-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MbrMpeKsiE0Grt7GcaUZIuUEQbG+KsqShANPEwGy8o3GEjgnVu0Vq1g1Vc+wWwl7 EjbJfV6uDm8m6WGSQgeEyw== 0001031003-99-000003.txt : 19991109 0001031003-99-000003.hdr.sgml : 19991109 ACCESSION NUMBER: 0001031003-99-000003 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19990924 FILED AS OF DATE: 19991108 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MERRILL LYNCH PREFERRED CAPITAL TRUST II CENTRAL INDEX KEY: 0001031003 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1225 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-07182-04 FILM NUMBER: 99743524 BUSINESS ADDRESS: STREET 1: MERRILL LYNCH & CO INC, WORLD FINANCIAL STREET 2: NORTH TOWER, 250 VESEY ST CITY: NEW YORK STATE: NY ZIP: 10281 BUSINESS PHONE: 2124491000 MAIL ADDRESS: STREET 1: MERRILL LYNCH & CO INC, WORLD FIN.CENTER STREET 2: NORTH TOWER 250 VESEY ST CITY: NEW YORK STATE: NY ZIP: 10281 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MERRILL LYNCH PREFERRED FUNDING II LP CENTRAL INDEX KEY: 0001031002 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1225 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-07182-03 FILM NUMBER: 99743525 BUSINESS ADDRESS: STREET 1: MERRILL LYNCH & CO INC, WORLD FINANCIAL STREET 2: NORTH TOWER, 250 VESEY ST CITY: NEW YORK STATE: NY ZIP: 10281 BUSINESS PHONE: 2124491000 MAIL ADDRESS: STREET 1: MERRILL LYNCH & CO INC, WORLD FIN.CENTER STREET 2: NORTH TOWER 250 VESEY ST CITY: NEW YORK STATE: NY ZIP: 10281 10-Q 1 FORM 10-Q ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 24, 1999 MERRILL LYNCH PREFERRED CAPITAL TRUST II (Exact name of Registrant as specified in its certificate of trust) COMMISSION FILE NO.: 1-7182-04 Delaware 13-7108354 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) World Financial Center North Tower New York, New York 10281 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 449-1000 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: Title of each class Name of each exchange on which registered - ------------------- ----------------------------------------- 8% Trust Originated New York Stock Exchange Preferred Securities ("TOPrS") (and the related guarantee) SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE MERRILL LYNCH PREFERRED FUNDING II, L.P. (Exact name of Registrant as specified in its certificate of limited partnership) COMMISSION FILE NO.: 1-7182-03 Delaware 13-3926165 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) World Financial Center North Tower New York, New York 10281 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 449-1000 SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: Title of each class Name of each exchange on which registered - ------------------- ----------------------------------------- 8% Partnership Preferred New York Stock Exchange Securities (and the related guarantee) SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: NONE Indicate by check mark whether the Registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports), and (2) have been subject to such requirements for the past 90 days. Yes |X| No |_| As of September 24, 1999, no voting stock was held by non-affiliates of the Registrants. ================================================================================ PART I - FINANCIAL INFORMATION ------------------------------ ITEM 1. FINANCIAL STATEMENTS --------------------
MERRILL LYNCH PREFERRED CAPITAL TRUST II BALANCE SHEETS (unaudited) (dollars in thousands, except per security amounts) - ----------------------------------------------------------------------------------------------------------------------- SEPTEMBER 24, 1999 DECEMBER 25, 1998 ------------------ ----------------- ASSETS Investment in partnership preferred securities $ 309,278 $ 309,278 Income receivable 6,186 6,186 ---------- ---------- Total Assets $ 315,464 $ 315,464 ========== ========== LIABILITY AND STOCKHOLDERS' EQUITY Distributions payable $ 6,186 $ 6,186 ---------- ---------- Stockholders' equity: Preferred securities (8% Trust Originated Preferred Securities; 12,000,000 authorized, issued, and outstanding; $25 liquidation amount per security) 300,000 300,000 Common securities (8% Trust Common Securities; 371,136 authorized, issued, and outstanding; $25 liquidation amount per security) 9,278 9,278 ---------- ---------- Total stockholders' equity 309,278 309,278 ---------- ---------- Total Liability and Stockholders' Equity $ 315,464 $ 315,464 ========== ==========
See Note to Financial Statements 2
MERRILL LYNCH PREFERRED CAPITAL TRUST II STATEMENTS OF EARNINGS (unaudited) (dollars in thousands) - ------------------------------------------------------------------------------------------------------------ FOR THE THREE MONTHS ENDED ------------------------------------------ SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ EARNINGS Income on partnership preferred securities $ 6,186 $ 6,186 ========= ========= FOR THE NINE MONTHS ENDED ------------------------------------------ SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ EARNINGS Income on partnership preferred securities $ 18,557 $ 18,557 ========= =========
See Note to Financial Statements 3
MERRILL LYNCH PREFERRED CAPITAL TRUST II STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (unaudited) (dollars in thousands) - ------------------------------------------------------------------------------------------------------- FOR THE NINE MONTHS ENDED ------------------------------------------ SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ PREFERRED SECURITIES Balance, beginning and end of period $ 300,000 $ 300,000 ---------- ---------- COMMON SECURITIES Balance, beginning and end of period 9,278 9,278 ---------- ---------- UNDISTRIBUTED EARNINGS Balance, beginning of period - - Earnings 18,557 18,557 Distributions (12,371) (12,371) Distributions payable (6,186) (6,186) ---------- ---------- Balance, end of period - - ---------- ---------- Total Stockholders' Equity $ 309,278 $ 309,278 ========== ==========
See Note to Financial Statements 4
MERRILL LYNCH PREFERRED CAPITAL TRUST II STATEMENTS OF CASH FLOWS (unaudited) (dollars in thousands) - ------------------------------------------------------------------------------------------------------------------- FOR THE NINE MONTHS ENDED ------------------------------------------ SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ CASH FLOWS FROM OPERATING ACTIVITIES: Earnings $ 18,557 $ 18,557 --------- --------- Cash provided by operating activities 18,557 18,557 --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Distributions (18,557) (18,557) --------- --------- Cash used for financing activities (18,557) (18,557) --------- --------- NET CHANGE IN CASH - - CASH, BEGINNING OF PERIOD - - --------- --------- CASH, END OF PERIOD $ - $ - ========= ========= SUPPLEMENTAL DISCLOSURE OF CASH FLOWS: Preferred and common distributions of $6,000 and $186, respectively, were accrued at September 24, 1999 and September 25, 1998.
See Note to Financial Statements 5 MERRILL LYNCH PREFERRED CAPITAL TRUST II NOTE TO FINANCIAL STATEMENTS (unaudited) SEPTEMBER 24, 1999 - ------------------------------------------------------------------------------- BASIS OF PRESENTATION These unaudited financial statements should be read in conjunction with the audited financial statements included in the Annual Report on Form 10-K of Merrill Lynch Preferred Capital Trust II (the "Trust") for the year ended December 25, 1998. The December 25, 1998 balance sheet was derived from the audited financial statements. The interim financial statements for the three- and nine-month periods are unaudited; however, in the opinion of the Regular Trustees of the Trust, all adjustments, consisting only of normal recurring accruals necessary for a fair statement of the results of operations, have been included. 6
MERRILL LYNCH PREFERRED FUNDING II, L.P. BALANCE SHEETS (unaudited) (dollars in thousands) - ---------------------------------------------------------------------------------------------------------------- SEPTEMBER 24, 1999 DECEMBER 25, 1998 ------------------ ----------------- ASSETS Investments: Affiliate debentures $ 360,218 $ 360,218 U.S. Treasury bills 3,704 3,772 ---------- ---------- Total investments 363,922 363,990 Interest receivable 7,204 7,204 ---------- ---------- Total Assets $ 371,126 $ 371,194 ========== ========== LIABILITY AND PARTNERS' CAPITAL Distributions payable $ 7,204 $ 7,204 ---------- ---------- Partners' capital: Limited partnership interest 309,278 309,278 General partnership interest 54,644 54,712 ---------- ---------- Total partners' capital 363,922 363,990 ---------- ---------- Total Liability and Partners' Capital $ 371,126 $ 371,194 ========== ==========
See Note to Financial Statements 7
MERRILL LYNCH PREFERRED FUNDING II, L.P. STATEMENTS OF EARNINGS (unaudited) (dollars in thousands) - ---------------------------------------------------------------------------------------------------- FOR THE THREE MONTHS ENDED ---------------------------------------- SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ EARNINGS Interest income: Affiliate debentures $ 7,204 $ 7,204 U.S. Treasury bills 38 50 ---------- ---------- Earnings $ 7,242 $ 7,254 ========== ========== FOR THE NINE MONTHS ENDED ---------------------------------------- SEPTEMBER 24, 1999 SEPTEMBER 25, 1999 ------------------ ------------------ EARNINGS Interest income: Affiliate debentures $ 21,613 $ 21,613 U.S. Treasury bills 133 150 ---------- ---------- Earnings $ 21,746 $ 21,763 ========== ==========
See Note to Financial Statements 8
MERRILL LYNCH PREFERRED FUNDING II, L.P. STATEMENTS OF CHANGES IN PARTNERS' CAPITAL (unaudited) (dollars in thousands) - --------------------------------------------------------------------------------------------------- FOR THE NINE MONTHS ENDED --------------------------------------- SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ LIMITED PARTNER'S CAPITAL Balance, beginning of period $ 309,278 $ 309,278 Net income allocated to limited partner 18,557 18,557 Distributions (12,371) (12,371) Distributions payable (6,186) (6,186) ---------- ---------- Balance, end of period 309,278 309,278 ---------- ---------- GENERAL PARTNER'S CAPITAL Balance, beginning of period 54,712 54,755 Net income allocated to general partner 3,189 3,206 Distributions (2,239) (2,281) Distributions payable (1,018) (1,018) ---------- ---------- Balance, end of period 54,644 54,662 ---------- ---------- TOTAL PARTNERS' CAPITAL $ 363,922 $ 363,940 ========== ==========
See Note to Financial Statements 9
MERRILL LYNCH PREFERRED FUNDING II, L.P. STATEMENTS OF CASH FLOWS (unaudited) (dollars in thousands) - ----------------------------------------------------------------------------------------------------------------------- FOR THE NINE MONTHS ENDED ---------------------------------------- SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------ ------------------ CASH FLOWS FROM OPERATING ACTIVITIES: Earnings $ 21,746 $ 21,763 Accretion of U.S. Treasury bills (133) (150) --------- --------- Cash provided by operating activities 21,613 21,613 --------- --------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of investment securities (3,639) (7,474) Maturities of investment securities 3,840 7,717 --------- --------- Cash provided by investing activities 201 243 --------- --------- CASH FLOWS FROM FINANCING ACTIVITIES: Distributions to limited partner (18,557) (18,557) Distributions to general partner (3,257) (3,299) --------- --------- Cash used for financing activities (21,814) (21,856) --------- --------- NET CHANGE IN CASH - - CASH, BEGINNING OF PERIOD - - --------- --------- CASH, END OF PERIOD $ - $ - ========= ========= SUPPLEMENTAL DISCLOSURE OF CASH FLOWS: Distributions of $7,204 were accrued at September 24, 1999 and September 25, 1998
See Note to Financial Statements 10 MERRILL LYNCH PREFERRED FUNDING II, L.P. NOTE TO FINANCIAL STATEMENTS (unaudited) SEPTEMBER 24, 1999 - -------------------------------------------------------------------------------- BASIS OF PRESENTATION These unaudited financial statements should be read in conjunction with the audited financial statements included in the Annual Report on Form 10-K of Merrill Lynch Preferred Funding II, L.P. (the "Partnership") for the year ended December 25, 1998. The December 25, 1998 balance sheet was derived from the audited financial statements. The interim financial statements for the three- and nine-month periods are unaudited; however, in the opinion of the General Partner of the Partnership, all adjustments, consisting only of normal recurring accruals necessary for a fair statement of the results of operations, have been included. 11 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Merrill Lynch Preferred Capital Trust II (the "Trust") is a statutory business trust formed under the Delaware Business Trust Act, as amended, pursuant to a declaration of trust and the filing of a certificate of trust with the Secretary of State on January 16, 1997, which was subsequently amended by an amended and restated declaration of trust dated as of February 4, 1997. The Trust exists for the exclusive purposes of (i) issuing trust securities, consisting of 8% Trust Originated Preferred Securities (the "TOPrS") and trust common securities (the "Trust Common Securities"), representing undivided beneficial ownership interests in the assets of the Trust, (ii) investing the gross proceeds of the trust securities in 8% Partnership Preferred Securities (the "Partnership Preferred Securities") issued by Merrill Lynch Preferred Funding II, L.P. (the "Partnership"), and (iii) engaging in only those other activities necessary or incidental thereto. The Partnership is a limited partnership formed under the Delaware Revised Uniform Limited Partnership Act, as amended, pursuant to an agreement of limited partnership and the filing of a certificate of limited partnership with the Secretary of State on January 16, 1997, which was subsequently amended by an amended and restated agreement of limited partnership dated February 6, 1997. Merrill Lynch & Co., Inc. (the "Company") is the sole general partner of the Partnership. The Partnership is managed by the general partner and exists for the exclusive purposes of (i) issuing its partnership interests, consisting of the Company's general partner interest and the Partnership Preferred Securities, (ii) investing the proceeds thereof in certain eligible securities of the Company and wholly owned subsidiaries of the Company (the "Affiliate Investment Instruments") and certain eligible debt securities, and (iii) engaging in only those other activities necessary or incidental thereto. The Registrants' activities are limited to issuing securities and investing the proceeds as described above. Since the Trust was organized on January 16, 1997, its activities, as specified in its declaration of trust, have been limited to the issuance of the TOPrS and the Trust Common Securities, the investing of the proceeds in the Partnership Preferred Securities, and the payment of distributions on the TOPrS and the Trust Common Securities in accordance with their terms. Since the Partnership was organized on January 16, 1997, its activities, as specified in its agreement of limited partnership, have been limited to the issuance of the Partnership Preferred Securities, the receipt of a capital contribution from the Company, as general partner, the investment of the proceeds in Affiliate Investment Instruments and certain eligible debt securities, and the payment of distributions on the Partnership Preferred Securities. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK On February 6, 1997, the Trust invested the gross proceeds from the sale of the Trust Common Securities and the TOPrS in the Partnership Preferred Securities (the "Trust Assets"). The Partnership, in turn, invested the proceeds from the sale of the Partnership Preferred Securities and a capital contribution from the Company in certain Affiliate Investment Instruments and eligible securities (the "Partnership Assets"). To the extent the Partnership has funds available from the Partnership Assets, the general partner of the Partnership may declare distributions to the Trust, as holder of the Partnership Preferred Securities. The Trust's ability to pay distributions to the holders of the TOPrS is dependent on its receipt of distributions on the Trust Assets from the Partnership. Therefore, upon the receipt by the Partnership of payments from the Partnership Assets and the distribution thereof to the Trust, the Trust will pass through such payments to the holders of the TOPrS. 12 PART II - OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 12 Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Securities Distributions 27 Financial Data Schedules* (b) Reports on Form 8-K None - ----------------- * The Financial Data Schedules to be contained in Exhibit 27 are required to be submitted only in the Registrants' electronic filing of this Form 10-Q by means of the EDGAR system. 13 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrants have duly caused this report to be signed on their behalf by the undersigned,thereunto duly authorized on the 8th day of November, 1999. MERRILL LYNCH PREFERRED CAPITAL TRUST II* By: /s/ JOHN C. STOMBER --------------------------------------------- Name: John C. Stomber Title: Regular Trustee By: /s/ STANLEY SCHAEFER --------------------------------------------- Name: Stanley Schaefer Title: Regular Trustee MERRILL LYNCH PREFERRED FUNDING II, L.P.* By: MERRILL LYNCH & CO., INC., as General Partner By: /s/ JOHN C. STOMBER --------------------------------------------- Name: John C. Stomber Title: Senior Vice President and Treasurer - ------------ * There is no principal executive officer(s), principal financial officer, controller, principal accounting officer or board of directors of the Registrants. The Trustees of the Trust (which include the Regular Trustees, the Property Trustee and the Delaware Trustee) together exercise all powers and perform all functions with respect to the Trust. 14 INDEX TO EXHIBITS EXHIBITS 12 Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Securities Distributions 27 Financial Data Schedules 15 EX-12 2 RATIO OF EARNINGS TO FIXED CHARGES
EXHIBIT 12 MERRILL LYNCH PREFERRED CAPITAL TRUST II MERRILL LYNCH PREFERRED FUNDING II, L.P. COMPUTATION OF RATIOS OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED SECURITIES DISTRIBUTIONS (dollars in thousands) FOR THE THREE MONTHS ENDED FOR THE THREE MONTHS ENDED SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------------------------ -------------------------------------- MERRILL LYNCH MERRILL LYNCH MERRILL LYNCH MERRILL LYNCH PREFERRED PREFERRED PREFERRED PREFERRED CAPITAL TRUST II FUNDING II, L.P. CAPITAL TRUST II FUNDING II, L.P. ---------------- ---------------- ---------------- ---------------- Earnings $ 6,186 $ 7,242 $ 6,186 $ 7,254 ======== ======== ======== ======== Fixed charges $ - $ - $ - $ - Preferred securities distribution requirements 6,000 6,186 6,000 6,186 -------- -------- -------- -------- Total combined fixed charges and preferred securities distributions $ 6,000 $ 6,186 $ 6,000 $ 6,186 ======== ======== ======== ======== Ratio of earnings to combined fixed charges and preferred securities distributions 1.03 1.17 1.03 1.17 FOR THE NINE MONTHS ENDED FOR THE NINE MONTHS ENDED SEPTEMBER 24, 1999 SEPTEMBER 25, 1998 ------------------------------------ ------------------------------------ MERRILL LYNCH MERRILL LYNCH MERRILL LYNCH MERRILL LYNCH PREFERRED PREFERRED PREFERRED PREFERRED CAPITAL TRUST II FUNDING II, L.P. CAPITAL TRUST II FUNDING II, L.P. ---------------- ---------------- ---------------- ---------------- Earnings $ 18,557 $ 21,746 $ 18,557 $ 21,763 ======== ======== ======== ======== Fixed charges $ - $ - $ - $ - Preferred securities distribution requirements 18,000 18,557 18,000 18,557 -------- -------- -------- -------- Total combined fixed charges and preferred securities distributions $ 18,000 $ 18,557 $ 18,000 $ 18,557 ======== ======== ======== ======== Ratio of earnings to combined fixed charges and preferred securities distributions 1.03 1.17 1.03 1.17
EX-27 3 FDS
5 0001031003 MERRILL LYNCH PREFERRED CAPITAL TRUST II 1,000 OTHER DEC-31-1999 DEC-26-1998 SEP-24-1999 0 309,278 6,186 0 0 315,464 0 0 315,464 6,186 0 0 300,000 9,278 0 315,464 0 18,557 0 0 0 0 0 18,557 0 18,557 0 0 0 18,557 0 0
EX-27 4 FDS
5 0001031002 MERRILL LYNCH PREFERRED FUNDING II, L.P. 1,000 OTHER DEC-31-1999 DEC-26-1998 SEP-24-1999 0 363,922 7,204 0 0 371,126 0 0 371,126 7,204 0 0 309,278 54,644 0 371,126 0 21,746 0 0 0 0 0 21,746 0 21,746 0 0 0 21,746 0 0
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