition as borrowers refinance with lower interest rate
lenders than the partnership. The partnership encounters
significant competition from banks, insurance
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companies,
savings and loan associations, mortgage bankers, pension funds, real
estate investment trusts and other lenders with objectives similar in
whole or in part of those of the partnership. Any general
increase in the availability of funds to mortgage lenders may increase
competition for loans and could reduce the yields they produce, including
those of the partnership.
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Risks
Associated With Junior Encumbrances
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In
the event of foreclosure under a second or third deed of trust the debt
secured by a senior deed(s) of trust must be satisfied before any proceeds
from the sale of the property can be applied toward the debt owed to
us. To protect our junior security interest, we may be required
to make substantial cash outlays for such items as loan payments to senior
lienholders to prevent their foreclosure, property taxes, insurance,
repairs, maintenance and any other expenses associated with the
property. These expenditures could have an adverse effect on
our profitability.
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Risks
Associated With Construction Loans
and
Rehabilitation Loans
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We
may make construction loans up to a maximum of ten percent (10%) of the
partnership’s loan portfolio. Construction loans are those
loans made to borrowers constructing entirely new structures or dwellings,
whether residential, commercial or multi-family
properties. Investing in construction loans subjects us to
greater risk than loans related to properties with operating
histories. If the partnership forecloses on property under
construction, construction will generally have to be completed before the
property can begin to generate an income stream or could be
sold. We may not have adequate cash reserves on hand with
respect to junior encumbrances and/or construction loans at all times to
protect our security. If we did not have adequate cash
reserves, we could suffer a loss of our
investment. Additionally, we may be required to obtain
permanent financing of the property in addition to the construction loan
which could involve the payment of significant fees and additional cash
obligations for the partnership. (See “CERTAIN LEGAL ASPECTS OF
LOANS” at page 44). In addition to construction loans, the
partnership also makes loans, the proceeds of which are used to remodel,
add to and/or rehabilitate an existing structure or dwelling, whether
residential, commercial or multifamily properties and which, in the
determination of management, are not construction loans. These
loans are referred to by management as “Rehabilitation Loans”. As of
December 31, 2004 the partnership had funded $41,373,000 in
Rehabilitation Loans and $8,880,000 remained to be disbursed for a
combined total of $50,253,000. While the partnership does not classify
Rehabilitation Loans as Construction Loans, Rehabilitation Loans do carry
some of the same risks as Construction Loans. There is no limit on the
amount of Rehabilitation Loans the partnership may make. We currently
anticipate that Rehabilitation Loans as a percentage of our total loan
portfolio will increase in the near term.
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Risks
of Real Estate Ownership After Foreclosure
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If
a borrower is unable to pay our loan or refinance it when it is due, we
will be required to institute foreclosure proceedings against the
borrower. Although we may immediately be able to sell the
property, sometimes we will be required to own the property for a period
of time. We will be subject to certain economic and liability
risks attendant to all property ownership which could affect the
partnership’s profitability. The risks of ownership will
include the following:
The
property could generate less income for us than we could have earned from
interest on the loan
If
the property is a rental property we will be required to find and keep
tenants
We
will be required to oversee and control operating expenses
We
will be subject to general and local real estate and economic market
conditions which could adversely affect the value of the
property
We
will be subject to any change in laws or regulations regarding taxes, use,
zoning and environmental protection and hazards
We
will be potentially liable for any injury that occurs on or to the
property
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Risks
of Real Estate Development On Property Acquired By Us
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If
we have acquired property through foreclosure or otherwise, there may be
circumstances in which it would be in the best interest of the partnership
not to immediately sell the property, but to develop it
ourselves. Depending upon the location of the property and
market conditions, the development done by us could be either residential
(single or multifamily) or commercial. Currently, the
partnership is pursuing development of a single family residential
property which it acquired in September 2004 through a foreclosure
sale. The partnership is developing this property by processing
plans for the creation of two condominium units on
it. Development of this residential property as well as any
other type of real estate involves risks including the
following:
We
will be required to rely on the skill and financial stability of third
party developers and contractors
Any
development or construction will involve obtaining local government
permits. We will be subject to the risk that our project does
not meet the requirements necessary to obtain those permits
Any
type of development and construction is subject to delays and cost
overruns
There
can be no guarantee that upon completion of the development that we will
be able to sell the property or realize a profit from the
sale
Economic
factors and real estate market conditions could adversely affect the value
of the property
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Bankruptcy
and Legal Limitations On Personal Judgments May Adversely Affect Our
Profitability
|
Any
borrower has the ability to delay a foreclosure sale by us for a period
ranging from several months to several years or more by filing a petition
in bankruptcy. The filing of a petition in bankruptcy
automatically stops or “stays” any actions to enforce the terms of the
loan. The length of this delay and the costs associated with it
will generally have an adverse impact on our profitability. We
also may not be able to obtain a personal judgment against a borrower (See
“CERTAIN LEGAL ASPECTS OF LOANS” at page 44).
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Risks
Associated With Unintended Violations of Usury Statutes
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Usury
laws impose restrictions on the maximum interest that may be charged on
our loans. Under California law, a loan arranged by a licensed
California real estate broker will be exempt from applicable California
usury provisions. Since Redwood Mortgage Corp., a licensed
California real estate broker, will arrange our loans, our loans should be
exempt from applicable state usury provisions. Nevertheless, unintended
violations of the usury statutes may occur. In such an event,
the partnership may have insufficient cash to pay any damages, thereby
adversely affecting the operations of the partnership. We could
also lose our entire investment. The partnership is currently
in the process of acquiring a Commercial Financing License, or
CFL. As a result, once we are operating under a CFL, this
license will provide the partnership with an exemption from the applicable
California usury provision.
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Risks
Associated With High Cost Mortgages
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In
March 1995, the Federal Reserve Board issued final regulations governing
high cost mortgages. Although the partnership anticipates
making relatively few loans that would qualify as high cost mortgages, the
failure to comply with these regulations could adversely affect the
partnership. A high cost mortgage is any loan made to a
consumer secured by the consumer’s principal residence if either (i) the
annual percentage rate exceeds by more than eight percent, the yield on
Treasury securities having comparable periods of maturity for first
mortgages, or ten percent for junior mortgages or (ii) the total fees
payable by a consumer at or before closing exceeds the greater of eight
percent (8%) of the total loan amount. These regulations
primarily focus on:
· additional
disclosure with respect to the terms of the loan to the
borrower,
· the
timing of such disclosures, and
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· the
prohibition of certain terms in the loan including balloon payments and
negative amortization.
The
failure to comply with the regulations, even if the failure was
unintended, will render the loan rescindable for up to three (3)
years. The lender could also be held liable for attorneys’
fees, finance charges and fees paid by the borrower and certain other
money damages.
On
October 10, 2001, then Governor Davis signed into law, Assembly Bill 489
which took effect on July 1, 2002. This law provides for state
regulation of residential mortgage and consumer loans secured by liens on
real property of $250,000 or less, which have (1) an annual percentage
rate at least eight percent above the interest rate on U.S. Treasury
securities of a comparable maturity, or (2) points and fees in excess of
six percent of the loan amount, exclusive of the points and
fees. Such loans would be considered “high cost loans” under
state law. While it is unlikely that the partnership would make
many high cost loans, the failure to comply with this law could have
significant adverse effects on the partnership. The law
prohibits certain lending practices with respect to high cost loans,
including the making of a loan without regard to the borrower’s income or
obligations. When making such loans, lenders must provide
borrowers with a consumer disclosure, and provide for an additional
rescission period prior to closing the loan.
· The
reckless or willful failure to comply with any provision of this law,
including the mandatory disclosure provisions, could result in, among
other penalties, the imposition of administrative penalties of $25,000,
loss or suspension of the offending broker’s license, as well as exposure
to civil liability to the consumer/borrower (including the imposition of
actual and punitive damages).
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Loan-To-Value
Ratios Are Determined By Appraisals Which May Be In Excess of the Ultimate
Purchase Price of the Underlying Property
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The
so-called “loan to value ratio” will not exceed the
following:
· eighty
percent (80%) of the appraised value for residential properties and
multi-unit property,
· seventy
percent (70%) of the appraised value for commercial property
and
· fifty
percent (50%) of the appraised value for unimproved land.
The
loan-to-value ratios are determined based on the appraised value of a
property which may be in excess of the ultimate purchase price of the
underlying property. We cannot assure you that such appraisals
will reflect the actual amount buyers will pay for the
property. In the case of a loan made in connection with a
pending property purchase, an appraisal may, for various reasons, reflect
a higher or lower value than the purchase amount; we will nevertheless
base our loan-to-value ratios on the appraised value, rather than on such
purchase amount. Further, if the value of the property declines
to a value below the amount of the loan, the loan could become
under-collateralized. This would result in a risk of loss for
the partnership if the borrower defaults on the loan.
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Larger
Loans Result in Less Diversity and May Increase Risk
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As
of December 31, 2004, the partnership held 75 loans secured by deeds of
trust, with an aggregate face value of $171,745,000. The
average value of those loans in 2004 was approximately $2,289,000, which
is an increase of $472,000 from the average loan value of $1,817,000 in
2003. The average loan as of December 31, 2004, represented
1.25% of partners’ capital and 1.33% of outstanding secured loans, as
compared to December 31, 2003, when average loan size represented 1.31% of
partners’ capital and 1.23% of outstanding secured loans. The
largest secured loan as of December 31, 2004, was for an amount of
approximately $12,045,000 and represented 6.56% of partners’ capital,
7.01% of outstanding secured loans and 6.00% of the total partnership
assets as compared to December 31, 2003, where the largest secured loan
was for the amount of approximately $16,010,000 and
represented
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11.54%
of partners’ capital, 10.88% of total secured loans and 9.84% of the total
partnership assets. The maximum investment by the partnership
in a loan will not exceed 10% of the then total partnership
assets.
The
partnership can as a general rule decrease risk of loss from delinquent
mortgage loans by investing in a greater total number of
loans. Investing in fewer, larger loans generally decreases
diversification of the portfolio and increases risk of loss and possible
reduction of yield to investors in the partnership in the case of a
delinquency of such a loan. However, since larger loans
generally will carry a somewhat higher interest rate, the general partner
may determine, from time to time, that a relatively larger loan is
advisable for the partnership.
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Use
Of Borrowed Money May Reduce Our Profitability or Cause Losses Through
Liquidation
|
We
are permitted and have borrowed funds for the purpose of making loans, for
increased liquidity, reducing cash reserve needs or for any other proper
partnership purpose on any terms commercially available. We may
assign all or a portion of our loan portfolio as security for such
loans. The maximum amount we may borrow is fifty percent (50%)
of the outstanding principal balance of our total loan
portfolio.
Changes
in the interest rate have a particularly adverse effect on us if we have
borrowed money to fund loans. Borrowed money will bear interest
at a variable rate, whereas we are likely to be making fixed rate
loans. Thus, if prevailing interest rates rise, we may have to
pay more in interest on the borrowed money than we make on loans to our
borrowers. This will reduce our profitability or cause losses through
liquidation of loans in order to repay the debt on the borrowed
money. It is possible that we could default on our obligation
if we cannot cover the debt on the borrowed money. (See “INVESTMENT
OBJECTIVES AND CRITERIA - Borrowing” at page 43).
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Changes
In Interest Rates May Affect Your Return On Your
Investment
|
Our
loans typically have fixed rates and the majority of our loans are for
terms of one to five years. Consequently, due to the terms of
our loans, if interest rates rapidly increase, such interest rates may
exceed the average interest rate earned by our loan
portfolio. If prevailing interest rates rise above the average
interest rate being earned by our loan portfolio, you may be unable to
quickly sell your units, as they are an illiquid investment, in order to
take advantage of higher returns available from other
investments. In addition, an increase in interest rates
accompanied by a tight supply of mortgage funds may make refinancing by
borrowers with balloon payments difficult or impossible. This
is true regardless of the market value of the underlying property at the
time such balloon payments are due. In such event, the property
may be foreclosed upon (See “CERTAIN LEGAL ASPECTS OF LOANS” at page
44). Moreover, the majority of the partnership’s loans do not
include prepayment penalties for a borrower paying off a loan prior to
maturity. The absence of a prepayment penalty in the
partnership’s loans may lead borrowers to refinance higher interest rate
loans in a market of falling interest rates. This would then
require the partnership to reinvest the prepayment proceeds in loans or
alternative short term investments with lower interest rates and a
corresponding lower yield to partners. (See “RISK FACTORS” at page
8).
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Equity
or Cash Flow Participation in Loans Could Result in Loss of Secured
Positions in Loans
|
The
partnership may sometimes participate in the appreciation in value or in
the cash flow from a secured property. If a borrower defaults
and claims that this participation makes the loan comparable to equity
(like stock) in a joint venture, the partnership might lose its secured
position as lender in the property. Other creditors of the
borrower might then wipe out or substantially reduce the partnership’s
investment. The partnership could also be exposed to the risks
associated with being an owner of real property. If a third
party were to assert successfully that a partnership loan was actually a
joint venture with the borrower, there might be a risk that the
partnership could be liable as joint venturer for the wrongful acts of the
borrower toward the third party.
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Marshaling
of Assets Could Delay Or Reduce Recovery of Loans
|
As
security for a single loan, we may require a borrower to execute deeds of
trust on other properties owned by the borrower in addition to the
property the borrower is purchasing or refinancing. In the
event of a default by the borrower, we may be required to “marshal” the
assets of the borrower. Marshaling is an equitable doctrine
used to protect a junior lienholder with a security interest in a single
property from
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being
“squeezed out” by a senior lienholder, such as us, with security interest
not only in the property, but in one or more additional
properties. Accordingly, if another creditor of the borrower
forced us to marshal the borrower’s assets, foreclosure and eventual
recovery of the loan could be delayed or reduced, and our costs associated
therewith could be increased.
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Potential
Liability For Toxic Or Hazardous Substances If We Are Considered Owner of
Real Property
|
If
we take an equity interest in, management control of, or foreclose on any
of the loans, we may be considered the owner of the real property securing
such loans. In the event of any environmental contamination,
there can be no assurance that we would not incur full recourse liability
for the entire cost of any such removal and cleanup, even if we did not
know about or participate in the contamination. Full recourse liability
means that any of our property, including the contaminated property, could
be sold in order to pay the costs of cleanup in excess of the value of the
property at which such contamination occurred. In addition, we
could incur liability to tenants and other users of the affected property,
or users of neighboring property, including liability for consequential
damages. Consequential damages are damages which are a
consequence of the contamination but are not costs required to clean up
the contamination, such as lost profits of a business.
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Potential
Loss Of Revenue In The Event Of The Presence of Hazardous
Substances
|
If
we became the “owner” of any real property containing hazardous
substances, we would also be exposed to risk of lost revenues during any
cleanup, the risk of lower lease rates or decreased occupancy if the
existence of such substances or sources on the property were a health
risk. If we fail to remove the substances or sources and clean
up the property, federal, state, or local environmental agencies could
perform such removal and cleanup. Such agencies would impose
and subsequently foreclose liens on the property for the cost
thereof. A “lien” is a charge against the property of which the
holder may cause the property to be sold and use the proceeds in
satisfaction of the lien. We may find it difficult or
impossible to sell the property prior to or following any such
cleanup. If such substances are discovered after we sell the
property, we could be liable to the purchaser thereof if the general
partners knew or had reason to know that such substances or sources
existed. In such case, we could also be subject to the costs
described above.
If
we are required to incur such costs or satisfy such liabilities, this
could have a material adverse effect on our
profitability. Additionally, if a borrower is required to incur
such costs or satisfy such liabilities, this could result in the
borrower’s inability to repay its loan from us.
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Potential
Conflicts and Risks If We Invest In Loans With General Partners or
Affiliates
|
We
may invest in loans acquired by the general partners or
affiliates. Our portion of the total loan may be smaller or
greater than the portion of the loan made by the general partners or
affiliates, but will generally be on terms substantially similar to the
terms of our investment. You should be aware that investing
with the general partners or affiliates could result in a conflict of
interest between the partnership and the general partners or affiliates in
the event that the borrower defaults on the loan and both the partnership
and the general partners or affiliates protect their own interest in the
loan and in the underlying security.
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Investment
Risks
|
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Lack
of Liquidity of Units Increases Their Risks
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No
public trading market for the units exists. It is highly
unlikely that a public trading market will ever
develop. Article 7 of the partnership agreement imposes
substantial restrictions upon your ability to transfer units (See “SUMMARY
OF LIMITED PARTNERSHIP AGREEMENT” at page 81 and “TRANSFER OF UNITS” at
page 84). In addition, the partnership agreement does not
provide for the buy-back or repurchase of units by the partnership or the
general partners. It does however, provide you with a limited
right to withdraw capital from the partnership after one year, with
penalty, and after 5 years without penalty subject to certain
requirements. (See “TRANSFER OF UNITS - Withdrawal from
Partnership” at page 84). There is no assurance that the value
of units for purposes of this withdrawal in any way reflects the fair
market value of the units. In addition, your units may not be
readily accepted as collateral for a loan. Consequently, you
should consider the purchase of units only as a long-term
investment.
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There
Is No Assurance You Will Receive Cash Distributions
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The
general partners and their affiliates are paid and reimbursed by the
partnership for certain services performed for the partnership and
expenses paid on behalf of the partnership (See “COMPENSATION OF THE
GENERAL PARTNERS AND AFFILIATES” at page 23). The partnership
bears all other expenses incurred in its operations. All of
these fees and expenses are deducted from cash funds generated by the
operations of the partnership prior to computing the amount that is
available for distribution to you. The general partners, in
their discretion, may also retain any portion of cash funds generated from
operations for working capital purposes of the
partnership. Accordingly, there is no assurance as to when or
whether cash will be available for distributions to you.
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Your
Ability To Recover Your Investment On Dissolution and Termination Will Be
Limited
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In
the event of dissolution or termination of the partnership, the proceeds
realized from the liquidation of assets, if any, will be distributed to
the partners only after the satisfaction of claims of
creditors. Accordingly, your ability to recover all or any
portion of your investment under such circumstances will depend on the
amount of funds so realized and claims to be satisfied
therefrom. Additionally, if you have elected to retain your
earnings in the partnership, you could lose such earnings in addition to
the amount of your initial investment.
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Certain
Kinds of Losses Cannot Be Insured Against
|
We
will require comprehensive insurance, including fire and extended
coverage, which is customarily obtained for or by a lender, on properties
in which we acquire a security interest. Generally, such
insurance will be obtained by and at the cost of the
borrower. However, there are certain types of losses (generally
of a catastrophic nature, such as civil disturbances and acts of God such
as earthquakes, floods and slides) which are either uninsurable or not
economically insurable. Should such a disaster occur to, or
cause the destruction of, any property serving as collateral for a loan,
we could lose both our invested capital and anticipated profits from such
investment. In addition, on certain real estate owned by us as
a result of foreclosure, we may require homeowner’s liability
insurance. However, insurance may not be available for theft,
vandalism, land or mud slides, hazardous substances or earthquakes on all
real estate owned and losses may result from destruction or vandalism of
the property thereby adversely affecting our profitability.
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Risks
Related To Concentration of Mortgages in the San Francisco Bay
Area
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As
of December 31, 2004, 76.36% ($131,143,000) of our loans are secured
by properties located in 6 counties that comprise the San Francisco Bay
Area. The San Francisco Bay Area economy is improving from the
economic downturn from 2000 to 2003. Employment and job
creation has improved but is still lower than desirable. During
2004 and continuing in 2005, the residential and commercial real estate
market, in Northern California generally experienced solid price
appreciation. Our concentration of loans in the San Francisco
Bay Area, however, exposes us to greater risk of loss if the economy in
the San Francisco Bay Area weakens than would be the case if our loans
were spread throughout California or the nation. The San
Francisco Bay Area economy and/or real estate market conditions could be
weakened by:
A
continued economic recession in or slowdown in the area
Overbuilding
of commercial and residential properties
Relocation
of businesses outside of the area due to economic factors such as high
cost of living and of doing business within the region
Increased
interest rates thereby weakening the general real estate
market
If
the economy were to weaken, it is likely that there would be more property
available for sale, values would fall, and lending opportunities would
decrease. In addition, a weak economy and increased
unemployment could adversely affect borrowers resulting in an increase in
the number of loans in default.
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You
Must Rely on the General Partners For Management Decisions; Limited
Partners Have No Control Over Operation of the Partnership
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All
decisions with respect to the management of the partnership will be made
exclusively by the general partners. Our success will, to a
large extent, depend on the quality of the management of the partnership,
particularly as it relates to lending decisions. You have no
right or power to take part in the management of the
partnership. Accordingly, you should not purchase any of the
units offered hereby unless you are willing to entrust all aspects of the
management of the partnership to the general partners. You
should carefully evaluate the general partners’ capabilities to perform
such functions (See “MANAGEMENT” at page 35).
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You
Will Be Bound By Decision of Majority Vote
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Subject
to certain limitations, limited partners holding a majority of units may
vote to, among other things:
· remove
the general partners,
· dissolve
the partnership,
· approve
or disapprove the sale of all or substantially all of the partnership’s
assets and
· amend
the partnership agreement, subject to certain limitations.
If
you do not vote with the majority in interest of the other limited
partners, you nonetheless will be bound by the majority
vote. The general partners shall have the right to increase
this offering or conduct an additional offering of securities without
obtaining your consent or the consent of any other limited
partner. (See “SUMMARY OF THE LIMITED PARTNERSHIP AGREEMENT” at
page 81” and “TRANSFER OF UNITS” at page 84).
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Net
Worth of the General Partners May Affect Ability of the General Partners
To Fulfill Their Obligations To The Partnership
|
The
general partners have represented that they have an aggregate net worth in
excess of $1,000,000, a significant portion of which consists of assets
which are illiquid. This may be relevant in evaluating the
ability of the general partners to fulfill their obligations and
responsibilities to the partnership (See “MANAGEMENT” at
page 35).
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Risks
Regarding Formation Loan and Repayment Thereof
|
The
partnership will loan to Redwood Mortgage Corp., a general partner, funds
in an amount equal to the sales commissions (See “PLAN OF DISTRIBUTION -
Formation Loan” at page 88). The formation loan will be an
unsecured loan that will not bear interest and will be repaid in annual
installments. Redwood Mortgage Corp. shall make annual installments of
one-tenth of the principal balance of the formation loan as of December 31
of each year. Such payment shall be due and payable by December
31 of the following year. Prior to the termination of this
offering, the principal balance of the formation loan will increase as
additional sales of units are made each year. Upon completion
of this offering, the balance of the formation loan will be repaid in ten
(10) equal annual installments of principal, without interest, commencing
on December 31 of the year following the year this offering
terminates. With respect to this offering, the formation loan
could range from a minimum of $5,000,000 assuming all investors elected to
receive current cash distributions to a maximum of $9,000,000 assuming all
investors elected to compound their earnings.
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A
portion of the amount we receive from withdrawing limited partners as
early withdrawal penalties may first be applied to reduce the principal
balance of the formation loan. This will have the effect of
reducing the amount owed by Redwood Mortgage Corp. to the
partnership. If all or any one of the initial general partners
are removed as a general partner by the vote of a majority of limited
partners and a successor or additional general partner(s) begins using any
other loan brokerage firm for the placement of loans or loan servicing,
Redwood Mortgage Corp. will be immediately released from any further
payment obligation under the formation loan. If all of the
general partners are removed, no other general partners are elected, the
partnership is liquidated and Redwood Mortgage Corp. is no longer
receiving payments for services rendered, the debt on the formation loan
shall be forgiven by the partnership and Redwood Mortgage Corp. will be
immediately released from any further obligations under the formation
loan. The non-interest bearing feature of the formation loan
will have the effect of slightly diluting your rate of return, but to a
much lesser extent than if the partnership were required to bear all of
its own syndication expenses out of the offering proceeds.
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Delays
In Investment Could Adversely Affect Your Return
|
A
delay will occur between the time you purchase your units and the time the
net proceeds of the offering are invested. This delay could
adversely affect the return paid to you. In order to mitigate
this risk, pending the investment of the proceeds of this offering, funds
will be placed in such highly liquid, short-term investments as the
general partners shall designate. The interest earned on such
interim investments is expected to be less than the interest earned by the
partnership on loans. The general partners estimate, based upon
their historical experience, that it will be no longer than ninety (90)
days from the time your funds are received by us until they are invested
in loans.
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No
Assurance of Limitation of Liability of Limited Partners
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As
a limited partner, you have no right to, and you take no part in, control
and management of the partnership’s business. However, the
partnership agreement authorizes all limited partners to exercise the
right to vote on certain matters, including the right to remove the
general partners and elect a successor general partner(s) (See “SUMMARY OF
LIMITED PARTNERSHIP AGREEMENT - Rights and Liabilities of Limited
Partners” at page 81). The California Revised Limited
Partnership Act expressly provides that the right to vote on those matters
will not cause you or any other limited partner to have personal liability
for partnership obligations in excess of the amount of your capital
contributions which have not been previously returned to
you. However, you may be required to return amounts distributed
to you as a return of your capital contribution if we are unable to pay
creditors who extended credit to us prior to the date of such return of
capital.
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No
Assurance That California Law Will Apply With Respect To Limitation Of
Liability Of Limited Partners
|
Morrison
& Foerster LLP, counsel for the partnership, has advised that strong
arguments may be made in support of the conclusion that California law
governs in all states as to the liability of the limited partners and that
neither the possession nor the exercise of such rights should affect the
liability of the limited partners. However, Morrison &
Foerster LLP, counsel for the partnership, has also advised that since
there is no authoritative precedent on this issue, a question exists as to
whether the exercise, or perhaps even the existence, of such voting rights
might provide a basis on which a court in a state other than California
could hold that you are not entitled to the limitation on liability for
which the partnership agreement provides. This is only a
concern if you are not a California resident.
|
We
Cannot Precisely Determine Compensation To Be Paid General Partners and
Affiliates
|
The
general partners and their affiliates are unable to predict the amounts of
compensation to be paid to them as set forth under “COMPENSATION OF THE
GENERAL PARTNERS AND AFFILIATES” at page 23. Any such
prediction would necessarily involve assumptions of future events and
operating results which cannot be made at this time. As a
result, there is a risk that investors will not have the opportunity to
judge ahead of time whether the compensation realized by the general
partners is commensurate with the return generated by the
loans.
|
Working
Capital Reserves May Not Be Adequate
|
We
intend to maintain working capital reserves to meet our obligations,
including carrying costs and operating expenses of the partnership (See
“ESTIMATED USE OF PROCEEDS” at page 21). The general partners
believe such reserves are reasonably sufficient for our
contingencies. If for any reason those reserves are
insufficient, the general partners will have to borrow the required funds
or require the partnership to liquidate some or all of our
loans. In the event the general partners deem it necessary to
borrow funds, there can be no assurance that such borrowing will be on
acceptable terms or even available to us. Such a result might
require us to liquidate our investments and abandon our
activities.
|
We
May Be Required to Forego More Favorable Investments to Avoid Regulation
Under Investment Company Act of 1940
|
The
general partners intend to conduct the operations of the partnership so
that we will not be subject to regulation under the Investment Company Act
of 1940. Among other things, they will monitor the proportions
of our funds which are placed in various investments and the form of such
investments so that we do not come within the definition of an investment
company under such Act. As a result, we may have to forego
certain investments which would produce a more favorable
return.
|
Conflicts
of Interest Risks
|
· The
risk factors below describe certain material conflicts of interest that
may arise in the course of the general partners’ management and operation
of our business. The disclosure in the prospectus under the
caption “CONFLICTS OF INTEREST,” beginning on page.28, sets forth a more
complete discussion of these conflicts of interest. Our
discussion of potential conflicts of interest reflects our knowledge of
the existing or potential conflicts of interest as of the date of this
prospectus. We cannot assure you that no other conflicts of
interest will arise in the future. Conflicts arise as a
result of the general partners’ legal and financial obligation to other
partners. The general partners and their affiliates will
experience conflicts of interest in connection with the management of the
partnership, including the following:
· The
general partners and their affiliates have legal and financial obligations
with respect to other partnerships which are similar to their obligations
with respect to the partnership.
· The
general partners and their affiliates have to allocate their time between
the partnership and other activities, including other real estate
partnerships in which they are involved.
· The
amount of the loan brokerage commission payable to affiliates of the
general partners will affect the overall rate of return to the limited
partners.
· In
the event of default of the formation loan, a conflict of interest would
arise on the general partners’ part in connection with the enforcement of
the formation loan and continued payment of other fees and compensation to
Redwood Mortgage Corp., including, but not limited to, the loan servicing
fees and the asset management fees.
|
Use
of Forward Looking Statements
|
Certain
statements in this prospectus which are not historical facts may be
considered forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
and Exchange Act of 1934, as amended, including statements regarding our
expectations, hopes, intentions, beliefs and strategies regarding the
future. Forward-looking statements include statements regarding
future interest rates and economic conditions and their effect on the
partnership and its assets, trends in the California real estate market,
estimates as to the allowance for loan losses and the valuation of real
estate held for sale, estimates of future annualized yield, estimates of
future limited partner withdrawals, estimates of the compensation to the
general partners and estimates of the formation loan. Actual
results may be materially different from what is projected by such
forward-looking statements. Factors that might cause such a
difference include unexpected changes in economic conditions and interest
rates, the impact of competition and competitive pricing and downturns in
the real estate markets in which we have made loans. All
forward-looking statements and reasons why results may differ included in
the prospectus are made as of the date hereof, and we assume no obligation
to update any such forward-looking statement or reason why actual results
may differ.
|
Tax
Risks
|
|
Risks
Associated With Partnership Status For Federal Income Tax
Purposes
|
The
partnership is intended to be treated as a partnership (other than a
publicly traded partnership) for federal income tax
purposes. Although we have received an opinion from Morrison
& Foerster LLP to the effect that the partnership will be treated as a
partnership (other than a publicly traded partnership) for federal income
tax purposes, we will not seek a ruling from the Internal Revenue Service
(“IRS”) on the tax treatment of the partnership or its
partners. Counsel’s opinion represents only its best legal
judgment based upon existing law and, among other things, factual
representations provided by the general partners. The opinion
of counsel has no binding effect on the IRS or any court, and no assurance
can be given that the conclusions reached in said opinion would be
sustained by a court if challenged by the IRS.
|
If
we were taxable as a corporation, the “pass through” treatment of our
income and losses would be lost. Instead, we would, among other
things, pay income tax on our earnings in the same manner and at the same
rate as a corporation, and our losses, if any, would not be deductible by
the limited partners. Limited partners would be taxed upon
distributions substantially in the manner that corporate shareholders are
taxed on dividends. In addition, if we were classified as a
publicly traded partnership but nonetheless remained taxable as a
partnership, the passive activity loss rules would apply in a manner that
could adversely affect limited partners. See “MATERIAL FEDERAL INCOME TAX
CONSEQUENCES – Tax Classification of the Partnership” at page
70.
|
|
Your
Ability to Offset Income with Our Losses May Be Limited
|
We
are engaged in mortgage lending. We take the position that most
of our income is nonpassive income for purposes of certain limitations on
the use of losses from passive activities. It is possible,
however, that the IRS could assert that our income is properly treated as
portfolio income for purposes of those limitations. Such
treatment is subject to the interpretation of complex Treasury
regulations, and is dependent upon a number of factors, such as whether we
are engaged in a trade or business, the extent to which we incur
liabilities in connection with our activities, and the proper matching of
the allocable expenses incurred in the production of partnership
income. There can be no assurance that an IRS challenge to our
characterization of our income will not succeed. It also is
possible that we might be unable to allocate expenses to the income
produced, in which case investors might find their ability to offset
income with allocable expenses limited by the two percent (2%) floor on
miscellaneous investment expenses.
|
Your
Tax Liability May Exceed the Cash You Receive
|
Your
tax liabilities associated with an investment in the partnership for a
given year may exceed the amount of cash we distribute to you during such
year. As a limited partner, you will be taxed on your allocable
share of our taxable income whether or not you actually receive cash
distributions from us. Your taxable income could exceed cash
distributions you receive, for example, if you elect to reinvest in the
partnership the cash distributions you would otherwise have
received. Taxable income in excess of cash distributions also
could result if we were to generate so-called “phantom income” (taxable
income without an associated receipt of cash). Based upon
historical experience, the general partners anticipate that the
partnership’s taxable income will not differ substantially from the cash
flow generated by our lending activities.
|
We
Expect to Generate Unrelated Business Taxable Income
|
Tax-exempt
investors (such as an employee pension benefit plan or an IRA) may be
subject to tax to the extent that income from the partnership is treated
as unrelated business taxable income, or UBTI. We borrow funds
on a limited basis, which can cause a portion of our income to be treated
as UBTI. We may also receive income from services rendered in
connection with making or securing loans, which is likely to constitute
UBTI. In addition, although we do not currently intend to own
and lease personal property, it is possible we may do so as a result of a
foreclosure upon a default. Although we use reasonable efforts
to prevent any borrowings and leases of personal property from causing any
significant amount of partnership income to be treated as UBTI, we expect
that some portion of our income will be UBTI. Prospective
investors that are tax-exempt entities are urged to consult their own tax
advisors regarding the suitability of an investment in
units. In particular, an investment in units may not be
suitable for charitable remainder trusts.
|
Risks
of Audit and Adjustment
|
The
IRS could challenge certain federal income tax positions taken by the
partnership if we are audited. Any adjustment to the
partnership’s return resulting from an audit by the IRS would result in
adjustments to your tax returns and might result in an examination of
items in such returns unrelated to the partnership or an examination of
tax returns for prior or later years. Moreover, the partnership
and investors could incur substantial legal and accounting costs in
contesting any IRS challenge, regardless of the outcome. The
general partners generally will have the authority and power to act for,
and bind the partnership in connection with, any such audit or adjustment
for administrative or judicial proceedings in connection
therewith.
|
Risks
of Effects of State and Local Taxation
|
The
state in which you reside may impose an income tax upon your share of the
taxable income of the partnership. Furthermore, states, such as
California in which the partnership will own property generally impose
income tax upon each partner’s share of a partnership’s taxable income
considered allocable to such states, whether or not each partner resides
in that state. As a result, a nonresident partner may be
required to file a tax return in California and any other such
state. Differences may exist between federal income tax laws
and state and local income tax laws. The partnership may be
required to withhold state taxes from distributions to investors in
certain instances. You are urged to consult with your own tax
advisers with respect to state and local taxation.
|
ERISA
RISKS
|
|
Risks
of Investment By Benefit Plan Investors and other Tax-Exempt
Investors
|
In
considering an investment in the partnership, if you are a pension or
profit-sharing plan qualified under Section 401(a) of the Code and exempt
from tax under Section 501(a) (a tax-qualified plan), you should consider
(i) whether the investment satisfies the diversification requirements of
Section 404(a)(3) of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”); or (ii) whether the investment is prudent, since
there may not be a market created in which you can sell or otherwise
dispose of the units. In addition if you are a Benefit Plan
Investor, including a tax-qualified pension or 401(k) plan or an IRA, you
should consider (i) whether a distribution of units from a tax-qualified
plan or IRA would be accepted by an IRA custodian as a rollover, and if
not, the automatic 20% income tax withholding which you may need to
satisfy out of other assets that you own; (ii) whether a required
distribution from a tax-qualified plan or IRA commencing on the April 1
following the calendar year in which you attain age 70 ½ could cause you
to become subject to income tax that you would need to satisfy out of
other assets if you were not able to transfer the unit for cash; and (iii)
whether interests in the partnership or the underlying assets owned by the
partnership constitute “Plan Assets” for purposes of Section 4975 of the
Code which would could cause certain transactions with the partnership to
constitute prohibited transactions. Finally, all tax-exempt
investors, including tax-qualified pension and 401(k) plans and IRAs
should consider (i) whether the investment will impair the liquidity of
your plan or other entity; and (ii) whether the investment will create
unrelated business taxable income for the plan or other
entity. ERISA requires that the assets of a plan be valued at
their fair market value as of the close of the plan year, and it may not
be possible to adequately value the units from year to year, since there
will not be a market for those units and the appreciation of any property
may not be shown in the value of the units until the partnership sells or
otherwise disposes of its investments (See “ERISA CONSIDERATIONS” at page
78).
|
|
“IT
IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY, OR ANY
INTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFORE, WITHOUT THE
PRIOR WRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF
CALIFORNIA, EXCEPT AS PERMITTED IN THE COMMISSIONER’S
RULES.”
|
Estimated
|
50 | % | ||||||||||||||||||||||||||||||
Estimated
|
50 | % |
Maximum
Offering (1)(2)
|
Offering
Sold (1)(2)
|
||||||||||||||||||||||||||||
Maximum
Offering (1)
|
Offering
Sold (1)
|
100,000,000
Units
|
50,000,000
Units
|
|||||||||||||||||||||||||||||
100,000,000
Units
|
50,000,000
Units
|
($100,000,000)
sold with
|
($50,000,000)
sold with
|
|||||||||||||||||||||||||||||
($100,000,000)
sold
|
($50,000,000)
sold
|
leveraged
funds
|
leveraged
funds
|
|||||||||||||||||||||||||||||
Dollar
Amount
|
%
|
Dollar
Amount
|
%
|
Dollar
Amount
|
%
|
Dollar
Amount
|
%
|
|||||||||||||||||||||||||
Gross
Proceeds
|
$ | 100,000,000 | 100 | % | $ | 50,000,000 | 100 | % | $ | 100,000,000 | 66.67 | % | $ | 50,000,000 | 66.67 | % | ||||||||||||||||
Leveraged
Funds
|
0 | 0 | 0 | 0 | $ | 50,000,000 | 33.33 | % | $ | 25,000,000 | 33.33 | % | ||||||||||||||||||||
Total
Partnership Funds
|
$ | 100,000,000 | 100 | % | $ | 50,000,000 | 100 | % | $ | 150,000,000 | 100 | % | $ | 75,000,000 | 100 | % | ||||||||||||||||
Less
Public Offering
|
||||||||||||||||||||||||||||||||
Expenses
(3)
|
$ | 4,000,000 | 4 | % | $ | 4,000,000 | 8 | % | $ | 4,000,000 | 2.67 | % | $ | 4,000,000 | 5.33 | % | ||||||||||||||||
Amount
Available for
|
||||||||||||||||||||||||||||||||
Investment
|
$ | 96,000,000 | 96 | % | $ | 46,000,000 | 92 | % | $ | 146,000,000 | 97.33 | % | $ | 71,000,000 | 94.67 | % | ||||||||||||||||
Less:
|
||||||||||||||||||||||||||||||||
Formation
Loan to pay
|
||||||||||||||||||||||||||||||||
sales
commissions (4)
|
$ | 9,000,000 | 9 | % | $ | 4,500,000 | 9 | % | $ | 9,000,000 | 6 | % | $ | 4,500,000 | 6 | % | ||||||||||||||||
Reserve
Liquidity Fund (5)
|
$ | 2,000,000 | 2 | % | $ | 1,000,000 | 2 | % | $ | 2,000,000 | 1.33 | % | $ | 1,000,000 | 1.33 | % | ||||||||||||||||
Cash
Available for
|
||||||||||||||||||||||||||||||||
Extension
of Loans (6)
|
$ | 85,000,000 | 85 | % | $ | 40,500,000 | 81 | % | $ | 135,000,000 | 90 | % | $ | 65,500,000 | 87.34 | % | ||||||||||||||||
|
(1)
|
Does
not include a capital contribution of the general partners in the amount
of 1/10th of 1% of the gross proceeds (See “SUMMARY OF THE LIMITED
PARTNERSHIP AGREEMENT - Capital Contributions” at page
82).
|
|
(2)
|
This
assumes that the general partners can leverage approximately fifty percent
(50%) of the gross offering proceeds thereby increasing the funds
available to make loans. The partnership may borrow funds for
the purpose of making loans, for increased liquidity, reducing cash
reserve needs or for any other partnership purposes. The
maximum amount the partnership may borrow is 50% of the outstanding
principal balance of the partnership’s total loan
portfolio.
|
|
(3)
|
Consists
of expenses incurred in connection with offering of the
units. These expenses include legal and accounting fees and
expenses, printing costs, filing fees and other disbursements in
connection with the sale and distribution of units. These
expenses also include reimbursements to participating broker dealers for
bona fide expenses incurred for due diligence purposes in a maximum amount
of one-half of one percent (.5%) of gross proceeds and up to an additional
five percent (5%) of gross proceeds if investors elect to receive cash
distributions or up to one percent (1%) of gross proceeds if investors
elect to reinvest their earnings for certain other expense reimbursements,
including reimbursements for education meetings for associated persons of
an NASD member, payable by the partnership. In no event will
all compensation payable to participating broker dealers, including sales
commissions, (see footnote 4 below), expense reimbursements, including
reimbursements for training and education meetings for associated persons
of an NASD member (estimated to be $700,000) and or due diligence expenses
exceed the ten and one-half percent (10.5%) compensation limitation set
forth in Rule 2810 of the NASD conduct rules (See “COMPENSATION OF THE
GENERAL PARTNERS AND AFFILIATES” at page
23).
|
|
(4)
|
The
amount of the formation loan payable to Redwood Mortgage Corp. set forth
in this table is based upon the maximum sales commissions allowable of
9%. Consequently, as the maximum sales commission is 9%, the
formation loan will not exceed nine percent (9%) of the total gross
proceeds of the offering, (See “PLAN OF DISTRIBUTION - Formation Loan” at
page 88). However, the general partners anticipate, based upon
historical experience and knowledge of professionals in the industry, that
the formation loan will be in the amount of (7.6%) of gross proceeds if
the maximum of $100,000,000 of gross proceeds is raised and assuming that
sixty-five percent (65%) of the investors elect to retain their earnings
in their capital
|
|
(5)
|
The
partnership anticipates maintaining an average balance of a reserve
liquidity fund equal to the lesser of two percent (2%) of the gross
proceeds of the offering or two percent (2%) of the net capital of the
partnership.
|
|
(6)
|
These
proceeds will be used to make loans (See “INVESTMENT OBJECTIVES AND
CRITERIA” at page 40). The exact amount of the cash available for
extension of loans will depend upon the amount of the formation loan, the
amount of offering expenses, use of leveraged funds and cash
reserves. (See Footnote (1)
above.)
|
Actual
|
As Adjusted (1)
|
|||||||
Units
($1.00 per unit)
|
$ | 183,368,000 | $ | 270,368,000 |
|
(1)
|
Adjusted
to reflect sales of all $100,000,000 of partnership units offered hereby,
determined after deduction of certain offering expenses aggregating
$4,000,000 and maximum formation loan of $9,000,000. (See
“ESTIMATED USE OF PROCEEDS” at page
21)
|
·
|
analyzed
the compensation arrangements in other
offerings,
|
·
|
spoken
to other professionals in the industry including issuers, promoters and
broker dealers,
|
·
|
examined
“rate sheets” from banks and savings & loans which set forth the rates
being charged by those institutions for the same or similar
services
|
·
|
collected
data regarding compensation from trade association meetings and/or other
relevant periodicals. Thus, we believe the amounts are
approximately equivalent to those which would customarily be paid to
unrelated parties for the same
services.
|
OPERATING
STAGE
|
||
Entity
Receiving
Compensation
|
Form and Method of
Compensation
|
Estimated Amount Payable
|
Redwood
Mortgage Corp.
|
Loan
brokerage commissions range from approximately three to six percent (3-6%)
of the principal amount of each loan, but may be higher or lower depending
upon market conditions. Loan brokerage commissions are limited
to an amount not to exceed four percent (4%) of the total partnership
assets per year. Such commissions are payable solely by the borrower and
not by us. (See “TERMS OF THE OFFERING” at page 21).
|
$4,120,000
per year (8)
|
Redwood
Mortgage Corp.
|
Processing
and escrow fees for services in connection with notary, document
preparation, credit investigation, and escrow fees in an amount equal to
the fees customarily charged by Redwood Mortgage Corp. for comparable
services in the geographical area where the property securing the loan is
located, payable solely by the borrower and not by the
partnership.
|
$44,000
per year (6)
|
Redwood
Mortgage Corp.
|
Loan
servicing fee payable monthly up to a maximum amount equal to 1/8 of 1%
per year of the outstanding principal amount of each
loan. (1)(2)
|
$892,000
per year (6)
|
Redwood
Mortgage Corp. (50%)
Gymno
Corporation ( 25%)
Michael
R Burwell (25%)
|
Asset
management fee payable monthly in an amount up to 1/32 of 1% of the “net
asset value.”(3)
|
$388,000
per year
|
Redwood
Mortgage Corp.
|
Reimbursement
of expenses relating to administration of the partnership, subject to
certain limitations; see Article 10 of the partnership agreement.
(4)
|
$271,000
per year (7)
|
Gymno
Corporation
|
Reconveyance
fee for reconveyance of property upon full payment of loan, payable by
borrower.
|
Approximately
$45 per deed of trust or market rate.
|
Redwood
Mortgage Corp.
|
Assumption
fee for assumption of loans payable by borrower of between 1/2 and 1 1/2
percent of the loan.
|
$16,000
per year (5)(6)
|
Redwood
Mortgage Corp.
|
Extension
fee for extending the loan period payable by borrower as a percentage of
the loan.
|
$8,000
per year (6)
|
Redwood
Mortgage Corp.
|
Interest
earned, if any, between the date of deposit of borrower’s funds into
Redwood Mortgage Corp.’s trust account and date of payment of such funds
by Redwood Mortgage Corp.
|
$0
per year
|
Redwood
Mortgage Corp. (33.33%)
Gymno
Corporation (33.33%)
Michael
R Burwell (33.33%)
|
One
percent (1%) interest in profits, losses and distributions of earnings and
cash available for distribution.
|
$83,000
per year (6)
|
LIQUIDATING
STAGE
|
||
Entity
Receiving
|
||
Compensation
|
Form and Method of
Compensation
|
Estimated Amount
|
Redwood
Mortgage Corp.
|
Redwood
Mortgage Corp.’s obligation to repay the principal amount of the formation
loan owed to the partnership will be reduced by a portion of the early
withdrawal penalties received by the partnership. Initially, a
portion of the early withdrawal penalties will be used to reduce the
formation loan obligation and a portion will be used to pay the
partnership’s offering expenses. This portion shall be
determined by the ratio between the initial amount of the formation loan
and the total amount of the offering expenses incurred by the
partnership. Assuming that the maximum formation loan is
$9,000,000 and the maximum organizational costs are $4,000,000, the ratio
would be 69:31. This amount could be higher or lower, depending
upon total offering expenses. That ratio will be determined by
the actual formation loan and offering expenses incurred. The
ratio will change as offering expenses are
amortized. Historically, 70% of the total early withdrawal
penalty payments were used to reduce Redwood Mortgage Corp.’s obligation
under the formation loan (See “TRANSFER OF UNITS – Withdrawal from
Partnership” at page 84).
|
$64,000
per year (6)(7)
|
|
(1)
|
Assuming
that all $100,000,000 of partnership units offered hereby are sold, we
estimate that the loan portfolio resulting from such sale will average
$89,158,000, which amount is the basis for the above loan servicing fee
calculation. That calculation is also based on an estimated one
percent (1%) annual loan servicing fee being paid by the
partnership. The general partners are entitled to receive a
maximum loan servicing fee of up to one and one-half percent (1½%) per
year which is paid monthly in an amount up to 1/8 of 1% of the outstanding
principal amount of each loan. The general
partners,
|
|
(2)
|
On
any property foreclosed upon, the loan servicing fee is payable by the
borrower up until the time of foreclosure. If, at the time of
foreclosure, the loan servicing fee has not been paid out of the cash
proceeds from a trustee’s sale of the foreclosed property, the loan
servicing fee will be payable by the
partnership.
|
(3)
|
The
general partners receive a monthly asset management fee in a maximum
amount of 1/32 of 1% of the net asset value of the partnership for
services rendered in connection with the ongoing management of the
partnership’s portfolio of loans. The general partners, in
their sole discretion, may elect to lower the amount of the asset
management fee they receive. The general partners may not
increase the asset management fee above the maximum
amount. Currently, the asset management fee is paid 50% to
Redwood Mortgage Corp., 25% to Gymno Corporation and 25% to Michael R.
Burwell. The general partners may, in their discretion, change
the relative amount received by each of them. The estimated
amount payable is based on a monthly asset management fee in the amount of
1/32 of 1% of the net asset value of the partnership which is estimated to
be $103,000,000.
|
|
(4)
|
The
general partners or their affiliates are reimbursed for the actual cost of
goods and materials used for or by the partnership and obtained from
unaffiliated parties. In addition, the general partners or
their affiliates are reimbursed for the cost of administrative services
necessary for the prudent operation of the partnership provided that such
reimbursement will be the lesser of (a) the actual cost of such services
or (b) ninety percent (90%) of the amount which the partnership would be
required to pay independent parties for comparable
services.
|
|
(5)
|
Redwood
Mortgage Corp. may receive an assumption fee of between .5% and 1.5% of
the outstanding balance of a loan when a new borrower assumes the loan
obligations of the original borrower under a loan. The actual
amount of the assumption fee is determined by the general partners at the
time of the assumption based on such factors as current interest rates,
the amount of the outstanding loan and the credit worthiness of the new
borrower.
|
|
(6)
|
The
amount of fees to be paid to the general partners and their affiliates
related to this offering are based on certain assumptions made in light of
the general partners’ past experience with similar programs. In
determining the average annual fees to be paid to the general partners and
their affiliates related to this offering the general partners have
assumed, based upon their historical experience the
following: (i) a partnership life of twelve (12) years assuming
$50,000,000 is raised in year one (1) and $50,000,000 is raised in year
two (2); (ii) sixty five percent (65%) of the investors elect to retain
their earnings in their capital accounts and thirty five percent (35%)
elect to receive periodic cash distributions; (iii) an eight percent (8%)
yield in all twelve (12) years; (iv) withdrawal rates of 5% in year six
(6) and 10% thereafter; (v) a turnover rate on loans of 5% in year two
(2), of ten percent (10%) in year three (3), fifteen percent (15%) in year
four (4) and twenty percent (20%) thereafter; (vi) no leveraging of the
portfolio has occurred (vii) early withdrawals by limited partners over a
one (1) year period of one percent (1%) per year during years three (3)
through twelve (12); (viii) syndication costs of $4,000,000 incurred
equally in years one (1) and two (2); (viii) cash liquidity reserves of
two percent (2%) of net capital. However, because the estimated
amount of fees to be paid to the general partners and their affiliates are
based on certain assumptions and conditions, including, historical
experience, which may not provide an exact measurement of the fees to be
paid, the general state of the economy, interest rates, the turnover rate
of loans, partnership earnings, the duration and type of loans the
partnership will make, and the election of investors to retain their
earnings in their capital accounts or receive periodic cash distributions,
the actual amount of fees paid will vary from those set forth
above.
|
(7)
|
Early
withdrawal penalties applied to the formation loan reduces the amount of
the formation loan balance owed by Redwood Mortgage Corp. to the
partnership. Early withdrawal penalties are applied based on
the original cost percentage of 70% and 30%, respectively, between the
formation loan and syndication costs. After the syndication
costs are reimbursed or amortized, early withdrawal penalties are applied
70% to the formation loan and 30% to other income. After the
formation loan is repaid, all early withdrawal penalty amounts are
credited to the partnership for use in making loans and for
reserves.
|
|
(8)
|
To
estimate the maximum loan brokerage commissions, we have assumed that
average partnership assets resulting from the sale of all $100,000,000 of
partnership units offered hereby will be $103,000,000, and brokerage loan
commissions at 4% of the total partnership
assets.
|
Year
Ended
|
Year
Ended
|
|||||||||
December
31, 2004
|
December
31, 2003
|
|||||||||
Actual
|
Actual
|
Maximum
|
Maximum
|
Actual
|
Actual
|
Maximum
|
Maximum
|
|||
Amount
|
Fee
|
Amount
|
Fee
|
Amount
|
Fee
|
Amount
|
Fee
|
|||
Form
|
Received
|
%
|
Allowable
|
%
|
Received
|
%
|
Allowable
|
%
|
||
PAID
BY PARTNERSHIP
|
||||||||||
Loan
Servicing Fee (1)
|
$1,565,000
|
1.00%
|
$2,348,000
|
1.5%
|
$1,057,000
|
1%
|
$1,586,000
|
1.5%
|
||
Asset
Management Fee (2)
|
$630,000
|
.375%
|
$630,000
|
.375%
|
$468,000
|
.375%
|
$468,000
|
.375%
|
||
Reimbursement
of Operating
|
||||||||||
Expenses
|
$307,000
|
N/A
|
$307,000
|
N/A
|
$290,000
|
N/A
|
$290,000
|
N/A
|
||
1%
of Profits, Losses and
|
||||||||||
Disbursements
|
$121,000
|
1%
|
$121,000
|
1%
|
$96,000
|
1%
|
$96,000
|
1%
|
||
PAID
BY BORROWERS
|
||||||||
Loan
Brokerage Fees (3)
|
$2,443,000
|
1.22%
|
$8,025,000
|
4%
|
$2,621,000
|
1.61%
|
$6,506,000
|
4%
|
Processing
and Servicing
|
||||||||
Fees
|
$35,000
|
N/A
|
$35,000
|
N/A
|
$32,000
|
N/A
|
$32,000
|
N/A
|
(ranges
from approximately
|
||||||||
$500
to $1,000 per loan based
|
||||||||
upon
loan size)
|
||||||||
Reconveyance
Fees
|
$24,429
|
N/A
|
$24,429
|
N/A
|
$7,033
|
N/A
|
$7,033
|
N/A
|
(maximum
of $45 per deed of
|
||||||||
trust
or equal to fractionalized
|
||||||||
interest
of the partnership in
|
||||||||
the
deed of trust)
|
||||||||
Assumption
Fee
|
$0
|
N/A
|
$0
|
N/A
|
$0
|
N/A
|
$0
|
N/A
|
Extension
Fee
|
$500
|
N/A
|
$500
|
N/A
|
$500
|
N/A
|
$500
|
N/A
|
(ranges
from approximately
|
||||||||
$250
to $1,000 per loan based
|
||||||||
upon
loan size)
|
||||||||
PAID
BY OTHERS
|
||||||||
Interest
earned on deposit
|
$0
|
N/A
|
$0
|
N/A
|
$0
|
N/A
|
$0
|
N/A
|
Early
withdrawal penalty (4)
|
$61,000
|
N/A
|
$61,000
|
N/A
|
$62,000
|
N/A
|
$62,000
|
N/A
|
·
|
the
size of the loan,
|
·
|
portfolio
diversification,
|
·
|
quality
and credit worthiness of borrower,
|
·
|
amount
of uninvested funds,
|
·
|
the
length of time that excess funds have remained
uninvested.
|
·
|
the
unpaid principal amount of the partnership’s
loan,
|
·
|
unpaid
interest accrued to the date of
foreclosure,
|
·
|
expenditures
made to protect the partnership’s interest in the property such as
payments to senior lienholders and for insurance and
taxes,
|
·
|
costs
of foreclosure (including attorneys’ fees actually incurred to prosecute
the foreclosure or to obtain relief from a stay in bankruptcy),
and
|
·
|
any
advances made by the general partners on behalf of the partnership for any
of the foregoing less any income or rents received, condemnation proceeds
or other awards received or similar monies
received.
|
·
|
bring
partnership class actions,
|
·
|
enforce
rights of all limited partners similarly situated,
and
|
·
|
bring
partnership derivative actions to enforce rights of the partnership
including, in each case, rights under certain rules and regulations of the
Securities and Exchange Commission;
and
|
·
|
approximately
25, which represents forty six percent (46%) of the other publicly offered
partnerships’ portfolios ($5,810,115) are secured by single family
residences,
|
·
|
4,
which represents nine percent (9%) of the other publicly offered
partnerships’ portfolios ($1,068,580) are secured by multifamily
units,
|
·
|
13,
which represents forty five percent (45%) of the other publicly offered
partnerships’ portfolios ($5,734,911) are secured by commercial
properties
|
·
|
33,
which represents forty nine percent (49%) of the partnership’s portfolio
($84,359,000) are secured by single family
residences.
|
·
|
15,
which represents eighteen percent (18%) of the partnership’s portfolio
($30,981,000) are secured by multifamily
units.
|
·
|
25,
which represents thirty two percent (32%) of the partnership’s portfolio
($54,670,000) are secured by commercial
properties.
|
·
|
2,
which represents one percent (1%) of the partnership’s portfolio
($1,735,000) are secured by unimproved
properties.
|
·
|
approximately
18, which represents twenty one percent (21%) of the other privately
offered partnerships’ portfolios ($1,777,514) are secured by single family
residences,
|
·
|
2,
which represents twenty six percent (26%) of the other privately offered
partnerships’ portfolios ($2,292,146) are secured by multifamily
units,
|
·
|
24,
which represents fifty three percent (53%) of the other privately offered
partnerships’ portfolios ($4,589,149) are secured by commercial
properties
|
|
TABLE
IV
|
is
not included herein because none of the partnerships has completed its
operations or disposed of all of its
loans.
|
|
TABLE
VI
|
Descriptions
of Open Loans of Prior Limited Partnerships is contained in Part II of the
Registration Statement.
|
·
|
implementation
of partnership investment policies
|
·
|
identification,
selection and extension of loans
|
·
|
preparation
and review of budgets
|
·
|
cash
flow and taxable income or loss projections and working capital
requirements
|
·
|
periodic
physical inspections and market
surveys
|
·
|
supervision
of any necessary litigation
|
·
|
preparation
and review of partnership reports, communications with limited
partners
|
·
|
supervision
and review of partnership bookkeeping, accounting and
audits
|
·
|
supervision
and review of partnership state and federal tax
returns
|
·
|
supervision
of professionals employed by the partnership in connection with any of the
foregoing, including attorneys and
accountants.
|
General Partners’
Interest
|
|||
Amount
of
|
|||
Beneficial
|
|||
Ownership
|
Percent
|
||
In
Partnership’s
|
Of
General
|
||
Net
Income,
|
Partners’
|
||
Title
|
Losses,
|
Interest
|
|
of
|
And
Cash
|
Owned
|
|
Class
|
Name and Address
|
Distributions (3)(5)
|
(4)
|
General
Partner’s Interest
|
Gymno
Corporation, 900 Veterans Blvd., Suite 500, Redwood City, California
94063(1)
|
.33%
|
33%
|
General
Partner’s Interest
|
Michael
R. Burwell, 900 Veterans Blvd., Suite 500, Redwood City, California
94063
|
.33%
|
33%
|
General
Partner’s Interest
|
Redwood
Mortgage Corp, 900 Veterans Blvd., Suite 500, Redwood City, California
94063 (2)
|
.33%
|
33%
|
General
Partners’ Interest
|
All
general partners as a group
|
1.00%
|
100%
|
(1)
|
Michael
R. Burwell has a controlling interest in Gymno
Corporation.
|
(2)
|
Redwood
Mortgage Corp. is owned 100% by The Redwood Group Ltd, an affiliate of the
general partners.
|
(3)
|
The
general partners own in the aggregate an interest in the partnership equal
to 1% of the partnership’s net income, losses and cash distributions, in
consideration of which the general partners contribute collectively to the
partnership, cash in the amount of 1/10th
of 1% of the capital contributed by limited partners. The
general partners share such interest
equally.
|
(4)
|
Each
general partner owns 33 1/3% of the general partners’
interests. The general partners’ interests represent an
interest in 1% of the partnership’s net income, losses and cash
distributions.
|
(5)
|
Excludes
50,000 units of limited partnership interests held by Redwood Mortgage
Corp.
|
For
the Three Months ended March 31,
|
||||||||
2005
|
2004
|
|||||||
Loans
secured by trust deeds
|
$ | 152,612,000 | $ | 138,220,000 | ||||
Less:
Allowance for loan losses
|
(2,434,000 | ) | (2,216,000 | ) | ||||
Real
estate held for sale, net of allowance of $1,000,000 and
|
||||||||
$500,000,
respectively
|
20,366,000 | 3,979,000 | ||||||
Cash,
cash equivalents and other assets
|
28,329,000 | 11,391,000 | ||||||
Total
assets
|
198,873,000 | 151,374,000 | ||||||
Liabilities
|
4,529,000 | 4,088,000 | ||||||
Partners’
capital
|
||||||||
General
partners
|
171,000 | 130,000 | ||||||
Limited
partners
|
194,173,000 | 147,156,000 | ||||||
Total
partners’ capital
|
194,344,000 | 147,286,000 | ||||||
Total
liabilities/partners’ capital
|
198,873,000 | 151,374,000 | ||||||
Revenues
|
$ | 4,525,000 | $ | 3,850,000 | ||||
Operating
expenses
|
||||||||
Management
fee
|
$ | 184,000 | $ | 141 ,000 | ||||
Provisions
for losses on loans
|
91,000 | 282,000 | ||||||
Provisions
for losses on real estate held for sale
|
0 | 0 | ||||||
Other
|
706,000 | 694,000 | ||||||
Net
income
|
3,544,000 | 2,733,000 | ||||||
Net
income allocated to general partners
|
35,000 | 27,000 | ||||||
Net
income allocated to Limited Partners
|
$ | 3,509,000 | $ | 2,706,000 | ||||
Net
income per $1,000 invested by Limited
|
||||||||
Partners
for entire period:
|
||||||||
-
where income is reinvested and
|
||||||||
compounded
|
$ | 17 | $ | 18 | ||||
-
where partner receives income in monthly
|
||||||||
distributions
|
$ | 17 | $ | 18 |
For
the Years ended December 31,
|
||||||||||||||||||||
2004
|
2003
|
2002
|
2001
|
2000
|
||||||||||||||||
Loans
secured by trust deeds
|
$ | 171,745,000 | $ | 147,174,000 | $ | 83,650,000 | $ | 82,790,000 | $ | 68,571,000 | ||||||||||
Less:
Allowance for loan losses
|
$ | (2,343,000 | ) | $ | (2,649,000 | ) | $ | (3,021,000 | ) | $ | (2,247,000 | ) | $ | (1,345,000 | ) | |||||
Real
estate held for sale
|
$ | 9,793,000 | $ | 3,979,000 | $ | 9,286,000 | $ | 0 | $ | 0 | ||||||||||
Cash,
cash equivalents and other assets
|
$ | 21,423,000 | $ | 14,150,000 | $ | 12,290,000 | $ | 5,467,000 | $ | 2,738,000 | ||||||||||
Total
assets
|
$ | 200,618,000 | $ | 162,654,000 | $ | 102,205,000 | $ | 86,010,000 | $ | 69,964,000 | ||||||||||
Liabilities
|
$ | 17,087,000 | $ | 23,882,000 | $ | 6,428,000 | $ | 12,256,000 | $ | 16,737,000 | ||||||||||
Partners’
capital
|
||||||||||||||||||||
General
partners
|
$ | 163,000 | $ | 123,000 | $ | 87,000 | $ | 67,000 | $ | 47,000 | ||||||||||
Limited
partners
|
$ | 183,368,000 | $ | 138,649,000 | $ | 95,690,000 | $ | 73,687,000 | $ | 53,180,000 | ||||||||||
Total
partners’ capital
|
$ | 183,531,000 | $ | 138,772,000 | $ | 95,777,000 | $ | 73,754,000 | $ | 53,227,000 | ||||||||||
Total
liabilities/partners’ capital
|
$ | 200,618,000 | $ | 162,654,000 | $ | 102,205,000 | $ | 86,010,000 | $ | 69,964,000 | ||||||||||
Revenues
|
$ | 17,133,000 | $ | 12,958,000 | $ | 11,691,000 | $ | 9,088,000 | $ | 6,349,000 | ||||||||||
Operating
expenses
|
||||||||||||||||||||
Management
fee
|
$ | 630,000 | $ | 468,000 | $ | 325,000 | $ | 158,000 | $ | 61,000 | ||||||||||
Provisions
for losses on loans
|
$ | 1,146,000 | $ | 782,000 | $ | 780,000 | $ | 957,000 | $ | 376,000 | ||||||||||
Provisions
for losses on real estate
|
||||||||||||||||||||
held
for sale
|
$ | 0 | $ | 0 | $ | 500,000 | $ | 0 | $ | 0 | ||||||||||
Other
|
$ | 3,225,000 | $ | 2,114,000 | $ | 2,600,000 | $ | 1,880,000 | $ | 1,625,000 | ||||||||||
Net
income
|
$ | 12,132,000 | $ | 9,594,000 | $ | 7,486,000 | $ | 6,093,000 | $ | 4,287,000 | ||||||||||
Net
income allocated to general partners
|
$ | 121,000 | $ | 96,000 | $ | 75,000 | $ | 61,000 | $ | 43,000 | ||||||||||
Net
income allocated to Limited Partners
|
$ | 12,011,000 | $ | 9,498,000 | $ | 7,411,000 | $ | 6,032,000 | $ | 4,244,000 | ||||||||||
Net
income per $1,000 invested by Limited
|
||||||||||||||||||||
Partners
for entire period:
|
||||||||||||||||||||
-
where income is reinvested and
|
||||||||||||||||||||
compounded
|
$ | 72 | $ | 78 | $ | 87 | $ | 90 | $ | 86 | ||||||||||
-
where partner receives income in monthly
|
||||||||||||||||||||
distributions
|
$ | 70 | $ | 75 | $ | 84 | $ | 86 | $ | 83 |
REDWOOD
MORTGAGE INVESTORS VIII
|
|||||||||||||||||||||
OTHER
PARTNERSHIPS: (3)
REDWOOD
MORTGAGE INVESTORS (4)
REDWOOD
MORTGAGE INVESTORS II (4)
REDWOOD
MORTGAGE INVESTORS III (4)
REDWOOD
MORTGAGE INVESOTRS IV (5)
REDWOOD
MORTGAGE INVESTORS V (5)
REDWOOD
MORTGAGE INVESTORS VI (5)
REDWOOD
MORTGAGE INVESTORS VII (5)
|
LIMITED
PARTNERS
99%
beneficial ownership in partnership’s
net
income, losses and cash distributions
99.91%
economic interest
|
||||||||||||||||||||
MICHAEL
BURWELL
Individual
General Partner
(.33%
beneficial ownership (1))
|
GYMNO
CORPORATION
Corporate
General Partner
(.33%
beneficial ownership (1)
.09%
economic ownership (2))
|
REDWOOD
MORTGAGE CORP.
Corporate
General Partner
(.33%
beneficial ownership (1))
|
|||||||||||||||||||
MICHAEL
BURWELL
50%
owner Gymno
Corporation
|
The
Burwell Trusts
50%
owner Gymno
Corporation
(6)
|
||||||||||||||||||||
THE
REDWOOD GROUP, LTD(6)
100%
owner Redwood Mortgage Corp.
|
|||||||||||||||||||||
The
Burwell Trusts
100%
owner of
The
Redwood Group, LTD
|
1.
|
Beneficial
ownership in a partner’s net income, losses and
distributions
|
2.
|
Economic
interest is an equity interest
|
3.
|
Limited
partners hold a 99% beneficial ownership and General Partners Michael
Burwell and Gymno Corporation each hold ½ of 1% (.5%) beneficial
ownership
|
4.
|
Limited
Partners hold a 100% economic
interest
|
5.
|
As
of December 31, 2004, limited partners hold economic interests of 99.87%,
99.76%, 99.85% and 99.87% and Gymno Corporation holds economic interests
of .13%, .24%, .15% and .13% in Redwood Mortgage Investors IV, Redwood
Mortgage Investors V, Redwood Mortgage Investors VI and Redwood Mortgage
Investors VII respectively
|
6.
|
Michael
R. Burwell has a controlling interest through trusts in The Redwood Group,
Ltd.
|
·
|
Yield
a high rate of return from mortgage lending;
and
|
·
|
Preserve
and protect the partnership’s
capital.
|
·
|
less
liquid,
|
·
|
not
readily transferable, and
|
·
|
not
provide a guaranteed return over its investment
life.
|
·
|
single-family
residences (including homes, condominiums and townhouses, including 1-4
unit residential buildings),
|
·
|
multifamily
residential property (such as apartment
buildings),
|
·
|
commercial
property (such as stores, shops, offices, warehouses and retail strip
centers), and
|
·
|
land.
|
·
|
Priority of Mortgages.
The lien securing each loan will not be junior to more than two
other encumbrances (a first and, in some cases a second deed of trust) on
the real property which is to be used as security for the
loan. Although we may also make wrap-around or “all-inclusive”
loans, those wrap-around loans will include no more than two (2)
underlying obligations (See “CERTAIN LEGAL ASPECTS OF LOANS - Special
Considerations in Connection with Junior Encumbrances” at page
45). We anticipate that the partnership’s loans will eventually
be diversified as to priority approximately as
follows:
|
§
|
first
mortgages – 40-60%;
|
§
|
second
mortgages – 40-60%;
|
§
|
third
mortgages – 0-10%.
|
§
|
sixty
seven percent (67%) were secured by first
mortgages,
|
§
|
twenty
nine percent (29%) by second mortgages
and
|
§
|
four
percent (4%) by third mortgages.
|
·
|
Geographic Area of Lending
Activity. We will continue to generally limit lending to properties
located in California. To date, we have made no loans outside
of California. Approximately 76.36% of our loans are secured by
deeds of trust on properties in the six San Francisco Bay Area
counties. We anticipate that this will continue in the
future. These counties, which have an aggregate population of
over 5.8 million, are Santa Clara, San Mateo, San Francisco, Alameda,
Contra Costa and Marin. The economy of the area where the
security is located is important in protecting market
values. Therefore, the general partners will limit the largest
percentage of our lending activity principally to the San Francisco Bay
Area since it has a broad diversified economic base, an expanding working
population and a minimum of buildable sites. The general
partners believe these factors contribute to a stable market for
residential property. Although we anticipate that the
partnership’s primary area of lending will continue to be Northern
California, we may elect to make loans secured by real property located
throughout California.
|
·
|
Construction Loans. We
may make construction loans up to a maximum of 10% of our loan
portfolio. With respect to residential property, a construction
loan is a loan in which the proceeds are used to construct a new dwelling
(up to four units) on a parcel of property on which no dwelling previously
existed or on which the existing dwelling was entirely
demolished. With respect to commercial property, a construction
loan is a loan in which the proceeds are used to construct an entirely new
building on a parcel of property on which no building existed or on which
an existing building was entirely demolished. As of
December 31, 2004, 8.36% of our loans consisted of construction
loans. The partnership also has undisbursed commitments for
construction loans. If all of such undisbursed commitments were
to be disbursed, then the aggregate amount of the partnership’s
construction loans would exceed 10% of its total loan
portfolio. The general partners anticipate, however, that as
such undisbursed commitments are disbursed, the total amount of
construction loans will not exceed such 10% level because such disbursed
loans will be offset by repayments of other outstanding construction loans
and by the overall growth in the partnership’s loan
portfolio.
|
·
|
Rehabilitation
Loans. The partnership also makes loans, the proceeds of
which are used to remodel, add to and/or rehabilitate an existing
structure or dwelling, whether residential, commercial or multifamily
properties and which, in the determination of management, are not
construction loans. These loans are referred to by management
as “rehabilitation loans”. As of December 31, 2004 the partnership
had funded $41,373,000 in rehabilitation loans and $8,880,000 remained to
be disbursed for a combined total of $50,253,000. While the partnership
does not classify rehabilitation loans as construction loans,
rehabilitation loans do carry some of the same risks as construction
loans. There is no limit on the amount of rehabilitation loans the
partnership may make.
|
·
|
Loan-to-Value
Ratios. The amount of the partnership’s loan combined
with the outstanding debt secured by a senior deed of trust on the
security property generally will not exceed a specified percentage of the
appraised value of the security property as determined by an independent
written appraisal at the time the loan is made. These
loan-to-value ratios are as
follows:
|
Type
of Security Property
|
Loan
to-Value Ratio
|
Residential
(including apartments)
|
80%
|
Commercial
Property (including retail stores, office buildings, warehouses
facilities, mixed use properties)
|
70%
|
Land
|
50%
|
·
|
Terms of
Loans. Most of our loans are for a period of 1 to 5
years, but in no event more than 15 years. Most loans provide
for monthly payments of principal and/or interest. Many loans
provide for payments of interest only or are only partially amortizing
with a “balloon” payment of principal payable in full at the end of the
term. Some loans provide for the deferral and compounding of all or a
portion of accrued interest for various periods of
time.
|
·
|
Equity Interests in Real
Property. Most of our loans provide for interest rates comparable
to second mortgage rates prevailing in the geographical area where the
security property is located. However, we reserve the right to
make loans (up to a maximum of 25% of the partnership’s loan portfolio)
bearing a reduced stated interest rate in return for an interest in the
appreciation in value of the security property during the term of the loan
(See “CONFLICTS OF INTEREST – Amount of Loan Brokerage Commissions, Other
Compensation To The General Partners And The Quality And Types Of Loans
Affects Rate of Return to You” at page
29).
|
·
|
Escrow
Conditions. Loans are funded through an escrow account
handled by a title insurance company or by Redwood Mortgage Corp., subject
to the following conditions:
|
§
|
Satisfactory
title insurance coverage is obtained for all loans. The title
insurance policy names the partnership as the insured and provides title
insurance in an amount at least equal to the principal amount of the
loan. Title insurance insures only the validity and priority of
the partnership’s deed of trust, and does not insure the partnership
against loss by reason of other causes, such as diminution in the value of
the security property, over appraisals,
etc.
|
§
|
Satisfactory
fire and casualty insurance is obtained for all loans, naming the
partnership as loss payee in an amount equal to cover the replacement cost
of improvements.
|
§
|
The
general partners do not intend to and to date have not arranged for
mortgage insurance, which would afford some protection against loss if the
partnership foreclosed on a loan and there was insufficient equity in the
security property to repay all sums owed. If the general
partners determine in their sole discretion to obtain such insurance, the
minimum loan-to-value ratio for residential property loans will be
increased.
|
§
|
All
loan documents (notes, deeds of trust, escrow agreements, and any other
documents needed to document a particular transaction or to secure the
loan) and insurance policies name the partnership as payee and
beneficiary. Loans are not written in the name of the general
partners or any other nominee.
|
·
|
Loans to General Partners and
Affiliates. Although we may loan funds to the general
partners or their affiliates, no such loans have been made to
date. However, the partnership has made and will make formation
loans to Redwood Mortgage Corp. and may, in certain limited circumstances,
loan funds to affiliates, to among other things, purchase real estate
owned by us as a result of
foreclosure.
|
·
|
Purchase of Loans from
Affiliates and Other Third Parties. Existing loans may
be purchased, from the general partners, their affiliates or other third
parties, only so long as any such loan is not in default and otherwise
satisfies all of the foregoing requirements; provided, the general
partners and their affiliates will sell no more than a 90% interest and
retain a 10% interest in any loan sold to the partnership which they have
held for more than 180 days. In such case, the general partners
and affiliates will hold their 10% interest and the partnership will hold
its 90% interest in the loan as tenants in common. The purchase
price to the partnership for any such loan will not exceed the par value
of the note or its fair market value, whichever is
lower.
|
·
|
Note
Hypothecation. We also may make loans which will be
secured by assignments of secured promissory notes. The amount
of a loan secured by an assigned note will satisfy the loan-to-value
ratios set forth above (which are determined as a specified percentage of
the appraised value of the underlying property) and also will not exceed
80% of the principal amount of the assigned note. For example,
if the property securing a note is commercial property, the total amount
of outstanding debt secured by such property, including the debt
represented by the assigned note and any senior mortgages, must not exceed
70% of the appraised value of such property, and the loan will not exceed
80% of the principal amount of the assigned note. For purposes
of making loans secured by promissory notes, we shall rely on the
appraised value of the underlying property, as determined by an
independent written appraisal which was conducted within the last twelve
(12) months. If such appraisal was not conducted within the
last twelve months, then we will arrange for a new appraisal to be
prepared for the property. All such appraisals will satisfy our
loan-to-value ratios set forth above. Any loan evidenced by a
note assigned to the partnership will also satisfy all other lending
standards and policies described herein. Concurrently with our
making of the loan, the borrower of partnership funds, i.e., the holder of
the promissory note, shall execute a written assignment which shall assign
to the partnership his/its interest in the promissory note. No
more than 20% of our portfolio at any time will be secured by promissory
notes. As of the date hereof, none of our portfolio is secured
by promissory notes.
|
·
|
Loan
Participation. We have participated in loans with other
limited partnerships organized by the general partners, where we have
purchased a fractional undivided interest in a loan, meeting the
requirements set forth above. Because we will not participate
in a loan which would not otherwise meet our requirements, the risk of
such participation is minimized. Although we may participate in
loans with nonaffiliated lenders, individuals or pension funds, we have
not to date. Any such participation would only be on the terms
and conditions set above.
|
·
|
Diversification. The
maximum investment by the partnership in a loan will not exceed the
greater of (1) $75,000, or (2) 10% of the then total partnership assets
(See Loan Participation, above).
|
·
|
Reserve Liquidity Fund.
A contingency reserve liquidity fund equal to the lesser of two
percent (2%) of the gross proceeds of the offering or two percent (2%) of
the net capital of the partnership will be established for the purpose of
covering unexpected cash needs of the
partnership.
|
·
|
issue
senior securities
|
·
|
invest
in the securities of other issuers for the purpose of exercising
control
|
·
|
underwrite
securities of other issuers, or
|
·
|
offer
securities in exchange for
property.
|
·
|
Due-on-Sale. Federal
law now provides that, subject to certain exceptions, notwithstanding any
contrary preexisting state law, due-on-sale clauses contained in mortgage
loan documents are enforceable in accordance with their terms by any
lender after October 15, 1985. Morrison & Foerster LLP,
counsel for the partnership, has advised that under the Garn-St. Germain
Act we will probably be entitled to enforce the “due-on-sale” clause
anticipated to be used in the deeds of trust given to secure the
loans. On the other hand, acquisition of a property by us by
foreclosure on one of our loans, may also constitute a “sale” of the
property, and would entitle a senior lienholder to accelerate its loan
against us. This would be likely to occur if then prevailing interest
rates were substantially higher than the rate provided for under the
accelerated loan. In that event, we may be compelled to sell or refinance
the property within a short period of time, notwithstanding that it may
not be an opportune time to do so.
|
·
|
Due-on-Encumbrance. With
respect to mortgage loans on residential property containing four or less
units, federal and California law prohibits acceleration of the loan
merely by reason of the further encumbering of the property (e.g.,
execution of a junior deed of trust). This prohibition does not
apply to mortgage loans on other types of property. Although
most of our second mortgages will be on properties that qualify for the
protection afforded by federal law, some loans will be secured by
apartment buildings or other commercial properties which may contain due
on encumbrance provisions. Absent consent by the senior lender,
second mortgage loans made by us may trigger acceleration of senior loans
on such properties if the senior loans contain due-on-encumbrance clauses,
although both the number of such instances and the actual likelihood of
acceleration is anticipated to be minor. Failure of a borrower
to pay off the accelerated senior loan would be an event of default and
subject us (as junior lienholder) to the attendant risks (See “CERTAIN
LEGAL ASPECTS OF LOANS - Special Considerations in Connection with Junior
Encumbrances” at page 45).
|
·
|
Prepayment
Charges. Some loans originated by the partnership
provide for certain prepayment charges to be imposed on the borrowers in
the event of certain early payments on the loans. Any prepayment charges
collected on loans will be retained by the partnership. Loans
secured by deeds of trust encumbering single-family owner-occupied
dwellings may be prepaid at any time, regardless of whether the note and
deed of trust so provides, but prepayments made in any 12-month period
during the first five years of the term of the loan which exceed 20% of
the original balance of the loan may be subject to a prepayment charge
provided the note and deed of trust so provided. The law limits
the prepayment charge in such loans to an amount equal to six months
advance interest on the amount prepaid in excess of the permitted 20%, or
interest to maturity, whichever is less. If a loan that is
secured by residential property is being prepaid because the lender has
accelerated the loan upon the sale of the property, California law does
not allow a prepayment penalty to be
charged.
|
·
|
Real Property
Loans. California statutory law imposes certain
disclosure requirements with respect to loans arranged by a California
real estate broker and secured by residential
property. However, those requirements are applicable to loans
that are in a lesser amount than the loans that the partnership
anticipates making. Notwithstanding the preceding, the
partnership intends to make disclosures to borrowers that would satisfy
these statutes to the extent reasonably practicable, regardless of whether
the statutes are applicable to the relevant loans. While it is
unlikely that the partnership would make any loans subject to these
additional disclosure requests, the failure to comply with the law could
have significant adverse effects on the partnership (See “RISK FACTORS -
Risks Associated with High Cost Mortgages” at page
11).
|
Capital
|
Secured
Loans
|
Net
Income
|
||||||||||
2004
|
$ | 183,531,000 | $ | 171,745,000 | $ | 12,132,000 | ||||||
2003
|
138,772,000 | 147,174,000 | 9,594,000 | |||||||||
2002
|
95,777,000 | 83,650,000 | 7,486,000 | |||||||||
2001
|
73,754,000 | 82,790,000 | 6,093,000 |
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
Cost
of properties
|
$ | 21,366,000 | $ | 10,793,000 | ||||
Reduction
in value
|
(1,000,000 | ) | (1,000,000 | ) | ||||
Real
estate held for sale, net
|
$ | 20,366,000 | $ | 9,793,000 |
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION OF THE
PARTNERSHIP
|
Offering
|
1st
|
2nd
|
3rd
|
4th
|
5th
|
Total
|
|||||||||||||||||||
Limited
partner contributions
|
$ | 14,932 | $ | 29,993 | $ | 29,999 | $ | 49,985 | $ | 47,314 | $ | 172,223 | ||||||||||||
Formation
Loans made
|
1,075 | 2,272 | 2,218 | 3,777 | 3,570 | 12,912 | ||||||||||||||||||
Repayments
to date
|
(785 | ) | (1,013 | ) | (558 | ) | (495 | ) | (45 | ) | (2,896 | ) | ||||||||||||
Early
withdrawal penalties
|
||||||||||||||||||||||||
Applied
|
(75 | ) | (112 | ) | (78 | ) | - | - | (265 | ) | ||||||||||||||
Balance,
December 31, 2004
|
$ | 215 | $ | 1,147 | $ | 1,582 | $ | 3,282 | $ | 3,525 | $ | 9,751 |
Changes
for the years ended December 31,
|
2004
|
2003
|
|||||||
Net
income
|
$ | 2,538,000 | $ | 2,108,000 | ||||
Revenue
|
||||||||
Interest
on loans
|
3,941,000 | 1,080,000 | ||||||
Late
fees
|
17,000 | 87,000 | ||||||
Other
|
217,000 | 100,000 | ||||||
$ | 4,175,000 | $ | 1,267,000 | |||||
Expenses
|
||||||||
Mortgage
servicing fees
|
508,000 | (41,000 | ) | |||||
Interest
expense
|
551,000 | (445,000 | ) | |||||
Amortization
of loan origination fees
|
33,000 | 11,000 | ||||||
Provision
for losses on loans
|
364,000 | 2,000 | ||||||
Provision
for losses on real estate held for sale
|
- | (500,000 | ) | |||||
Clerical
costs through Redwood Mortgage Corp.
|
17,000 | 24,000 | ||||||
Asset
management fees
|
162,000 | 143,000 | ||||||
Professional
services
|
100,000 | 45,000 | ||||||
Broker
expense
|
(181,000 | ) | (263,000 | ) | ||||
Amortization
of discount on imputed interest
|
124,000 | 41,000 | ||||||
Other
|
(41,000 | ) | 142,000 | |||||
$ | 1,637,000 | $ | (841,000 | ) | ||||
Net
income increase
|
$ | 2,538,000 | $ | 2,108,000 |
Changes
during the
|
||||
three
months ended
|
||||
March
31, 2005
|
||||
versus
2004
|
||||
Net
income
|
$ | 811,000 | ||
Revenue
|
||||
Interest
on loans
|
370,000 | |||
Interest
– bank
|
31,000 | |||
Late
fees
|
(18,000 | ) | ||
Gain
on sale of real estate held for sale
|
183,000 | |||
Imputed
interest on Formation Loan
|
43,000 | |||
Other
|
66,000 | |||
$ | 675,000 | |||
Expenses
|
35,000 | |||
Mortgage
servicing fees
|
(70,000 | ) | ||
Interest
expense
|
8,000 | |||
Amortization
of loan origination fees
|
(191,000 | ) | ||
Provision
for losses on loans and real estate held for sale
|
43,000 | |||
Asset
management fees
|
3,000 | |||
Clerical
costs through Redwood Mortgage Corp.
|
(7,000 | ) | ||
Professional
services
|
43,000 | |||
Amortization
of discount on imputed interest
|
$ | (136,000 | ) | |
$ | 811,000 |
2004
|
2003
|
2002
|
||||||||||
Compounding
|
$ | 7,367,000 | $ | 5,958,000 | $ | 4,716,000 | ||||||
Distributing
|
$ | 4,452,000 | $ | 3,362,000 | $ | 2,517,000 |
2004
|
2003
|
2002
|
||||||||||
Cash
distributions
|
$ | 4,452,000 | $ | 3,362,000 | $ | 2,517,000 | ||||||
Capital
liquidation*
|
$ | 1,988,000 | $ | 1,845,000 | $ | 1,049,000 | ||||||
Total
|
$ | 6,440,000 | $ | 5,207,000 | $ | 3,566,000 |
2004
|
2003
|
2002
|
||||||||||
$ | 794,000 | $ | 786,000 | $ | 244,000 |
Contractual
Obligation
|
Total
|
Less
than 1 Year
|
1-3
Years
|
3-5
Years
|
||||||||||||
Line
of credit
|
$ | 16,000 | $ | - | $ | 5,333 | $ | 10,667 | ||||||||
Construction
loans
|
9,286 | 9,286 | - | - | ||||||||||||
Rehabilitation
loans
|
8,880 | 8,880 | - | - | ||||||||||||
Total
|
$ | 34,166 | $ | 18,166 | $ | 5,333 | $ | 10,667 |
2005
|
2006
|
2007
|
2008
|
2009
|
Thereafter
|
Total
|
||||||||||||||||||||||
Interest
earning assets:
|
||||||||||||||||||||||||||||
Money
market accounts
|
$ | 8,772 | $ | 8,772 | ||||||||||||||||||||||||
Average
interest rate
|
1.20 | % | 1.20 | % | ||||||||||||||||||||||||
Loans
secured by deeds of
|
||||||||||||||||||||||||||||
trust
|
$ | 68,761 | $ | 68,829 | $ | 21,185 | $ | 3,629 | $ | 8,844 | $ | 497 | $ | 171,745 | ||||||||||||||
Average
interest rate
|
10.79 | % | 9.61 | % | 9.68 | % | 9.42 | % | 9.28 | % | 8.50 | % | 10.02 | % | ||||||||||||||
Loans;
unsecured
|
$ | 34 | $ | 34 | ||||||||||||||||||||||||
Average
interest rate
|
- | - | ||||||||||||||||||||||||||
Interest
bearing liabilities
|
||||||||||||||||||||||||||||
Line
of credit
|
$ | 16,000 | - | - | - | - | - | $ | 16,000 | |||||||||||||||||||
Average
interest rate
|
5.00 | % | - | - | - | - | - | 5.00 | % |
Complete
Construction
|
Rehabilitation
|
Disbursed
funds
|
$ | 14,362 | $ | 41,373 | ||||
Undisbursed
funds
|
$ | 9,286 | $ | 8,880 |
Three
months ended
|
|
March
31,
|
2005
|
2004
|
|||||||
Compounding
|
$ | 2,215,000 | $ | 1,656,000 | ||||
Distributing
|
$ | 1,239,000 | $ | 1,005,000 |
Three
months ended
|
|
March
31,
|
2005
|
2004
|
|||||||
Cash
distributions
|
$ | 1,239,000 | $ | 1,005,000 | ||||
Capital
liquidation*
|
$ | 514,000 | $ | 627,000 | ||||
Total
|
$ | 1,753,000 | $ | 1,632,000 |
Thee
months ended
|
|
March
31,
|
2005
|
2004
|
|||||||
$ | 96,000 | $ | 328,000 |
Contractual
Obligation
|
Total
|
Less
than 1 Year
|
1-3
Years
|
3-5
Years
|
||||||||||||
Line
of credit
|
$ | - | $ | - | $ | - | $ | - | ||||||||
Construction
loans
|
2,444 | 2,444 | - | - | ||||||||||||
Rehabilitation
loans
|
6,631 | 6,631 | - | - | ||||||||||||
Total
|
$ | 9,075 | $ | 9,075 | $ | - | $ | - |
2005
|
2006
|
2007
|
2008
|
2009
|
Thereafter
|
Total
|
||||||||||||||||||||||
Interest
earning assets:
|
||||||||||||||||||||||||||||
Money
market accounts
|
$ | 14,557 | $ | 14,557 | ||||||||||||||||||||||||
Average
interest rate
|
1.20 | % | 1.20 | % | ||||||||||||||||||||||||
Loans
secured by deeds of
|
||||||||||||||||||||||||||||
trust
|
$ | 56,804 | 46,984 | 27,803 | 10,956 | 8,828 | 1,237 | $ | 152,612 | |||||||||||||||||||
Average
interest rate
|
10.75 | % | 9.88 | % | 9.43 | % | 10.32 | % | 9.28 | % | 9.44 | % | 10.11 | % | ||||||||||||||
Loans,
unsecured
|
$ | 34 | $ | 34 | ||||||||||||||||||||||||
Average
interest rate
|
- | - | ||||||||||||||||||||||||||
Interest
bearing liabilities:
|
||||||||||||||||||||||||||||
Line
of credit
|
$ | - | $ | - | ||||||||||||||||||||||||
Average
interest rate
|
5.75 | % | 5.75 | % |
Complete
Construction
|
Rehabilitation
|
Disbursed
funds
|
$ | 13,487,000 | $ | 49,567,000 | ||||
Undisbursed
funds
|
$ | 2,444,000 | $ | 6,631,000 | ||||
Total
commitments
|
$ | 15,931,000 | $ | 56,198,000 |
December
31,
|
2004
|
2003
|
2002
|
Single
family homes (1-4 units)
|
$ | 84,359 | 49.12 | % | $ | 66,631 | 45.27 | % | $ | 36,574 | 43.72 | % | ||||||||||||
Apartments
(over 4 units)
|
30,981 | 18.04 | % | 22,649 | 15.39 | % | 6,572 | 7.86 | % | |||||||||||||||
Commercial
|
54,670 | 31.83 | % | 52,502 | 35.67 | % | 32,089 | 38.36 | % | |||||||||||||||
Land
|
1,735 | 1.01 | % | 5,392 | 3.67 | % | 8,415 | 10.06 | % | |||||||||||||||
Total
|
$ | 171,745 | 100.00 | % | $ | 147,174 | 100.00 | % | $ | 83,650 | 100.00 | % |
#
of Loans
|
Amount
|
Percent
|
||||||||||
1st
Mortgages
|
43 | $ | 115,082 | 67.01 | % | |||||||
2nd
Mortgages
|
28 | 50,282 | 29.28 | % | ||||||||
3rd
Mortgages
|
4 | 6,381 | 3.71 | % | ||||||||
Total
|
75 | $ | 171,745 | 100.00 | % | |||||||
Maturing
in 2005
|
21 | $ | 68,761 | 40.04 | % | |||||||
Maturing
in 2006
|
24 | 68,829 | 40.07 | % | ||||||||
Maturing
in 2007
|
11 | 21,185 | 12.34 | % | ||||||||
Maturing
after 12/31/07
|
19 | 12,970 | 7.55 | % | ||||||||
Total
|
75 | $ | 171,745 | 100.00 | % | |||||||
Average
secured loan as a % of secured loan portfolio
|
$ | 2,289 | 1.33 | % | ||||||||
Largest
secured loan as a % of secured loan portfolio
|
12,045 | 7.01 | % | |||||||||
Smallest
secured loan as a % of secured loan portfolio
|
50 | 0.03 | % | |||||||||
Average
secured loan-to-value at time of loan based on
|
||||||||||||
appraisals
and prior liens at time of loan
|
56.94 | % | ||||||||||
Largest
secured loan as a % of partnership assets
|
12,045 | 6.00 | % |
March
31,
|
2005
|
2004
|
Single
family homes (1-4 units)
|
$ | 62,354 | 40.86 | % | $ | 58,620 | 42.41 | % | ||||||||
Apartments
(5+ units)
|
21,825 | 14.30 | % | 23,621 | 17.09 | % | ||||||||||
Commercial
|
66,700 | 43.71 | % | 50,587 | 36.60 | % | ||||||||||
Land
|
1,733 | 1.13 | % | 5,392 | 3.90 | % | ||||||||||
Total
|
$ | 152,612 | 100.00 | % | $ | 138,220 | 100.00 | % |
#
of Secured Loans
|
Amount
|
Percent
|
||||||||||
1st
Mortgages
|
44 | $ | 109,427 | 71.70 | % | |||||||
2nd
Mortgages
|
30 | 34,389 | 22.53 | % | ||||||||
3rd
Mortgages
|
5 | 8,796 | 5.77 | % | ||||||||
Total
|
79 | $ | 152,612 | 100.00 | % | |||||||
Maturing
12/31/05 and prior
|
19 | $ | 56,804 | 37.22 | % | |||||||
Maturing
prior to 12/31/06
|
21 | 46,984 | 30.79 | % | ||||||||
Maturing
prior to 12/31/07
|
16 | 27,803 | 18.22 | % | ||||||||
Maturing
after 12/31/07
|
23 | 21,021 | 13.77 | % | ||||||||
Total
|
79 | $ | 152,612 | 100.00 | % | |||||||
Average
secured loan as a % of secured loan portfolio
|
$ | 1,932 | 1.27 | % | ||||||||
Largest
secured loan as a % of secured loan portfolio
|
11,685 | 7.66 | % | |||||||||
Smallest
secured loan as a % of secured loan portfolio
|
50 | 0.03 | % | |||||||||
Average
secured loan-to-value at time of loan based on
|
||||||||||||
appraisals
and prior liens at time of loan
|
60.16 | % | ||||||||||
Largest
secured loan as a percent of partnership assets
|
11,685 | 5.96 | % |
Number
of Mortgage
|
||||||||||||
Investments
|
Amount
|
Percent
|
||||||||||
First
Mortgage
|
169 | $ | 283,270 | 61.05 | % | |||||||
Second
Mortgage
|
161 | 167,864 | 36.18 | % | ||||||||
Third
Mortgage
|
21 | 12,829 | 2.77 | % | ||||||||
351 | $ | 463,963 | 100.00 | % | ||||||||
Maturing
before 1/1/2005
|
191 | $ | 172,171 | 37.11 | % | |||||||
Maturing
after 1/1/2005 and before 1/1/2007
|
83 | 229,179 | 49.40 | % | ||||||||
Maturing
after 1/1/2007
|
77 | 62,613 | 13.49 | % | ||||||||
351 | $ | 463,963 | 100.00 | % | ||||||||
Single
Family Residences
|
208 | $ | 284,992 | 61.43 | % | |||||||
Commercial
Properties
|
107 | 149,682 | 32.26 | % | ||||||||
Multi-Unit
Properties
|
20 | 14,664 | 3.16 | % | ||||||||
Land
|
16 | 14,625 | 3.15 | % | ||||||||
351 | $ | 463,963 | 100.00 | % |
1.
|
Table
of open loans for the partnership as of December 31, 2004. As of December 31,
2004, the partnership had seventy five (75) open loans with a principal
outstanding balance totaling $171,745,000. Open loans are those
loans in which the principal amount of the loan is
outstanding. That is, the loan has not been paid back to the
partnership.
|
·
|
the
date the loan was funded;
|
·
|
the
amount of the existing first or second mortgage on the property, if
any;
|
·
|
the
amount of the loan, the term of the
loan;
|
·
|
the
appraised value of the property at the time the loan was
made;
|
·
|
the
loan to value ratio at the time the loan was made;
and
|
·
|
the
current status of the loan
|
S
|
|||||||||||||||
Existing
|
Existing
|
%
|
t
|
||||||||||||
1st
|
2nd
|
Amount
of
|
Loan
|
Appraised
|
Loan
to
|
a
|
|||||||||
Mortgage
|
Mortgage
|
Partnership
|
Term
|
Value
of
|
Value
|
t
|
|||||||||
Date
|
at
|
at
|
Loans
at
|
In
|
Property
at
|
Ratio
at
|
u
|
||||||||
County
|
Funded
|
Funding
|
Funding
|
Funding
|
Months
|
Funding
|
Funding
|
s
|
|||||||
Single
Family Residences (county)(5)
|
|||||||||||||||
Marin
1
|
2/4/99
|
$0
|
$0
|
$1,210,000
|
24
|
$1,860,000
|
65.05%
|
C
|
|||||||
San
Francisco 2
|
1/25/00
|
$492,978
|
$0
|
$400,000
|
60
|
$1,430,000
|
62.45%
|
A
|
|||||||
Marin
1
|
8/29/00
|
$0
|
$0
|
$1,325,000
|
6
|
$1,916,000
|
69.15%
|
C
|
|||||||
Napa
1
|
7/5/01
|
$0
|
$0
|
$3,515,000
|
18
|
$7,550,000
|
46.56%
|
C
|
|||||||
San
Mateo2
|
11/30/01
|
$139,911
|
$0
|
$318,229
|
12
|
$660,967
|
69.31%
|
E
|
|||||||
Santa
Clara 2
|
7/9/02
|
$1,647,000
|
$0
|
$263,000
|
24
|
$2,550,000
|
74.90%
|
A
|
|||||||
Santa
Clara 3
|
8/8/02
|
$632,118
|
$836,009
|
$805,000
|
60
|
$3,600,000
|
63.14%
|
A
|
|||||||
Alameda
1
|
8/16/02
|
$0
|
$0
|
$1,300,000
|
24
|
$8,130,000
|
15.99%
|
A
|
|||||||
San
Mateo 2
|
8/22/02
|
$709,865
|
$0
|
$269,000
|
36
|
$1,400,000
|
69.92%
|
A
|
|||||||
San
Mateo 1, 5
|
9/5/02
|
$0
|
$0
|
$1,781,000
|
36
|
$2,550,000
|
69.84%
|
B
|
|||||||
Napa
2
|
10/30/02
|
$500,000
|
$0
|
$1,320,000
|
36
|
$2,600,000
|
70.00%
|
B
|
|||||||
San
Mateo 1
|
5/1/03
|
$0
|
$0
|
$7,700,000
|
18
|
$13,200,000
|
58.33%
|
A
|
|||||||
Fresno
1, 5
|
7/21/03
|
$0
|
$0
|
$6,073,600
|
24
|
$8,673,000
|
70.03%
|
A
|
|||||||
Santa
Clara 2
|
12/5/03
|
$376,031
|
$0
|
$130,000
|
60
|
$775,000
|
65.29%
|
A
|
|||||||
Alameda
2, 5
|
12/23/03
|
$18,210,000
|
$0
|
$16,010,000
|
24
|
$59,600,000
|
57.42%
|
A
|
|||||||
Placer
1
|
12/12/03
|
$0
|
$0
|
$1,070,000
|
24
|
$1,400,000
|
76.43%
|
A
|
|||||||
Alameda
2
|
1/23/04
|
$189,597
|
$0
|
$500,000
|
80
|
$1,070,000
|
64.45%
|
A
|
|||||||
Alameda
3, 5
|
1/15/04
|
$15,440,356
|
$18,210,000
|
$8,245,000
|
24
|
$59,600,000
|
70.29%
|
A
|
|||||||
Santa
Clara 2
|
4/2/04
|
$1,654,802
|
$0
|
$800,000
|
24
|
$3,700,000
|
66.35%
|
A
|
|||||||
San
Francisco 2
|
4/20/04
|
$2,400,000
|
$0
|
$335,000
|
60
|
$4,000,000
|
68.38%
|
A
|
|||||||
San
Francisco 1
|
4/1/04
|
$0
|
$0
|
$1,180,000
|
24
|
$1,480,000
|
79.73%
|
A
|
|||||||
San
Mateo 2
|
4/30/04
|
$734,638
|
$0
|
$1,085,000
|
60
|
$2,800,000
|
64.99%
|
A
|
|||||||
Contra
Costa 1
|
5/11/04
|
$0
|
$0
|
$403,000
|
60
|
$530,000
|
76.04%
|
A
|
|||||||
San
Mateo 2
|
5/14/04
|
$312,908
|
$0
|
$50,000
|
60
|
$650,000
|
55.83%
|
A
|
|||||||
San
Joaquin 1
|
5/18/04
|
$0
|
$0
|
$188,000
|
60
|
$255,000
|
73.73%
|
C
|
|||||||
San
Francisco 1, 5
|
6/8/04
|
$0
|
$0
|
$8,400,000
|
24
|
$31,400,000
|
26.75%
|
A
|
|||||||
San
Mateo 2
|
6/21/04
|
$716,218
|
$0
|
$690,000
|
60
|
$2,200,000
|
63.92%
|
A
|
|||||||
Alameda
1, 5
|
7/1/04
|
$0
|
$0
|
$15,615,000
|
18
|
$52,400,000
|
29.80%
|
A
|
|||||||
San
Diego 1
|
7/2/04
|
$0
|
$0
|
$2,400,000
|
24
|
$3,200,000
|
75.00%
|
A
|
|||||||
San
Francisco 2
|
9/29/04
|
$763,929
|
$0
|
$385,000
|
36
|
$1,500,000
|
76.60%
|
A
|
|||||||
Contra
Costa 1, 5
|
9/1/04
|
$0
|
$0
|
$11,684,000
|
24
|
$26,020,000
|
44.90%
|
A
|
|||||||
Contra
Costa 2, 5
|
9/1/04
|
$11,684,500
|
$0
|
$7,821,000
|
24
|
$26,020,000
|
74.96%
|
A
|
|||||||
Sacramento
2, 5
|
9/16/04
|
$1,390,876
|
$0
|
$10,540,000
|
24
|
$15,900,000
|
75.04%
|
A
|
|||||||
Marin
1
|
10/29/04
|
$0
|
$0
|
$2,000,000
|
48
|
$13,000,000
|
15.38%
|
A
|
|||||||
San
Francisco 2
|
12/29/04
|
$1,180,000
|
$0
|
$425,000
|
14
|
$2,420,000
|
66.32%
|
A
|
|||||||
1
|
Indicates
a first deed of trust on property
|
2
|
Indicates
a second deed of trust on property
|
3
|
Indicates
a third deed of trust on the
property
|
4
|
The
term loan to value ratio means the total amount of debt secured by the
property expressed as a percentage of the total value of the property at
the inception of the loan. Generally, the loan to value ratio
will not exceed 80% of the appraised value for residential properties, 70%
of the appraised value for commercial properties and 50% of appraised
value for land.
|
5
|
Loans
may be secured by multiple single family residences, including multiple
condominiums in the same building.
|
A.
|
Loan
current or less than 90 days
delinquent
|
B.
|
Loan
90 days or more delinquent
|
C.
|
Loan
in foreclosure
|
D.
|
Loan
in bankruptcy
|
E.
|
Loan
is less than 90 days delinquent in interest payments, but is past
maturity
|
S
|
||||||||
Existing
|
Existing
|
%
|
t
|
|||||
1st
|
2nd
|
Amount
of
|
Loan
|
Appraised
|
Loan
to
|
a
|
||
Mortgage
|
Mortgage
|
Partnership
|
Term
|
Value
of
|
Value
|
t
|
||
Date
|
at
|
At
|
Loans
at
|
in
|
Property
at
|
Ratio
at
|
u
|
|
County
|
Funded
|
Funding
|
Funding
|
Funding
|
Months
|
Funding
|
Funding
|
s
|
Multiple
Units (county)
|
||||||||
Contra
Costa 2
|
7/14/99
|
$47,138
|
$0
|
$310,247
|
24
|
$477,066
|
74.91%
|
E
|
San
Francisco 1
|
7/7/00
|
$0
|
$0
|
$4,000,000
|
73
|
$5,956,000
|
67.16%
|
C
|
Contra
Costa 2
|
5/22/03
|
$2,146,575
|
$0
|
$1,950,000
|
24
|
$5,795,000
|
70.69%
|
A
|
Santa
Clara 2
|
6/26/03
|
$14,800,000
|
$0
|
$2,660,000
|
36
|
$26,650,000
|
65.52%
|
A
|
San
Joaquin 1
|
12/26/03
|
$0
|
$0
|
$413,000
|
60
|
$550,000
|
75.09%
|
A
|
Riverside
2
|
10/29/03
|
$3,115,363
|
$0
|
$3,650,000
|
24
|
$8,990,000
|
75.25%
|
A
|
San
Francisco 1
|
3/4/04
|
$0
|
$0
|
$5,200,000
|
36
|
$8,350,000
|
62.28%
|
A
|
San
Francisco 1
|
5/27/04
|
$0
|
$0
|
$666,000
|
24
|
$1,025,000
|
64.98%
|
A
|
San
Francisco 1
|
5/10/04
|
$0
|
$0
|
$881,000
|
24
|
$1,175,000
|
74.98%
|
A
|
San
Francisco 1
|
5/7/04
|
$0
|
$0
|
$875,000
|
24
|
$1,100,000
|
79.55%
|
A
|
Contra
Costa 1
|
12/9/04
|
$0
|
$0
|
$6,900,000
|
24
|
$13,200,000
|
52.27%
|
A
|
Contra
Costa 2
|
12/9/04
|
$6,900,000
|
$0
|
$1,890,000
|
24
|
$13,200,000
|
66.59%
|
A
|
San
Francisco 2
|
12/10/04
|
$881,250
|
$0
|
$641,500
|
17
|
$2,410,000
|
63.18%
|
A
|
San
Francisco 2
|
12/10/04
|
$875,000
|
$0
|
$908,000
|
17
|
$2,560,000
|
69.65%
|
A
|
1
|
Indicates
a first deed of trust on property
|
2
|
Indicates
a second deed of trust on property
|
3
|
Indicates
a third deed of trust on the
property
|
4
|
The
term loan to value ratio means the total amount of debt secured by the
property expressed as a percentage of the total value of the property at
the inception of the loan. Generally, the loan to value ratio
will not exceed 80% of the appraised value for residential properties, 70%
of the appraised value for commercial properties and 50% of appraised
value for land.
|
A.
|
Loan
current or less than 90 days
delinquent
|
B.
|
Loan
90 days or more delinquent
|
C.
|
Loan
in foreclosure
|
D.
|
Loan
in bankruptcy
|
E.
|
Loan
is less than 90 days delinquent in interest payments, but is past
maturity
|
S
|
||||||||
Existing
|
Existing
|
%
|
t
|
|||||
1st
|
2nd
|
Amount
of
|
Loan
|
Appraised
|
Loan
to
|
a
|
||
Mortgage
|
Mortgage
|
Partnership
|
Term
|
Value
of
|
Value
|
t
|
||
Date
|
At
|
At
|
Loans
at
|
in
|
Property
at
|
Ratio
at
|
u
|
|
County
|
Funded
|
Funding
|
Funding
|
Funding
|
Months
|
Funding
|
Funding
|
s
|
Commercial
Properties (county)
|
||||||||
Yuba
1
|
12/18/03
|
$0
|
$0
|
$148,000
|
72
|
$450,000
|
32.89%
|
A
|
Santa
Clara 2
|
7/15/02
|
$2,916,000
|
$0
|
$799,000
|
36
|
$5,807,700
|
63.97%
|
B
|
San
Mateo 1
|
2/27/01
|
$0
|
$0
|
$350,000
|
60
|
$495,000
|
70.71%
|
A
|
Santa
Clara 1
|
3/14/02
|
$0
|
$0
|
$770,000
|
60
|
$750,000
|
102.67%
|
A
|
Alameda
1
|
3/14/02
|
$0
|
$0
|
$320,000
|
60
|
$248,111
|
128.97%
|
A
|
Santa
Clara 3
|
5/15/02
|
$8,100,000
|
$0
|
$4,550,000
|
36
|
$28,528,000
|
44.34%
|
B
|
Santa
Clara 1
|
7/19/02
|
$0
|
$0
|
$3,600,000
|
24
|
$4,810,000
|
74.84%
|
C
|
San
Mateo 1
|
9/13/02
|
$0
|
$0
|
$441,000
|
60
|
$840,000
|
52.50%
|
A
|
El
Dorado 3
|
11/26/02
|
$378,450
|
$340,000
|
$900,000
|
60
|
$2,450,000
|
66.06%
|
A
|
Riverside
1
|
12/20/02
|
$0
|
$0
|
$1,500,000
|
60
|
$2,500,000
|
60.00%
|
A
|
San
Francisco 1
|
2/20/03
|
$0
|
$0
|
$10,440,000
|
22
|
$13,050,000
|
80.00%
|
A
|
Los
Angeles 1
|
3/28/03
|
$0
|
$0
|
$7,292,000
|
24
|
$11,680,000
|
62.43%
|
A
|
Sacramento
1
|
6/3/03
|
$0
|
$0
|
$2,500,000
|
36
|
$5,130,000
|
48.73%
|
A
|
Alameda
1
|
6/20/03
|
$0
|
$0
|
$3,570,000
|
36
|
$5,500,000
|
64.91%
|
A
|
San
Francisco 1
|
11/14/03
|
$0
|
$0
|
$2,750,000
|
24
|
$3,960,000
|
69.44%
|
A
|
San
Joaquin 1
|
12/4/03
|
$0
|
$0
|
$3,375,000
|
24
|
$4,710,000
|
71.66%
|
A
|
Napa
1
|
12/30/03
|
$0
|
$0
|
$1,610,000
|
24
|
$2,300,000
|
70.00%
|
A
|
San
Francisco 2
|
4/30/04
|
$241,655
|
$0
|
$375,000
|
60
|
$950,000
|
64.91%
|
A
|
Santa
Clara 2
|
5/27/04
|
$2,850,000
|
$0
|
$500,000
|
60
|
$4,750,000
|
70.53%
|
A
|
Marin
1
|
5/28/04
|
$0
|
$0
|
$4,650,000
|
36
|
$7,690,000
|
60.47%
|
A
|
Marin
2
|
7/21/04
|
$785,226
|
$0
|
$300,000
|
60
|
$1,450,000
|
74.84%
|
A
|
San
Francisco 1
|
7/9/04
|
$0
|
$0
|
$2,000,000
|
60
|
$2,575,000
|
77.67%
|
A
|
Alameda
1
|
7/27/04
|
$0
|
$0
|
$1,947,000
|
60
|
$3,100,000
|
62.81%
|
A
|
San
Francisco 3
|
12/14/04
|
$236,808
|
$375,000
|
$100,000
|
52
|
$950,000
|
74.93%
|
A
|
1
|
Indicates
a first deed of trust on property
|
2
|
Indicates
a second deed of trust on property
|
3
|
Indicates
a third deed of trust on the
property
|
4
|
The
term loan to value ratio means the total amount of debt secured by the
property expressed as a percentage of the total value of the property at
the inception of the loan. Generally, the loan to value ratio
will not exceed 80% of the appraised value for residential properties, 70%
of the appraised value for commercial properties and 50% of appraised
value for land.
|
A.
|
Loan
current or less than 90 days
delinquent
|
B.
|
Loan
90 days or more delinquent
|
C.
|
Loan
in foreclosure
|
D.
|
Loan
in bankruptcy
|
E.
|
Loan
is less than 90 days delinquent in interest payments, but is past
maturity
|
S
|
||||||||
Existing
|
Existing
|
%
|
t
|
|||||
1st
|
2nd
|
Amount
of
|
Loan
|
Appraised
|
Loan
to
|
a
|
||
Mortgage
|
Mortgage
|
Partnership
|
Term
|
Value
of
|
Value
|
t
|
||
Date
|
At
|
at
|
Loans
at
|
in
|
Property
at
|
Ratio
at
|
u
|
|
County
|
Funded
|
Funding
|
Funding
|
Funding
|
Months
|
Funding
|
Funding
|
s
|
Land
(county)
|
||||||||
Santa
Clara 1
|
1/17/02
|
$0
|
$0
|
$987,000
|
24
|
$1,500,000
|
65.80%
|
A
|
Lake
1
|
6/30/04
|
$0
|
$0
|
$750,000
|
60
|
$1,300,000
|
57.69%
|
A
|
1
|
Indicates
a first deed of trust on property
|
|
4
|
The
term loan to value ratio means the total amount of debt secured by the
property expressed as a percentage of the total value of the property at
the inception of the loan. Generally, the loan to value ratio
will not exceed 80% of the appraised value for residential properties, 70%
of the appraised value for commercial properties and 50% of appraised
value for land.
|
A.
|
Loan
current or less than 90 days
delinquent
|
B.
|
Loan
90 days or more delinquent
|
C.
|
Loan
in foreclosure
|
D.
|
Loan
in bankruptcy
|
E.
|
Loan
is less than 90 days delinquent in interest payments, but is past
maturity
|
·
|
amend
the limited partnership agreement, subject to certain limitations
described in Section 12.4 of the limited partnership
agreement;
|
·
|
remove
or replace one or all of the general partners. In addition,
limited partners representing ten percent (10%) of the limited partner
interests may call a meeting of the partnership. (See “SUMMARY
OF THE LIMITED PARTNERSHIP AGREEMENT” at page
81).
|
a)
|
terminate
the partnership;
|
b)
|
amend
the limited partnership agreement, subject to certain
limitiations;
|
c)
|
approve
or disapprove the sale of all or substantially all of the assets of the
partnership; or
|
d)
|
remove
and replace one or all of the general
partners.
|
e)
|
upon
the removal, death, retirement, insanity, dissolution or bankruptcy of a
general partner, unless the business of the partnership is continued by a
remaining general partner, if any, or if there is no remaining general
partner, by a new general partner elected to continue the business of the
partnership by all the limited partners (or by a majority-in-interest of
the limited partners, in the case of
removal);
|
f)
|
upon
the affirmative vote of a majority-in interest of the limited
partners;
|
g)
|
upon
the sale of all or substantially all (i.e., at least seventy percent
(70%)) of the partnership’s assets as of the time of the sale;
or
|
h)
|
otherwise
by operation of law.
|
i)
|
the
assignee is a minor or incompetent (unless a guardian, custodian or
conservator has been appointed to handle the affairs of such
person);
|
j)
|
the
assignment is not permitted under applicable law, including, in particular
but without limitation, applicable federal and state securities laws;
or
|
k)
|
such
assignment would jeopardize the partnership’s existence or qualification
as a limited partnership under California law or the applicable laws of
any other jurisdiction in which the partnership is then conducting
business.
|
l)
|
the
transfer or assignment would cause a termination of the partnership for
federal or California income tax purposes, when considered together with
other transfers or assignments of interests during the twelve month period
that is relevant to that determination,
or
|
m)
|
the
general partners determine that the transfer or assignment would result in
the partnership being classified as a “publicly traded partnership” within
the meaning of Section 7704(b) of the Code or any regulations or rules
promulgated thereunder.
|
n)
|
Election of Investors to Pay
Client Fees. If you acquire units directly from the
partnership through the services of a registered investment advisor, you
will have the election to authorize us to pay your registered investment
advisor an estimated quarterly amount of no more than 2% annually of your
capital account that would otherwise be paid to you as periodic cash
distributions or compounded as earnings. For ease of reference,
we have referred to these fees as “client fees.” If you elect
to compound earnings, then the amount of the earnings reinvested by you
will be reduced by an amount equal to the amount of the client fees
paid. Thus, the amount of the periodic cash distributions paid
or the amount of earnings compounded will be less if you elect to pay
client fees through us. The authorization to pay client fees is
solely at your election and is not a requirement of investment with
us.
|
o)
|
Client Fees are not Sales
Commissions. All client fees paid will be paid from
those amounts that would otherwise be paid to you or compounded in your
capital account. The payment of all client fees is
noncumulative and subject to the availability of sufficient earnings in
your capital account. In no event will any such client fees be
paid by us as sales commissions or other compensation. We are
merely agreeing to pay to the registered investment advisor, as
an
|
p)
|
Representations and Warranties
of Registered Investment Advisors. All registered
investment advisors will represent and warrant to the partnership that,
among other things, the investment in the units is suitable for you, that
he has informed you of all pertinent facts relating to the liquidity and
marketability of units, and that if he is affiliated with an NASD
registered broker or dealer, that all client fees received by him in
connection with this transaction will be run through the books and records
of the NASD member in compliance with Notice to Members 96-33 and Rules
3030 and 3040 of the NASD Conduct
Rules.
|
Formation
Loans and Payments
|
Year
|
Principal
advanced 1st
offering
|
Principal
advanced 2nd
offering
|
Principal
advanced 3rd
offering
|
Principal
advanced
4th
offering
|
Principal
advanced
5th
offering
|
|||||||||||||||
1993
|
$ | 206,000 | - | - | - | - | ||||||||||||||
1994
|
319,000 | - | - | - | - | |||||||||||||||
1995
|
250,000 | - | - | - | - | |||||||||||||||
1996
|
300,000 | $ | 15,000 | - | - | - | ||||||||||||||
1997
|
- | 421,000 | - | - | - | |||||||||||||||
1998
|
- | 404,000 | - | - | - | |||||||||||||||
1999
|
- | 708,000 | - | - | - | |||||||||||||||
2000
|
- | 724,000 | $ | 378,000 | - | - | ||||||||||||||
2001
|
- | - | 1,462,000 | - | - | |||||||||||||||
2002
|
- | - | 378,000 | $ | 1,300,000 | - | ||||||||||||||
2003
|
2,477,000 | $ | 453,000 | |||||||||||||||||
2004
|
3,117,000 | |||||||||||||||||||
Total
|
$ | 1,075,000 | $ | 2,272,000 | $ | 2,218,000 | $ | 3,777,000 | $ | 3,570,000 |
Formation
Loans and Payments
|
Year
|
Total
payments
due
|
Payments
received from Redwood Mortgage Corp.
|
Application
of early withdrawal penalties
|
Total
applied
|
Balance
|
|||||||||||||||
1993
|
- | - | $ | 206,000 | ||||||||||||||||
1994
|
- | - | 525,000 | |||||||||||||||||
1995
|
- | - | 775,000 | |||||||||||||||||
1996
|
$ | - | $ | 9,000 | $ | 7,000 | $ | 16,000 | 1,074,000 | |||||||||||
1997
|
109,000 | 99,000 | 9,000 | 108,000 | 1,387,000 | |||||||||||||||
1998
|
151,000 | 134,000 | 16,000 | 150,000 | 1,641,000 | |||||||||||||||
1999
|
186,000 | 165,000 | 25,000 | 190,000 | 2,159,000 | |||||||||||||||
2000
|
248,000 | 230,000 | 20,000 | 250,000 | 3,011,000 | |||||||||||||||
2001
|
339,000 | 300,000 | 46,000 | 346,000 | 4,127,000 | |||||||||||||||
2002
|
488,000 | 530,000 | 18,000 | 548,000 | 5,257,000 | |||||||||||||||
2003
|
636,000 | 575,000 | 62,000 | 637,000 | 7,550,000 | |||||||||||||||
2004
|
916,000 | 855,000 | 61,000 | 916,000 | 9,751,000 | |||||||||||||||
Total
|
$ | 3,073,000 | $ | 2,897,000 | $ | 264,000 | $ | 3,161,000 |
q)
|
a
brochure entitled Redwood Mortgage Investors
VIII;
|
r)
|
a
participating broker-dealer only fact
sheet;
|
s)
|
a
slide presentation;
|
t)
|
participating
broker-dealer
only updates;
|
2004
|
2003
|
|||||||
Cash
and cash equivalents
|
$ | 16,301 | $ | 8,921 | ||||
Loans
|
||||||||
Loans
secured by deeds of trust
|
171,745 | 147,174 | ||||||
Loans,
unsecured
|
34 | 34 | ||||||
Allowance
for loan losses
|
(2,343 | ) | (2,649 | ) | ||||
Net
loans
|
169,436 | 144,559 | ||||||
Interest
and other receivables
|
||||||||
Accrued
interest and late fees
|
4,895 | 4,735 | ||||||
Advances
on loans
|
131 | 416 | ||||||
Total
interest and other receivables
|
5,026 | 5,151 | ||||||
Other
assets
|
||||||||
Loan
origination fees, net
|
62 | 44 | ||||||
Real
estate held for sale, net
|
9,793 | 3,979 | ||||||
Total
other assets
|
9,855 | 4,023 | ||||||
Total
assets
|
$ | 200,618 | $ | 162,654 |
Liabilities
|
||||||||
Line
of credit
|
$ | 16,000 | $ | 22,000 | ||||
Accounts
payable
|
25 | 224 | ||||||
Payable
to affiliate
|
638 | 448 | ||||||
Total
liabilities
|
16,663 | 22,672 | ||||||
Investors
in applicant status
|
424 | 1,210 | ||||||
Partners'
capital
|
||||||||
Limited
partners' capital, subject to redemption, net of
|
||||||||
unallocated
syndication costs of $1,084 and $875 for 2004
|
||||||||
And
2003, respectively; and net of formation loan receivable
|
||||||||
of
$9,751 and $7,550 for 2004 and 2003, respectively
|
183,368 | 138,649 | ||||||
General
partners' capital, net of unallocated syndication costs
|
||||||||
of
$11 and $9 for 2004 and 2003, respectively
|
163 | 123 | ||||||
Total
partners' capital
|
183,531 | 138,772 | ||||||
Total
liabilities and partners' capital
|
$ | 200,618 | $ | 162,654 |
2004
|
2003
|
2002
|
||||||||||
Revenues
|
||||||||||||
Interest
on loans
|
$ | 16,437 | $ | 12,496 | $ | 11,416 | ||||||
Late
fees
|
218 | 201 | 114 | |||||||||
Other
|
478 | 261 | 161 | |||||||||
17,133 | 12,958 | 11,691 | ||||||||||
Expenses
|
||||||||||||
Mortgage
servicing fees
|
1,565 | 1,057 | 1,098 | |||||||||
Interest
expense
|
622 | 71 | 516 | |||||||||
Amortization
of loan origination fees
|
56 | 23 | 12 | |||||||||
Provision
for losses on loans
|
1,146 | 782 | 780 | |||||||||
Provision
for losses on real estate held for sale
|
- | - | 500 | |||||||||
Asset
management fees
|
630 | 468 | 325 | |||||||||
Clerical
costs from Redwood Mortgage Corp.
|
307 | 290 | 266 | |||||||||
Professional
services
|
211 | 111 | 66 | |||||||||
Broker
expense
|
- | 181 | 444 | |||||||||
Amortization
of discount on imputed interest
|
319 | 195 | 154 | |||||||||
Other
|
145 | 228 | 44 | |||||||||
5,001 | 3,406 | 4,205 | ||||||||||
Income
before minority interest
|
12,132 | 9,552 | 7,486 | |||||||||
Minority
interest share of subsidiary loss
|
- | 42 | - | |||||||||
Net
income
|
$ | 12,132 | $ | 9,594 | $ | 7,486 | ||||||
Net
income
|
||||||||||||
General
partners (1%)
|
$ | 121 | $ | 96 | $ | 75 | ||||||
Limited
partners (99%)
|
12,011 | 9,498 | 7,411 | |||||||||
$ | 12,132 | $ | 9,594 | $ | 7,486 | |||||||
Net
income per $1,000 invested by
|
||||||||||||
limited
partners for entire period
|
||||||||||||
Where
income is compounded
|
$ | 72 | $ | 78 | $ | 87 | ||||||
Where
partner receives income in monthly distributions
|
$ | 70 | $ | 75 | $ | 84 |
Limited
Partners
|
||||||||||||||||||||
Partners
|
Capital
|
Total
|
||||||||||||||||||
In
|
Account
|
Unallocated
|
Formation
|
Limited
|
||||||||||||||||
Applicant
|
Limited
|
Syndication
|
Loan,
|
Partners'
|
||||||||||||||||
Status
|
Partners
|
Costs
|
Gross
|
Capital
|
||||||||||||||||
Balances
at December 31, 2001
|
$ | 673 | $ | 78,214 | $ | (400 | ) | $ | (4,127 | ) | $ | 73,687 | ||||||||
Contributions
on application
|
21,563 | - | - | - | - | |||||||||||||||
Formation
loan increases
|
- | - | - | (1,677 | ) | (1,677 | ) | |||||||||||||
Formation
loan payments received
|
- | - | - | 530 | 530 | |||||||||||||||
Interest
credited to partners in applicant status
|
1 | - | - | - | - | |||||||||||||||
Transfers
to partners' capital
|
(19,659 | ) | 19,659 | - | - | 19,659 | ||||||||||||||
Net
income
|
- | 7,411 | - | - | 7,411 | |||||||||||||||
Syndication
costs incurred
|
- | - | (377 | ) | - | (377 | ) | |||||||||||||
Allocation
of syndication costs
|
- | (178 | ) | 178 | - | - | ||||||||||||||
Partners'
withdrawals
|
- | (3,543 | ) | - | - | (3,543 | ) | |||||||||||||
Early
withdrawal penalties
|
- | (23 | ) | 7 | 16 | - | ||||||||||||||
Balances
at December 31, 2002
|
2,578 | 101,540 | (592 | ) | (5,258 | ) | 95,690 | |||||||||||||
Contributions
on application
|
40,030 | - | - | - | - | |||||||||||||||
Formation
loan increases
|
- | - | - | (2,929 | ) | (2,929 | ) | |||||||||||||
Formation
loan payments received
|
- | - | - | 575 | 575 | |||||||||||||||
Interest
credited to partners in applicant status
|
37 | - | - | - | - | |||||||||||||||
Interest
withdrawn
|
(14 | ) | - | - | - | - | ||||||||||||||
Transfers
to partners' capital
|
(41,421 | ) | 41,421 | - | - | 41,421 | ||||||||||||||
Net
income
|
- | 9,498 | - | - | 9,498 | |||||||||||||||
Syndication
costs incurred
|
- | - | (478 | ) | - | (478 | ) | |||||||||||||
Allocation
of syndication costs
|
- | (178 | ) | 178 | - | - | ||||||||||||||
Partners'
withdrawals
|
- | (5,128 | ) | - | - | (5,128 | ) | |||||||||||||
Early
withdrawal penalties
|
- | (79 | ) | 17 | 62 | - | ||||||||||||||
Balances
at December 31, 2003
|
1,210 | 147,074 | (875 | ) | (7,550 | ) | 138,649 | |||||||||||||
Contributions
on application
|
40,954 | - | - | - | - | |||||||||||||||
Formation
loan increases
|
- | - | - | (3,117 | ) | (3,117 | ) | |||||||||||||
Formation
loan payments received
|
- | - | - | 855 | 855 | |||||||||||||||
Interest
credited to partners in applicant status
|
20 | - | - | - | - | |||||||||||||||
Interest
withdrawn
|
(8 | ) | - | - | - | - | ||||||||||||||
Transfers
to partners' capital
|
(41,752 | ) | 41,752 | - | - | 41,752 | ||||||||||||||
Net
income
|
- | 12,011 | - | - | 12,011 | |||||||||||||||
Syndication
costs incurred
|
- | - | (417 | ) | - | (417 | ) | |||||||||||||
Allocation
of syndication costs
|
- | (192 | ) | 192 | - | - | ||||||||||||||
Partners'
withdrawals
|
- | (6,365 | ) | - | - | (6,365 | ) | |||||||||||||
Early
withdrawal penalties
|
- | (77 | ) | 16 | 61 | - | ||||||||||||||
Balances
at December 31, 2004
|
$ | 424 | $ | 194,203 | $ | (1,084 | ) | $ | (9,751 | ) | $ | 183,368 |
General
Partners
|
||||||||||||||||
Capital
|
Total
|
|||||||||||||||
Account
|
Unallocated
|
General
|
Total
|
|||||||||||||
General
|
Syndication
|
Partners'
|
Partners'
|
|||||||||||||
Partners
|
Costs
|
Capital
|
Capital
|
|||||||||||||
Balances
at December 31, 2001
|
$ | 71 | $ | (4 | ) | $ | 67 | $ | 73,754 | |||||||
Contributions
on application
|
- | - | - | - | ||||||||||||
Formation
loan increases
|
- | - | - | (1,677 | ) | |||||||||||
Formation
loan payments received
|
- | - | - | 530 | ||||||||||||
Interest
credited to partners in applicant status
|
- | - | - | - | ||||||||||||
Capital
contributed
|
22 | - | 22 | 19,681 | ||||||||||||
Net
income
|
75 | - | 75 | 7,486 | ||||||||||||
Syndication
costs incurred
|
- | (4 | ) | (4 | ) | (381 | ) | |||||||||
Allocation
of syndication costs
|
(2 | ) | 2 | - | - | |||||||||||
Partners'
withdrawals
|
(73 | ) | - | (73 | ) | (3,616 | ) | |||||||||
Early
withdrawal penalties
|
- | - | - | - | ||||||||||||
Balances
at December 31, 2002
|
93 | (6 | ) | 87 | 95,777 | |||||||||||
Contributions
on application
|
- | - | - | - | ||||||||||||
Formation
loan increases
|
- | - | - | (2,929 | ) | |||||||||||
Formation
loan payments received
|
- | - | - | 575 | ||||||||||||
Interest
credited to partners in applicant status
|
- | - | - | - | ||||||||||||
Interest
withdrawn
|
- | - | - | - | ||||||||||||
Capital
contributed
|
40 | - | 40 | 41,461 | ||||||||||||
Net
income
|
96 | - | 96 | 9,594 | ||||||||||||
Syndication
costs incurred
|
- | (5 | ) | (5 | ) | (483 | ) | |||||||||
Allocation
of syndication costs
|
(2 | ) | 2 | - | - | |||||||||||
Partners'
withdrawals
|
(95 | ) | - | (95 | ) | (5,223 | ) | |||||||||
Early
withdrawal penalties
|
- | - | - | - | ||||||||||||
Balances
at December 31, 2003
|
132 | (9 | ) | 123 | 138,772 | |||||||||||
Contributions
on application
|
- | - | - | - | ||||||||||||
Formation
loan increases
|
- | - | - | (3,117 | ) | |||||||||||
Formation
loan payments received
|
- | - | - | 855 | ||||||||||||
Interest
credited to partners in applicant status
|
- | - | - | - | ||||||||||||
Interest
withdrawn
|
- | - | - | - | ||||||||||||
Capital
contributed
|
41 | - | 41 | 41,793 | ||||||||||||
Net
income
|
121 | - | 121 | 12,132 | ||||||||||||
Syndication
costs incurred
|
- | (4 | ) | (4 | ) | (421 | ) | |||||||||
Allocation
of syndication costs
|
(2 | ) | 2 | - | - | |||||||||||
Partners'
withdrawals
|
(118 | ) | - | (118 | ) | (6,483 | ) | |||||||||
Early
withdrawal penalties
|
- | - | - | - | ||||||||||||
Balances
at December 31, 2004
|
$ | 174 | $ | (11 | ) | $ | 163 | $ | 183,531 |
2004
|
2003
|
2002
|
||||||||||
Cash
flows from operating activities
|
||||||||||||
Net
income
|
$ | 12,132 | $ | 9,594 | $ | 7,486 | ||||||
Adjustments
to reconcile net income to
|
||||||||||||
net
cash provided by operating activities
|
||||||||||||
Amortization
of loan fees
|
56 | 23 | 12 | |||||||||
Imputed
interest income
|
(319 | ) | (195 | ) | (154 | ) | ||||||
Amortization
of discount
|
319 | 195 | 154 | |||||||||
Provision
for loan and real estate losses
|
1,146 | 782 | 1,280 | |||||||||
Realized
loss on sale of real estate
|
- | 127 | - | |||||||||
Minority
interest share of subsidiary loss
|
- | (42 | ) | - | ||||||||
Change
in operating assets and liabilities
|
||||||||||||
Unsecured
loans
|
- | - | 4 | |||||||||
Accrued
interest and late fees
|
(2,566 | ) | (3,448 | ) | (1,253 | ) | ||||||
Advances
on loans
|
74 | (500 | ) | (312 | ) | |||||||
Other
receivables
|
- | 888 | (888 | ) | ||||||||
Loan
origination fees
|
(74 | ) | (45 | ) | (28 | ) | ||||||
Accounts
payable
|
(199 | ) | (225 | ) | 375 | |||||||
Payable
to affiliate
|
190 | 154 | 185 | |||||||||
Deferred
interest
|
- | (112 | ) | 112 | ||||||||
Net
cash provided by operating activities
|
10,759 | 7,196 | 6,973 | |||||||||
Cash
flows from investing activities
|
||||||||||||
Loans
originated
|
(81,579 | ) | (96,820 | ) | (32,601 | ) | ||||||
Principal
collected on loans
|
52,359 | 35,097 | 26,083 | |||||||||
Payments
for development of real estate
|
- | (706 | ) | (219 | ) | |||||||
Proceeds
from disposition of real estate
|
- | 6,036 | - | |||||||||
Net
cash used in investing activities
|
(29,220 | ) | (56,393 | ) | (6,737 | ) | ||||||
Cash
flows from financing activities
|
||||||||||||
Borrowings
(repayments) on line of credit, net
|
(6,000 | ) | 22,000 | (11,400 | ) | |||||||
Repayments
on note payable
|
- | (1,782 | ) | (7 | ) | |||||||
Contributions
by partner applicants
|
41,007 | 40,093 | 21,586 | |||||||||
Partners'
withdrawals
|
(6,483 | ) | (5,223 | ) | (3,616 | ) | ||||||
Syndication
costs paid
|
(421 | ) | (483 | ) | (381 | ) | ||||||
Formation
loan lending
|
(3,117 | ) | (2,929 | ) | (1,677 | ) | ||||||
Formation
loan collections
|
855 | 575 | 530 | |||||||||
Distributions
to minority interest
|
- | (1,321 | ) | - | ||||||||
Net
cash provided by financing activities
|
25,841 | 50,930 | 5,035 | |||||||||
Net
increase in cash and cash equivalents
|
7,380 | 1,733 | 5,271 | |||||||||
Cash
and cash equivalents - beginning of year
|
8,921 | 7,188 | 1,917 | |||||||||
Cash
and cash equivalents - end of year
|
$ | 16,301 | $ | 8,921 | $ | 7,188 | ||||||
Supplemental
disclosures of cash flow information
|
||||||||||||
Cash
paid for interest
|
$ | 622 | $ | 71 | $ | 516 |
Initial
|
Second
|
Third
|
Fourth
|
Fifth
|
||||||||||||||||||||
Offering
of
|
Offering
of
|
Offering
of
|
Offering
of
|
Offering
of
|
||||||||||||||||||||
$ | 15,000 | $ | 30,000 | $ | 30,000 | $ | 50,000 | $ | 75,000 |
Total
|
||||||||||||||
Limited
Partner
|
||||||||||||||||||||||||
contributions
|
$ | 14,932 | $ | 29,993 | $ | 29,999 | $ | 49,985 | $ | 47,314 | $ | 172,223 | ||||||||||||
Formation
loan made
|
$ | 1,075 | $ | 2,272 | $ | 2,218 | $ | 3,777 | $ | 3,570 | $ | 12,912 | ||||||||||||
Discount
on
|
||||||||||||||||||||||||
imputed
interest
|
(25 | ) | (303 | ) | (291 | ) | (571 | ) | (748 | ) | (1,938 | ) | ||||||||||||
Formation
loan
|
||||||||||||||||||||||||
made,
net
|
1,050 | 1,969 | 1,927 | 3,206 | 2,822 | 10,974 | ||||||||||||||||||
Repayments
to date
|
(785 | ) | (1,013 | ) | (558 | ) | (495 | ) | (45 | ) | (2,896 | ) | ||||||||||||
Early
withdrawal
|
||||||||||||||||||||||||
penalties
applied
|
(75 | ) | (112 | ) | (78 | ) | - | - | (265 | ) | ||||||||||||||
Formation
loan, net
|
||||||||||||||||||||||||
at
December 31, 2004
|
190 | 844 | 1,291 | 2,711 | 2,777 | 7,813 | ||||||||||||||||||
Unamortized
discount
|
||||||||||||||||||||||||
on
imputed interest
|
25 | 303 | 291 | 571 | 748 | 1,938 | ||||||||||||||||||
Balance,
|
||||||||||||||||||||||||
December
31, 2004
|
$ | 215 | $ | 1,147 | $ | 1,582 | $ | 3,282 | $ | 3,525 | $ | 9,751 | ||||||||||||
Percent
loaned
|
7.2 | % | 7.6 | % | 7.4 | % | 7.6 | % | 7.5 | % | 7.5 | % |
Costs
incurred
|
$ | 2,974 | ||
Early
withdrawal penalties applied
|
(104 | ) | ||
Allocated
to date
|
(1,775 | ) | ||
December
31, 2004 balance
|
$ | 1,095 |
2004
|
2003
|
|||||||
Specified
loans
|
$ | 137 | $ | 49 | ||||
General
|
2,206 | 2,600 | ||||||
$ | 2,343 | $ | 2,649 |
2004
|
2003
|
2002
|
||||||||||
Beginning
balance
|
$ | 2,649 | $ | 3,021 | $ | 2,247 | ||||||
Restructured
loans
|
- | - | 11 | |||||||||
Additions
charged to income
|
1,146 | 782 | 780 | |||||||||
Transfers
|
(500 | ) | - | - | ||||||||
Write-offs
|
(952 | ) | (1,154 | ) | (17 | ) | ||||||
$ | 2,343 | $ | 2,649 | $ | 3,021 |
|
Cash and cash
equivalents
|
|
The
Partnership considers all highly liquid financial instruments with
maturities of three months or less at the time of purchase to be cash
equivalents.
|
|
Real estate held for
sale
|
|
Real
estate held for sale includes real estate acquired through foreclosure and
is stated at the lower of the recorded investment in the loan, plus any
senior indebtedness, or at the property's estimated fair value, less
estimated costs to sell.
|
3.
|
Other Partnership
Provisions
|
|
The
Partnership is a California limited partnership. The rights,
duties and powers of the general and limited partners of the Partnership
are governed by the limited partnership agreement and Sections 15611 et
seq. of the California Corporations
Code.
|
|
The
general partners are in complete control of the Partnership business,
subject to the voting rights of the limited partners on specified
matters. Any one of the general partners acting alone has the
power and authority to act for and bind the
Partnership.
|
3.
|
Other Partnership
Provisions (continued)
|
|
The
approval of all the limited partners is required to elect a new general
partner to continue the Partnership business where there is no remaining
general partner after a general partner ceases to be a general partner
other than by removal.
|
|
Applicant
status
|
|
Subscription
funds received from purchasers of Partnership units are not admitted to
the Partnership until subscription funds are needed to fund a loan, to
fund the formation loan, create appropriate reserves, or to pay
organizational expense or other proper partnership
purposes. During the period prior to the time of admission,
which is anticipated to be between 1 - 90 days, purchasers' subscriptions
will remain irrevocable and will earn interest at money market rates,
which are lower than the anticipated return on the Partnership's loan
portfolio.
|
|
During
2004, 2003 and 2002, interest totaling $20,000, $37,000 and $1,000,
respectively, was credited to partners in applicant status. As
loans were made and partners were transferred to regular status to begin
sharing in income from loans secured by deeds of trust, the interest
credited was either paid to the investors or transferred to partners'
capital along with the original
investment.
|
|
Election to receive
monthly, quarterly or annual
distributions
|
|
At
subscription, investors elect to receive monthly, quarterly or annual
distributions of earnings allocations, or to allow earnings to
compound. Subject to certain limitations, a compounding
investor may subsequently change his election, but an investor's election
to have cash distributions is
irrevocable.
|
|
Profits and
losses
|
|
Profits
and losses are allocated among the limited partners according to their
respective capital accounts monthly after 1% of the profits and losses are
allocated to the general partners.
|
|
Liquidity, capital
withdrawals and early
withdrawals
|
|
There
are substantial restrictions on transferability of Partnership units and
accordingly an investment in the Partnership is
non-liquid. Limited partners have no right to withdraw from the
Partnership or to obtain the return of their capital account for at least
one year from the date of purchase of
units.
|
|
In
order to provide a certain degree of liquidity to the limited partners
after the one-year period, limited partners may withdraw all or part of
their capital accounts from the Partnership in four quarterly installments
beginning on the last day of the calendar quarter following the quarter in
which the notice of withdrawal is given, subject to a 10% early withdrawal
penalty. The 10% penalty is applicable to the amount withdrawn
as stated in the notice of withdrawal and will be deducted from the
capital account.
|
|
December
31, 2004, 2003 and 2002
|
3.
|
Other Partnership
Provisions (continued)
|
|
Liquidity, capital
withdrawals and early withdrawals
(continued)
|
4.
|
General Partners and
Related Parties
|
|
The
following are commissions and/or fees, which are paid to the general
partners:
|
|
Mortgage brokerage
commissions
|
|
For
fees in connection with the review, selection, evaluation, negotiation and
extension of loans, the general partners may collect an amount equivalent
to 12% of the loaned amount until 6 months after the termination date of
the offering. Thereafter, loan brokerage commissions (points)
will be limited to an amount not to exceed 4% of the total Partnership
assets per year. The loan brokerage commissions are paid by the
borrowers and thus, are not an expense of the Partnership. In
2004, 2003 and 2002, loan brokerage commissions paid by the borrowers were
$2,443,000, $2,621,000 and $996,000,
respectively.
|
|
Mortgage servicing
fees
|
|
Monthly
mortgage servicing fees of up to 1/8 of 1% (1.5% annual) of the unpaid
principal are paid to Redwood Mortgage Corp., based on the unpaid
principal balance of the loan portfolio, or such lesser amount as is
reasonable and customary in the geographic area where the property
securing the mortgage is located. Once a loan is categorized as
impaired, mortgage servicing fees are no longer accrued
thereon. Additional service fees are recorded upon the receipt
of any subsequent payments on impaired loans. Mortgage
servicing fees of $1,565,000, $1,057,000 and $1,098,000 were incurred for
2004, 2003 and 2002, respectively. The Partnership had a
payable to Redwood Mortgage Corp. for servicing fees of $638,000 and
$448,000 at December 31, 2004 and 2003,
respectively.
|
|
Asset management
fee
|
|
The
general partners receive monthly fees for managing the Partnership's loan
portfolio and operations up to 1/32 of 1% of the "net asset value" (3/8
of 1% annual). Asset management fees of $630,000,
$468,000 and $325,000 were incurred for 2004, 2003 and 2002,
respectively.
|
|
December
31, 2004, 2003 and 2002
|
4.
|
General Partners and
Related Parties (continued)
|
|
Other
fees
|
|
The
Partnership Agreement provides for other fees such as reconveyance,
mortgage assumption and mortgage extension fees. Such fees are
incurred by the borrowers and are paid to the general
partners.
|
|
Operating
expenses
|
|
Redwood
Mortgage Corp., a general partner, is reimbursed by the Partnership for
all operating expenses incurred by it on behalf of the Partnership,
including without limitation, out-of-pocket general and administration
expenses of the Partnership, accounting and audit fees, legal fees and
expenses, postage and preparation of reports to limited
partners. During 2004, 2003 and 2002, operating expenses
totaling $307,000, $290,000 and $266,000, respectively, were reimbursed to
Redwood Mortgage Corp.
|
|
Contributed
capital
|
|
The
general partners jointly or severally are to contribute 1/10 of 1% of
limited partners' contributions in cash contributions as proceeds from the
offerings are received from the limited partners. As of
December 31, 2004 and 2003, Gymno Corporation, a general partner, had
capital in accordance with Section 4.02(a) of the Partnership
Agreement.
|
5.
|
Real Estate Held for
Sale
|
|
The
following schedule reflects the cost of the properties and recorded
reductions to estimated fair values, including estimated costs to sell, at
December 31 (in thousands):
|
2004
|
2003
|
|||||||
Costs
of properties
|
$ | 10,793 | $ | 4,479 | ||||
Reduction
in value
|
(1,000 | ) | (500 | ) | ||||
Real
estate held for sale, net
|
$ | 9,793 | $ | 3,979 |
|
December
31, 2004, 2003 and 2002
|
5.
|
Real Estate Held for
Sale (continued)
|
|
During
2002, the Partnership contributed its interests in two foreclosed real
properties into two limited liability companies
("LLCs").
|
|
Russian
|
|
During
2002, a single-family residence that secured a Partnership loan totaling
$4,402,000, including accrued interest and advances, was transferred via a
statutory warranty deed to a new entity named Russian Hill Property
Company, LLC ("Russian"). Russian was formed by the Partnership
to complete the development and sale of the property. The
assets, liabilities and operating results of Russian have been
consolidated into the accompanying consolidated financial statements of
the Partnership. Costs related to the sale and development of
this property were capitalized during 2003. Commencing January
2004, costs related to sales and maintenance of the property are being
expensed. At December 31, 2004 and 2003, the Partnership's
total investment in Russian was $3,979,000, net of a valuation allowance
of $500,000.
|
|
Stockton
|
|
During
2002, six condominium units that secured a Partnership loan totaling
$2,163,000, including accrued interest and advances, were transferred via
a statutory warranty deed to a new entity named Stockton Street Property
Company, LLC ("Stockton"). In addition, senior debt was assumed
by Stockton on the property in the amount of $1,789,000 (see Note
7). Stockton was formed by the Partnership and an affiliate to
complete development and sales of the condominium units. The
Partnership is co-manager of Stockton along with the other member and is
to receive 66% of the profits or losses. The assets,
liabilities and operating results of Stockton have been consolidated into
the accompanying consolidated financial statements of the
Partnership. Development costs were capitalized during
construction; thus, there was no income or expense recognized by Stockton
during a portion of 2003. As of December 31, 2003, advances of
approximately $132,000 were made for construction and other related
development costs and $48,000 of interest expense was capitalized,
respectively. As of December 31, 2003, the property had been
sold and a net loss of $127,000 was incurred, of which $42,000 was
allocated to the minority interest.
|
6.
|
Bank Line of
Credit
|
|
The
Partnership has a $42,000,000 bank line of credit through November 25,
2005, with borrowings at prime and secured by its loan
portfolio. The outstanding balances were $16,000,000 and
$22,000,000 at December 31, 2004 and 2003, respectively. The
interest rate was 5.00% at December 31, 2004 and 4.00% at December 31,
2003. The line of credit requires the Partnership to comply
with certain financial covenants. The Partnership was in
compliance with these covenants at December 31, 2004 and
2003.
|
7.
|
Note
Payable
|
|
During
2002, the Partnership assumed a bank loan of $1,789,000 in connection with
the foreclosure on a property (see Note 5). The loan was
secured by the property and bore interest at 5.68%. As of
December 31, 2003, this loan has been paid in full upon the sale of the
related property.
|
|
8.
|
Income
Taxes
|
|
The
following reflects a reconciliation of partners' capital reflected in the
consolidated financial statements to the tax basis of Partnership capital
(in thousands):
|
2004
|
2003
|
|||||||
Partners'
capital per consolidated
|
||||||||
financial
statements
|
$ | 183,531 | $ | 138,772 | ||||
Non-allocated
syndication costs
|
1,095 | 884 | ||||||
Allowance
for loan losses and
|
||||||||
real
estate held for sale
|
3,343 | 3,149 | ||||||
Formation
loans receivable
|
9,751 | 7,550 | ||||||
Partners'
capital - tax basis
|
$ | 197,720 | $ | 150,355 |
|
In
2004 and 2003, approximately 48% and 47%, respectively, of taxable income
was allocated to tax-exempt organizations (i.e., retirement
plans).
|
|
9.
|
Fair Value of
Financial Instruments
|
|
The
following methods and assumptions were used to estimate the fair value of
financial instruments:
|
|
(a)
|
Cash
and cash equivalents. The carrying amount equals fair
value. All amounts, including interest bearing, are subject to
immediate withdrawal.
|
|
(b)
|
Secured
loans carrying value was $171,745,000 and $147,174,000 at December 31,
2004 and 2003, respectively. The fair value of these loans of
$173,067,000 and $148,552,000, respectively, was estimated based upon
projected cash flows discounted at the estimated current interest rates at
which similar loans would be made. The applicable amount of the
allowance for loan losses along with accrued interest and advances related
thereto should also be considered in evaluating the fair value versus the
carrying value.
|
|
10.
|
Non-cash
Transactions
|
|
During
2004, the Partnership foreclosed on, or acquired property through deeds in
lieu of foreclosure, four properties (see Note 5), which resulted in an
increase in real estate held for sale and allowance for real estate held
for sale of $6,315,000 and $500,000, respectively and a decrease in loans
receivable, accrued interest, advances and allowance for loan losses of
$4,422,000, $1,840,000, $53,000 and $500,000,
respectively.
|
|
During
2003, the Partnership restructured three loans that resulted in an
increase to secured loans receivable of $2,989,000 and a decrease to
accrued interest and advances of $2,626,000 and $363,000,
respectively.
|
|
During
2003, a previously secured loan became unsecured which resulted in a
decrease to secured loans receivable of $34,000 and an increase to
unsecured loans of $34,000.
|
11.
|
Asset Concentrations
and Characteristics
|
|
Most
loans are secured by recorded deeds of trust. At December 31,
2004 and 2003, there were 75 and 81 secured loans outstanding,
respectively, with the following characteristics (dollars in
thousands):
|
2004
|
2003
|
|||||||
Number
of secured loans outstanding
|
75 | 81 | ||||||
Total
secured loans outstanding
|
$ | 171,745 | $ | 147,174 | ||||
Average
secured loan outstanding
|
$ | 2,289 | $ | 1,817 | ||||
Average
secured loan as percent of total secured loans
|
1.33 | % | 1.23 | % | ||||
Average
secured loan as percent of partners' capital
|
1.25 | % | 1.31 | % | ||||
Largest
secured loan outstanding
|
$ | 12,045 | $ | 16,010 | ||||
Largest
secured loan as percent of total secured loans
|
7.01 | % | 10.88 | % | ||||
Largest
secured loan as percent of partners' capital
|
6.56 | % | 11.54 | % | ||||
Largest
secured loan as a percent of total assets
|
6.00 | % | 9.84 | % | ||||
Number
of counties where security
|
||||||||
is
located (all California)
|
17 | 20 | ||||||
Largest
percentage of secured loans
|
||||||||
in
one county
|
20.48 | % | 26.47 | % | ||||
Average
secured loan to appraised value
|
||||||||
of
security based on appraised values and
|
||||||||
prior
liens at time loan was consummated
|
56.94 | % | 53.97 | % | ||||
Number
of secured loans in foreclosure status
|
6 | 3 | ||||||
Amount
of secured loans in foreclosure
|
$ | 14,682 | $ | 2,931 |
11.
|
Asset Concentrations
and Characteristics
(continued)
|
|
The
following secured loan categories were held at December 31, 2004 and 2003
(in thousands):
|
2004
|
2003
|
|||||||
First
trust deeds
|
$ | 115,082 | $ | 84,437 | ||||
Second
trust deeds
|
50,282 | 61,247 | ||||||
Third
trust deeds
|
6,381 | 1,490 | ||||||
Total
loans
|
171,745 | 147,174 | ||||||
Prior
liens due other lenders at time of loan
|
99,140 | 116,870 | ||||||
Total
debt
|
$ | 270,885 | $ | 264,044 | ||||
Appraised
property value at time of loan
|
$ | 475,710 | $ | 489,219 | ||||
Total
secured loans as a percent of appraisals
|
56.94 | % | 53.97 | % | ||||
Secured
loans by type of property
|
||||||||
Owner
occupied homes
|
$ | 9,234 | $ | 13,656 | ||||
Non-owner
occupied homes
|
75,125 | 52,975 | ||||||
Apartments
|
30,981 | 22,649 | ||||||
Commercial
|
54,670 | 52,502 | ||||||
Land
|
1,735 | 5,392 | ||||||
$ | 171,745 | $ | 147,174 |
|
The
interest rates on the loans range from 8.50% to 13.25% at December 31,
2004 and 7.50% to 18.00% at December 31,
2003.
|
|
Scheduled
maturity dates of secured loans as of December 31, 2004 are as follows (in
thousands):
|
Year
Ending December 31,
|
||||
2005
|
$ | 68,761 | ||
2006
|
68,829 | |||
2007
|
21,185 | |||
2008
|
3,629 | |||
2009
|
8,844 | |||
Thereafter
|
497 | |||
$ | 171,745 |
11.
|
Asset Concentrations
and Characteristics
(continued)
|
12.
|
Commitments and
Contingencies
|
|
Construction /
rehabilitation loans
|
|
Workout
agreements
|
|
Legal
proceedings
|
|
The
Partnership is involved in various legal actions arising in the normal
course of business. In the opinion of management, such matters
will not have a material effect upon the financial position of the
Partnership.
|
13.
|
Selected Financial
Information (Unaudited)
|
Calendar
Quarter
|
|
(in
thousands, except for per limited partner
amounts)
|
First
|
Second
|
Third
|
Fourth
|
Annual
|
||||||||||||||||
Revenues
|
||||||||||||||||||||
2004
|
$ | 3,850 | $ | 3,785 | $ | 4,504 | $ | 4,994 | $ | 17,133 | ||||||||||
2003
|
$ | 2,789 | $ | 3,072 | $ | 3,225 | $ | 3,872 | $ | 12,958 | ||||||||||
Expenses
|
||||||||||||||||||||
2004
|
$ | 1,117 | $ | 907 | $ | 1,418 | $ | 1,559 | $ | 5,001 | ||||||||||
2003
|
$ | 659 | $ | 711 | $ | 722 | $ | 1,272 | $ | 3,364 | ||||||||||
Net
income allocated to general partners
|
||||||||||||||||||||
2004
|
$ | 27 | $ | 29 | $ | 31 | $ | 34 | $ | 121 | ||||||||||
2003
|
$ | 21 | $ | 24 | $ | 25 | $ | 26 | $ | 96 | ||||||||||
Net
income allocated to limited partners
|
||||||||||||||||||||
2004
|
$ | 2,706 | $ | 2,849 | $ | 3,055 | $ | 3,401 | $ | 12,011 | ||||||||||
2003
|
$ | 2,109 | $ | 2,337 | $ | 2,478 | $ | 2,574 | $ | 9,498 | ||||||||||
Net
income per $1,000 invested
|
||||||||||||||||||||
where
income is
|
||||||||||||||||||||
Reinvested
and compounded
|
||||||||||||||||||||
2004
|
$ | 18 | $ | 18 | $ | 18 | $ | 18 | $ | 72 | ||||||||||
2003
|
$ | 20 | $ | 19 | $ | 18 | $ | 21 | $ | 78 | ||||||||||
Withdrawn
|
||||||||||||||||||||
2004
|
$ | 18 | $ | 17 | $ | 17 | $ | 18 | $ | 70 | ||||||||||
2003
|
$ | 20 | $ | 19 | $ | 18 | $ | 18 | $ | 75 |
Col
B.
|
Col.
C - Additions
|
Col
E.
|
||||||||||
Col
A.
|
Balance
at
|
Charged
to
|
Charged
|
Balance
|
||||||||
Beginning
|
Costs
and
|
to
Other
|
Col.
D
|
at
End
|
||||||||
Description
|
of
Period
|
Expenses
|
Accounts
|
Deductions
|
of
Period
|
|||||||
Year
Ended December 31, 2002
|
||||||||||||
Deducted
from asset accounts
|
||||||||||||
Allowance
for loan losses
|
$ 2,247
|
$ 780
|
$ 11
|
(a)
|
$ (17)
|
(b)
|
$ 3,021
|
|||||
Cumulative
write-down of
|
||||||||||||
real
estate held for sale (REO)
|
-
|
500
|
-
|
-
|
500
|
|||||||
$ 2,247
|
$ 1,280
|
$ 11
|
$ (17)
|
(b)
|
$ 3,521
|
|||||||
Year
Ended December 31, 2003
|
||||||||||||
Deducted
from asset accounts
|
||||||||||||
Allowance
for loan losses
|
$ 3,021
|
$ 782
|
$ -
|
$ (1,154)
|
(b)
|
$ 2,649
|
||||||
Cumulative
write-down of
|
||||||||||||
real
estate held for sale (REO)
|
500
|
-
|
-
|
-
|
500
|
|||||||
$ 3,521
|
$ 782
|
$ -
|
$ (1,154)
|
(b)
|
$ 3,149
|
|||||||
Year
Ended December 31, 2004
|
||||||||||||
Deducted
from asset accounts
|
||||||||||||
Allowance
for loan losses
|
$ 2,649
|
$ 1,146
|
$ (500)
|
$ (952)
|
(b)
|
$ 2,343
|
||||||
Cumulative
write-down of
|
||||||||||||
real
estate held for sale (REO)
|
500
|
-
|
500
|
-
|
1,000
|
|||||||
$ 3,149
|
$ 1,146
|
$ -
|
$ (952)
|
(b)
|
$ 3,343
|
Col.
H
|
|||||||||||||||||||||||||||
. |
Principal
|
||||||||||||||||||||||||||
Col.
F
|
Amount
|
||||||||||||||||||||||||||
Face
|
Col.
G
|
of
Loans
|
|||||||||||||||||||||||||
Col.
C
|
Col.
D
|
Amount
of
|
Carrying
|
Subject
to
|
Col.
I
|
Col.
J
|
|||||||||||||||||||||
Col.
B
|
Final
|
Periodic
|
Col.
E
|
Mortgage
|
Amount
of
|
Delinquent
|
Type
|
California
|
|||||||||||||||||||
Col.
A
|
Interest
|
Maturity
|
Payment
|
Prior
|
Original
|
Mortgage
|
Principal
|
of
|
Geographic
|
||||||||||||||||||
Descrip.
|
Rate
|
Date
|
Terms
|
Liens
|
Amount
|
Investment
|
Or
Interest
|
Lien
|
Location
|
||||||||||||||||||
Comm.
|
11.75 | % |
12/01/09
|
$ | 3 | $ | - | $ | 148 | $ | 128 | $ | - |
1st
|
Yuba
|
||||||||||||
Res.
|
12.00 | % |
05/01/03
|
12 | - | 1,210 | 1,210 | 1,210 |
1st
|
Marin
|
|||||||||||||||||
Apts.
|
12.50 | % |
11/15/02
|
4 | 47 | 39 | 292 | 292 |
2nd
|
Contra
Costa
|
|||||||||||||||||
Comm.
|
11.50 | % |
02/01/05
|
4 | 493 | 400 | 395 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Apts.
|
12.00 | % |
07/01/06
|
40 | - | 4,000 | 7,057 | 7,057 |
1st
|
San
Francisco
|
|||||||||||||||||
Comm.
|
12.00 | % |
05/01/07
|
8 | 2,916 | 799 | 788 | 788 |
2nd
|
Santa
Clara
|
|||||||||||||||||
Res.
|
12.00 | % |
05/01/03
|
13 | - | 1,325 | 1,325 | 1,325 |
1st
|
Marin
|
|||||||||||||||||
Res.
|
13.25 | % |
01/01/04
|
20 | - | 3,515 | 1,304 | 1,304 |
1st
|
Napa
|
|||||||||||||||||
Comm.
|
11.50 | % |
08/01/06
|
3 | - | 350 | 271 | - |
1st
|
San
Mateo
|
|||||||||||||||||
Land
|
9.50 | % |
07/01/05
|
8 | - | 987 | 987 | - |
1st
|
Santa
Clara
|
|||||||||||||||||
Res.
|
10.00 | % |
12/01/02
|
3 | - | 318 | 316 | 316 |
1st
|
San
Mateo
|
|||||||||||||||||
Comm.
|
7.50 | % |
02/28/07
|
5 | - | 770 | 770 | - |
1st
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
7.50 | % |
02/28/07
|
2 | - | 320 | 320 | - |
1st
|
Alameda
|
|||||||||||||||||
Comm.
|
13.00 | % |
06/01/05
|
41 | 10,000 | 4,550 | 6,020 | 6,020 |
2nd
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
10.50 | % |
08/01/04
|
31 | - | 3,600 | 3,600 | 3,600 |
1st
|
Santa
Clara
|
|||||||||||||||||
Res.
|
10.25 | % |
06/01/06
|
4 | 1,647 | 263 | 215 | - |
2nd
|
Santa
Clara
|
|||||||||||||||||
Res.
|
10.50 | % |
09/01/07
|
2 | 1,468 | 805 | 520 | - |
3rd
|
Santa
Clara
|
|||||||||||||||||
Res.
|
11.50 | % |
09/01/05
|
12 | - | 1,300 | 1,299 | - |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
10.50 | % |
09/01/05
|
2 | 710 | 269 | 269 | - |
2nd
|
San
Mateo
|
|||||||||||||||||
Res.
|
10.50 | % |
10/01/05
|
16 | - | 1,781 | 1,781 | 1,781 |
1st
|
San
Mateo
|
|||||||||||||||||
Comm.
|
10.50 | % |
10/01/07
|
4 | - | 441 | 435 | - |
1st
|
San
Mateo
|
|||||||||||||||||
Comm.
|
11.25 | % |
12/01/07
|
9 | 718 | 900 | 892 | - |
1st
& 3rd
|
El
Dorado
|
|||||||||||||||||
Res.
|
10.00 | % |
11/01/05
|
11 | 500 | 1,320 | 1,320 | 1,320 |
2nd
|
Napa
|
|||||||||||||||||
Comm.
|
10.00 | % |
01/01/08
|
13 | - | 1,500 | 1,500 | - |
1st
|
River
Side
|
|||||||||||||||||
Comm.
|
10.00 | % |
12/31/04
|
87 | - | 10,440 | 10,440 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
11.50 | % |
12/01/05
|
41 | - | 7,700 | 8,364 | - |
1st
|
San
Mateo
|
|||||||||||||||||
Comm.
|
10.00 | % |
04/01/05
|
47 | - | 5,293 | 6,236 | - |
1st
|
Los
Angeles
|
|||||||||||||||||
Apts.
|
10.00 | % |
06/01/05
|
16 | 2,147 | 1,950 | 1,549 | - |
2nd
|
Contra
Costa
|
|||||||||||||||||
Apts.
|
13.00 | % |
01/02/06
|
29 | 14,800 | 2,660 | 2,660 | - |
2nd
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
12.00 | % |
07/01/06
|
25 | - | 2,500 | 2,500 | - |
1st
|
Sacramento
|
|||||||||||||||||
Res.
|
11.00 | % |
07/01/05
|
9 | - | 6,074 | 3,610 | - |
1st
|
Fresno
|
|||||||||||||||||
Comm.
|
11.00 | % |
07/01/06
|
33 | - | 3,570 | 3,570 | - |
1st
|
Alameda
|
|||||||||||||||||
Apts.
|
9.50 | % |
01/01/09
|
4 | - | 413 | 409 | - |
1st
|
San
Joaquin
|
|||||||||||||||||
Comm.
|
9.50 | % |
12/01/05
|
22 | - | 2,750 | 2,750 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.25 | % |
12/01/08
|
1 | 376 | 130 | 129 | - |
2nd
|
Santa
Clara
|
|||||||||||||||||
Apts.
|
9.50 | % |
11/01/05
|
29 | 3,115 | 3,650 | 3,650 | - |
2nd
|
River
Side
|
|||||||||||||||||
Comm.
|
9.00 | % |
01/01/06
|
25 | - | 3,375 | 3,375 | - |
1st
|
San
Joaquin
|
|||||||||||||||||
Res.
|
10.00 | % |
12/25/05
|
133 | 5,577 | 16,010 | 12,045 | - |
2nd
|
Alameda
|
|||||||||||||||||
Res.
|
8.50 | % |
01/01/06
|
8 | - | 1,070 | 1,062 | - |
1st
|
Placer
|
|||||||||||||||||
Comm.
|
9.50 | % |
01/01/06
|
13 | - | 1,610 | 1,610 | - |
1st
|
Alameda
|
Col.
H
|
|||||||||||||||||||||||||||
Principal
|
|||||||||||||||||||||||||||
Col.
F
|
Amount
|
||||||||||||||||||||||||||
Face
|
Col.
G
|
of
Loans
|
|||||||||||||||||||||||||
Col.
C
|
Col.
D
|
Amount
of
|
Carrying
|
Subject
to
|
Col.
I
|
Col.
J
|
|||||||||||||||||||||
Col.
B
|
Final
|
Periodic
|
Col.
E
|
Mortgage
|
Amount
of
|
Delinquent
|
Type
|
California
|
|||||||||||||||||||
Col.
A
|
Interest
|
Maturity
|
Payment
|
Prior
|
Original
|
Mortgage
|
Principal
|
of
|
Geographic
|
||||||||||||||||||
Descrip.
|
Rate
|
Date
|
Terms
|
Liens
|
Amount
|
Investment
|
or
Interest
|
Lien
|
Location
|
||||||||||||||||||
Res.
|
8.50 | % |
10/01/10
|
4 | 190 | 500 | 497 | - |
2nd
|
Alameda
|
|||||||||||||||||
Res.
|
10.00 | % |
01/25/06
|
6 | 22,354 | 8,245 | 4,868 | - |
3rd
|
San
Mateo
|
|||||||||||||||||
Apts.
|
10.00 | % |
03/10/07
|
43 | - | 5,200 | 5,200 | - |
1st
|
Santa
Clara
|
|||||||||||||||||
Res.
|
8.50 | % |
04/01/06
|
6 | 1,655 | 800 | 800 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.00 | % |
05/01/09
|
3 | 2,400 | 335 | 335 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.25 | % |
04/01/06
|
9 | - | 1,180 | 1,180 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Apts.
|
9.25 | % |
06/01/06
|
5 | - | 666 | 666 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.25 | % |
05/01/09
|
9 | 735 | 1,085 | 1,081 | - |
2nd
|
San
Mateo
|
|||||||||||||||||
Comm.
|
9.50 | % |
05/01/09
|
3 | 242 | 375 | 374 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.25 | % |
06/01/09
|
3 | - | 403 | 403 | - |
1st
|
Contra
Costa
|
|||||||||||||||||
Apts.
|
9.25 | % |
06/01/06
|
7 | - | 881 | 881 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
8.50 | % |
06/01/09
|
- | 313 | 50 | 50 | - |
2nd
|
San
Mateo
|
|||||||||||||||||
Apts.
|
9.25 | % |
06/01/06
|
7 | - | 875 | 875 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Res.
|
9.25 | % |
06/01/09
|
2 | - | 188 | 187 | - |
1st
|
San
Joaquin
|
|||||||||||||||||
Res.
|
10.75 | % |
07/01/06
|
20 | - | 8,400 | 2,172 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Comm.
|
9.00 | % |
06/01/09
|
4 | 2,850 | 500 | 498 | - |
2nd
|
Santa
Clara
|
|||||||||||||||||
Comm.
|
10.00 | % |
06/01/07
|
39 | - | 4,650 | 4,650 | - |
1st
|
Marin
|
|||||||||||||||||
Land
|
9.00 | % |
07/01/09
|
6 | - | 750 | 748 | - |
1st
|
Lake
|
|||||||||||||||||
Res.
|
9.25 | % |
07/01/09
|
6 | 716 | 690 | 689 | - |
2nd
|
San
Mateo
|
|||||||||||||||||
Res.
|
8.75 | % |
01/01/06
|
78 | - | 15,615 | 6,344 | - |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
10.50 | % |
07/01/06
|
14 | - | 2,400 | 1,600 | - |
1st
|
San
Diego
|
|||||||||||||||||
Comm.
|
9.00 | % |
08/01/09
|
2 | 785 | 300 | 299 | - |
2nd
|
Marin
|
|||||||||||||||||
Comm.
|
9.00 | % |
08/01/09
|
15 | - | 2,000 | 1,600 | - |
1st
|
San
Francisco
|
|||||||||||||||||
Comm.
|
9.50 | % |
08/01/09
|
16 | - | 1,947 | 1,943 | - |
1st
|
Alameda
|
|||||||||||||||||
Res.
|
9.25 | % |
10/01/07
|
3 | 764 | 385 | 385 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
8.75 | % |
09/01/06
|
86 | - | 11,684 | 11,506 | - |
1st
|
Contra
Costa
|
|||||||||||||||||
Res.
|
10.00 | % |
09/01/06
|
37 | 11,685 | 7,821 | 4,382 | - |
2nd
|
Contra
Costa
|
|||||||||||||||||
Res.
|
9.25 | % |
10/01/06
|
83 | 1,400 | 10,540 | 10,471 | - |
2nd
|
Sacramento
|
|||||||||||||||||
Res.
|
9.00 | % |
11/01/08
|
15 | - | 2,000 | 2,000 | - |
1st
|
Marin
|
|||||||||||||||||
Apts.
|
8.75 | % |
01/01/07
|
50 | - | 6,900 | 6,900 | - |
1st
|
Contra
Costa
|
|||||||||||||||||
Apts.
|
10.00 | % |
01/01/07
|
2 | 6,900 | 1,890 | 324 | - |
2nd
|
Contra
Costa
|
|||||||||||||||||
Comm.
|
11.00 | % |
05/01/09
|
1 | 612 | 100 | 100 | - |
3rd
|
San
Francisco
|
|||||||||||||||||
Apts.
|
11.00 | % |
06/01/06
|
1 | 881 | 641 | 143 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Apts.
|
11.00 | % |
06/01/06
|
2 | 875 | 908 | 375 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Res.
|
11.00 | % |
04/01/06
|
- | 1,180 | 425 | 246 | - |
2nd
|
San
Francisco
|
|||||||||||||||||
Total
|
$ | 1,379 | $ | 99,140 | $ | 201,434 | $ | 171,745 | $ | 25,013 |
Year
ended December 31,
|
2004
|
2003
|
2002
|
||||||||||
Balance
at beginning of year
|
$ | 147,174 | $ | 83,650 | $ | 82,790 | ||||||
Additions
during period
|
||||||||||||
New
loans
|
81,579 | 96,820 | 32,601 | |||||||||
Other
|
- | 2,989 | 1,060 | |||||||||
Total
additions
|
81,579 | 99,809 | 33,661 | |||||||||
Deductions
during period
|
||||||||||||
Collections
of principal
|
52,359 | 35,097 | 26,083 | |||||||||
Foreclosures
|
4,422 | - | 5,986 | |||||||||
Cost
of loans sold
|
- | - | - | |||||||||
Amortization
of premium
|
- | - | - | |||||||||
Other
|
227 | 1,188 | 732 | |||||||||
Total
deductions
|
57,008 | 36,285 | 32,801 | |||||||||
Balance
at close of year
|
$ | 171,745 | $ | 147,174 | $ | 83,650 |
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
Cash
and cash equivalents
|
$ | 21,448 | $ | 16,301 | ||||
Loans
|
||||||||
Loans,
secured by deeds of trust
|
152,612 | 171,745 | ||||||
Loans,
unsecured
|
34 | 34 | ||||||
Allowance
for loan losses
|
(2,434 | ) | (2,343 | ) | ||||
Net
loans
|
150,212 | 169,436 | ||||||
Interest
and other receivables
|
||||||||
Accrued
interest and late fees
|
4,699 | 4,895 | ||||||
Advances
on loans
|
78 | 131 | ||||||
4,777 | 5,026 | |||||||
Loan
origination fees, net
|
45 | 62 | ||||||
Real
estate held for sale, net of allowance of $1,000
|
20,366 | 9,793 | ||||||
Prepaid
expenses
|
18 | - | ||||||
Due
from affiliates
|
2,007 | - | ||||||
Total
assets
|
$ | 198,873 | $ | 200,618 |
Liabilities
|
||||||||
Line
of credit
|
$ | - | $ | 16,000 | ||||
Accounts
payable
|
9 | 25 | ||||||
Payable
to affiliate
|
653 | 638 | ||||||
Total
liabilities
|
662 | 16,663 | ||||||
Minority
interest
|
2,901 | - | ||||||
Investors
in applicant status
|
966 | 424 | ||||||
Partners’
capital
|
||||||||
Limited
partners’ capital, subject to redemption net of
unallocated
|
||||||||
syndication
costs of $1,143 and $1,084 for March 31, 2005 and
|
||||||||
December
31, 2004, respectively; and formation loan receivable of
|
||||||||
$10,192
and $9,751 for March 31, 2005 and December 31, 2004,
|
||||||||
respectively
|
194,173 | 183,368 | ||||||
General
partners’ capital, net of unallocated syndication costs of
$12
|
||||||||
and
$11 for March 31, 2005 and December 31, 2004, respectively
|
171 | 163 | ||||||
Total
partners’ capital
|
194,344 | 183,531 | ||||||
Total
liabilities and partners’ capital
|
$ | 198,873 | $ | 200,618 |
THREE
MONTHS ENDED
MARCH
31,
|
2005
|
2004
|
|||||||
Revenues
|
||||||||
Interest
on loans
|
$ | 4,103 | $ | 3,733 | ||||
Interest-bank
|
35 | 4 | ||||||
Late
fees
|
35 | 53 | ||||||
Gain
on sale of real estate held for sale
|
183 | - | ||||||
Imputed
interest on Formation Loan
|
100 | 57 | ||||||
Other
|
69 | 3 | ||||||
4,525 | 3,850 | |||||||
Expenses
|
||||||||
Mortgage
servicing fees
|
388 | 353 | ||||||
Interest
expense
|
36 | 106 | ||||||
Amortization
of loan origination fees
|
20 | 12 | ||||||
Provisions
for losses on loans and real estate
|
91 | 282 | ||||||
Asset
management fees
|
184 | 141 | ||||||
Clerical
costs through Redwood Mortgage Corp.
|
78 | 75 | ||||||
Professional
services
|
48 | 55 | ||||||
Amortization
of discount on imputed interest
|
100 | 57 | ||||||
Other
|
36 | 36 | ||||||
981 | 1,117 | |||||||
Net
income
|
$ | 3,544 | $ | 2,733 | ||||
Net
income: general
partners (1%)
|
$ | 35 | $ | 27 | ||||
limited
partners (99%)
|
3,509 | 2,706 | ||||||
$ | 3,544 | $ | 2,733 | |||||
Net
income per $1,000 invested by limited
|
||||||||
partners
for entire period
|
||||||||
-where
income is compounded and retained
|
$ | 17 | $ | 18 | ||||
-where
partner receives income in monthly
|
||||||||
distributions
|
$ | 17 | $ | 18 |
THREE
MONTHS ENDED MARCH 31,
|
2005
|
2004
|
|||||||
Cash
flows from operating activities
|
||||||||
Net
income
|
$ | 3,544 | $ | 2,733 | ||||
Adjustments
to reconcile net income to net cash
|
||||||||
provided
by (used in) operating activities
|
||||||||
Imputed
interest income
|
(100 | ) | (57 | ) | ||||
Amortization
of discount
|
100 | 57 | ||||||
Amortization
of loan origination fees
|
20 | 12 | ||||||
Provision
for loan and real estate losses
|
91 | 282 | ||||||
Gain
on sale of real estate
|
(183 | ) | - | |||||
Change
in operating assets and liabilities
|
||||||||
Accrued
interest and late fees
|
(286 | ) | (653 | ) | ||||
Advances
on loans
|
(9 | ) | (32 | ) | ||||
Loan
origination fees
|
3 | - | ||||||
Due
from affiliates
|
(2,007 | ) | - | |||||
Accounts
payable
|
(16 | ) | (214 | ) | ||||
Payable
to affiliate
|
15 | 36 | ||||||
Prepaid
expenses
|
(18 | ) | - | |||||
Net
cash provided by (used in) operating activities
|
1,154 | 2,164 | ||||||
Cash
flows from investing activities
|
||||||||
Loans
originated
|
(23,831 | ) | (12,859 | ) | ||||
Principal
collected on loans
|
34,603 | 21,695 | ||||||
Payments
for development of real estate
|
(36 | ) | - | |||||
Proceeds
from disposition of real estate
|
1,448 | - | ||||||
Net
cash provided by investing activities
|
12,184 | 8,836 | ||||||
Cash
flows from financing activities
|
||||||||
Repayments
on line of credit, net
|
(16,000 | ) | (20,000 | ) | ||||
Contributions
by partner applicants
|
10,155 | 8,283 | ||||||
Partners’
withdrawals
|
(1,779 | ) | (1,627 | ) | ||||
Syndication
costs paid
|
(118 | ) | (124 | ) | ||||
Formation
loan lending
|
(748 | ) | (570 | ) | ||||
Formation
loan collections
|
299 | 204 | ||||||
Net
cash used in financing activities
|
(8,191 | ) | (13,834 | ) | ||||
Net
increase/(decrease) in cash and cash equivalents
|
5,147 | (2,834 | ) | |||||
Cash
and cash equivalents – beginning of year
|
16,301 | 8,921 | ||||||
Cash
and cash equivalents – end of period
|
21,448 | 6,087 | ||||||
Supplemental
disclosures of cash flow information
|
||||||||
Cash
paid for interest
|
$ | 36 | $ | 106 |
|
Formation
Loans
|
1st
|
2nd
|
3rd
|
4th
|
5th
|
Total
|
|||||||||||||||||||
Limited
partner
|
||||||||||||||||||||||||
contributions
|
$ | 14,932 | $ | 29,993 | $ | 29,999 | $ | 49,985 | $ | 57,447 | $ | 182,356 | ||||||||||||
Formation
loan made
|
$ | 1,075 | $ | 2,272 | $ | 2,218 | $ | 3,777 | $ | 4,318 | $ | 13,660 | ||||||||||||
Discount
on imputed
|
||||||||||||||||||||||||
interest
|
(19 | ) | (270 | ) | (272 | ) | (524 | ) | (716 | ) | (1,801 | ) | ||||||||||||
Formation
loan made, net
|
1,056 | 2,002 | 1,946 | 3,253 | 3,602 | 11,859 | ||||||||||||||||||
Repayments
to date
|
(811 | ) | (1,061 | ) | (606 | ) | (583 | ) | (134 | ) | (3,195 | ) | ||||||||||||
Early
withdrawal
|
||||||||||||||||||||||||
penalties
applied
|
(76 | ) | (114 | ) | (80 | ) | (3 | ) | - | (273 | ) | |||||||||||||
Formation
loan, net
|
||||||||||||||||||||||||
at
March 31, 2005
|
169 | 827 | 1,260 | 2,667 | 3,468 | 8,391 | ||||||||||||||||||
Unamortized
discount
|
||||||||||||||||||||||||
on
imputed interest
|
19 | 270 | 272 | 524 | 716 | 1,801 | ||||||||||||||||||
Balance
|
||||||||||||||||||||||||
March
31, 2005
|
$ | 188 | $ | 1,097 | $ | 1,532 | $ | 3,191 | $ | 4,184 | $ | 10,192 | ||||||||||||
Percent
loaned
|
7.2 | % | 7.6 | % | 7.4 | % | 7.6 | % | 7.5 | % | 7.5 | % |
Costs
incurred
|
$ | 3,092 | ||
Early
withdrawal penalties applied
|
(106 | ) | ||
Allocated
to date
|
(1,831 | ) | ||
March
31, 2005 balance
|
$ | 1,155 |
|
Reclassifications
|
|
Loans
secured by deeds of trust
|
|
Allowance
for loan losses
|
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
Impaired
loans
|
$ | - | $ | - | ||||
Specified
loans
|
137 | 137 | ||||||
General
|
2,297 | 2,206 | ||||||
Unsecured
loans
|
- | - | ||||||
$ | 2,434 | $ | 2,343 |
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
Beginning
balance
|
$ | 2,343 | $ | 2,649 | ||||
Additions
charged to income
|
91 | 1,146 | ||||||
Write-offs
|
- | (952 | ) | |||||
Transferred
to real estate held for
|
||||||||
sale
reserve
|
- | (500 | ) | |||||
$ | 2,434 | $ | 2,343 |
|
Net
income per $1,000 invested
|
|
NOTE 3 – GENERAL
PARTNERS AND RELATED PARTIES
|
|
The
following are commissions and/or fees, which are paid to the general
partners.
|
|
Mortgage brokerage
commissions
|
|
Mortgage
servicing fees
|
|
Asset management
fees
|
|
Other
fees
|
|
Operating
expenses
|
|
MARCH
31, 2005 (unaudited)
|
|
NOTE 4 – REAL ESTATE
HELD FOR SALE
|
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
Cost
of properties
|
$ | 21,366,000 | $ | 10,793,000 | ||||
Reduction
in value
|
(1,000,000 | ) | (1,000,000 | ) | ||||
Real
estate held for sale, net
|
$ | 20,366,000 | $ | 9,793,000 |
|
REDWOOD
MORTGAGE INVESTORS VIII
|
|
MARCH
31, 2005 (unaudited)
|
|
NOTE 5 – BANK LINE OF
CREDIT
|
|
NOTE 6 – NON-CASH
TRANSACTIONS
|
|
NOTE 7 – FAIR VALUE OF
FINANCIAL INSTRUMENTS
|
|
REDWOOD
MORTGAGE INVESTORS VIII
|
|
MARCH
31, 2005 (unaudited)
|
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
Number
of secured loans outstanding
|
79 | 75 | ||||||
Total
secured loans outstanding
|
$ | 152,612 | $ | 171,745 | ||||
Average
secured loan outstanding
|
$ | 1,932 | $ | 2,289 | ||||
Average
secured loan as percent of total secured loans
|
1.27 | % | 1.33 | % | ||||
Average
secured loan as percent of partners’ capital
|
0.99 | % | 1.25 | % | ||||
Largest
secured loan outstanding
|
$ | 11,685 | $ | 12,045 | ||||
Largest
secured loan as percent of total secured loans
|
7.66 | % | 7.01 | % | ||||
Largest
secured loan as percent of partners’ capital
|
6.01 | % | 6.56 | % | ||||
Largest
secured loan as percent of total assets
|
5.96 | % | 6.00 | % | ||||
Number
of counties where security is located (all California)
|
19 | 17 | ||||||
Largest
percentage of secured loans in one county
|
18.28 | % | 20.48 | % | ||||
Average
secured loan to appraised value of security based on
|
||||||||
appraised
values and prior liens at time loan was consummated
|
60.16 | % | 56.94 | % | ||||
Number
of secured loans in foreclosure status
|
4 | 6 | ||||||
Amount
of secured loans in foreclosure
|
$ | 6,185 | $ | 14,682 |
|
REDWOOD
MORTGAGE INVESTORS VIII
|
March
31,
|
December
31,
|
|||||||
2005
|
2004
|
|||||||
First
Trust Deeds
|
$ | 109,427 | $ | 115,082 | ||||
Second
Trust Deeds
|
34,389 | 50,282 | ||||||
Third
Trust Deeds
|
8,796 | 6,381 | ||||||
Total
loans
|
152,612 | 171,745 | ||||||
Prior
liens due other lenders at time of loan
|
80,864 | 99,140 | ||||||
Total
debt
|
$ | 233,476 | $ | 270,885 | ||||
Appraised
property value at time of loan
|
$ | 388,098 | $ | 475,710 | ||||
Total
secured loans as a percent of appraisals
|
60.16 | % | 56.94 | % | ||||
Secured
loans by type of property
|
||||||||
Owner
occupied homes
|
$ | 11,224 | $ | 9,234 | ||||
Non-owner
occupied homes
|
51,130 | 75,125 | ||||||
Apartments
|
21,825 | 30,981 | ||||||
Commercial
|
66,700 | 54,670 | ||||||
Land
|
1,733 | 1,735 | ||||||
$ | 152,612 | $ | 171,745 |
Year
Ending
|
||||
December
31,
|
Amount
|
|||
2005
|
$ | 56,804 | ||
2006
|
46,984 | |||
2007
|
27,803 | |||
2008
|
10,956 | |||
2009
|
8,828 | |||
Thereafter
|
1,237 | |||
$ | 152,612 |
|
Legal
proceedings
|
ASSETS
|
||||
2004
|
||||
Cash
and cash equivalents
|
$ | 117,626 | ||
Other
current assets
|
869 | |||
Total
current assets
|
118,495 | |||
Investment
in partnerships
|
||||
Redwood
Mortgage Investors IV
|
7,500 | |||
Redwood
Mortgage Investors V
|
5,000 | |||
Redwood
Mortgage Investors VI
|
9,773 | |||
Redwood
Mortgage Investors VII
|
11,998 | |||
Redwood
Mortgage Investors VIII
|
172,322 | |||
206,593 | ||||
$ | 325,088 | |||
Liabilities
|
||||
Accounts
payable - related party
|
$ | 5,846 | ||
Total
current liabilities
|
5,846 | |||
Stockholders'
equity
|
||||
Common
stock, no par, authorized 1,000,000
|
||||
shares;
issued and outstanding 500 shares
|
5,000 | |||
Additional
paid-in capital
|
7,500 | |||
Retained
earnings
|
306,742 | |||
Total
stockholders' equity
|
319,242 | |||
$ | 325,088 | |||
1.
|
Organization
|
|
Gymno
Corporation (the "Company") was formed in July 1986. The
Company was formed for the purpose of serving as the corporate general
partner of certain California limited partnerships, (presently Redwood
Mortgage Investors ("RMI") I, II, III, IV, V, VI, VII and VIII), which
invest in high-yield debt instruments, primarily promissory notes secured
by deeds of trust on California real
estate.
|
|
As
the corporate general partner, the Company receives management fees and
reconveyance fees from the partnerships. In addition, the
Company receives its allocation of income from the various
partnerships
|
2.
|
Summary of Significant
Accounting Policies
|
|
Cash and cash
equivalents
|
|
Cash
represents cash and short-term, highly liquid investments with maturities
of three months or less at the time of
purchase.
|
|
GYMNO
CORPORATION
|
3.
|
Investment in
Partnerships
|
|
The
following is a summary of the Company's investments in the RMI
partnerships as of December 31,
2004:
|
|
The
Company has a payable to an affiliate, Redwood Mortgage Corp. ("RMC"), in
the amount of $5,846 at December 31, 2004. The Company incurs a
monthly management fee to RMC for usage of space, utilities, personnel and
management expertise.
|
5.
|
Guarantees
|
Cash
|
$ | 136,692 | ||
Other
assets
|
869 | |||
Total
current assets
|
137,561 | |||
Investment
in partnerships
|
||||
Redwood
Mortgage Investors IV
|
7,500 | |||
Redwood
Mortgage Investors V
|
5,000 | |||
Redwood
Mortgage Investors VI
|
9,773 | |||
Redwood
Mortgage Investors VII
|
11,998 | |||
Redwood
Mortgage Investors VIII
|
182,455 | |||
216,726 | ||||
$ | 354,287 |
Liabilities
|
||||
Accounts
payable - related party
|
$ | 436 | ||
Total
current liabilities
|
436 | |||
Stockholders'
equity
|
||||
Common
stock, no par, authorized 1,000,000
|
||||
shares;
issued and outstanding 500 shares
|
5,000 | |||
Additional
paid-in capital
|
7,500 | |||
Retained
earnings
|
341,351 | |||
Total
stockholders' equity
|
353,851 | |||
$ | 354,287 | |||
1.
|
Organization
|
|
Gymno
Corporation (the "Company") was formed in July 1986. The
Company was formed for the purpose of serving as the corporate general
partner of certain California limited partnerships, (presently Redwood
Mortgage Investors (“RMI”) I, II, III, IV, V, VI, VII and VIII), which
invest in high-yield debt instruments, primarily promissory notes secured
by deeds of trust on California real
estate.
|
|
As
the corporate general partner, the Company receives management fees and/or
reconveyance fees from the partnerships. In addition, the
Company receives its allocation of income from the various
partnerships.
|
2.
|
Summary of Significant
Accounting Policies
|
|
Cash and
equivalents
|
|
Cash
represents cash and short-term, highly liquid investments with maturities
of three months or less at the time of
purchase.
|
|
The
bank cash balance at March 31, 2005 was with one bank. Deposits
in this bank exceeded the FDIC insurance limits (up to $100,000 per bank)
by approximately $24,377 at March 31,
2005.
|
3.
|
Investment in
Partnerships
|
Gymno
|
||||||||||||||||
Gymno
|
Corporation
|
|||||||||||||||
Corporation
|
Investment
|
|||||||||||||||
Partnership
|
Partnership
|
Partnership
|
Percent
of
|
|||||||||||||
Net
Assets
|
Net
Income
|
Investment
|
Net
Assets
|
|||||||||||||
RMI
I
|
$ | 755,881 | $ | 10,565 | $ | 0 | - | |||||||||
RMI
II
|
180,115 | 2,170 | 0 | - | ||||||||||||
RMI
III
|
1,318,546 | 17,920 | 0 | - | ||||||||||||
RMI
IV
|
5,951,390 | 86,303 | 7,500 | 0.13 | % | |||||||||||
RMI
V
|
2,036,564 | 22,806 | 5,000 | 0.25 | % | |||||||||||
RMI
VI
|
6,425,547 | 98,955 | 9,773 | 0.15 | % | |||||||||||
RMI
VII
|
9,146,632 | 139,096 | 11,998 | 0.13 | % | |||||||||||
RMI
VIII
|
194,344,000 | 3,544,132 | 182,455 | 0.09 | % | |||||||||||
$ | 220,158,675 | $ | 3,921,947 | $ | 216,726 |
5.
|
Guarantees
|
|
The
Company is a guarantor on two separate lines of credit agreements for RMI
VII and RMI VIII. RMI VII has a $2,500,000 line of credit
agreement secured by its loan portfolio and expiring on December 2,
2007. RMI VIII has a $42,000,000 line of credit agreement
secured by its loan portfolio and expiring on November 25,
2005. There were no outstanding balances on the lines of credit
at March 31, 2005.
|
Cash
and equivalents
|
$ | 4,895,642 | ||
Investment
in partnership
|
50,000 | |||
Due
from related parties
|
789,623 | |||
Prepaid
expenses
|
23,639 | |||
Investment
in mortgage loans
|
187,303 | |||
Income-producing
property, net
|
1,124,695 | |||
Fixed
assets, net
|
195,459 | |||
Deferred
costs of brokerage related rights, net
|
6,772,004 | |||
Total
assets
|
$ | 14,038,365 | ||
Accounts
payable and accrued liabilities
|
$ | 33,630 | ||
Accrued
compensated absences
|
79,560 | |||
Accrued
profit-sharing
|
74,256 | |||
Deferred
compensation
|
624,928 | |||
Notes
payable
|
812,566 | |||
Advances
from partnerships, net
|
7,115,177 | |||
Deferred
income taxes
|
2,021,000 | |||
Total
liabilities
|
10,761,117 | |||
Stockholder's
equity
|
||||
Common
stock, wholly-owned by The Redwood
|
||||
Group,
Ltd., at $4 stated value (1,000 shares authorized,
|
||||
issued
and outstanding)
|
4,000 | |||
Retained
earnings
|
3,273,248 | |||
Total
stockholder's equity
|
3,277,248 | |||
Total
liabilities and stockholder's equity
|
$ | 14,038,365 | ||
1.
|
Organization
|
|
Redwood
Mortgage Corp. (the "Company"), is a wholly-owned subsidiary of The
Redwood Group, LTD. (the "Parent"), which is owned by The Estate of D.
Russell Burwell and the Irrevocable Burwell Family Trust. The
Company, Michael R. Burwell (the son of D. Russell Burwell), and Gymno
Corporation (owned by the Burwells) are general partners in Redwood
Mortgage Investors VIII, which invests in high-yield debt instruments,
primarily promissory notes secured by deeds of trust on California real
estate. Michael Burwell and Gymno Corporation are also general
partners in seven other related limited partnerships and another related
company is general partner in a ninth related limited
partnership.
|
2.
|
Summary of Significant
Accounting Policies
|
|
Accrual
basis
|
|
The
accompanying financial statement was prepared on the accrual basis of
accounting wherein revenue is recognized when earned and expenses are
recognized when incurred. Loan commissions are recognized as
revenue when the related loan closes escrow and loan service fees are
recognized over the period services are
provided.
|
|
Cash and
equivalents
|
|
Cash
represents cash and short-term, highly liquid investments with maturities
of three months or less. Cash deposits at September 30, 2004,
that exceeded federal insurance limits (up to $100,000), were
$4,464,142.
|
|
Allowance for loan
losses
|
|
Loans
and the related accrued interest, late fees and advances are analyzed on a
continuous basis for recoverability. Delinquencies are
identified and followed as part of the loan
system. Delinquencies are determined based upon contractual
terms. A provision is made for loan losses to adjust the
allowance for loan losses to an amount considered by management to be
adequate, with due consideration to collateral values, to provide for
unrecoverable loans and receivables, including impaired loans, other
loans, accrued interest, late fees and advances on loans and other
accounts receivable (unsecured). If a loan is categorized as
impaired, interest is no longer accrued. The Company charges
off uncollectible loans and related receivables directly to the allowance
account once it is determined that the full amount is not
collectible. As of September 30, 2004, management had an
allowance for accrued interest of
$74,128.
|
|
Fixed assets and
income-producing property
|
2.
|
Summary of Significant
Accounting Policies
(continued)
|
|
Deferred costs of
brokerage related rights
|
|
Consistent
with Statement of Financial Accounting Standards No. 141 and 142, the
Company has recognized as an asset rights to act as the mortgage loan
broker for various of its affiliated limited partnerships. Such
rights result in brokerage commissions to the Company. The
initial costs of these rights include fees paid to broker-dealers on
behalf of affiliated partnerships. Such costs are being
amortized over the anticipated 25-year period that brokerage fee net cash
flows are expected to be received in proportion to the expected receipt of
these cash flows.
|
|
The
Company evaluates the fair value of these rights to determine if the
brokerage rights have been impaired. Fair value is determined
based on the estimated brokerage fee net cash flows to be received by the
Company over the expected 25 year lives of the partnerships' underlying
loan portfolios. It is the Company's experience that the
underlying loan portfolios increase as partner capital is raised and
accumulated for the first seven years of a partnership's existence, and
then will begin to decline gradually over the subsequent 18 years of their
estimated lives. If the carrying value of the deferred mortgage
brokerage rights exceeds their estimated fair value, an allowance for
impairment of value is recognized. The Company has determined
that no allowance for impairment was required against its deferred
mortgage brokerage rights.
|
|
Income
taxes
|
|
The
Company's operating results are included in the consolidated tax returns
of the Parent, which files its income tax returns on the cash basis of
accounting. Income taxes are allocated to the Company by the
Parent for those taxes currently payable and those deferred as if the
Company were filing separate tax returns. A provision for
income taxes is provided for deferred taxes resulting from differences in
the timing of reporting revenue and expense items for financial versus tax
purposes.
|
|
Use of
estimates
|
|
In
preparing a balance sheet in accordance with accounting principles
generally accepted in the United States of America, management is required
to make estimates that affect the reported amounts of assets and
liabilities as of the balance sheet date. Such estimates relate
principally to the period of recoverability of deferred costs of brokerage
related rights and the determination of the allowance for loan
losses. Actual results could differ from these
estimates.
|
3.
|
Partnership
Services
|
|
The
following are commissions and/or fees derived by the Company from services
provided to its affiliated
partnerships:
|
|
Loan servicing
fees
|
3.
|
Partnership Services
(continued)
|
|
Loan
commissions
|
|
The
Company earns loan commissions in connection with the review, selection,
evaluation, negotiation and extension of partnership mortgage investments
in an amount up to 12% of the mortgage investments until 6 months after
the termination date of a partnership offering. Only 1 of the 9
affiliated limited partnerships is in the offering
stage. Thereafter, loan commissions are limited to an amount
not to exceed 4% of the total partnership assets per year. The
loan commissions are paid by the borrowers, and thus, are not an expense
of the partnerships.
|
|
Asset management
fee
|
|
Other fees and
charges
|
|
The
limited partnership agreements provide for other fees such as
reconveyance, mortgage assumption and mortgage extension
fees. Such fees are incurred by the borrowers and are paid to
the Company. In addition, the Company is reimbursed for
expenses and clerical costs associated with accounting and related
services incurred on behalf of the limited
partnerships.
|
4.
|
Investment in Mortgage
Loans
|
|
At
September 30, 2004, the Company had investments in mortgage loans maturing
as follows:
|
Year
ending
|
||||
September
30,
|
||||
2005
|
$ | 101,511 | ||
2006
|
1,113 | |||
2007
|
1,256 | |||
2008
|
1,415 | |||
2009
|
1,595 | |||
Thereafter
|
80,413 | |||
$ | 187,303 |
|
REDWOOD
MORTGAGE CORP.
|
5.
|
Income-Producing
Property
|
Building
and improvements
|
$ | 602,832 | ||
Land
|
547,168 | |||
1,150,000 | ||||
Less
accumulated depreciation and amortization
|
(25,305 | ) | ||
Income-producing
property, net
|
$ | 1,124,695 |
6.
|
Fixed
Assets
|
Furniture
and equipment
|
$ | 364,065 | ||
Computer
software
|
56,218 | |||
420,283 | ||||
Less
accumulated depreciation and amortization
|
(224,824 | ) | ||
Fixed
assets, net
|
$ | 195,459 |
7.
|
Deferred Costs of
Brokerage Related Rights
|
Deferred
costs of brokerage related rights
|
$ | 8,500,803 | ||
Less
accumulated amortization
|
(1,728,799 | ) | ||
Deferred
costs of brokerage related rights, net
|
$ | 6,772,004 |
|
Estimated
amortization expense for each of the next five years is as
follows:
|
Year
Ending September 30:
|
||||
2005
|
$ | 689,970 | ||
2006
|
$ | 635,748 | ||
2007
|
$ | 592,850 | ||
2008
|
$ | 529,360 | ||
2009
|
$ | 533,739 |
|
REDWOOD
MORTGAGE CORP.
|
8.
|
Income
Taxes
|
Cash
to accrual differences
|
$ | (26,000 | ) | |
Deferred
costs of brokerage related rights
|
3,681,000 | |||
State
deferred taxes
|
(201,000 | ) | ||
Net
operating loss carryforwards
|
(1,406,000 | ) | ||
Other
|
(27,000 | ) | ||
Net
deferred tax liability
|
$ | 2,021,000 |
9.
|
Advances from
Partnerships
|
Year Ending September 30:
|
||||
2005
|
$ | 1,120,002 | ||
2006
|
1,120,002 | |||
2007
|
1,012,631 | |||
2008
|
1,012,631 | |||
2009
|
1,012,631 | |||
Thereafter
|
3,590,941 | |||
8,868,838 | ||||
Less
discount on imputed interest
|
(1,753,661 | ) | ||
Advances
from partnerships, net
|
$ | 7,115,177 |
|
REDWOOD
MORTGAGE CORP.
|
10.
|
Notes
Payable
|
|
During
2003, the Company entered into an interest-only note payable to a bank for
the purchase of a property. The note matures in December 2004,
bears interest at 5.25%, and is secured by the property. The
note balance at September 30, 2004 totaled
$747,500.
|
2005
|
$ | 760,520 | ||
2006
|
13,802 | |||
2007
|
14,632 | |||
2008
|
15,511 | |||
2009
|
8,101 | |||
Total
|
$ | 812,566 | ||
11.
|
Commitments and
Guarantees
|
2005
|
$ | 183,772 | ||
2006
|
189,288 | |||
2007
|
194,972 | |||
2008
|
200,814 | |||
2009
|
117,712 | |||
$ | 886,558 |
12.
|
Profit-Sharing
Plan
|
|
The
Company has a defined contribution profit-sharing plan which provides for
Company contributions of 5% of eligible wages, plus any discretionary
additional Company contributions.
|
13.
|
Related Party
Transactions
|
|
Partnership
transactions
|
|
As
described in Notes 1 and 3, the Company's main source of revenue is from
originating and servicing mortgage obligations from nine limited
partnerships whose general partners are related to the Company (one such
general partner is the Company). The Company has received
advances from these limited partnerships to help finance the costs of
brokerage related rights.
|
|
Due from related
parties
|
Related
party advances
|
$ | 115,153 | ||
Partnership
services
|
674,470 | |||
$ | 789,623 |
|
Investment in
partnership
|
|
During
2003, the Company purchased an investment in Redwood Mortgage Investor's
VIII from a former investor at that investor’s cost. The
investment balance was $50,000 at September 30,
2004.
|
14.
|
Deferred Compensation
Agreement
|
15.
|
Subsequent
Events
|
|
Subsequent
to year end, the Company paid off the $747,500 note
payable.
|
|
Subsequent
to year end, the maximum borrowings on a partnership's line of credit, for
which the Company is a guarantor, was increased from $32,000,000 to
$42,000,000.
|
|
(UNAUDITED)
|
Cash
and equivalents
|
$ | 4,463,449 | ||
Investment
in partnership
|
50,000 | |||
Due
from related parties
|
891,418 | |||
Prepaid
expenses
|
22,889 | |||
Investment
in mortgage loans
|
187,523 | |||
Income-producing
property, net
|
1,112,195 | |||
Fixed
assets, net
|
177,836 | |||
Deferred
costs of brokerage related rights, net
|
7,883,214 | |||
Total
assets
|
$ | 14,788,524 | ||
Accounts
payable and accrued liabilities
|
$ | 838 | ||
Accrued
compensated absences
|
116,028 | |||
Deferred
compensation
|
570,928 | |||
Notes
payable
|
58,651 | |||
Advances
from partnerships, net
|
8,248,503 | |||
Deferred
income taxes
|
2,478,000 | |||
Total
liabilities
|
11,472,948 | |||
Stockholder's
equity
|
||||
Common
stock, wholly-owned by The Redwood Group Ltd.,
|
||||
at
$4 stated value (1,000 shares authorized, issued and
|
||||
outstanding)
|
4,000 | |||
Retained
earnings
|
3,311,576 | |||
Total
stockholder's equity
|
3,315,576 | |||
Total
liabilities and stockholder's equity
|
$ | 14,788,524 |
|
The
accompanying notes are an integral part of this financial
statement
|
1.
|
Organization
|
|
Redwood
Mortgage Corp. (the "Company"), is a wholly-owned subsidiary of The
Redwood Group, LTD. (the "Parent"), which is owned by The Estate of D.
Russell Burwell and the Irrevocable Burwell Family Trust. The
Company, Michael R. Burwell (the son of D. Russell Burwell), and Gymno
Corporation (owned by the Burwells) are general partners in Redwood
Mortgage Investors VIII, which invests in high-yield debt instruments,
primarily promissory notes secured by deeds of trust on California real
estate. Michael Burwell and Gymno Corporation are also general
partners in seven other related limited partnerships and another related
company is general partner in a ninth related limited
partnership.
|
2.
|
Summary of Significant
Accounting Policies
|
|
Accrual
basis
|
|
The
accompanying financial statement was prepared on the accrual basis of
accounting wherein revenue is recognized when earned and expenses are
recognized when incurred. Loan commissions are recognized as
revenue when the related loan closes escrow and loan service fees are
recognized over the period services are
provided.
|
|
Cash and
equivalents
|
|
Cash
represents cash and short-term, highly liquid investments with maturities
of three months or less. Cash deposits at March 31,2004, that
exceeded federal insurance limits (up to $100,000), were
$3,016,930.
|
|
Allowance for loan
losses
|
|
Loans
and the related accrued interest, late fees and advances are analyzed on a
continuous basis for recoverability. Delinquencies are
identified and followed as part of the loan
system. Delinquencies are determined based upon contractual
terms. A provision is made for loan losses to adjust the
allowance for loan losses to an amount considered by management to be
adequate, with due consideration to collateral values, to provide for
unrecoverable loans and receivables, including impaired loans, other
loans, accrued interest, late fees and advances on loans and other
accounts receivable (unsecured). If a loan is categorized as
impaired, interest is no longer accrued. The Company charges
off uncollectible loans and related receivables directly to the allowance
account once it is determined that the full amount is not
collectible. As of March 31, 2005, management had an allowance
for accrued interest of $74,128.
|
|
Fixed assets and
income-producing property
|
2.
|
Summary of Significant
Accounting Policies
(continued)
|
|
Deferred costs of
brokerage related rights
|
|
Consistent
with Statement of Financial Accounting Standards No. 141 and 142, the
Company has recognized as an asset rights to act as the mortgage loan
broker for various of its affiliated limited partnerships. Such
rights result in brokerage commissions to the Company. The
initial costs of these rights include fees paid to broker-dealers on
behalf of affiliated partnerships. Such costs are being
amortized over the anticipated 25-year period that brokerage fee net cash
flows are expected to be received in proportion to the expected receipt of
these cash flows.
|
|
The
Company evaluates the fair value of these rights to determine if the
brokerage rights have been impaired. Fair value is determined
based on the estimated brokerage fee net cash flows to be received by the
Company over the expected 25 year lives of the partnerships' underlying
loan portfolios. It is the Company's experience that the
underlying loan portfolios increase as partner capital is raised and
accumulated for the first seven years of a partnership's existence, and
then will begin to decline gradually over the subsequent 18 years of their
estimated lives. If the carrying value of the deferred mortgage
brokerage rights exceeds their estimated fair value, an allowance for
impairment of value is recognized. The Company has determined
that no allowance for impairment was required against its deferred
mortgage brokerage rights.
|
|
Income
taxes
|
|
The
Company's operating results are included in the consolidated tax returns
of the Parent, which files its income tax returns on the cash basis of
accounting. Income taxes are allocated to the Company by the
Parent for those taxes currently payable and those deferred as if the
Company were filing separate tax returns. A provision for
income taxes is provided for deferred taxes resulting from differences in
the timing of reporting revenue and expense items for financial versus tax
purposes.
|
|
Use of
estimates
|
|
In
preparing a balance sheet in accordance with accounting principles
generally accepted in the United States of America, management is required
to make estimates that affect the reported amounts of assets and
liabilities as of the balance sheet date. Such estimates relate
principally to the period of recoverability of deferred costs of brokerage
related rights and the determination of the allowance for loan
losses. Actual results could differ from these
estimates.
|
3.
|
Partnership
Services
|
|
The
following are commissions and/or fees derived by the Company from services
provided to its affiliated
partnerships:
|
|
Loan servicing
fees
|
3.
|
Partnership Services
(continued)
|
|
Loan
commissions
|
|
The
Company earns loan commissions in connection with the review, selection,
evaluation, negotiation and extension of partnership mortgage investments
in an amount up to 12% of the mortgage investments until 6 months after
the termination date of a partnership offering. Only 1 of the 9
affiliated limited partnerships is in the offering
stage. Thereafter, loan commissions are limited to an amount
not to exceed 4% of the total partnership assets per year. The
loan commissions are paid by the borrowers, and thus, are not an expense
of the partnerships.
|
|
Asset management
fee
|
|
Other fees and
charges
|
|
The
limited partnership agreements provide for other fees such as
reconveyance, mortgage assumption and mortgage extension
fees. Such fees are incurred by the borrowers and are paid to
the Company. In addition, the Company is reimbursed for
expenses and clerical costs associated with accounting and related
services incurred on behalf of the limited
partnerships.
|
4.
|
Investment in Mortgage
Loans
|
|
At
March 31, 2005, the Company had investments in mortgage loans maturing as
follows:
|
Year
ending
|
||||
September
30,
|
||||
2005
|
$ | 101,511 | ||
2006
|
1,113 | |||
2007
|
1,256 | |||
2008
|
1,415 | |||
2009
|
1,595 | |||
Thereafter
|
80,633 | |||
$ | 187,523 |
5.
|
Income-Producing
Property
|
Building
and improvements
|
$ | 602,832 | ||
Land
|
547,168 | |||
1,150,000 | ||||
Less
accumulated depreciation and amortization
|
(37,805 | ) | ||
Income-producing
property, net
|
$ | 1,112,195 |
6.
|
Fixed
Assets
|
Furniture
and equipment
|
$ | 311,754 | ||
Computer
software
|
127,491 | |||
439,245 | ||||
Less
accumulated depreciation and amortization
|
(261,409 | ) | ||
Fixed
assets, net
|
$ | 177,836 |
7.
|
Deferred Costs of
Brokerage Related Rights
|
Deferred
costs of brokerage related rights
|
$ | 10,216,623 | ||
Less
accumulated amortization
|
(2,333,409 | ) | ||
Deferred
costs of brokerage related rights, net
|
$ | 7,883,214 |
|
Estimated
amortization expense for each of the next five years is as
follows:
|
Year
Ending September 30:
|
||||
2005
|
$ | 395,948 | ||
2006
|
$ | 731,875 | ||
2007
|
$ | 683,507 | ||
2008
|
$ | 614,859 | ||
2009
|
$ | 614,373 |
8.
|
Income
Taxes
|
Cash
to accrual differences
|
$ | 55,000 | ||
Deferred
costs of brokerage related rights
|
4,210,000 | |||
State
deferred taxes
|
(242,000 | ) | ||
Net
operating loss carryforwards
|
(1,518,000 | ) | ||
Other
|
(27,000 | ) | ||
Net
deferred tax liability
|
$ | 2,478,000 |
9.
|
Advances from
Partnerships
|
Year Ending September 30:
|
||||
2005
|
$ | 611,621 | ||
2006
|
1,213,956 | |||
2007
|
1,208,546 | |||
2008
|
1,181,665 | |||
2009
|
1,181,665 | |||
Thereafter
|
4,795,702 | |||
10,193,155 | ||||
Less
discount on imputed interest
|
(1,944,652 | ) | ||
Advances
from partnerships, net
|
$ | 8,248,503 |
10.
|
Notes
Payable
|
|
During
2003, the Company entered into an interest-only note payable to a bank for
the purchase of a property. The note matured in December, 2004
at an interest rate of 5.25%, and was fully paid at its maturity in
December, 2004.
|
2005
|
$ | 6,605 | ||
2006
|
13,802 | |||
2007
|
14,632 | |||
2008
|
15,511 | |||
2009
|
8,101 | |||
Total
|
$ | 58,651 | ||
11.
|
Commitments and
Guarantees
|
2005
|
$ | 9,886 | ||
2006
|
189,288 | |||
2007
|
194,972 | |||
2008
|
200,814 | |||
2009
|
117,712 | |||
$ | 712,672 |
12.
|
Profit-Sharing
Plan
|
|
The
Company has a defined contribution profit-sharing plan which provides for
Company contributions of 5% of eligible wages, plus any discretionary
additional Company contributions.
|
13.
|
Related Party
Transactions
|
|
Partnership
transactions
|
|
As
described in Notes 1 and 3, the Company's main source of revenue is from
originating and servicing mortgage obligations from nine limited
partnerships whose general partners are related to the Company (one such
general partner is the Company). The Company has received
advances from these limited partnerships to help finance the costs of
brokerage related rights.
|
|
Due from related
parties
|
Related
party advances
|
$ | 150,153 | ||
Partnership
services
|
741,265 | |||
$ | 891,418 |
|
Investment in
partnership
|
|
During
2003, the Company purchased an investment in Redwood Mortgage Investor's
VIII from a former investor at that investor’s cost. The
investment balance was $50,000 at March 31,
2005.
|
14.
|
Deferred Compensation
Agreement
|
|
PRIOR
PERFORMANCE TABLES
|
1st
Offering
|
2nd
Offering
|
3rd
Offering
|
4th
Offering
|
5th
Offering
|
||||||||||||||||
Dollar
Amount Offered
|
$ | 15,000 | $ | 30,000 | $ | 30,000 | $ | 50,000 | $ | 75,000 | ||||||||||
Dollar
Amount Raised
|
$ | 14,932 | $ | 29,993 | $ | 29,999 | $ | 49,985 | $ | 47,314 | ||||||||||
Percentage
of Amount Raised
|
99.55 | % | 99.98 | % | 100 | % | 99.97 | % | 63.09 | % | ||||||||||
Less
Offering Expenses:
|
||||||||||||||||||||
Organization
Expense
|
3.90 | % | 2.00 | % | 2.05 | % | 1.30 | % | 1.10 | % | ||||||||||
Selling
Commissions Paid to
|
||||||||||||||||||||
Non
Affiliates (1)
|
0 | 0 | 0 | 0 | 0 | |||||||||||||||
Selling
Commissions Paid to Affiliates
|
0 | 0 | 0 | 0 | 0 | |||||||||||||||
Percentage
Available for Investment
|
||||||||||||||||||||
Net
of Offering Expenses
|
96.10 | % | 98.00 | % | 97.95 | % | 98.70 | % | 98.90 | % | ||||||||||
Loans
Funded from Offering Proceeds
|
||||||||||||||||||||
Secured
by Deeds of Trust
|
87.90 | % | 89.40 | % | 89.55 | % | 90.10 | % | 90.40 | % | ||||||||||
Formation
Loan
|
7.20 | % | 7.60 | % | 7.40 | % | 7.60 | % | 7.50 | % | ||||||||||
Loan
Commitments
|
0 | 0 | 0 | 0 | 0 | |||||||||||||||
Loan
Application or Mortgage
|
||||||||||||||||||||
Processing
Fees
|
0 | 0 | 0 | 0 | 0 | |||||||||||||||
Funds
Available for Future
|
||||||||||||||||||||
Commitments
|
0 | 0 | 0 | 0 | 0 | |||||||||||||||
Reserve
|
1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | ||||||||||
Total
|
96.10 | % | 98.00 | % | 97.95 | % | 98.70 | % | 98.90 | % |
Date
Offering Commenced
|
03/03/93
|
12/4/96
|
08/31/00
|
10/31/02
|
10/07/03
|
|||
Length
of Offering
|
44
months
|
44
months
|
20
months
|
11
months
|
Open
|
|||
Months
to Commit 90% of Amount
|
||||||||
Available
for Investment (Measured
|
||||||||
from
Beginning of Offering)
|
45
months
|
45
months
|
21
months
|
12
months
|
N/A |
(1)
|
Commissions
are paid by Redwood Mortgage Corp. through the Formation Loan (See” PLAN
OF DISTRIBUTION - Formation Loan” at Page 88 of the
Prospectus).
|
RMI
VIII
(In
thousands)
|
||||
Date
Offering Commenced (1)
|
03/03/93
|
|||
Dollar
Amount Raised (2)
|
$ | 172,223 | ||
Amount
Paid to General Partners and
|
||||
Affiliates
from:
|
||||
Offering
Proceeds
|
0 | |||
Selling
Commissions
|
0 | |||
Loan
Application or Loan Processing Fees
|
0 | |||
Reimbursement
of Expenses, at Cost
|
182 | |||
Acquisition
Fees
|
0 | |||
Advisory
Fees
|
0 | |||
Other
|
0 | |||
Loan
Points, Processing and Other Fees Paid
|
||||
by
the Borrowers to Affiliates:
|
||||
Points
(3)
|
12,164 | |||
Processing
Fees (3)
|
193 | |||
Other
(3)
|
56 | |||
Dollar
Amount of Cash Generated from
|
||||
Operations
Before Deducting
|
||||
Payments
to General Partners and Affiliates:
|
71,075 | |||
Amount
Paid to General Partners and Affiliates
|
||||
from
Operations:
|
||||
Partnership
Management Fees
|
1,776 | |||
Earnings
Fee
|
490 | |||
Mortgage
Servicing Fee
|
5,898 | |||
Reimbursement
of Expenses, at Cost
|
1,499 | |||
Early
Withdrawal
|
265 |
$’s
in thousands except for cash distribution per
$1,000
|
1993
|
1994
|
1995
|
1996
|
|||||||||||||
Gross
Revenues
|
$ | 119 | $ | 498 | $ | 1,050 | $ | 1,727 | ||||||||
Less:
General Partners' Mgmt Fee
|
0 | 6 | 12 | 17 | ||||||||||||
Loan
Servicing Fee
|
6 | 29 | 85 | 156 | ||||||||||||
Administrative
Expenses
|
4 | 27 | 51 | 86 | ||||||||||||
Provision
for Uncollected Accts
|
0 | 13 | 26 | 55 | ||||||||||||
Amortization
of Organization Costs
|
1 | 3 | 3 | 3 | ||||||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
4 | 14 | 19 | 2 | ||||||||||||
Interest
Expense
|
0 | 0 | 26 | 189 | ||||||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||||||
Limited
Partners
|
$ | 104 | $ | 406 | $ | 828 | $ | 1,219 | ||||||||
Federal
Taxable Income
|
$ | 109 | $ | 433 | $ | 873 | $ | 1,299 | ||||||||
Sources
of Funds - Net Income
|
||||||||||||||||
distributable
to limited partners
|
$ | 104 | $ | 406 | $ | 828 | $ | 1,219 | ||||||||
Reduction
in Assets
|
0 | 0 | 0 | 0 | ||||||||||||
Increase
in Liabilities
|
0 | 0 | 1,914 | 0 | ||||||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||||||
Syndication
Costs
|
0 | 0 | 0 | 4 | ||||||||||||
Increase
in Applicant's Deposit
|
129 | 61 | 0 | 311 | ||||||||||||
Increase
in Partners' Capital
|
||||||||||||||||
Collection
on Formation Loan
|
0 | 0 | 0 | 17 | ||||||||||||
Admittance
of New Partners
|
2,766 | 4,514 | 3,843 | 3,864 | ||||||||||||
Cash
generated from Operations
|
||||||||||||||||
and
Financing
|
2,999 | 4,981 | 6,585 | 5,415 | ||||||||||||
Use
of Funds-Increase in Assets
|
(2,364 | ) | (4,192 | ) | (5,671 | ) | (3,860 | ) | ||||||||
Reduction
in Liabilities
|
(0 | ) | (0 | ) | (0 | ) | (176 | ) | ||||||||
Decrease
in Applicant's Deposit
|
(0 | ) | (0 | ) | (189 | ) | (0 | ) | ||||||||
Decrease
in Partner’s Capital
|
||||||||||||||||
Formation
Loan
|
(206 | ) | (319 | ) | (250 | ) | (315 | ) | ||||||||
Syndication
Costs
|
(200 | ) | (81 | ) | (175 | ) | (214 | ) | ||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
(2 | ) | (6 | ) | (8 | ) | (1 | ) | ||||||||
Investment
Income Paid to LP's
|
(47 | ) | (166 | ) | (303 | ) | (418 | ) | ||||||||
Return
of Capital to LP's
|
(0 | ) | (0 | ) | (6 | ) | (147 | ) | ||||||||
Net
Increase (Decrease) in Cash
|
180 | 217 | (17 | ) | 284 | |||||||||||
Cash
at the beginning of the year
|
0 | 180 | 397 | 380 | ||||||||||||
Cash
at the end of the year
|
$ | 180 | $ | 397 | $ | 380 | $ | 664 |
1993
|
1994
|
1995
|
1996
|
|||||||||||||
Cash
Distribution Credited on
|
||||||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 83 | $ | 81 | $ | 83 | $ | 84 | ||||||||
Cash
Distribution Data paid for
|
||||||||||||||||
$1,000
Invested for a Limited
|
||||||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||||||
Distribution
(GAAP Basis)
|
$ | 80 | $ | 79 | $ | 80 | $ | 81 | ||||||||
Cash
Distribution to All Investors for
|
||||||||||||||||
$1,000
Invested (2)
|
||||||||||||||||
Income
(1)
|
$ | 36 | $ | 33 | $ | 32 | $ | 31 | ||||||||
Capital
(1)
|
$ | 0 | $ | 0 | $ | 0.60 | $ | 11 | ||||||||
Federal
Income Tax Results for
|
||||||||||||||||
$1,000
Invested Capital for a
|
||||||||||||||||
Compounding
Limited Partner
|
$ | 96 | $ | 92 | $ | 96 | $ | 99 | ||||||||
Federal
Income Tax Results for $1,000
|
||||||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||||||
Monthly
Earnings Distributions
|
$ | 93 | $ | 89 | $ | 92 | $ | 95 |
|
(2) Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
$’s
in thousands except for cash distribution per
$1,000
|
1997
|
1998
|
1999
|
2000
|
|||||||||||||
Gross
Revenues
|
$ | 2,630 | $ | 3,406 | $ | 4,426 | $ | 6,349 | ||||||||
Less:
General Partners' Mgmt Fee
|
25 | 32 | 42 | 61 | ||||||||||||
Loan
Servicing Fee
|
190 | 295 | 359 | 506 | ||||||||||||
Administrative
Expenses
|
144 | 147 | 174 | 270 | ||||||||||||
Provision
for Uncollected Accts
|
140 | 163 | 409 | 375 | ||||||||||||
Amortization
of Organization Costs
|
0 | 0 | 0 | 0 | ||||||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
9 | 4 | 2 | 5 | ||||||||||||
Interest
Expense
|
341 | 514 | 527 | 887 | ||||||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||||||
Limited
Partners
|
$ | 1,781 | $ | 2,251 | $ | 2,913 | $ | 4,245 | ||||||||
Federal
Taxable Income
|
$ | 1,929 | $ | 2,411 | $ | 3,331 | $ | 4,755 | ||||||||
Sources
of Funds - Net Income
|
||||||||||||||||
distributable
to limited partners
|
$ | 1,781 | $ | 2,251 | $ | 2,913 | $ | 4,245 | ||||||||
Reduction
in Assets
|
0 | 0 | 0 | 0 | ||||||||||||
Increase
in Liabilities
|
3,988 | 348 | 0 | 16,269 | ||||||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||||||
Syndication
Costs
|
5 | 8 | 13 | 10 | ||||||||||||
Increase
in Applicant's Deposit
|
0 | 0 | 330 | 0 | ||||||||||||
Increase
in Partners' Capital
|
||||||||||||||||
Collection
on Formation Loan
|
108 | 150 | 191 | 250 | ||||||||||||
Admittance
of New Partners
|
5,572 | 5,110 | 9,202 | 14,997 | ||||||||||||
Cash
generated from Operations
|
||||||||||||||||
and
Financing
|
11,454 | 7,867 | 12,649 | 35,771 | ||||||||||||
Use
of Funds-Increase in Assets
|
(9,905 | ) | (6,598 | ) | (3,439 | ) | (32,472 | ) | ||||||||
Reduction
in Liabilities
|
(0 | ) | (0 | ) | (5,832 | ) | (0 | ) | ||||||||
Decrease
in Applicant's Deposit
|
(311 | ) | (0 | ) | (0 | ) | (105 | ) | ||||||||
Decrease
in Partner’s Capital
|
||||||||||||||||
Formation
Loan
|
(420 | ) | (404 | ) | (708 | ) | (1,102 | ) | ||||||||
Syndication
Costs
|
(189 | ) | (126 | ) | (177 | ) | (227 | ) | ||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
(2 | ) | (2 | ) | (1 | ) | (1 | ) | ||||||||
Investment
Income Paid to LP's
|
(495 | ) | (614 | ) | (826 | ) | (1,245 | ) | ||||||||
Return
of Capital to LP's
|
(133 | ) | (257 | ) | (592 | ) | (762 | ) | ||||||||
Net
Increase (Decrease) in Cash
|
(1 | ) | (134 | ) | $ | 1,074 | $ | (143 | ) | |||||||
Cash
at the beginning of the year
|
664 | 663 | 529 | 1,603 | ||||||||||||
Cash
at the end of the year
|
$ | 663 | $ | 529 | $ | 1,603 | $ | 1,460 |
1997
|
1998
|
1999
|
2000
|
|||||||||||||
Cash
Distribution Credited on
|
||||||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 84 | $ | 84 | $ | 84 | $ | 86 | ||||||||
Cash
Distribution Paid for
|
||||||||||||||||
$1,000
Invested for a Limited
|
||||||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||||||
Distribution
(GAAP Basis)
|
$ | 81 | $ | 81 | $ | 81 | $ | 83 | ||||||||
Cash
Distribution to All Investors for
|
||||||||||||||||
$1,000
Invested (2)
|
||||||||||||||||
Income
(1)
|
$ | 31 | $ | 29 | $ | 31 | $ | 34 | ||||||||
Capital
(1)
|
8 | 12 | $ | 22 | $ | 21 | ||||||||||
Federal
Income Tax Results for
|
||||||||||||||||
$1,000
Invested Capital for a
|
||||||||||||||||
Compounding
Limited Partner
|
$ | 100 | $ | 98 | $ | 102 | $ | 102 | ||||||||
Federal
Income Tax Results for $1,000
|
||||||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||||||
Monthly
Earnings Distributions
|
$ | 97 | $ | 95 | $ | 99 | $ | 98 |
|
(2) Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
$’s
in thousands except for cash distribution per
$1,000
|
2001
|
2002
|
2003
|
2004
|
|||||||||||||
Gross
Revenues
|
$ | 9,088 | $ | 11,691 | $ | 12,958 | $ | 17,133 | ||||||||
Less:
General Partners' Mgmt Fee
|
158 | 325 | 468 | 630 | ||||||||||||
Loan
Servicing Fee
|
552 | 1,098 | 1,057 | 1,565 | ||||||||||||
Administrative
Expenses
|
416 | 1,060 | 1,045 | 1,139 | ||||||||||||
Provision
for Uncollected Accts
|
957 | 1,280 | 782 | 1,146 | ||||||||||||
Amortization
of Organization Costs
|
0 | 0 | 0 | 0 | ||||||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
1 | 1 | 37 | 20 | ||||||||||||
Interest
Expense
|
972 | 516 | 71 | 622 | ||||||||||||
Net
Income (GAAP Basis) dist. to
|
||||||||||||||||
Limited
Partners
|
$ | 6,032 | $ | 7,411 | $ | 9,498 | $ | 12,011 | ||||||||
Federal
Taxable Income
|
$ | 6,926 | $ | 8,719 | $ | 9,072 | $ | 12,212 | ||||||||
Sources
of Funds - Net Income
|
||||||||||||||||
distributable
to limited partners
|
$ | 6,032 | $ | 7,411 | $ | 9,498 | $ | 12,011 | ||||||||
Reduction
in Assets
|
0 | 0 | 0 | 0 | ||||||||||||
Increase
in Liabilities
|
0 | 0 | 18,822 | 0 | ||||||||||||
Early
Withdrawal Penalties Applied to
|
||||||||||||||||
Syndication
Costs
|
24 | 7 | 17 | 16 | ||||||||||||
Increase
in Applicant's Deposit
|
448 | 1,905 | 0 | 0 | ||||||||||||
Increase
in Partners' Capital
|
||||||||||||||||
Collection
on Formation Loan
|
346 | 546 | 637 | 916 | ||||||||||||
Admittance
of New Partners
|
$ | 19,266 | $ | 19,681 | 41,461 | 41,793 | ||||||||||
Cash
generated from Operations
|
||||||||||||||||
and
Financing
|
26,116 | 29,550 | 70,435 | 54,736 | ||||||||||||
Use
of Funds-Increase in Assets
|
(15,480 | ) | (10,923 | ) | (58,715 | ) | (30,583 | ) | ||||||||
Reduction
in Liabilities
|
(5,038 | ) | (7,733 | ) | (0 | ) | (6,009 | ) | ||||||||
Decrease
in Applicant's Deposit
|
(0 | ) | (0 | ) | (1,368 | ) | (786 | ) | ||||||||
Decrease
in Partner’s Capital
|
||||||||||||||||
Formation
Loan
|
(1,462 | ) | (1,677 | ) | (2,929 | ) | (3,117 | ) | ||||||||
Syndication
Costs
|
(291 | ) | (381 | ) | (483 | ) | (421 | ) | ||||||||
Offering
Period Interest Expense to
|
||||||||||||||||
Limited
Partners
|
(0 | ) | (0 | ) | (0 | ) | (0 | ) | ||||||||
Investment
Income Paid to LP's
|
(1,962 | ) | (2,516 | ) | (3,362 | ) | (4,452 | ) | ||||||||
Return
of Capital to LP's
|
(1,426 | ) | (1,049 | ) | (1,845 | ) | (1,988 | ) | ||||||||
Net
Increase (Decrease) in Cash
|
$ | 457 | $ | 5,271 | 1,733 | 7,380 | ||||||||||
Cash
at the beginning of the year
|
1,460 | 1,917 | 7,188 | 8,921 | ||||||||||||
Cash
at the end of the year
|
$ | 1,917 | $ | 7,188 | $ | 8,921 | $ | 16,301 |
2001
|
2002
|
2003
|
2004
|
|||||||||||||
Cash
Distribution Credited on
|
||||||||||||||||
$1,000
Invested for a Compounding
|
||||||||||||||||
Limited
Partner (GAAP Basis)
|
$ | 90 | $ | 87 | $ | 78 | $ | 72 | ||||||||
Cash
Distribution Paid for
|
||||||||||||||||
$1,000
Invested for a Limited
|
||||||||||||||||
Partner
Receiving Monthly Earnings
|
||||||||||||||||
Distribution
(GAAP Basis)
|
$ | 87 | $ | 84 | $ | 75 | $ | 70 | ||||||||
Cash
Distribution to All Investors for
|
||||||||||||||||
$1,000
Invested (2)
|
||||||||||||||||
Income
(1)
|
$ | 37 | $ | 34 | $ | 35 | $ | 32 | ||||||||
Capital
(1)
|
$ | 27 | $ | 19 | $ | 19 | $ | 14 | ||||||||
Federal
Income Tax Results for
|
||||||||||||||||
$1,000
Invested Capital for a
|
||||||||||||||||
Compounding
Limited Partner
|
$ | 106 | $ | 105 | $ | 76 | $ | 75 | ||||||||
Federal
Income Tax Results for $1,000
|
||||||||||||||||
Invested
for a Limited Partner Receiving
|
||||||||||||||||
Monthly
Earnings Distributions
|
$ | 103 | $ | 101 | $ | 73 | $ | 72 |
|
(2) Based
upon cash distributions actually paid to limited partners receiving
monthly earning distributions compared to all limited
partners. Cash distributions credited to compounding limited
partners are not included for purposes of this
calculation.
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
11/06/01
|
06/05/02
|
100,000.00
|
5,901.81
|
105,901.81
|
Santa
Clara
|
02/18/00
|
01/10/03
|
100,000.00
|
30,948.51
|
130,948.51
|
Stanislaus
|
08/13/02
|
04/29/03
|
211,358.00
|
16,597.47
|
227,955.47
|
Contra
Costa
|
12/05/02
|
10/03/03
|
161,883.95
|
14,932.40
|
176,816.35
|
Contra
Costa
|
10/11/96
|
11/05/03
|
40,000.00
|
18,577.55
|
58,577.55
|
Contra
Costa
|
01/18/01
|
07/09/04
|
77,500.00
|
33,182.90
|
110,682.90
|
Marin
|
11/12/02
|
07/15/04
|
105,000.00
|
18,067.33
|
123,067.33
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Stanislaus
|
07/24/98
|
03/13/02
|
150,000.00
|
42,295.62
|
192,295.62
|
San
Joaquin
|
05/10/02
|
06/30/03
|
50,000.00
|
5,993.88
|
55,993.88
|
Alameda
|
08/28/03
|
04/18/04
|
196,221.25
|
6,420.08
|
202,641.33
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
El
Dorado
|
02/23/95
|
07/08/02
|
44,100.00
|
35,017.01
|
79,117.01
|
Stanislaus
|
02/06/98
|
08/13/02
|
149,996.00
|
80,738.97
|
230,734.97
|
Riverside
|
03/15/97
|
12/20/02
|
100,000.00
|
43,058.96
|
143,058.96
|
San
Mateo
|
10/16/01
|
02/12/03
|
285,000.00
|
33,001.58
|
318,001.58
|
San
Francisco
|
10/28/92
|
12/01/04
|
152,000.00
|
104,757.32
|
256,757.32
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Mateo
|
01/25/00
|
06/27/01
|
69,999.20
|
11,235.86
|
81,235.06
|
Santa
Clara
|
05/25/01
|
04/24/02
|
50,000.00
|
5,591.12
|
55,591.12
|
Sonoma
|
09/18/96
|
04/30/02
|
4,873.50
|
2,185.37
|
7,058.87
|
Santa
Clara
|
04/24/02
|
05/30/02
|
68,750.00
|
864.80
|
69,614.80
|
Santa
Clara
|
02/18/00
|
01/10/03
|
100,000.00
|
30,948.51
|
130,948.51
|
Sonoma
|
10/30/96
|
09/02/03
|
4,993.20
|
2,674.49
|
7,667.69
|
Alameda
|
02/04/03
|
12/10/04
|
100,000.00
|
18,169.37
|
118,169.37
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
11/02/98
|
04/19/01
|
100,000.00
|
27,415.08
|
127,415.08
|
Placer
|
12/30/96
|
01/24/02
|
55,000.00
|
33,519.78
|
88,519.78
|
Alameda
|
11/16/93
|
03/29/02
|
150,000.00
|
124,797.19
|
274,797.19
|
Alameda
|
11/16/93
|
03/29/02
|
49,586.38
|
25,483.23
|
75,069.61
|
Santa
Clara
|
01/21/94
|
03/29/02
|
178,180.70
|
149,309.32
|
327,490.02
|
Santa
Clara
|
11/15/96
|
03/29/02
|
6,369.10
|
4,187.46
|
10,556.56
|
El
Dorado
|
02/23/95
|
07/08/02
|
44,100.00
|
35,017.01
|
79,117.01
|
Riverside
|
03/15/97
|
12/20/02
|
100,000.00
|
62,617.99
|
162,617.99
|
Tuolumne
|
08/25/00
|
04/07/03
|
59,500.00
|
17,883.29
|
77,383.29
|
San
Francisco
|
04/24/03
|
07/14/04
|
80,000.00
|
9,589.48
|
89,589.48
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Mateo
|
05/31/00
|
01/04/01
|
50,000.00
|
3,302.24
|
53,302.24
|
San
Mateo
|
07/31/00
|
10/16/01
|
50,000.00
|
31,375.88
|
81,375.88
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
02/02/00
|
02/14/02
|
82,008.48
|
19,223.17
|
101,231.65
|
Alameda
|
11/16/93
|
03/29/02
|
100,000.00
|
83,198.13
|
183,198.13
|
Alameda
|
11/16/93
|
03/29/02
|
26,445.95
|
13,591.00
|
40,036.95
|
Santa
Clara
|
01/21/94
|
03/29/02
|
123,934.27
|
103,852.67
|
227,786.94
|
Santa
Clara
|
11/15/96
|
03/29/02
|
4,430.90
|
2,913.16
|
7,344.06
|
San
Mateo
|
10/16/01
|
02/12/03
|
9,500.00
|
1,100.05
|
10,600.05
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Tuolumne
|
06/28/01
|
01/25/02
|
89,999.00
|
6,136.75
|
96,135.75
|
Contra
Costa
|
10/30/01
|
03/12/02
|
96,000.00
|
3,883.88
|
99,883.88
|
San
Mateo
|
02/23/01
|
03/15/02
|
150,000.00
|
19,238.22
|
169,238.22
|
Alameda
|
11/16/93
|
03/29/02
|
150,000.00
|
124,797.19
|
274,797.19
|
Alameda
|
11/16/93
|
03/29/02
|
39,668.93
|
20,386.49
|
60,055.42
|
Santa
Clara
|
05/25/01
|
04/24/02
|
150,000.00
|
16,773.36
|
166,773.36
|
Sonoma
|
09/18/96
|
04/30/02
|
7,546.48
|
3,383.99
|
10,930.47
|
San
Mateo
|
07/09/02
|
10/22/02
|
67,750.00
|
2,078.35
|
69,828.35
|
Alameda
|
06/20/02
|
10/21/03
|
70,000.00
|
9,879.60
|
79,879.60
|
Contra
Costa
|
03/25/03
|
09/24/03
|
80,000.00
|
4,086.86
|
84,086.86
|
Sonoma
|
10/30/96
|
09/02/03
|
7,731.83
|
4,141.37
|
11,873.20
|
San
Mateo
|
01/29/99
|
06/09/03
|
67,000.00
|
27,738.38
|
94,738.38
|
Contra
Costa
|
03/25/03
|
01/09/04
|
68,000.00
|
5,515.56
|
73,515.56
|
San
Mateo
|
07/09/87
|
06/30/04
|
5,500.00
|
6,292.58
|
11,792.58
|
San
Mateo
|
07/09/87
|
06/30/04
|
82,500.00
|
90,700.75
|
173,200.75
|
Marin
|
11/12/02
|
07/15/04
|
105,000.00
|
18,067.33
|
123,067.33
|
San
Francisco
|
08/25/03
|
07/19/04
|
125,000.00
|
9,761.03
|
134,761.03
|
San
Francisco
|
07/12/02
|
10/07/04
|
100,000.00
|
23,524.06
|
123,524.06
|
Alameda
|
02/04/03
|
12/10/04
|
105,000.00
|
19,077.67
|
124,077.67
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
11/30/02
|
02/11/03
|
149,999.50
|
3,281.24
|
153,280.74
|
San
Francisco
|
10/12/88
|
11/04/03
|
60,000.00
|
76,042.84
|
136,042.84
|
San
Joaquin
|
05/10/02
|
06/30/03
|
100,000.00
|
11,987.38
|
111,987.38
|
Alameda
|
08/28/03
|
04/18/04
|
147,165.94
|
4,815.01
|
151,980.95
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Contra
Costa
|
05/31/00
|
02/07/01
|
255,000.00
|
22,379.13
|
277,379.13
|
Santa
Clara
|
11/02/98
|
04/19/01
|
100,000.00
|
27,415.08
|
127,415.08
|
Alameda
|
08/08/97
|
09/29/01
|
31,500.00
|
15,500.93
|
47,000.93
|
San
Francisco
|
02/02/00
|
02/14/02
|
27,891.53
|
6,537.91
|
34,429.44
|
Alameda
|
11/16/93
|
03/29/02
|
150,000.00
|
124,797.19
|
274,797.19
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
11/16/93
|
03/29/02
|
39,668.93
|
20,386.49
|
60,055.42
|
San
Mateo
|
06/11/02
|
11/22/02
|
100,000.00
|
4,936.46
|
104,936.46
|
Riverside
|
03/15/97
|
12/20/02
|
100,000.00
|
62,617.99
|
162,617.99
|
Alameda
|
01/31/96
|
06/26/03
|
147,000.00
|
115,617.40
|
262,617.40
|
Tuolumne
|
08/25/00
|
04/07/03
|
59,500.00
|
17,883.29
|
77,383.29
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Sonoma
|
11/18/87
|
12/26/02
|
70,000.00
|
86,359.95
|
156,359.95
|
San
Francisco
|
04/08/86
|
09/19/03
|
75,000.00
|
144,878.32
|
219,878.32
|
San
Mateo
|
08/07/98
|
07/22/03
|
27,000.00
|
15,313.22
|
42,313.22
|
Sacramento
|
07/16/98
|
04/04/03
|
4,570.00
|
1,305.69
|
5,875.69
|
Stanislaus
|
08/13/02
|
04/29/03
|
28,179.00
|
2,212.83
|
30,391.83
|
Sacramento
|
07/16/98
|
04/04/03
|
4,570.00
|
1,305.69
|
5,875.69
|
San
Mateo
|
01/20/98
|
05/10/04
|
48,500.00
|
29,083.54
|
77,583.54
|
San
Mateo
|
07/09/87
|
06/30/04
|
5,500.00
|
6,292.58
|
11,792.58
|
San
Mateo
|
07/09/87
|
06/30/04
|
82,500.00
|
90,700.75
|
173,200.75
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
10/10/89
|
12/23/02
|
195,000.00
|
345,756.46
|
540,756.46
|
Sacramento
|
07/16/98
|
06/02/03
|
137,100.00
|
48,883.90
|
185,983.90
|
Sacramento
|
05/27/88
|
06/26/03
|
344,250.00
|
386,172.60
|
730,422.60
|
San
Francisco
|
10/20/00
|
06/30/03
|
57,972.00
|
19,071.60
|
77,043.60
|
Contra
Costa
|
04/25/03
|
11/21/03
|
100,000.00
|
5,900.20
|
105,900.20
|
Sacramento
|
12/24/98
|
03/18/04
|
243,000.00
|
91,819.20
|
334,819.20
|
Sacramento
|
12/24/98
|
03/18/04
|
27,000.00
|
6,608.85
|
33,608.85
|
Alameda
|
08/28/03
|
04/18/04
|
44,153.41
|
1,444.62
|
45,598.03
|
San
Francisco
|
01/31/95
|
10/18/04
|
26,750.00
|
18,193.27
|
44,943.27
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Stanislaus
|
07/24/98
|
03/13/02
|
422,000.00
|
56,394.16
|
478,394.16
|
Alameda
|
11/16/93
|
03/29/02
|
575,000.00
|
478,389.24
|
1,053,389.24
|
Alameda
|
11/16/93
|
03/29/02
|
99,172.75
|
50,966.46
|
150,139.21
|
Santa
Clara
|
01/21/94
|
03/29/02
|
671,366.60
|
562,582.20
|
1,233,948.80
|
Santa
Clara
|
11/15/96
|
03/29/02
|
24,000.00
|
15,779.17
|
39,779.17
|
Stanislaus
|
02/06/98
|
08/13/02
|
200,002.00
|
107,655.91
|
307,657.91
|
San
Mateo
|
05/17/01
|
09/13/02
|
204,000.00
|
31,751.79
|
235,751.79
|
San
Francisco
|
02/22/00
|
10/01/02
|
173,865.38
|
52,515.02
|
226,380.40
|
San
Francisco
|
02/22/00
|
10/01/02
|
226,138.63
|
56,002.09
|
282,140.72
|
Contra
Costa
|
06/19/97
|
06/28/04
|
91,664.42
|
56,434.53
|
148,098.95
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Sonoma
|
09/18/96
|
04/30/02
|
20,633.18
|
9,252.33
|
29,885.51
|
Sacramento
|
07/16/98
|
04/04/03
|
308.00
|
88.00
|
396.00
|
Sonoma
|
10/30/96
|
09/02/03
|
21,139.96
|
11,323.11
|
32,463.07
|
San
Mateo
|
09/13/02
|
07/21/04
|
5,300.00
|
1,030.17
|
6,330.17
|
Stanislaus
|
08/26/92
|
09/15/04
|
49,000.00
|
71,293.83
|
120,293.83
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Mateo
|
07/16/90
|
05/17/01
|
170,000.00
|
212,112.03
|
382,112.03
|
San
Francisco
|
01/31/01
|
08/10/01
|
300,025.00
|
5,691.63
|
305,716.63
|
Alameda
|
10/10/89
|
12/23/02
|
195,000.00
|
226,406.98
|
421,406.98
|
Sacramento
|
07/16/98
|
06/02/03
|
9,240.00
|
3,294.58
|
12,534.58
|
Sacramento
|
05/27/88
|
06/26/03
|
60,750.00
|
68,148.10
|
128,898.10
|
San
Francisco
|
10/20/00
|
06/30/03
|
20,288.00
|
6,674.34
|
26,962.34
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Alameda
|
11/16/93
|
03/29/02
|
95,000.00
|
79,038.22
|
174,038.22
|
Alameda
|
11/16/93
|
03/29/02
|
33,057.87
|
16,988.97
|
50,046.84
|
Santa
Clara
|
01/21/94
|
03/29/02
|
167,841.65
|
140,645.55
|
308,487.20
|
Santa
Clara
|
11/15/96
|
03/29/02
|
6,000.00
|
3,944.79
|
9,944.79
|
San
Mateo
|
05/17/01
|
09/13/02
|
204,000.00
|
31,751.79
|
235,751.79
|
San
Mateo
|
10/16/01
|
02/12/03
|
85,253.00
|
9,871.87
|
95,124.87
|
Contra
Costa
|
06/19/97
|
06/28/04
|
91,664.42
|
56,434.53
|
148,098.95
|
Shasta
|
05/10/95
|
07/14/04
|
58,333.16
|
49,690.13
|
108,023.29
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Tuolumne
|
06/28/01
|
01/25/02
|
170,001.00
|
11,591.83
|
181,592.83
|
Sonoma
|
09/18/96
|
04/30/02
|
22,701.71
|
10,179.89
|
32,881.60
|
Santa
Clara
|
11/06/01
|
06/05/02
|
160,000.00
|
9,443.10
|
169,443.10
|
San
Mateo
|
07/09/02
|
10/22/02
|
67,750.00
|
2,078.35
|
69,828.35
|
Santa
Clara
|
07/08/03
|
12/11/03
|
210,000.00
|
7,556.38
|
217,556.38
|
Sacramento
|
07/16/98
|
04/04/03
|
5,122.00
|
1,463.40
|
6,585.40
|
San
Francisco
|
01/30/01
|
08/26/03
|
363,700.00
|
102,512.32
|
466,212.32
|
San
Mateo
|
07/16/03
|
09/29/03
|
137,500.00
|
2,523.03
|
140,023.03
|
Sonoma
|
10/30/96
|
09/02/03
|
23,259.30
|
12,458.28
|
35,717.58
|
Marin
|
11/12/02
|
07/15/04
|
105,000.00
|
18,067.33
|
123,067.33
|
San
Mateo
|
09/13/02
|
07/21/04
|
53,000.00
|
10,301.68
|
63,301.68
|
San
Francisco
|
07/12/02
|
10/07/04
|
250,000.00
|
58,809.75
|
308,809.75
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Placer
|
01/11/01
|
07/31/02
|
63,865.00
|
17,316.05
|
81,181.05
|
Placer
|
03/30/00
|
09/30/02
|
74,594.32
|
30,266.65
|
104,860.97
|
Sacramento
|
07/29/97
|
12/23/02
|
265,000.00
|
110,226.06
|
375,226.06
|
Alameda
|
10/10/89
|
12/23/02
|
169,555.45
|
119,349.49
|
288,904.94
|
Alameda
|
11/30/02
|
02/11/03
|
200,000.50
|
4,375.01
|
204,375.51
|
Sacramento
|
07/16/98
|
06/02/03
|
153,660.00
|
54,788.48
|
208,448.48
|
San
Joaquin
|
05/10/02
|
06/30/03
|
76,250.00
|
9,140.61
|
85,390.61
|
San
Francisco
|
10/12/88
|
11/04/03
|
60,000.00
|
76,042.84
|
136,042.84
|
Alameda
|
08/28/03
|
04/18/04
|
294,319.77
|
9,629.63
|
303,949.40
|
San
Francisco
|
01/31/95
|
10/18/04
|
40,125.00
|
27,289.91
|
67,414.91
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
12/01/00
|
03/08/02
|
330,750.00
|
55,302.25
|
386,052.25
|
Alameda
|
11/16/93
|
03/29/02
|
575,000.00
|
478,389.24
|
1,053,389.24
|
Alameda
|
11/16/93
|
03/29/02
|
99,172.75
|
50,966.46
|
150,139.21
|
Santa
Clara
|
01/21/94
|
03/29/02
|
1,376,301.53
|
1,153,293.52
|
2,529,595.05
|
Santa
Clara
|
11/15/96
|
03/29/02
|
49,200.00
|
32,347.29
|
81,547.29
|
San
Mateo
|
05/17/01
|
09/13/02
|
192,000.00
|
29,884.04
|
221,884.04
|
San
Mateo
|
10/16/01
|
02/12/03
|
147,497.00
|
17,079.41
|
164,576.41
|
Contra
Costa
|
04/25/03
|
11/21/03
|
175,000.00
|
10,325.19
|
185,325.19
|
Alameda
|
01/31/96
|
06/26/03
|
63,000.00
|
49,550.32
|
112,550.32
|
San
Mateo
|
08/13/90
|
06/16/03
|
185,000.00
|
304,202.46
|
489,202.46
|
San
Mateo
|
02/12/03
|
04/13/04
|
46,578.00
|
5,378.35
|
51,956.35
|
San
Mateo
|
02/12/03
|
04/13/04
|
116,922.00
|
13,500.94
|
130,422.94
|
Shasta
|
05/10/95
|
07/14/04
|
83,333.42
|
70,986.19
|
154,319.61
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Sonoma
|
09/18/96
|
04/30/02
|
11,932.63
|
5,350.83
|
17,283.46
|
Los
Angeles
|
08/28/01
|
06/06/02
|
375,000.00
|
36,283.07
|
411,283.07
|
San
Mateo
|
06/30/93
|
07/17/02
|
29,700.00
|
29,327.78
|
59,027.78
|
Marin
|
01/23/02
|
01/30/03
|
195,000.00
|
23,074.93
|
218,074.93
|
San
Mateo
|
02/07/01
|
03/03/03
|
144,270.68
|
22,807.92
|
167,078.60
|
Stanislaus
|
08/13/02
|
04/29/03
|
563,642.00
|
44,261.54
|
607,903.54
|
San
Mateo
|
10/29/99
|
05/15/03
|
130,000.00
|
47,845.68
|
177,845.68
|
Contra
Costa
|
01/22/03
|
12/24/03
|
100,000.00
|
9,525.27
|
109,525.27
|
Santa
Clara
|
07/08/03
|
12/11/03
|
210,000.00
|
7,556.38
|
217,556.38
|
Sonoma
|
10/30/96
|
09/02/03
|
12,225.71
|
6,548.41
|
18,774.12
|
Alameda
|
01/24/03
|
09/25/03
|
295,000.00
|
20,753.05
|
315,753.05
|
San
Mateo
|
07/16/03
|
09/29/03
|
137,500.00
|
2,523.03
|
140,023.03
|
San
Mateo
|
07/31/02
|
01/14/04
|
300,000.00
|
26,852.75
|
326,852.75
|
Santa
Clara
|
08/13/02
|
02/04/04
|
275,000.00
|
47,002.23
|
322,002.23
|
San
Francisco
|
04/16/04
|
07/23/04
|
156,000.00
|
3,488.48
|
159,488.48
|
Stanislaus
|
04/14/04
|
08/20/04
|
153,750.00
|
5,114.83
|
158,864.83
|
Contra
Costa
|
04/23/04
|
09/20/04
|
250,000.00
|
9,304.97
|
259,304.97
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
08/22/01
|
03/25/02
|
439,250.00
|
31,779.41
|
471,029.41
|
Placer
|
01/11/01
|
07/31/02
|
85,150.00
|
23,087.17
|
108,237.17
|
Placer
|
03/30/00
|
09/30/02
|
99,455.20
|
40,353.95
|
139,809.15
|
San
Francisco
|
08/05/01
|
12/26/02
|
800,000.00
|
117,187.05
|
917,187.05
|
San
Francisco
|
10/20/00
|
06/30/03
|
31,884.00
|
10,489.18
|
42,373.18
|
San
Joaquin
|
05/10/02
|
06/30/03
|
100,000.00
|
11,987.38
|
111,987.38
|
Alameda
|
08/28/03
|
04/18/04
|
882,983.51
|
28,889.69
|
911,873.20
|
Alameda
|
03/12/03
|
06/03/04
|
900,000.00
|
94,454.58
|
994,454.58
|
San
Francisco
|
01/31/95
|
10/18/04
|
40,125.00
|
27,289.91
|
67,414.91
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
12/01/00
|
03/08/02
|
330,750.00
|
55,302.25
|
386,052.25
|
Stanislaus
|
07/24/98
|
03/13/02
|
500,000.00
|
140,985.40
|
640,985.40
|
Alameda
|
11/16/93
|
03/29/02
|
412,500.00
|
343,192.28
|
755,692.28
|
Alameda
|
11/16/93
|
03/29/02
|
49,586.38
|
25,483.23
|
75,069.61
|
Santa
Clara
|
01/21/94
|
03/29/02
|
335,683.30
|
281,291.10
|
616,974.40
|
Santa
Clara
|
11/15/96
|
03/29/02
|
12,000.00
|
7,889.58
|
19,889.58
|
Stanislaus
|
02/06/98
|
08/13/02
|
400,004.00
|
215,311.81
|
615,315.81
|
San
Francisco
|
02/22/00
|
10/01/02
|
434,653.87
|
131,284.65
|
565,938.52
|
San
Francisco
|
02/22/00
|
10/01/02
|
565,334.12
|
140,002.14
|
705,336.26
|
Contra
Costa
|
11/16/99
|
12/12/02
|
829,500.00
|
265,960.28
|
1,095,460.28
|
Alameda
|
11/07/00
|
10/08/03
|
205,000.00
|
91,615.70
|
296,615.70
|
Contra
Costa
|
06/19/97
|
06/28/04
|
146,667.16
|
90,295.80
|
236,962.96
|
Shasta
|
05/10/95
|
07/14/04
|
83,333.42
|
70,986.19
|
154,319.61
|
Alameda
|
12/16/03
|
11/18/04
|
675,000.00
|
59,636.26
|
734,636.26
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Sacramento
|
11/28/01
|
12/03/04
|
135,000.00
|
29,490.66
|
164,490.66
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Mateo
|
01/17/02
|
03/21/02
|
608,000.00
|
24,779.08
|
632,779.08
|
San
Mateo
|
02/03/00
|
04/08/02
|
1,292,800.00
|
231,560.23
|
1,524,360.23
|
San
Mateo
|
09/21/00
|
04/09/02
|
1,300,000.00
|
244,708.97
|
1,544,708.97
|
San
Francisco
|
03/29/96
|
04/23/02
|
105,000.00
|
81,802.86
|
186,802.86
|
San
Francisco
|
02/23/01
|
04/26/02
|
950,000.00
|
133,783.33
|
1,083,783.33
|
San
Francisco
|
03/21/01
|
04/26/02
|
694,070.00
|
54,453.16
|
748,523.16
|
San
Mateo
|
01/25/02
|
04/30/02
|
491,250.00
|
14,058.98
|
505,308.98
|
San
Mateo
|
07/26/00
|
05/13/02
|
1,634,213.28
|
176,228.48
|
1,810,441.76
|
Santa
Clara
|
01/04/02
|
05/17/02
|
1,849,000.00
|
74,590.25
|
1,923,590.25
|
Los
Angeles
|
08/2/01
|
06/06/02
|
375,000.00
|
36,283.07
|
411,283.07
|
Alameda
|
05/07/97
|
06/28/02
|
50,000.00
|
34,004.25
|
84,004.25
|
San
Mateo
|
10/22/97
|
07/25/02
|
250,000.00
|
94,251.17
|
344,251.17
|
Contra
Costa
|
02/15/01
|
08/27/02
|
650,000.00
|
116,658.77
|
766,658.77
|
San
Mateo
|
06/14/01
|
09/04/02
|
350,000.00
|
55,488.03
|
405,488.03
|
Santa
Clara
|
03/29/02
|
09/13/02
|
173,500.00
|
10,028.95
|
183,528.95
|
San
Mateo
|
06/22/01
|
10/10/02
|
1,723,682.70
|
127,438.97
|
1,851,121.67
|
Santa
Clara
|
05/10/02
|
10/11/02
|
500,000.00
|
24,454.96
|
524,454.96
|
San
Mateo
|
02/08/02
|
10/23/02
|
1,950,000.00
|
153,693.72
|
2,103,693.72
|
Santa
Clara
|
06/12/01
|
12/11/02
|
500,000.00
|
82,726.03
|
582,726.03
|
San
Mateo
|
08/29/01
|
01/17/03
|
3,368,000.00
|
353,867.20
|
3,721,867.20
|
Santa
Clara
|
07/25/01
|
02/21/03
|
800,000.00
|
141,810.55
|
941,810.55
|
Santa
Clara
|
08/18/99
|
02/28/03
|
850,000.00
|
305,229.88
|
1,155,229.88
|
San
Mateo
|
03/13/03
|
04/04/03
|
441,500.00
|
2,413.13
|
443,913.13
|
Stanislaus
|
08/13/02
|
04/29/03
|
746,821.00
|
58,646.18
|
805,467.18
|
San
Mateo
|
10/09/02
|
05/15/03
|
368,000.00
|
25,879.97
|
393,879.97
|
Santa
Clara
|
07/15/02
|
06/12/03
|
413,047.83
|
26,781.65
|
439,829.48
|
Alameda
|
08/21/02
|
07/14/03
|
346,000.00
|
33,980.16
|
379,980.16
|
Marin
|
04/18/01
|
08/08/03
|
605,500.00
|
163,399.86
|
768,899.86
|
Napa
|
04/05/01
|
08/14/03
|
1,675,000.00
|
399,944.05
|
2,074,944.05
|
Santa
Clara
|
09/19/02
|
11/14/03
|
1,117,647.10,
|
49,483.13
|
1,167,130.23
|
San
Mateo
|
10/31/01
|
12/09/03
|
1,500,000.00
|
325,351.65
|
1,825,351.65
|
Santa
Clara
|
07/08/03
|
12/11/03
|
500,000.00
|
7,556.38
|
507,556.38
|
Santa
Clara
|
09/23/03
|
12/19/03
|
300,000.00
|
6,601.71
|
306,601.71
|
San
Joaquin
|
08/18/03
|
01/26/04
|
229,750.00
|
10,893.07
|
240,643.07
|
Santa
Clara
|
05/30/01
|
02/25/04
|
2,070,000.00
|
290,995.60
|
2,360,995.60
|
El
Dorado
|
02/28/03
|
03/03/04
|
1,450,000.00
|
145,265.03
|
1,595,265.03
|
Contra
Costa
|
11/12/03
|
03/03/04
|
400,000.00
|
10,324.19
|
410,324.19
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
San
Francisco
|
11/21/01
|
03/11/04
|
300,000.00
|
70,906.84
|
370,906.84
|
Sonoma
|
07/24/03
|
04/01/04
|
500,000.00
|
31,273.58
|
531,273.58
|
Alameda
|
06/30/03
|
04/20/04
|
3,706,819.38
|
84,082.51
|
3,790,901.89
|
Santa
Clara
|
11/13/03
|
04/22/04
|
40,000.00
|
1,496.21
|
41,496.21
|
San
Mateo
|
04/30/03
|
05/20/04
|
414,886.55
|
31,479.29
|
446,365.84
|
Contra
Costa
|
09/16/03
|
06/04/04
|
180,000.00
|
11,019.43
|
191,019.43
|
Lake
|
01/17/02
|
06/30/04
|
708,000.00
|
195,716.82
|
903,716.82
|
San
Mateo
|
09/13/02
|
07/21/04
|
206,700.00
|
40,176.53
|
246,876.53
|
Santa
Clara
|
12/11/02
|
08/06/04
|
629,676.47
|
63,534.36
|
693,210.83
|
Stanislaus
|
10/16/03
|
09/08/04
|
300,000.00
|
24,185.26
|
324,185.26
|
Marin
|
07/31/03
|
10/19/04
|
2,535,000.00
|
253,306.74
|
2,788,306.74
|
San
Francisco
|
10/17/03
|
10/25/04
|
800,000.00
|
72,424.39
|
872,424.39
|
San
Francisco
|
01/23/04
|
10/25/04
|
326,077.18
|
20,851.20
|
346,928.38
|
Mariposa
|
11/08/01
|
11/02/04
|
70,000.00
|
23,990.68
|
93,990.68
|
King
|
06/15/04
|
11/29/04
|
80,000.00
|
3,315.06
|
83,315.06
|
San
Francisco
|
01/29/04
|
12/08/04
|
920,000.00
|
78,861.30
|
998,861.30
|
San
Francisco
|
07/15/02
|
12/20/04
|
2,000,000.00
|
507,735.68
|
2,507,735.68
|
Napa
|
03/22/02
|
12/27/04
|
2,300,000.00
|
497,526.69
|
2,797,526.69
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
08/22/01
|
03/25/02
|
439,250.00
|
31,779.41
|
471,029.41
|
San
Francisco
|
10/12/01
|
06/26/02
|
734,443.00
|
70,542.63
|
804,985.63
|
Placer
|
01/11/01
|
07/31/02
|
350,985.00
|
95,164.40
|
446,149.40
|
Placer
|
03/30/00
|
09/30/02
|
409,950.48
|
166,337.43
|
576,287.91
|
Santa
Clara
|
04/09/01
|
11/21/02
|
1,830,500.00
|
346,907.24
|
2,177,407.24
|
San
Francisco
|
08/05/01
|
12/26/02
|
2,000,000.00
|
29,267.61
|
2,029,267.61
|
Alameda
|
04/25/03
|
05/09/03
|
650,000.00
|
2,527.77
|
652,527.77
|
San
Mateo
|
05/03/02
|
06/18/03
|
1,700,000.00
|
201,804.17
|
1,901,804.17
|
San
Francisco
|
10/20/00
|
06/30/03
|
289,856.00
|
95,356.67
|
385,212.67
|
Alameda
|
02/13/02
|
10/06/03
|
100,000.00
|
17,951.67
|
117,951.67
|
Merced
|
05/08/01
|
03/12/04
|
182,000.00
|
59,032.16
|
241,032.16
|
Alameda
|
08/28/03
|
04/18/04
|
15,702,286.98
|
513,751.54
|
16,216,038.52
|
San
Mateo
|
06/18/03
|
05/07/04
|
2,250,000.00
|
200,000.00
|
2,450,000.00
|
Alameda
|
03/12/03
|
06/03/04
|
9,420,000.00
|
988,623.03
|
10,408,623.03
|
Santa
Clara
|
04/09/01
|
06/10/04
|
3,681,943.00
|
436,599.46
|
4,118,542.46
|
Sonoma
|
11/20/02
|
07/23/04
|
250,000.00
|
41,695.92
|
291,695.92
|
Santa
Clara
|
12/12/03
|
11/22/04
|
2,204,437.00
|
277,962.25
|
2,482,399.25
|
El
Dorado
|
07/30/04
|
12/15/04
|
682,500.00
|
22,560.41
|
705,060.41
|
Alameda
|
04/18/03
|
12/30/04
|
395,500.00
|
67,909.25
|
463,409.25
|
CLOSED
|
LOAN
|
INTEREST/
|
PROCEEDS
|
||
PROPERTY
|
FUNDED
|
ON
|
AMOUNT
|
LATE/MISC
|
TO
DATE
|
Santa
Clara
|
08/31/00
|
01/18/02
|
750,000.00
|
142,075.00
|
892,075.00
|
Alameda
|
12/28/00
|
02/08/02
|
7,000,000.00
|
988,952.97
|
7,988,952.97
|
San
Mateo
|
02/16/96
|
03/13/02
|
75,000.00
|
53,582.95
|
128,582.95
|
San
Mateo
|
08/20/96
|
03/13/02
|
65,000.00
|
42,985.75
|
107,985.75
|
Stanislaus
|
07/24/98
|
03/13/02
|
1,072,000.00
|
302,272.70
|
1,374,272.70
|
Alameda
|
11/16/93
|
03/29/02
|
192,500.00
|
160,156.40
|
352,656.40
|
Santa
Clara
|
01/21/94
|
03/29/02
|
5,033,074.95
|
421,936.65
|
5,455,011.60
|
Santa
Clara
|
11/15/96
|
03/29/02
|
18,000.00
|
11,834.37
|
29,834.37
|
San
Francisco
|
12/09/99
|
06/11/02
|
550,000.00
|
151,958.67
|
701,958.67
|
Stanislaus
|
02/06/98
|
08/13/02
|
349,998.00
|
188,394.87
|
538,392.87
|
San
Francisco
|
06/11/02
|
09/19/02
|
583,000.00
|
17,432.13
|
600,432.13
|
San
Francisco
|
02/22/00
|
10/01/02
|
1,303,980.75
|
393,859.74
|
1,697,840.49
|
San
Francisco
|
02/22/00
|
10/01/02
|
1,696,027.25
|
420,012.58
|
2,116,039.83
|
Contra
Costa
|
11/16/99
|
12/12/02
|
1,540,500.00
|
493,926.24
|
2,034,426.24
|
Riverside
|
03/15/97
|
12/20/02
|
50,000.00
|
19,560.21
|
69,560.21
|
San
Mateo
|
03/07/00
|
12/26/02
|
2,900,000.00
|
1,013,527.75
|
3,913,527.75
|
San
Mateo
|
10/16/01
|
02/12/03
|
422,750.00
|
48,952.34
|
471,702.34
|
San
Francisco
|
12/12/01
|
02/25/03
|
2,454,500.00
|
360,471.12
|
2,814,971.12
|
San
Francisco
|
03/23/01
|
02/25/03
|
4,750,000.00
|
1,056,386.68
|
5,806,386.68
|
San
Francisco
|
03/23/01
|
02/25/03
|
2,250,000.00
|
471,670.11
|
2,721,670.11
|
Los
Angeles
|
05/23/00
|
03/28/03
|
4,702,959.08
|
1,498,216.02
|
6,201,175.10
|
San
Diego
|
02/13/02
|
04/11/03
|
270,000.00
|
39,135.36
|
309,135.36
|
San
Francisco
|
12/20/02
|
04/25/03
|
692,000.00
|
130,004.83
|
822,004.83
|
San
Mateo
|
10/23/02
|
05/01/03
|
2,500,000.00
|
149,687.50
|
2,649,687.50
|
Alameda
|
11/07/00
|
10/08/03
|
205,000.00
|
91,615.70
|
296,615.70
|
San
Mateo
|
05/24/00
|
01/16/04
|
775,000.00
|
294,197.11
|
1,069,197.11
|
Santa
Clara
|
01/22/03
|
01/30/04
|
1,387,500.00
|
139,501.62
|
1,527,001.62
|
Santa
Clara
|
08/27/03
|
02/17/04
|
2,000,000.00
|
93,205.57
|
2,093,205.57
|
San
Mateo
|
02/12/03
|
04/13/04
|
136,500.00
|
15,716.61
|
152,216.61
|
Alameda
|
02/22/02
|
04/26/04
|
1,714,419.42
|
388,319.22
|
2,102,738.64
|
San
Francisco
|
04/24/03
|
07/14/04
|
420,000.00
|
50,344.74
|
470,344.74
|
Calaveras
|
01/17/03
|
07/26/04
|
1,500,000.00
|
178,495.42
|
1,678,495.42
|
San
Francisco
|
09/19/97
|
09/22/04
|
650,000.00
|
490,485.46
|
1,140,485.46
|
Napa
|
05/23/03
|
10/29/04
|
1,625,000.00
|
233,368.11
|
1,858,368.11
|
San
Francisco
|
03/28/97
|
11/24/04
|
644,912.24
|
560,446.15
|
1,205,358.39
|
Alameda
|
05/13/04
|
12/17/04
|
2,625,000.00
|
132,813.89
|
2,757,813.89
|
1.
|
To
each Partner’s Capital Account there shall be credited, in the event such
Partner utilized the services of a Participating Broker Dealer, such
Partner’s capital contribution, or if such Partner acquired his Units
through an unsolicited sale, such Partner’s capital contribution plus the
amount of the sales commissions if any, paid by Redwood Mortgage Corp.
that are specially allocated to such partner, such Partner’s distributive
share of Profits and any items in the nature of income or gain (from
unexpected adjustments, allocations or distributions) that are specially
allocated to a Partner and the amount of any Partnership liabilities that
are assumed by such Partner or that are secured by any Partnership
property distributed to such
Partner.
|
2.
|
To
each Partner’s Capital Account there shall be debited the amount of cash
and the Gross Asset Value of any Partnership property distributed to such
Partner pursuant to any provision of this Agreement, such Partner’s
distributive share of Losses, and any items in the nature of expenses or
losses that are specially allocated to a Partner and the amount of any
liabilities of such Partner that are assumed by the Partnership or that
are secured by any property contributed by such Partner to the
Partnership.
|
1.
|
The
initial Gross Asset Value of any asset contributed by a Partner to the
Partnership shall be the gross fair market value of such asset, as
determined by the contributing Partner and the
Partnership;
|
2.
|
The
Gross Asset Values of all Partnership assets shall be adjusted to equal
their respective gross fair market values, as determined by the General
Partners, as of the following times: (a) the acquisition of an
additional interest in the Partnership (other than pursuant to
Section 4.2) by any new or existing Partner in exchange for more than
a de minimis capital contribution; (b) the distribution by the
Partnership to a Partner of more than a de minimis amount of Partnership
property other than money, unless all Partners receive simultaneous
distributions of undivided interests in the distributed property in
proportion to their Interests in the Partnership; and (c) the
termination of the Partnership for federal income tax purposes pursuant to
Section 708(b)(1)(B) of the Code;
and
|
3.
|
If
the Gross Asset Value of an asset has been determined or adjusted pursuant
to clause (a) or (b) above, such Gross Asset Value shall
thereafter be adjusted by the depreciation, amortization or other cost
recovery deduction allowable which is taken into account with respect to
such asset for purposes of computing Profits and
Losses.
|
4.
|
Any
expenditures of the Partnership described in Section 705(a)(2)(B) of
the Code or treated as Section 705(a)(2)(B) of the Code expenditures
pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(i), and not
otherwise taken into account in computing Profits or Losses pursuant to
this Section 1.25, shall be subtracted from such taxable income or
loss.
|
5.
|
Gain
or loss resulting from any disposition of Partnership property with
respect to which gain or loss is recognized for federal income tax
purposes shall be computed by reference to the Gross Asset Value of the
property disposed of, notwithstanding that the adjusted tax basis of such
property differs from its Gross Asset
Value;
|
6.
|
In
lieu of the depreciation, amortization, and other cost recovery deductions
taken into account in computing such taxable income or loss, there shall
be taken into account depreciation, amortization or other cost recovery
deductions for such Fiscal Year or other period, computed such that if the
Gross Asset Value of an asset differs from its adjusted basis for federal
income tax purposes at the beginning of a Fiscal Year or other period,
depreciation, amortization or other cost recovery deductions shall be an
amount which bears the same ratio to such beginning Gross Asset Value as
the federal income tax depreciation, amortization or other cost recovery
deductions for such Fiscal Year or other period bears to such beginning
adjusted tax basis; and
|
7.
|
Notwithstanding
any other provision of this Section 1.25, any items in the nature of
income or gain or expenses or losses, which are specially allocated under
Section 5.4 (a) or (b), shall not be taken into account in
computing Profits or Losses.
|
8.
|
To
determine the terms of the offering of Units, including the right to
increase the size of the offering or offer additional securities, the
amount for discounts allowable or commissions to be paid and the manner of
complying with applicable law;
|
9.
|
To
employ, at the expense of the Partnership, such agents, employees,
independent contractors, attorneys and accountants as they deem reasonable
and necessary;
|
10.
|
To
effect necessary insurance for the proper protection of the Partnership,
the General Partners or Limited
Partners;
|
11.
|
To
pay, collect, compromise, arbitrate, or otherwise adjust any and all
claims or demands against the
Partnership;
|
12.
|
To
bind the Partnership in all transactions involving the Partnership’s
property or business affairs, including the execution of all loan
documents and the sale of notes and to change the Partnership’s investment
objectives, notwithstanding any other provision of this Agreement;
provided, however, the General Partners may not, without the consent of a
Majority of the Limited Partners, sell or exchange all or substantially
all of the Partnership’s assets, as those terms are defined in
Section 9.1;
|
13.
|
To
amend this Agreement with respect to the matters described in
Subsections 12.4(a) through (k)
below;
|
14.
|
To
determine the accounting method or methods to be used by the Partnership,
which methods may be changed at any time by written notice to all Limited
Partners;
|
15.
|
To
open accounts in the name of the Partnership in one or more banks, savings
and loan associations or other financial institutions, and to deposit
Partnership funds therein, subject to withdrawal upon the signature of the
General Partners or any person authorized by
them;
|
16.
|
To
borrow funds for the purpose of making Loans, provided that the amount of
borrowed funds does not exceed fifty percent (50%) of the Partnership’s
Loan portfolio and in connection with such borrowings, to pledge or
hypothecate all or a portion of the assets of the Partnership as security
for such loans; and
|
17.
|
To
invest the reserve funds of the Partnership in cash, bank accounts,
certificates of deposits, money market accounts, short-term bankers
acceptances, publicly traded bond funds or any other liquid
assets.
|
18.
|
A
Limited Partner who desires to withdraw from the Partnership after the
expiration of the above referenced five year period shall give written
notice of withdrawal (“Notice of Withdrawal”) to the General Partners, and
subject to the provisions of subsections (e) and (f) below such Limited
Partner’s Capital Account shall be liquidated as
follows:
|
1.
|
Except
as provided in subsection (b)(ii) below, the Limited Partner’s
Capital Account shall be liquidated in twenty (20) equal quarterly
installments each equal to 5% of the total Capital Account beginning the
last day of the calendar quarter following the quarter in which the Notice
of Withdrawal is given, provided that such notice is received thirty (30)
days prior to the end of the preceding quarter. Upon approval
by the General Partners, the Limited Partner’s Capital Account may be
liquidated upon similar terms over a period longer than twenty (20) equal
quarterly installments.
|
2.
|
Notwithstanding
subsection (b)(i) above, any Limited Partner may liquidate part or
all of his entire outstanding Capital Account in four equal quarterly
installments beginning of the last day of the calendar quarter following
the preceding quarter in which Notice of Withdrawal is given, provided
that such notice was received thirty (30) days prior to the end of the
preceding quarter. An early withdrawal under this subsection
8.1(b)(ii) shall be subject to a 10% early withdrawal penalty
applicable to any sums prior to the time when such sums could have been
withdrawn pursuant to the withdrawal provisions set forth in subsection
(a)(i) above.
|
19.
|
The
10% early withdrawal penalty will be deducted pro rata from the Limited
Partner’s Capital Account. The 10% early withdrawal penalty
will be received by the Partnership, and a portion of the sums collected
as such early withdrawal penalty shall be applied by the Partnership
toward the next installment(s) of principal under the Formation Loan owed
to the Partnership by Redwood Mortgage Corp., a General Partner and any
successor firm, as described in Section 10.9 below. This
portion shall be determined by the ratio between the initial amount of the
Formation Loan and the total amount of the organizational and syndication
costs incurred by the Partnership in this offering of
Units. After the Formation Loan has been paid, the 10% early
withdrawal penalty will be used to pay the Continuing Servicing Fee, as
set forth in Section 10.13 below. The balance of such
early withdrawal penalties shall be retained by the Partnership for its
own account.
|
20.
|
Commencing
with the end of the calendar month in which such Notice of Withdrawal is
given, and continuing on or before the twentieth day after the end of each
month thereafter, any Cash Available for Distribution allocable to the
Capital Account (or portion thereof) with respect to which Notice of
Withdrawal has been given shall also be distributed in cash to the
withdrawing Limited Partner in the manner provided in Section 5.2
above.
|
21.
|
During
the liquidation period described in subsections 8.1(a) and (b), the
Capital Account of a withdrawing Limited Partner shall remain subject to
adjustment as described in Section 1.4
above. Any reduction in said Capital Account by reason of
an allocation of Losses, if any, shall reduce all subsequent liquidation
payments proportionately. In no event shall any Limited Partner
receive cash distributions upon withdrawal from the Partnership if the
effect of such distribution would be to create a deficit in such Limited
Partner’s Capital Account.
|
22.
|
Payments
to withdrawing Limited Partners shall at all times be subject to the
availability of sufficient cash flow generated in the ordinary course of
the Partnership’s business, and the Partnership shall not be required to
liquidate outstanding Loans prior to their maturity dates for the purposes
of meeting the withdrawal requests of Limited Partners. For
this purpose, cash flow is considered to be available only after all
current Partnership expenses have been paid (including compensation to the
General Partners and Affiliates) and adequate provision has been made for
the payment of all monthly or annual cash distributions on a pro rata
basis which must be paid to Limited Partners who elected to receive such
distributions upon subscription for Units pursuant to Section 4.3 or
who changed their initial election to compound Earnings as set forth in
Section 4.3. Furthermore, no more than 20% of the total
Limited Partners’ Capital Accounts outstanding for the beginning of any
calendar year shall be liquidated during any calendar year. The
General Partners also have the discretion to adjust the timing of
withdrawals that would otherwise be made during a taxable year, including
deferring withdrawals indefinitely, if the scheduled withdrawals could
result in the Partnership being classified as a “publicly traded
partnership” within the meaning of Section 7704(b) of the Code or any
regulations of rules promulgated thereunder. If Notices of
Withdrawal in excess of these limitations are received by the General
Partners, the priority of distributions among Limited Partners shall be
determined as follows: first, to those Limited Partners withdrawing
Capital Accounts according to the 20 quarter or longer installment
liquidation period described under subsection (b)(i) above, then to
Benefit Plan Investors withdrawing Capital Accounts under subsection
(b)(ii) above, then to all other Limited Partners withdrawing Capital
Accounts under subsection (b)(ii) above, then to Administrators
withdrawing Capital Accounts under subsection (g) below, and finally to
all other Limited Partners withdrawing Capital Accounts under subsection
(a) above.
|
23.
|
Upon
the death of a Limited Partner, a Limited Partner’s heirs or executors
may, subject to certain conditions as set forth herein, liquidate all or a
part of the deceased Limited Partner’s investment without
penalty. An executor, heir or other administrator of the
Limited Partner’s estate (for ease of reference the “Administrator”) shall
give written notice of withdrawal (“Notice of Withdrawal”) to the General
Partners within 6 months of the Limited Partner’s date of death or
the investment will become subject to the liquidation provisions set forth
in Section 8.1 (a) through (f) above. The total amount
available to be liquidated in any one year shall be limited to $50,000 per
Limited Partner. The liquidation of the Limited Partner’s
Capital Account in
|
GENERAL
PARTNERS:
|
||
Michael
R. Burwell
|
||
GYMNO
CORPORATION
|
||
A
California Corporation
|
||
By:
|
||
Michael R. Burwell,
President
|
||
REDWOOD
MORTGAGE CORP.
|
||
A
California Corporation
|
||
By:
|
||
Michael R. Burwell,
President
|
||
LIMITED
PARTNERS:
|
GYMNO
CORPORATION
|
|
(General
Partner and Attorney-in-Fact)
|
||
By:
|
||
Michael R. Burwell,
President
|
||
[ ]
|
INDIVIDUAL
|
[ ]
|
PENSION PLAN (Trustee signature
required)
|
||
[ ]
|
TRUST (Trustee
signature required)
|
[ ]
|
PROFIT
SHARING PLAN
|
||
(Title page,
Successor Trustee page and
|
(Trustee
signature required)
|
||||
signature pages
of the Trust Agreement
|
|||||
MUST
be enclosed)
|
[ ]
|
KEOGH
(H.R.10)
|
|||
(Custodian
signature required)
|
|||||
*
|
[ ]
|
JOINT
TENANTS WITH RIGHTS
|
|||
OF
SURVIVORSHIP
|
[ ]
|
CUSTODIAL/UGMA (circle
one)
|
|||
(All
parties must sign)
|
(Custodian
signature required)
|
||||
*
|
[ ]
|
COMMUNITY
PROPERTY
|
[ ]
|
TOD
– Transfer On Death
|
|
(must
be titled as an Individual or as
|
|||||
*
|
[ ]
|
TENANTS
IN COMMON
|
Joint
Tenants only – special form required)
|
||
(All
parties must sign)
|
|||||
[ ]
|
401(k) (Trustee signature
required)
|
||||
*
|
[ ]
|
IRA
|
|||
(Individual
Retirement Account)
|
[ ]
|
OTHER (Please
describe)
|
|||
(Investor
and Custodian must sign)
|
|||||
*
|
[ ]
|
ROTH
IRA
|
|||
(Investor
and Custodian must sign)
|
|||||
*
|
[ ]
|
SEP/IRA
|
|||
(Investor
and Custodian must sign)
|
|||||
1.
|
INVESTOR
NAME
AND
ADDRESS
|
Type
or print your name(s) exactly as the title should appear in the account
records of the partnership. Complete this section for all
trusts other than IRA/Keogh or other qualified plans. If IRA/Keogh or qualified plan, Section 2
must also be completed. All checks and correspondence
will go to this address unless another address is listed in
Sections 2 or 5 below.
|
[ ]
Mr. [ ]
Mrs. [ ]
Ms. [ ]
Dr.
|
||
Name
as it will appear on the account (How title should be
held)
|
||
(Additional
Name(s) if held in joint tenancy, community property,
tenants-in-common)
|
Street
Address
|
||||
City
|
State
|
Zip
Code
|
Home
Phone Number
|
Social
Security #/ Taxpayer ID#
|
A
social security number or taxpayer identification number is required for
each individual investor. (For IRAs, Keoghs (HR10) and
qualified plans, the taxpayer identification number is your plan or
account tax or employer identification number. For most
individual taxpayers, it is your social security
number. NOTE: If the units are to be held in more
than one name, only one number will be used and will be that of the first
person listed).
|
|||||||||||
2.
|
CUSTODIAN/
TRUST
COMPANY REGISTRATION
|
Name
of Custodian/Trust Company:
|
|||||||||
Please
print here the exact name of Custodian/ Trust Company
|
|||||||||||
Address
|
|||||||||||
City
|
State
|
Zip
Code
|
|||||||||
Taxpayer
ID#
|
Client
Account Number
|
||||||||||
SIGNATURE:
|
|||||||||||
(X)
|
(Custodian/Trust
Company)
|
||||||||||
3.
|
INVESTMENT
|
Number
of units to be purchased
|
|||||||||
Minimum
subscription is
|
|||||||||||
2,000
units at $1 per unit
|
Amount
of payment enclosed
|
||||||||||
($2,000),
with additional
|
|||||||||||
investments
of any amount
|
|||||||||||
with
minimum of 1,000
|
|||||||||||
units
($1,000)for existing
|
|||||||||||
limited
partners.
|
Please make check payable to “Redwood Mortgage
Investors VIII”
|
||||||||||
If
the investor has elected to compound their share of monthly, quarterly or
annual income (see 4. below), then the interest earned on
subscription funds until admission to the partnership will be invested in
additional units on behalf of the investor; therefore, the actual number
of units to be issued to the investor upon admission to the partnership
will be increased.
|
||||||
Check
one: [ ] Initial Investment
|
[ ]
Additional Investment*
|
|||||
*A
completed Subscription Agreement is required for each initial and
additional investment
|
4.
|
DISTRIBUTIONS
|
Does
the investor wish to have his income compounded or
distributed?
|
Check
One: [ ] Compounded
|
or
|
[ ] Distributed
|
|
The
election to compound income may be changed after three (3)
years.
|
|||
The
election to distribute income is
irrevocable.
|
If income
is to be distributed:
|
||||||||
Check
One: [ ]
Monthly
|
[ ]
Quarterly
|
[ ]
**Annually
|
||||||
(**payable only on
12/31)
|
||||||||
5.
|
SPECIAL
ADDRESS FOR CASH DISTRIBUTIONS
|
||||||||||
(If
the same as in Sections
|
Name
|
Client
Account #
|
|||||||||
1
or 2, please disregard)
|
|||||||||||
Address
|
|||||||||||
City
|
State
|
Zip
Code
|
|||||||||
If
cash distributions are to be sent to an address other than that listed, in
Sections 1 or 2, please enter the information here. All other
communications will be mailed to the investor’s registered address of
record under Sections 1 or 2. In no event will the
partnership or its affiliates be responsible for any adverse consequences
of direct deposits.
|
|||||||||||
DIRECT
DEPOSIT
|
Check
one: Checking: [ ] Savings: [ ]
|
||||||||||
Account
#__________________ ABA (Routing)
#________________________
|
|||||||||||
(Must
attach original voided check for
checking account deposits, deposit slip for savings account
deposits)
|
|||||||||||
6.
|
SIGNATURES
|
IN
WITNESS WHEREOF, the undersigned has executed below this
________day
|
|||||||||
of
_______________, 200___, at (City)
|
|||||||||||
Investor’s
primary residence is in
|
(State)
|
||||||||||
(X)
|
|||||||||||
(Investor
Signature and Title)
|
|||||||||||
(X)
|
|||||||||||
(Investor
Signature and Title)
|
7.
|
BROKER-DEALER
DATA
(To
be completed by selling broker-dealer)
|
The
undersigned broker-dealer hereby certifies that (i) a copy of the
prospectus, as amended and/or supplemented to date, has been delivered to
the above investor; and (ii) that the appropriate suitability
determination as set forth in the prospectus has been made and that the
appropriate records are being maintained.
|
|||
(X)
|
|||||
Broker-Dealer
Authorized Signature (Required on all Applications)
|
|||||
Broker-Dealer
Name:
|
|||||
Street
Address:
|
|||||
City,
State, Zip Code:
|
|||||
Registered
Representative
|
|||||
Name
(Last, First):
|
|||||
Street
Address:
|
|||||
City,
State, Zip Code
|
|||||
Phone
No.:
|
|||||
The
registered representative, by signing below, certifies that he has
reasonable grounds to believe, on the basis of information obtained from
the investor concerning his investment objectives, other investments,
financial situation and needs and any other information known by the
selling broker-dealer, that investment in the units is suitable for the
investor and that suitability records are being maintained; and that he
has informed the investor of all pertinent facts relating to the liquidity
and marketability of the units.
|
|||||
Registered
Representative’s Signature:
|
|||||
(X)
|
|||||
8.
|
ACCEPTANCE
|
This
subscription accepted
|
|||
This
subscription will not
|
|||||
be
an effective agreement
|
REDWOOD
MORTGAGE INVESTORS VIII,
|
||||
until
it or a facsimile is
|
A
California Limited Partnership
|
||||
signed
by a general
|
900
Veterans Blvd., Suite 500
|
||||
partner
of Redwood
|
Redwood
City CA 94063
|
||||
Mortgage
Investors VIII, a
|
|||||
California
limited
|
(650)
365-5341
|
||||
partnership
|
|||||
By:
|
|||||
(Office
Use Only)
|
Partner
#:
|
Date
Entered:
|
|||
Check
Amount:
|
$
|
Check
Date:
|
||
Check
Number:
|
(a)
|
The
issuer of any security upon which a restriction on transfer has been
imposed pursuant to Sections 260.102.6, 260.141.10 or 260.534 shall
cause a copy of this section to be delivered to each issuee or transferee
of such security.
|
(b)
|
It
is unlawful for the holder of any such security to consummate a sale or
transfer of such security, or any interest therein, without the prior
written consent of the Commissioner (until this condition is removed
pursuant to Section 260.141.12 of these rules),
except:
|
(c)
|
The
certificates representing all such securities subject to such a
restriction on transfer, whether upon initial issuance or upon any
transfer thereof, shall bear on their face a legend, prominently stamped
or printed thereon in capital letters of not less than 10-point size,
reading as follows:
|
REDWOOD
MORTGAGE INVESTORS VIII
|
$100,000,000
Units of Limited Partnership Interest
|
||||
General
Partners:
|
||||
Michael
R. Burwell
Gymno
Corporation
Redwood
Mortgage Corp.
|
||||
Dated: August
4, 2005
|
||||
Maximum
of
|
||||
$ | 100,000,00 | |||
SEC
Registration Fee
|
$ | 11,770 | ||
NASD
Registration Fee
|
10,500 | |||
California
Registration Fee
|
2,500 | |||
Printing
and Engraving Expenses
|
335,000 | |||
Accounting
Fees and Expenses
|
265,000 | |||
Legal
Fees and Expenses
|
525,000 | |||
Other
Blue Sky Filing Fees and Expenses
|
225,000 | |||
Postage
|
200,000 | |||
Advertising
and Sales
|
420,000 | |||
Sales
Literature
|
365,000 | |||
Due
Diligence
|
400,000 | |||
Sales
Seminars
|
1,000,000 | |||
Miscellaneous
|
240,230 | |||
Total
|
$ | 4,000,000 |
ITEM
32.
|
Sales to Special
Parties.
|
Inapplicable
|
|
ITEM
33.
|
Recent Sales of Unregistered
Securities.
|
None
|
|
ITEM
34.
|
Indemnification of Directors and
Officers
|
ITEM
35.
|
Treatment of Proceeds from Stock Being
Registered
|
Inapplicable.
|
ITEM
36.
|
Financial Statements and
Exhibits.
|
|
(a)
|
Financial
Statements Included in the Prospectus:
|
|
1.
|
Redwood
Mortgage Investors VIII:
|
|
Report
of Independent Registered Public Accounting Firm
|
||
Consolidated
Financial Statements, December 31, 2004 and 2003 and for each
of the years in the three year period ending December 31,
2004
|
||
Interim
Consolidated Condensed Financial Statements, as of March 31, 2005
(unaudited)
|
2.
|
Gymno
Corporation:
|
|
Report
of Independent Registered Public Accounting Firm
|
||
Balance
Sheet, as of December 31, 2004
|
||
Interim
Balance Sheet, as of March 31, 2005
(unaudited)
|
3.
|
Redwood
Mortgage Corp.:
|
|
Report
of Independent Registered Public Accounting Firm
|
||
Balance
Sheet, as of September 30, 2004
|
||
Interim
Balance Sheet, as of March 31, 2005
(unaudited)
|
(b)
|
Exhibits:
|
Exhibit Number
|
1.1
|
Form
of Participating Dealer Agreement
|
||||
1.2
|
Form
of Advisory Agreement
|
||||
3.1
|
Sixth
Amended and Restated Limited Partnership Agreement and Subscription
Agreements
|
||||
3.2
|
Special
Notice for California Residents
|
||||
3.3
|
Certificate
of Limited Partnership
|
||||
5.1
|
Opinion
of Counsel as to the Legality of the Securities Being
Registered
|
||||
5.2
|
Opinion
of Counsel as to ERISA Matters
|
||||
8.1
|
Opinion
of Counsel on Certain Tax Matters
|
||||
10.2
|
Loan
Servicing Agreement
|
||||
10.3
|
(a)
|
Form
of Note secured by Deed of Trust for Construction Loans which provides for
interest only payments
|
|||
(b)
|
Form
of Note secured by Deed of Trust for Commercial Loans which provides for
interest only payments
|
||||
(c)
|
Form
of Note secured by Deed of Trust for Commercial Loans which provides for
principal and interest payments
|
||||
(d)
|
Form
of Note secured by Deed of Trust for Residential Loans which provides for
interest only payments
|
||||
(e)
|
Form
of Note secured by Deed of Trust for Residential Loans which provides for
interest and principal prepayments
|
||||
10.4
|
(a)
|
Construction
Deed of Trust, Assignment of Leases and Rents, Security Agreement and
Fixture Filing to accompany Exhibit 10.3(a)
|
|||
(b)
|
Deed
of Trust, Assignment of Leases and Rents, and Security Agreement and
Fixture Filing to accompany Exhibits 10.3(b) and
10.3(c)
|
||||
(c)
|
Deed
of Trust, Assignment of Leases and Rents, and Security Agreement and
Fixture Filing to accompany
|
||||
Exhibit
10.3(d) and 10.3(e)
|
10.6
|
Agreement
to Seek a Lender
|
||||
10.7
|
Formation
Loan – Promissory Note
|
||||
10.8
|
Line
of Credit – Credit and Security Agreement
|
||||
23.1
|
Consent
of the Law Offices Morrison and Foerster LLP (included in Exhibit 5.1,
Exhibit 5.2 and Exhibit 8.1)
|
||||
23.2
|
Consent
of Armanino McKenna, LLP
|
||||
99.1
|
Table
VI - Description of Open Loans of Prior Limited
Partnerships
|
||||
ITEM
37.
|
Undertaking.
|
||
i)
|
To
include any prospectus required by Section 10(a)(3) of the Securities Act
of 1933;
|
ii)
|
To
reflect in the prospectus any facts or events arising after the effective
date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration
statement;
|
iii)
|
To
include any material information with respect to the plan of distribution
not previously disclosed in the registration statement or any material
change to such information in the registration
statement.
|
(i)
|
Any
preliminary prospectus or prospectus of an undersigned registrant relating
to the offering required to be filed pursuant to Rule
424;
|
(ii)
|
Any
free writing prospectus relating to the offering prepared by or on behalf
of the undersigned registrant or used or referred to by the undersigned
registrant;
|
(iii)
|
The
portion of any other free writing prospectus relating to the offering
containing material information about the undersigned registrant or its
securities provided by or on behalf of the undersigned registrant;
and
|
(iv)
|
Any
other communication that is an offer in the offering made by the
undersigned registrant to the
purchaser.
|
REDWOOD MORTGAGE INVESTORS
VIII
|
|
A
California Limited Partnership
|
|
By:/s/Michael R. Burwell
|
|
Michael
R. Burwell, General Partner
|
|
BY: GYMNO CORPORATION
|
|
General
Partner
|
By:/s/Michael R. Burwell
|
|
Michael
R. Burwell, President and Chief Financial Officer
|
|
BY: REDWOOD MORTGAGE
CORP.
|
|
General
Partner
|
By:/s/Michael R. Burwell
|
|
Michael
R. Burwell, President
|
|
Signature
|
Title
|
Date
|
/s/
Michael R. Burwell
|
President
and Chief Financial Officer of
|
|
Michael
R. Burwell
|
Gymno
Corporation; Director of Gymno
|
April
23, 2008
|
Corporation;
President of Redwood
|
||
Mortgage
Corp.
|
||
/s/
Michael R. Burwell
|
General
Partner
|
|
Michael
R. Burwell
|
April
23, 2008
|
8.
|
Indemnification.
|
9.
|
Arbitration.
|
1.
|
A
Limited Partner who desires to withdraw from the Partnership after the
expiration of the above referenced one year period shall give written
notice of withdrawal (“Notice of Withdrawal”) to the General Partners,
which Notice of Withdrawal shall state the sum or percentage interests to
be withdrawn. Subject to the provisions of subsections (e)
and (f) below, such Limited Partner may liquidate part or all of his
entire Capital Account in four equal quarterly installments beginning the
last day of the quarter following the quarter in which the Notice of
Withdrawal is given, provided that such notice was received thirty (30)
days prior to the end of the quarter. An early withdrawal
under this subsection (a) shall be subject to a 10% early withdrawal
penalty applicable to the sum withdrawn as stated in the Notice of
Withdrawal. The 10% penalty shall be subject to and payable
upon the terms set forth in subsection
(c) below.
|
2.
|
A
Limited Partner who desires to withdraw from the Partnership after the
expiration of the above referenced five year period shall give written
notice of withdrawal (“Notice of Withdrawal”) to the General Partners, and
subject to the provisions of subsections (e) and (f) below such Limited
Partner’s Capital Account shall be liquidated as
follows:
|
3.
|
The
10% early withdrawal penalty will be deducted pro rata from the Limited
Partner’s Capital Account. The 10% early withdrawal penalty
will be received by the Partnership, and a portion of the sums collected
as such early withdrawal penalty shall be applied by the Partnership
toward the next installment(s) of principal under the Formation Loan owed
to the Partnership by Redwood Mortgage Corp., a General Partner and any
successor firm, as described in Section 10.9 below. This
portion shall be determined by the ratio between the initial amount of the
Formation Loan and the total amount of the organizational and syndication
costs incurred by the Partnership in this offering of
Units. After the Formation Loan has been paid, the 10% early
withdrawal penalty will be used to pay the Continuing Servicing Fee, as
set forth in Section 10.13 below. The balance of such
early withdrawal penalties shall be retained by the Partnership for its
own account.
|
4.
|
Commencing
with the end of the calendar month in which such Notice of Withdrawal is
given, and continuing on or before the twentieth day after the end of each
month thereafter, any Cash Available for Distribution allocable to the
Capital Account (or portion thereof) with respect to which Notice of
Withdrawal has been given shall also be distributed in cash to the
withdrawing Limited Partner in the manner provided in Section 5.2
above.
|
5.
|
During
the liquidation period described in subsections 8.1(a) and (b), the
Capital Account of a withdrawing Limited Partner shall remain subject to
adjustment as described in Section 1.3
above. Any reduction in said Capital Account by reason of
an allocation of Losses, if any, shall reduce all subsequent liquidation
payments proportionately. In no event shall any Limited Partner
receive cash distributions upon withdrawal from the Partnership if the
effect of such distribution would be to create a deficit in such Limited
Partner’s Capital Account.
|
6.
|
Payments
to withdrawing Limited Partners shall at all times be subject to the
availability of sufficient cash flow generated in the ordinary course of
the Partnership’s business, and the Partnership shall not be required to
liquidate outstanding Loans prior to their maturity dates for the purposes
of meeting the withdrawal requests of Limited Partners. For
this purpose, cash flow is considered to be available only after all
current Partnership expenses have been paid (including compensation to the
General Partners and Affiliates) and adequate provision has been made for
the payment of all monthly or annual cash distributions on a pro rata
basis which must be paid to Limited Partners who elected to receive such
distributions upon subscription for Units pursuant to Section 4.3 or
who changed their initial election to compound Earnings as set forth in
Section 4.3. Furthermore, no more than 20% of the total
Limited Partners’ Capital Accounts outstanding for the beginning of any
calendar year shall be liquidated during any calendar year. The
General Partners also have the discretion to adjust the timing of
withdrawals that would otherwise be made during a taxable year, including
deferring withdrawals indefinitely, if the scheduled withdrawals could
result in the Partnership being classified as a “publicly traded
partnership” within the meaning of Section 7704(b) of the Code or any
regulations of rules promulgated thereunder. If Notices of
Withdrawal in excess of these limitations are received by the General
Partners, the priority of distributions among Limited Partners shall be
determined as follows: first, to those Limited Partners withdrawing
Capital Accounts according to the 20 quarter or longer installment
liquidation period described under subsection (b)(i) above, then to
Benefit Plan Investors withdrawing Capital Accounts under subsection
(b)(ii) above, then to all other Limited Partners withdrawing Capital
Accounts under subsection (b)(ii) above, then to Administrators
withdrawing Capital Accounts under subsection (g) below, and finally to
all other Limited Partners withdrawing Capital Accounts under subsection
(a) above.
|
7.
|
Upon
the death of a Limited Partner, a Limited Partner’s heirs or executors
may, subject to certain conditions as set forth herein, liquidate all or a
part of the deceased Limited Partner’s investment without
penalty. An executor, heir or other administrator of the
Limited Partner’s estate (for ease of reference the “Administrator”) shall
give written notice of withdrawal (“Notice of Withdrawal”) to the General
Partners within 6 months of the Limited Partner’s date of death or
the investment will become subject to the liquidation provisions set forth
in Section 8.1 (a) through (f) above. The total amount
available to be liquidated in any one year shall be limited to $50,000 per
Limited Partner. The liquidation of the Limited Partner’s
Capital Account in any one year shall be made in four equal quarterly
installments beginning the last day of the calendar quarter following the
quarter in which time the Notice of Withdrawal is received. Due
to the complex nature of administering a decedent’s estate, the General
Partners reserve the right and discretion to request any and all
information they deem necessary and relevant in determining the date of
death, the name of the beneficiaries and/or any other matters they deem
relevant. The General Partners retain the discretion to
refuse or to delay the liquidation of a deceased Limited Partner’s
investment unless or until the General Partners have received all such
information they deem relevant. The liquidation of a
Limited Partner’s Capital Account pursuant to this subsection is subject
to the provisions of subsections 8.1(d), (e) and (f)
above.
|
1.
|
There
is a change in the name of the Partnership or the amount of the
contribution of any Limited
Partner;
|
2.
|
A
Person is substituted as a Limited
Partner;
|
GENERAL
PARTNERS:
|
||
Michael
R. Burwell
|
||
GYMNO
CORPORATION
|
||
A
California Corporation
|
||
By:
|
||
Michael R. Burwell,
President
|
||
REDWOOD
MORTGAGE CORP.
|
||
A
California Corporation
|
||
By:
|
||
Michael R. Burwell,
President
|
||
LIMITED
PARTNERS:
|
GYMNO
CORPORATION
|
|
(General
Partner and Attorney-in-Fact)
|
||
By:
|
||
Michael R. Burwell,
President
|
||
[ ]
|
INDIVIDUAL
|
[ ]
|
PENSION PLAN (Trustee
signature required)
|
||
[ ]
|
TRUST (Trustee
signature required)
|
[ ]
|
PROFIT
SHARING PLAN
|
||
(Title page,
Successor Trustee page and
|
(Trustee
signature required)
|
||||
signature pages
of the Trust Agreement
|
|||||
MUST
be enclosed)
|
[ ]
|
KEOGH
(H.R.10)
|
|||
(Custodian
signature required)
|
|||||
*
|
[ ]
|
JOINT
TENANTS WITH RIGHTS
|
|||
OF
SURVIVORSHIP
|
[ ]
|
CUSTODIAL/UGMA (circle
one)
|
|||
(All
parties must sign)
|
(Custodian
signature required)
|
||||
*
|
[ ]
|
COMMUNITY
PROPERTY
|
[ ]
|
TOD
– Transfer On Death
|
|
(must
be titled as an Individual or as
|
|||||
*
|
[ ]
|
TENANTS
IN COMMON
|
Joint
Tenants only – special form required)
|
||
(All
parties must sign)
|
|||||
[ ]
|
401(k) (Trustee
signature required)
|
||||
*
|
[ ]
|
IRA
|
|||
(Individual
Retirement Account)
|
[ ]
|
OTHER (Please
describe)
|
|||
(Investor
and Custodian must sign)
|
|||||
*
|
[ ]
|
ROTH
IRA
|
|||
(Investor
and Custodian must sign)
|
|||||
*
|
[ ]
|
SEP/IRA
|
|||
(Investor
and Custodian must sign)
|
|||||
1.
|
INVESTOR
NAME
AND
ADDRESS
|
Type
or print your name(s) exactly as the title should appear in the account
records of the partnership. Complete this section for all
trusts other than IRA/Keogh or other qualified plans. If IRA/Keogh or qualified plan, Section 2
must also be completed. All checks and correspondence
will go to this address unless another address is listed in
Sections 2 or 5 below.
|
[ ]
Mr. [ ]
Mrs. [ ]
Ms. [ ]
Dr.
|
||
Name
as it will appear on the account (How title should be
held)
|
||
(Additional
Name(s) if held in joint tenancy, community property,
tenants-in-common)
|
Street
Address
|
||||
City
|
State
|
Zip
Code
|
Home
Phone Number
|
Social
Security #/ Taxpayer ID#
|
A
social security number or taxpayer identification number is required for
each individual investor. (For IRAs, Keoghs (HR10) and
qualified plans, the taxpayer identification number is your plan or
account tax or employer identification number. For most
individual taxpayers, it is your social security
number. NOTE: If the units are to be held in more
than one name, only one number will be used and will be that of the first
person listed).
|
|||||||||||
2.
|
CUSTODIAN/
TRUST
COMPANY REGISTRATION
|
Name
of Custodian/Trust Company:
|
|||||||||
Please
print here the exact name of Custodian/ Trust Company
|
|||||||||||
Address
|
|||||||||||
City
|
State
|
Zip
Code
|
|||||||||
Taxpayer
ID#
|
Client
Account Number
|
||||||||||
SIGNATURE:
|
|||||||||||
(X)
|
(Custodian/Trust
Company)
|
||||||||||
3.
|
INVESTMENT
|
Number
of units to be purchased
|
|||||||||
Minimum
subscription is
|
|||||||||||
2,000
units at $1 per unit
|
Amount
of payment enclosed
|
||||||||||
($2,000),
with additional
|
|||||||||||
investments
of any amount
|
|||||||||||
with
minimum of 1,000
|
|||||||||||
units
($1,000)for existing
|
|||||||||||
limited
partners.
|
Please make check payable to “Redwood Mortgage
Investors VIII”
|
||||||||||
If
the investor has elected to compound their share of monthly, quarterly or
annual income (see 4. below), then the interest earned on
subscription funds until admission to the partnership will be invested in
additional units on behalf of the investor; therefore, the actual number
of units to be issued to the investor upon admission to the partnership
will be increased.
|
||||||
Check
one: [ ] Initial Investment
|
[ ]
Additional Investment*
|
|||||
*A
completed Subscription Agreement is required for each initial and
additional investment
|
4.
|
DISTRIBUTIONS
|
Does
the investor wish to have his income compounded or
distributed?
|
Check
One: [ ] Compounded
|
or
|
[ ] Distributed
|
|
The
election to compound income may be changed after three (3)
years.
|
|||
The
election to distribute income is
irrevocable.
|
If income
is to be distributed:
|
|||||||
Check
One: [ ]
Monthly
|
[ ]
Quarterly
|
[ ]
**Annually
|
|||||
(**payable only on
12/31)
|
|||||||
5.
|
SPECIAL
ADDRESS FOR CASH DISTRIBUTIONS
|
||||||||||
(If
the same as in Sections
|
Name
|
Client
Account #
|
|||||||||
1
or 2, please disregard)
|
|||||||||||
Address
|
|||||||||||
City
|
State
|
Zip
Code
|
|||||||||
If
cash distributions are to be sent to an address other than that listed, in
Sections 1 or 2, please enter the information here. All other
communications will be mailed to the investor’s registered address of
record under Sections 1 or 2. In no event will the
partnership or its affiliates be responsible for any adverse consequences
of direct deposits.
|
|||||||||||
DIRECT
DEPOSIT
|
Check
one: Checking: [ ] Savings: [ ]
|
||||||||||
Account
#__________________ ABA (Routing)
#________________________
|
|||||||||||
(Must
attach original voided check for
checking account deposits, deposit slip for savings account
deposits)
|
|||||||||||
6.
|
SIGNATURES
|
IN
WITNESS WHEREOF, the undersigned has executed below this
________day
|
|||||||||
of
_______________, 200___, at (City)
|
|||||||||||
Investor’s
primary residence is in
|
(State)
|
||||||||||
(X)
|
|||||||||||
(Investor
Signature and Title)
|
|||||||||||
(X)
|
|||||||||||
(Investor
Signature and Title)
|
7.
|
BROKER-DEALER
DATA
(To
be completed by selling broker-dealer)
|
The
undersigned broker-dealer hereby certifies that (i) a copy of the
prospectus, as amended and/or supplemented to date, has been delivered to
the above investor; and (ii) that the appropriate suitability
determination as set forth in the prospectus has been made and that the
appropriate records are being maintained.
|
|||
(X)
|
|||||
Broker-Dealer
Authorized Signature (Required on all Applications)
|
|||||
Broker-Dealer
Name:
|
|||||
Street
Address:
|
|||||
City,
State, Zip Code:
|
|||||
Registered
Representative
|
|||||
Name
(Last, First):
|
|||||
Street
Address:
|
|||||
City,
State, Zip Code
|
|||||
Phone
No.:
|
|||||
The
registered representative, by signing below, certifies that he has
reasonable grounds to believe, on the basis of information obtained from
the investor concerning his investment objectives, other investments,
financial situation and needs and any other information known by the
selling broker-dealer, that investment in the units is suitable for the
investor and that suitability records are being maintained; and that he
has informed the investor of all pertinent facts relating to the liquidity
and marketability of the units.
|
|||||
Registered
Representative’s Signature:
|
|||||
(X)
|
|||||
8.
|
ACCEPTANCE
|
This
subscription accepted
|
|||
This
subscription will not
|
|||||
be
an effective agreement
|
REDWOOD
MORTGAGE INVESTORS VIII,
|
||||
until
it or a facsimile is
|
A
California Limited Partnership
|
||||
signed
by a general
|
900
Veterans Blvd., Suite 500
|
||||
partner
of Redwood
|
Redwood
City CA 94063
|
||||
Mortgage
Investors VIII, a
|
|||||
California
limited
|
(650)
365-5341
|
||||
partnership
|
|||||
By:
|
|||||
(Office
Use Only)
|
Partner
#:
|
Date
Entered:
|
|||
Check
Amount:
|
$
|
Check
Date:
|
||
Check
Number:
|
(a)
|
The
issuer of any security upon which a restriction on transfer has been
imposed pursuant to Sections 260.102.6, 260.141.10 or 260.534 shall
cause a copy of this section to be delivered to each issuee or transferee
of such security.
|
(b)
|
It
is unlawful for the holder of any such security to consummate a sale or
transfer of such security, or any interest therein, without the prior
written consent of the Commissioner (until this condition is removed
pursuant to Section 260.141.12 of these rules),
except:
|
(c)
|
The
certificates representing all such securities subject to such a
restriction on transfer, whether upon initial issuance or upon any
transfer thereof, shall bear on their face a legend, prominently stamped
or printed thereon in capital letters of not less than 10-point size,
reading as follows:
|
[ ]
|
INDIVIDUAL
|
[ ]
|
PENSION PLAN (Trustee
signature required)
|
||
[ ]
|
TRUST (Trustee
signature required)
|
[ ]
|
PROFIT
SHARING PLAN
|
||
(Title page,
Successor Trustee page and
|
(Trustee
signature required)
|
||||
signature pages
of the Trust Agreement
|
|||||
MUST
be enclosed)
|
[ ]
|
KEOGH
(H.R.10)
|
|||
(Custodian
signature required)
|
|||||
*
|
[ ]
|
JOINT
TENANTS WITH RIGHTS
|
|||
OF
SURVIVORSHIP
|
[ ]
|
CUSTODIAL/UGMA (circle
one)
|
|||
(All
parties must sign)
|
(Custodian
signature required)
|
||||
*
|
[ ]
|
COMMUNITY
PROPERTY
|
[ ]
|
TOD
– Transfer On Death
|
|
(must
be titled as an Individual or as
|
|||||
*
|
[ ]
|
TENANTS
IN COMMON
|
Joint
Tenants only – special form required)
|
||
(All
parties must sign)
|
|||||
[ ]
|
401(k) (Trustee
signature required)
|
||||
*
|
[ ]
|
IRA
|
|||
(Individual
Retirement Account)
|
[ ]
|
OTHER (Please
describe)
|
|||
(Investor
and Custodian must sign)
|
|||||
*
|
[ ]
|
ROTH
IRA
|
|||
(Investor
and Custodian must sign)
|
|||||
*
|
[ ]
|
SEP/IRA
|
|||
(Investor
and Custodian must sign)
|
|||||
1.
|
INVESTOR
NAME
AND
ADDRESS
|
Type
or print your name(s) exactly as the title should appear in the account
records of the partnership. Complete this section for all
trusts other than IRA/Keogh or other qualified plans. If IRA/Keogh or qualified plan, Section 2
must also be completed. All checks and correspondence
will go to this address unless another address is listed in
Sections 2 or 5 below.
|
[ ]
Mr. [ ]
Mrs. [ ]
Ms. [ ]
Dr.
|
||
Name
as it will appear on the account (How title should be
held)
|
||
(Additional
Name(s) if held in joint tenancy, community property,
tenants-in-common)
|
Street
Address
|
||||
City
|
State
|
Zip
Code
|
Home
Phone Number
|
Social
Security #/ Taxpayer ID#
|
A
social security number or taxpayer identification number is required for
each individual investor. (For IRAs, Keoghs (HR10) and
qualified plans, the taxpayer identification number is your plan or
account tax or employer identification number. For most
individual taxpayers, it is your social security
number. NOTE: If the units are to be held in more
than one name, only one number will be used and will be that of the first
person listed).
|
|||||||||||
2.
|
CUSTODIAN/
TRUST
COMPANY REGISTRATION
|
Name
of Custodian/Trust Company:
|
|||||||||
Please
print here the exact name of Custodian/ Trust Company
|
|||||||||||
Address
|
|||||||||||
City
|
State
|
Zip
Code
|
|||||||||
Taxpayer
ID#
|
Client
Account Number
|
||||||||||
SIGNATURE:
|
|||||||||||
(X)
|
(Custodian/Trust
Company)
|
||||||||||
3.
|
INVESTMENT
|
Number
of units to be purchased
|
|||||||||
Minimum
subscription is
|
|||||||||||
2,000
units at $1 per unit
|
Amount
of payment enclosed
|
||||||||||
($2,000),
with additional
|
|||||||||||
investments
of any amount
|
|||||||||||
with
minimum of 1,000
|
|||||||||||
units
($1,000)for existing
|
|||||||||||
limited
partners.
|
Please make check payable to “Redwood Mortgage
Investors VIII”
|
||||||||||
If
the investor has elected to compound their share of monthly, quarterly or
annual income (see 4. below), then the interest earned on
subscription funds until admission to the partnership will be invested in
additional units on behalf of the investor; therefore, the actual number
of units to be issued to the investor upon admission to the partnership
will be increased.
|
||||||
Check
one: [ ] Initial Investment
|
[ ]
Additional Investment*
|
|||||
*A
completed Subscription Agreement is required for each initial and
additional investment
|
4.
|
DISTRIBUTIONS
|
Does
the investor wish to have his income compounded or
distributed?
|
Check
One: [ ] Compounded
|
or
|
[ ] Distributed
|
|
The
election to compound income may be changed after three (3)
years.
|
|||
The
election to distribute income is
irrevocable.
|
If income
is to be distributed:
|
||||||||
Check
One: [ ]
Monthly
|
[ ]
Quarterly
|
[ ]
**Annually
|
||||||
(**payable only on
12/31)
|
||||||||
5.
|
SPECIAL
ADDRESS FOR CASH DISTRIBUTIONS
|
||||||||||
(If
the same as in Sections
|
Name
|
Client
Account #
|
|||||||||
1
or 2, please disregard)
|
|||||||||||
Address
|
|||||||||||
City
|
State
|
Zip
Code
|
|||||||||
If
cash distributions are to be sent to an address other than that listed, in
Sections 1 or 2, please enter the information here. All other
communications will be mailed to the investor’s registered address of
record under Sections 1 or 2. In no event will the
partnership or its affiliates be responsible for any adverse consequences
of direct deposits.
|
|||||||||||
DIRECT
DEPOSIT
|
Check
one: Checking: [ ] Savings: [ ]
|
||||||||||
Account
#__________________ ABA (Routing)
#________________________
|
|||||||||||
(Must
attach original voided check for
checking account deposits, deposit slip for savings account
deposits)
|
|||||||||||
6.
|
SIGNATURES
|
IN
WITNESS WHEREOF, the undersigned has executed below this
________day
|
|||||||||
of
_______________, 200___, at (City)
|
|||||||||||
Investor’s
primary residence is in
|
(State)
|
||||||||||
(X)
|
|||||||||||
(Investor
Signature and Title)
|
|||||||||||
(X)
|
|||||||||||
(Investor
Signature and Title)
|
Last
Name First:
|
|
Street
Address:
|
|
City,
State, Zip Code:
|
|
Telephone
Number
|
Advisor's
Signature
|
|
Print
or Type Name:
|
8.
|
ACCEPTANCE
|
This
subscription accepted
|
|
This
subscription will not
|
|||
be
an effective agreement
|
REDWOOD
MORTGAGE INVESTORS VIII,
|
||
until
it or a facsimile is
|
A
California Limited Partnership
|
||
signed
by a general
|
900
Veterans Blvd., Suite 500
|
||
partner
of Redwood
|
Redwood
City CA 94063
|
||
Mortgage
Investors VIII, a
|
|||
California
limited
|
(650)
365-5341
|
||
partnership
|
|||
By:
|
|||
(Office
Use Only)
|
Partner
#:
|
Date
Entered:
|
|||
Check
Amount:
|
$
|
Check
Date:
|
||
Check
Number:
|
REDWOOD
MORTGAGE INVESTORS VIII
|
AUTHORIZATION
TO MAKE PAYMENTS OF CLIENT FEES
|
FOR
INVESTORS WHO UTILIZE THE SERVICES OF REGISTERED INVESTMENT
ADVISORS
|
PAYEE 1
|
LIMITED PARTNER
|
|
Please
designate whether Advisor or Broker/Dealer Firm
|
||
Name
of Payee - Please Print
|
Name
of Limited Partner - Please Print
|
|
Authorized
Signature of Payee
|
Signature
of Limited Partner (or Trustee)
|
|
Firm
Name
|
Signature
of Joint Owner (if applicable)
|
|
Street
Address
|
Date
of Admission
|
|
City, State, Zip
Code
|
(a)
|
The
issuer of any security upon which a restriction on transfer has been
imposed pursuant to Sections 260.102.6, 260.141.10 or 260.534 shall cause
a copy of this section to be delivered to each issuee or transferee of
such security.
|
(b)
|
It
is unlawful for the holder of any such security to consummate a sale or
transfer of such security, or any interest therein, without the prior
written consent of the Commissioner (until this condition is removed
pursuant to Section 260.141.12 of these rules),
except:
|
|
(1)
|
to
the issuer;
|
|
(2)
|
pursuant
to the order or process of any
court;
|
|
(3)
|
to
any person described in Subdivision (i) of Section 25102 of the Code or
Section 260.105.14 of these rules;
|
|
(4)
|
to
the transferor’s ancestors, descendants or spouse or any custodian or
trustee for the account of the transferor or the transferor’s ancestors,
descendants or spouse; or to a transferee by a trustee or custodian for
the account of the transferee or the transferee’s ancestors, descendants
or spouse;
|
|
(5)
|
to
the holders of securities of the same class of the same
issuer;
|
|
(6)
|
by
way of gift or donation inter vivos or on
death;
|
|
(7)
|
by
or through a broker-dealer licensed under the Code (either acting as such
or as a finder) to a resident of a foreign state, territory or country who
is neither domiciled in this state to the knowledge of the broker-dealer,
nor actually present in this state if the sale of such securities is not
in violation of any securities law of the foreign state, territory or
country concerned;
|
|
(8)
|
to
a broker-dealer licensed under the Code in a principal transaction, or as
an underwriter or member of an underwriting syndicate or
group;
|
|
(9)
|
if
the interest sold or transferred is a pledge or other lien given by the
purchaser to the seller upon a sale of the security for which the
Commissioner’s written consent is obtained or under this rule is not
required;
|
(10)
|
by
way of a sale qualified under Sections 25111, 25112, or 25113, or 25121 of
the Code, of the securities to be transferred, provided that no order
under Section 25140 or Subdivision (a) of Section 25143 is in effect with
respect to such qualification;
|
(11)
|
by
a corporation to a wholly owned subsidiary of such corporation, or by a
wholly owned subsidiary of a corporation to such
corporation;
|
(12)
|
by
way of an exchange qualified under Section 25111, 25112, or 25113 of the
Code, provided that no order under Section 25140 or Subdivision (a) of
Section 25148 is in effect with respect to such
qualification;
|
(13)
|
between
residents of foreign states, territories or countries who are neither
domiciled nor actually present in this
state;
|
(14)
|
to
the State Controller pursuant to the Unclaimed Property Law or to the
administrator of the unclaimed property law of another state;
or
|
(15)
|
by
the State Controller pursuant to the Unclaimed Property Law or to the
administrator of the unclaimed property law of another state, if, in
either such case, such person (i) discloses to potential purchasers at the
sale that transfer of the securities is restricted under this rule, (ii)
delivers to each purchaser a copy of this rule, and (iii) advises the
Commissioner of the name of each
purchaser;
|
(16)
|
by
a trustee to a successor trustee when such transfer does not involve a
change in the beneficial ownership of the securities, provided that any
such transfer is on the condition that any certificate evidencing the
security issued to such transferee shall contain the legend required by
this section.
|
(c)
|
The
certificates representing all such securities subject to such a
restriction on transfer, whether upon initial issuance or upon any
transfer thereof, shall bear on their face a legend, prominently stamped
or printed thereon in capital letters of not less than 10-point size,
reading as follows:
|
(a)
|
The
issuer of any security upon which a restriction on transfer has been
imposed pursuant to Sections 260.102.6, 260.141.10 or 260.534 shall cause
a copy of this section to be delivered to each issuee or transferee of
such security.
|
(b)
|
It
is unlawful for the holder of any such security to consummate a sale or
transfer of such security, or any interest therein, without the prior
written consent of the Commissioner (until this condition is removed
pursuant to Section 260.141.12 of these rules),
except:
|
|
(1)
|
to
the issuer;
|
|
(2)
|
pursuant
to the order or process of any
court;
|
|
(3)
|
to
any person described in Subdivision (i) of Section 25102 of the Code or
Section 260.105.14 of these rules;
|
|
(4)
|
to
the transferor’s ancestors, descendants or spouse or any custodian or
trustee for the account of the transferor or the transferor’s ancestors,
descendants or spouse; or to a transferee by a trustee or custodian for
the account of the transferee or the transferee’s ancestors, descendants
or spouse;
|
|
(5)
|
to
the holders of securities of the same class of the same
issuer;
|
|
(6)
|
by
way of gift or donation inter vivos or on
death;
|
|
(7)
|
by
or through a broker-dealer licensed under the Code (either acting as such
or as a finder) to a resident of a foreign state, territory or country who
is neither domiciled in this state to the knowledge of the broker-dealer,
nor actually present in this state if the sale of such securities is not
in violation of any securities law of the foreign state, territory or
country concerned;
|
|
(8)
|
to
a broker-dealer licensed under the Code in a principal transaction, or as
an underwriter or member of an underwriting syndicate or
group;
|
|
(9)
|
if
the interest sold or transferred is a pledge or other lien given by the
purchaser to the seller upon a sale of the security for which the
Commissioner’s written consent is obtained or under this rule is not
required;
|
(10)
|
by
way of a sale qualified under Sections 25111, 25112, or 25113, or 25121 of
the Code, of the securities to be transferred, provided that no order
under Section 25140 or Subdivision (a) of Section 25143 is in effect with
respect to such qualification;
|
(11)
|
by
a corporation to a wholly owned subsidiary of such corporation, or by a
wholly owned subsidiary of a corporation to such
corporation;
|
(12)
|
by
way of an exchange qualified under Section 25111, 25112, or 25113 of the
Code, provided that no order under Section 25140 or Subdivision (a) of
Section 25148 is in effect with respect to such
qualification;
|
(13)
|
between
residents of foreign states, territories or countries who are neither
domiciled nor actually present in this
state;
|
(14)
|
to
the State Controller pursuant to the Unclaimed Property Law or to the
administrator of the unclaimed property law of another state;
or
|
(15)
|
by
the State Controller pursuant to the Unclaimed Property Law or to the
administrator of the unclaimed property law of another state, if, in
either such case, such person (i) discloses to potential purchasers at the
sale that transfer of the securities is restricted under this rule, (ii)
delivers to each purchaser a copy of this rule, and (iii) advises the
Commissioner of the name of each
purchaser;
|
(16)
|
by
a trustee to a successor trustee when such transfer does not involve a
change in the beneficial ownership of the securities, provided that any
such transfer is on the condition that any certificate evidencing the
security issued to such transferee shall contain the legend required by
this section.
|
(c)
|
The
certificates representing all such securities subject to such a
restriction on transfer, whether upon initial issuance or upon any
transfer thereof, shall bear on their face a legend, prominently stamped
or printed thereon in capital letters of not less than 10-point size,
reading as follows:
|
1. NAME
OF LIMITED PARTNERSHIP
|
||
Redwood
Mortgage Investors VIII, a California limited
partnership
|
||
2. STREET
ADDRESS OF PRINCIPAL EXECUTIVE
OFFICE CITY
AND
STATE ZIP
CODE
|
||
650
El Camino Real, Suite
G Redwood
City,
CA 94063
|
||
3. STREET
ADDRESS OF CALIFORNIA OFFICE IF EXECUTIVE OFFICE IS IN ANOTHER
STATE CITY ZIP
CODE
|
||
4. COMPLETE
IF LIMITED PARTNERSHIP WAS FORMED PRIOR TO JULY 1, 1984 AND IS IN
EXISTENCE ON DATE
|
||
THIS
CERTIFICATE IS EXECUTED.
|
||
5. ORIGINAL
LIMITED PARTNERSHIP WAS RECORDED ON____________________19______, WITH
THE
|
||
RECORDER
OF ___________________________COUNTY. FILE OR RECORDATION
NUMBER_________________________
|
||
6. NAMES
AND ADDRESS OF ALL GENERAL PARTNERS (CONTINUE ON SECOND PAGE IF
NECESSARY)
|
||
NAME: D.
Russell Burwell
|
NAME: Gymno
Corporation, a California Corporation
|
|
ADDRESS: 650
El Camino Real, Suite G
|
ADDRESS: 650
El Camino Real, Suite G
|
|
CITY: Redwood
City STATE: CA ZIP
CODE: 94063
|
CITY: Redwood
City STATE: CA ZIP
CODE: 94063
|
|
NAME: Michael
R. Burwell
|
NAME:
|
|
ADDRESS: 650
El Camino Real, Suite G
|
ADDRESS:
|
|
CITY: Redwood
City STATE: CA ZIP
CODE: 94063
|
CITY:
|
|
NAME
AND ADDRESS OF AGENT FOR SERVICE OF PROCESS
|
||
NAME: Stephen
C. Ryan, Esq.
|
||
ADDRESS: 235
Montgomery Street, Suite
450 CITY: San
Francisco STATE: ca ZIP
CODE: 94104
|
||
7. OTHER
MATTERS TO BE INCLUDED IN THIS
|
8. INDICATE
THE NUMBER OF GENERAL PARTNERS
|
|
CERTIFICATE
MAY STATED ON SEPARATE PAGES
|
SIGNATURES
REQUIRED FOR FILING CERTIFICATE OF
|
|
AND
BY REFERENCE HEREIN ARE PART OF THIS
|
AMENDMENT,
DISSOLUTION, CONTINUATION AND
|
|
CERTIFICATE.
|
CANCELLATION.
|
|
NUMBER
OF GENERAL PARTNER(S) SIGNATURE (S)
|
||
NUMBER
OF PAGES ATTACHED: 0
|
IS/ARE 1
|
|
IT
IS HEREBY DECLARED THAT I AM (WE ARE) THE PERSON(S) WHO
EXECUTED
|
THIS
SPACE FOR FILING
|
|
THIS
CERTIFICATE OF LIMITED PARTNERSHIP WHICH EXECUTION IS MY
(OUR)
|
OFFICER
USE
|
|
ACT
AND DEED. (SEE INSTRUCTIONS)
|
||
/s/ D. Russell
Burwell 5/21/92 /s/ D. Russell
Burwell 5/21/92
|
9215400002
|
|
D.
Russell
Burwell Gymno
Corporation (General Partner) a
|
||
California
Corporation, its: President
|
||
/s/ Michael R.
Burwell 5/21/92
|
FILED
|
|
Michael
R. Burwell, General Partner
|
In
the office of the
|
|
TITLE DATE POSITION
OR TITLE
|
Secretary
of State
|
|
RETURN
ACKNOWLEDEMENT TO:
|
May
27, 1992
|
|
/s/ March Fong Eu
|
||
Stephen
C. Ryan, Esq.
|
March
Fong Eu
|
|
Wilson,
Ryan & Campilongo
|
SECRETARY
OF STATE
|
|
235
Montgomery Street, Suite 450
|
||
San
Francisco, CA 94104
|
||
(Seal
of the State
of State
of California
|
FILED
|
|
California) Secretary
of State
|
In
the office of the
|
|
Bill
Jones
|
Secretary
of State
|
|
Of
the State of California
|
||
AMENDMENT
TO CERTIFICATE OF LIMITED PARTNERSHIP
|
||
March
14, 2000
|
||
A
$30.00 filing fee must accompany this form.
|
||
IMPORTANT
– Read instructions before completing this form
|
/s/ Bill Jones
|
|
BILL
JONES,
|
||
Secretary
of State
|
||
This
space for filing use only
|
||
1. SECRETARY
OF STATE FILE NUMBER
|
2. NAME
OF LIMITED PARTNERSHIP
|
|
199215400002
|
Redwood
Mortgage Investors VIII, a California Limited
Partnership
|
|
3. COMPLETE
ONLY THE BOXES WHERE INFORMATION IS BEING CHANGED. ADDITIONAL
PAGES MAY BE
|
||
ATTACHED
IF NECESSARY
|
||
A. LIMITED
PARTNERSHIP NAME (END THE NAME WITH THE WORDS “LIMITED PARTNERSHIP” OR
THE
|
||
ABBREVIATION
“L.P.”
|
||
B. THE
STREET ADDRESS OF THE PRINCIPAL OFFICE
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
C. THE
STREET ADDRESS IN CALIFORNIA WHERE RECORDS ARE KEPT
|
||
STREET
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
D. THE
ADDRESS OF THE GENERAL PARTNER (S)
|
||
NAME
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
E. NAME
CHANGE OF A GENERAL
PARTNER FROM TO
|
||
F. GENERAL
PARTNER(S) CESSATION
|
||
G. GENERAL
PARTNER ADDED
|
||
NAME Redwood
Mortgage Corp.
|
||
ADDRESS 650
El Camino Real, Suite G
|
||
CITY Redwood
City STATE CA ZIP
CODE 94063
|
||
H. THE
PERSON(S) AUTHORIZED TO WIND UP AFFAIRS OF THE LIMITED
PARTNERSHIP
|
||
NAME
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
I. THE
NAME OF THE AGENT FOR SERVICE TO PROCESS
|
||
J. IF
AN INDIVIDUAL, CALIFORNIA STREET ADDRESS OF THE AGENT FOR SERVICE OF
PROCESS
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
K. NUMBER
OF GENERAL PARTNERS’ SIGNATURES REQUIRED FOR FILING CERTIFICATE OF
AMENDMENT,
|
||
REINSTATEMENT,
MERGER, DISSOLUTION, CONTINUATION AND
CANCELLATION o
|
||
L. OTHER
MATTERS (ATTACH ADDITIONAL PAGES IF NECESSARY).
|
||
4. TOTAL
NUMBER OF PAGES ATTACHED IF
ANY 0
|
||
5. I
CERTIFY THAT THE STATEMENTS CONTAINED IN THIS DOCUMENT ARE TRUE AND
CORRECT TO MY OWN
|
||
KNOWLEDGE. I
DECLARE THAT I AM THE PERSON WHO IS EXECUTING THE INSTRUMENT, WHICH
EXECUTION
|
||
IS
MY ACT AND DEED
|
||
/s/ Michael R.
Burwell General
Partner Michael R.
Burwell 2/8/00
|
||
SIGNATURE POSITION
OR
TITLE PRINT
NAME DATE
|
||
/s/ D. Russell
Burwell General
Partner/President Redwood Mortgage Corp. by: D. Russell
Burwell 2/8/00
|
||
SIGNATURE POSITION
OR
TITLE PRINT
NAME DATE
|
||
FORM
LP-2
|
(Seal
of the State
of State
of California
|
ENDORSED-FILED
|
|
California) Secretary
of State
|
In
the office of the
|
|
Bill
Jones
|
Secretary
of State
|
|
Of
the State of California
|
||
AMENDMENT
TO CERTIFICATE OF LIMITED PARTNERSHIP
|
||
April
2, 2002
|
||
A
$30.00 filing fee must accompany this form.
|
||
IMPORTANT
– Read instructions before completing this form
|
/s/ Bill Jones
|
|
BILL
JONES,
|
||
Secretary
of State
|
||
This
space for filing use only
|
||
1. SECRETARY
OF STATE FILE NUMBER
|
2. NAME
OF LIMITED PARTNERSHIP
|
|
9215400002
|
Redwood
Mortgage Investors VIII, a California Limited
Partnership
|
|
3. COMPLETE
ONLY THE BOXES WHERE INFORMATION IS BEING CHANGED. ADDITIONAL
PAGES MAY BE
|
||
ATTACHED
IF NECESSARY
|
||
A. LIMITED
PARTNERSHIP NAME (END THE NAME WITH THE WORDS “LIMITED PARTNERSHIP” OR
THE
|
||
ABBREVIATION
“L.P.”
|
||
B. THE
STREET ADDRESS OF THE PRINCIPAL OFFICE
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
C. THE
STREET ADDRESS IN CALIFORNIA WHERE RECORDS ARE KEPT
|
||
STREET
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
D. THE
ADDRESS OF THE GENERAL PARTNER (S)
|
||
NAME
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
E. NAME
CHANGE OF A GENERAL
PARTNER FROM TO
|
||
F. GENERAL
PARTNER(S) CESSATION D. Russell
Burwell
|
||
G. GENERAL
PARTNER ADDED
|
||
NAME
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
H. THE
PERSON(S) AUTHORIZED TO WIND UP AFFAIRS OF THE LIMITED
PARTNERSHIP
|
||
NAME
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
I. THE
NAME OF THE AGENT FOR SERVICE TO PROCESS
|
||
J. IF
AN INDIVIDUAL, CALIFORNIA STREET ADDRESS OF THE AGENT FOR SERVICE OF
PROCESS
|
||
ADDRESS
|
||
CITY STATE ZIP CODE
|
||
K. NUMBER
OF GENERAL PARTNERS’ SIGNATURES REQUIRED FOR FILING CERTIFICATE OF
AMENDMENT,
|
||
REINSTATEMENT,
MERGER, DISSOLUTION, CONTINUATION AND
CANCELLATION o
|
||
L. OTHER
MATTERS (ATTACH ADDITIONAL PAGES IF NECESSARY).
|
||
4. TOTAL
NUMBER OF PAGES ATTACHED IF
ANY 0
|
||
5. I
CERTIFY THAT THE STATEMENTS CONTAINED IN THIS DOCUMENT ARE TRUE AND
CORRECT TO MY OWN
|
||
KNOWLEDGE. I
DECLARE THAT I AM THE PERSON WHO IS EXECUTING THE INSTRUMENT, WHICH
EXECUTION
|
||
IS
MY ACT AND DEED
|
||
/s/ Michael R.
Burwell General
Partner Michael R.
Burwell 3/28/02
|
||
SIGNATURE POSITION
OR
TITLE PRINT
NAME DATE
|
||
FORM
LP-2
|
The
Partnership Agreement
|
|
2.
|
The
Registration Statement;
|
|
3.
|
The
Prospectus;
|
|
4.
|
The
form of Subscription Agreement;
|
|
5.
|
Information
and representations that have been provided to us by the General Partner;
and
|
|
6.
|
ERISA,
the Code, regulations and interpretations issued by the DOL, and available
case law.
|
(A)
|
“Freely
Transferable”.
|
(C)
|
Registered
under the Securities Exchange Act of
1934.
|
(i)
|
The
Partnership will be treated as a partnership for U.S. federal income tax
purposes, and not as an association taxable as a
corporation;
|
(ii)
|
Based
upon the legislative history of Section 7704, the text of the Regulations,
the anticipated operations of the Partnership as described in the
Prospectus and the Agreement, and the representations of the General
Partners contained in the Certificate, the Partnership will not be treated
as a publicly traded partnership, within the meaning of Section 7704 of
the Code; and
|
(iii)
|
We
have reviewed the statements included or incorporated by reference in the
Prospectus under the headings “Risk Factors - Tax Risks” and “Material
Federal Income Tax Consequences,” and insofar as such statements pertain
to matters of law or legal conclusions, in each case with respect to U.S.
federal income tax law, they are correct in all material
respects.
|
Borrower:
|
Loan
Amount:
|
Term:
|
Interest
Rate:
|
%
|
Late
Charge:
|
Prepayment
Bonus:
|
Yes
|
No
|
Deed
of Trust Recorded: Series #
|
County
|
,
CA
|
Beneficiary’s
Investment:
|
Percentage
of Ownership:
|
%
|
Date:
|
Date:
|
Redwood
City, California
|
Redwood
City, California
|
RECORDING
REQUESTED BY
|
||||||||||||
AND
WHEN RECORDED, MAIL TO
|
||||||||||||
Name REDWOOD
MORTGAGE CORP.
|
||||||||||||
P.O.
BOX 5096
|
||||||||||||
Address REDWOOD
CITY, CA 94063-0096
|
||||||||||||
Title
Order No.
|
Escrow
No.
|
|||||||||||
BY THIS DEED OF TRUST,
made this
|
day
of
|
,
|
20__,
|
between
|
||
,
herein called Trustor, whose address
is,
|
|
and
PLM LENDER SERVICES, INC., a California Corporation,
|
,herein
called Trustee,
and
|
,herein
called Beneficiary,
|
Trustor
grants, transfers, and assigns to Trustee, in trust, with power of sale,
that property in City of
|
COUNTY
|
BOOK
|
PAGE
|
COUNTY
|
BOOK
|
PAGE
|
COUNTY
|
BOOK
|
PAGE
|
Alameda
|
3540
|
89
|
Marin
|
2736
|
463
|
Santa
Barbara
|
2486
|
1244
|
Alpine
|
18
|
753
|
Mariposa
|
143
|
717
|
Santa
Clara
|
0623
|
713
|
Amador
|
250
|
243
|
Mendocino
|
942
|
242
|
Santa
Cruz
|
2358
|
744
|
Butte
|
1870
|
678
|
Merced
|
1940
|
361
|
Shasta
|
1195
|
293
|
Calaveras
|
368
|
92
|
Modoc
|
225
|
668
|
Sierra
|
59
|
439
|
Colusa
|
409
|
347
|
Mono
|
160
|
215
|
Siskiyou
|
697
|
407
|
Contra
Costa
|
7077
|
178
|
Monterey
|
877
|
243
|
Solano
|
1860
|
581
|
Del
Norte
|
174
|
526
|
Napa
|
922
|
96
|
Sonoma
|
2810
|
975
|
El
Dorado
|
1229
|
594
|
Nevada
|
665
|
303
|
Stanislaus
|
2587
|
332
|
Fresno
|
6227
|
411
|
Orange
|
10961
|
398
|
Sutter
|
817
|
182
|
Glenn
|
565
|
290
|
Placer
|
1528
|
440
|
Tehema
|
630
|
522
|
Humboldt
|
1213
|
31
|
Plumas
|
227
|
443
|
Trinity
|
161
|
393
|
Imperial
|
1355
|
801
|
Riverside
|
1973
|
139405
|
Tulare
|
3137
|
567
|
Inyo
|
205
|
660
|
Sacramento
|
731025
|
59
|
Tuolumne
|
396
|
309
|
Kern
|
4809
|
2351
|
San
Benito
|
386
|
94
|
Ventura
|
4182
|
662
|
Kings
|
1018
|
394
|
San
Bernardino
|
8294
|
877
|
Yolo
|
1081
|
335
|
Lake
|
743
|
552
|
San
Francisco
|
B820
|
585
|
Yuba
|
564
|
163
|
Lassen
|
271
|
367
|
San
Joaquin
|
3813
|
6
|
San
Diego
|
File
No.
|
|
Los
Angeles
|
T8512
|
751
|
San
Luis Obispo
|
1750
|
491
|
73-
|
||
Madera
|
1176
|
234
|
San
Mateo
|
6491
|
600
|
299568
|
||
DATE:
|
Loan
No.:
|
4.
|
This
Note shall be unsecured.
|
|
Redwood
Mortgage Corp., a California
corporation
|
Date
|
Amount
of
Advance
|
Amount
of Principal Paid or Prepaid
|
Unpaid
Principal Amount
|
Notation
Made By
|
|
EXHIBIT
10.8
|
By:
/s/ Roger Shelton
|
/s/
Michael Burwell
|
Name
of partnership
|
Number
of Loans
|
Estimated
Total Amount of Loans Made 01/01/02 to 12/31/04
|
Outstanding
Loan Balances Originated 01/01/02 to 12/31/04
|
Total
Outstanding Loans as of 12/31/04
|
CMI
|
14
|
$1,406,204.87
|
$644,799.72
|
$782,124.37
|
RMI
|
6
|
$820,635.02
|
$571,561.27
|
$602,337.64
|
RMI
II
|
2
|
$355,814.97
|
$308,461.22
|
$343,965.60
|
RMI
III
|
20
|
$2,100,200.01
|
$671,842.31
|
$825,097.99
|
RMI
IV
|
9
|
$4,306,072.69
|
$2,807,140.89
|
$4,514,305.88
|
RMI
V
|
7
|
$942,061.03
|
$644,214.94
|
$1,590,978.80
|
TOTAL
|
58
|
$9,930,988.59
|
$5,648,020.35
|
$8,658,810.28
|
Name
of partnership
|
Number
of Loans
|
Estimated
Total Amount of Loans Made 01/01/02 to 12/31/04
|
Outstanding
Loan Balances Originated 01/01/02 to 12/31/04
|
Total
Outstanding Loans as of 12/31/04
|
RMI
VI
|
21
|
$6,632,475.97
|
$4,846,802.30
|
$5,225,128.49
|
RMI
VII
|
39
|
$11,983,746.59
|
$6,239,193.08
|
$7,388,478.20
|
TOTAL
|
60
|
$18,616,222.56
|
$11,085,995.38
|
$12,613,606.69
|
Name
of partnership
|
Number
of Loans
|
Estimated
Total Amount of Loans Made 01/01/02 to 12/31/04
|
Outstanding
Loan Balances Originated 01/01/02 to 12/31/04
|
Total
Outstanding Loans as of 12/3104
|
RMI
VIII
|
119
|
$269,235,162.59
|
$159,267,312.44
|
$171,744,735.19
|
Loans
|
||
First
Trust Deeds
|
$7,420,875.55
|
|
Second
Trust Deeds
|
$2,510,113.04
|
|
Total
|
$9,930,988.59
|
|
Location
of Loans
|
||
Alameda
County
|
$3,556,222.00
|
|
Santa
Clara County
|
$2,318,200.00
|
|
San
Francisco County
|
$1,661,512.50
|
|
San
Mateo County
|
$694,671.04
|
|
Stanislaus
County
|
$578,181.82
|
|
Contra
Costa County
|
$560,079.23
|
|
Marin
County
|
$339,622.00
|
|
San
Joaquin County
|
$150,000.00
|
|
Sacramento
County
|
$72,500.00
|
|
Total
|
$9,930,988.59
|
|
Type
of Property
|
||
Owner
Occupied Homes
|
$2,111,872.00
|
|
Non-Owner
Occupied
|
$3,425,515.55
|
|
Commercial
|
$4,393,601.04
|
|
Total
|
$9,930,988.59
|
Loans
(1)
|
||
First
Trust Deeds
|
$12,461,067.60
|
|
Second
Trust Deeds
|
$5,205,154.96
|
|
Third
Trust Deeds
|
$950,000.00
|
|
Total
|
$18,616,222.56
|
|
Location
of Loans
|
||
Alameda
County
|
$7,456,585.99
|
|
Santa
Clara County
|
$3,470,653.75
|
|
San
Francisco County
|
$1,569,767.50
|
|
San
Mateo County
|
$1,451,328.96
|
|
Contra
Costa County
|
$886,250.00
|
|
San
Diego County
|
$800,000.00
|
|
Stanislaus
County
|
$717,386.36
|
|
Sacramento
County
|
$710,500.00
|
|
Monterey
County
|
$400,000.00
|
|
San
Joaquin County
|
$317,750.00
|
|
Marin
County
|
$300,000.00
|
|
Solano
County
|
$160,000.00
|
|
Merced
County
|
$146,000.00
|
|
Colusa
County
|
$120,000.00
|
|
Madera
County
|
$110,000.00
|
|
Total
|
$18,616,222.56
|
|
Type
of Property
|
||
Owner
Occupied Homes
|
$6,127,000.00
|
|
Non-Owner
Occupied
|
$6,813,789.86
|
|
Commercial
|
$5,675,432.70
|
|
Total
|
$18,616,222.56
|
Loans
(1)
|
||
First
Trust Deeds
|
$176,526,080.59
|
|
Second
Trust Deeds
|
$92,109,082.00
|
|
Third
Trust Deeds
|
$600,000.00
|
|
Total
|
$269,235,162.59
|
|
Location
of Loans
|
||
Alameda
County
|
$82,135,811.39
|
|
San
Francisco County
|
$43,221,320.00
|
|
Contra
Costa County
|
$31,228,800.00
|
|
Santa
Clara County
|
$27,031,250.00
|
|
San
Mateo County
|
$23,671,450.00
|
|
Sacramento
County
|
$13,040,000.00
|
|
Marin
County
|
$10,135,000.00
|
|
Los
Angeles County
|
$7,292,000.00
|
|
Fresno
County
|
6,073,600.00
|
|
Riverside
County
|
$5,150,000.00
|
|
Napa
County
|
$4,885,000.00
|
|
San
Joaquin County
|
$4,017,250.00
|
|
El
Dorado County
|
$3,032,500.00
|
|
San
Diego County
|
$2,670,000.00
|
|
Calaveras
County
|
$1,500,000.00
|
|
Lake
County
|
$1,458,000.00
|
|
Placer
County
|
$1,070,000.00
|
|
Stanislaus
County
|
$793,181.20
|
|
Sonoma
County
|
$750,000.00
|
|
King
County
|
$80,000.00
|
|
Total
|
$269,235,162.59
|
|
Type
of Property
|
||
Owner
Occupied Homes
|
$25,622,569.38
|
|
Non-Owner
Occupied
|
$134,683,273.20
|
|
Commercial
|
$77,392,320.01
|
|
Land
|
$4,507,000.00
|
|
Apartments
|
$27,030,000.00
|
|
Total
|
$269,235,162.59
|