<PAGE>




                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C.  20549

                                    FORM 10-K

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934
For the fiscal year ended December 31, 1996
                                       OR
[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934
Commission file number 33-43870
                       --------

                 NYLIFE Structured Asset Management Company Ltd.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

                     Texas                                    13-3641944
                     -----                                    ----------
         (State or other jurisdiction                      (I.R.S. Employer
       of incorporation or organization)                  Identification No.)

 51 Madison Avenue - Suite 1710, New York, NY                    10010
 --------------------------------------------                    -----
   (Address of principal executive offices)                   (Zip Code)

Registrant's telephone number, including area code (212) 576-6456
                                                   --------------

Securities Registered Pursuant to Section 12(b) of the Act:
                         NONE

Securities Registered Pursuant to Section 12(g) of the Act:
                         NONE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
                                   Yes  X   No
                                      ---     ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.   X
            ---

State the aggregate market value of the voting stock held by non-affiliates
of the registrant.  Not applicable; see Item 5. - Market for Registrant's
Common Equity and Related Stockholder Matters.

The Exhibit Index begins on page 26.
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                                TABLE OF CONTENTS


                                                                        PAGE NO.
                                                                        --------
PART I
Item 1.   Business                                                         3-13
Item 2.   Properties                                                         14
Item 3.   Legal Proceedings                                                  14
Item 4.   Submission of Matters to a Vote of Security Holders                14


PART II
Item 5.   Market for Registrant's Common Equity and Related
          Stockholder Matters                                                15
Item 6.   Selected Financial Data                                         15-16
Item 7.   Management's Discussion and Analysis of
          Financial Condition and Results of Operations                   17-21
Item 8.   Financial Statements and Supplementary Data                        22
Item 9.   Changes in and Disagreements with Accountants on
          Accounting and Financial Disclosure                                22


PART III
Item 10.  Directors and Executive Officers of the Registrant              23-24
Item 11.  Executive Compensation                                             25
Item 12.  Security Ownership of Certain Beneficial Owners
          and Management                                                     25
Item 13.  Certain Relationships and Related Transactions                     25


PART IV
Item 14.  Exhibits, Financial Statement Schedules and Reports             26-28
          on Form 8-K

Signatures                                                                   29


Appendix A to Annual Report on Form 10-K                             F-1 - F-15


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DEFINITIONS - All capitalized terms not defined herein shall have the
meanings given to them herein and in the Financial Statements attached hereto
as Appendix A.

                                     PART I

ITEM 1. BUSINESS

GENERAL
NYLIFE Structured Asset Management Company Ltd. (the "Company" or "SAMCO") is a
limited liability company formed under the laws of the State of Texas on October
18, 1991.  The entity offers its equity investors limited liability protection
while providing them with flow through tax treatment.

SAMCO has two members.  The principal member is NYLIFE SFD Holding Inc. ("SFD
Holding", formerly NAFCO Inc.) . The other member is NYLIFE Depositary
Corporation ("NDC").  Both members are Delaware corporations and indirect
wholly-owned subsidiaries of New York Life Insurance Company ("New York Life").
Certain directors and officers of SFD Holding have been designated as managers
of SAMCO.  A manager is similar to a director of a corporation, and the managers
may designate one or more persons as officers of the limited liability company.

SFD Holding and NDC (collectively, the "Members") have purchased membership
interests of 83.33% and 16.67%, respectively.  In 1992, SFD Holding made an
initial capital contribution to SAMCO of 500 shares of $1 par value, nonvoting,
nonconvertible, 24.39% cumulative preferred stock of NYLIFE Bridge Investor Inc.
("NBII," like SAMCO, a subsidiary of SFD Holding).  The preferred stock was
originally recorded by SAMCO at $5,000,000 which represented SFD Holding's
recorded carrying value for the preferred stock.  NBII was liquidated and the
original investment in preferred stock and accumulated dividends were paid to
SAMCO during 1993.  On January 15, 1992, NDC made an initial capital
contribution of $1,000,000 in cash.  SAMCO had no operations prior to that date.

SAMCO has issued three series of secured five-year notes (the "Notes"), at both
floating (Series A and Series B) and fixed (Series C) rates, the net proceeds of
which were used to finance the acquisition of security alarm monitoring
contracts (the "Contracts").  The Contracts acquired consist of the obligations
and payment rights with respect to monitoring services, and in certain instances
repair and maintenance services, for security alarm systems in residential homes
and light commercial businesses.

Security monitoring is the process of notifying designated parties (either
individuals or public authorities) if an unauthorized entry, fire, medical or
other emergency signal from a customer alarm system is received at a central
monitoring station.  The Company is engaged in the residential and light
commercial security alarm monitoring segment of the security alarm industry.

THE SECURITY ALARM INDUSTRY
The security alarm industry can be classified in four segments, each of which
serves both residential and commercial markets: (i) manufacturers of alarm
system components; (ii) wholesalers who distribute such components; (iii)
parties that sell or lease, install and maintain security alarm systems;


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and (iv) parties that monitor security alarm signals.  Sales, leasing,
installation, maintenance and monitoring overlap significantly.  Within each
geographic market, many companies sell or lease, install, maintain and monitor
systems.  Many of these companies are independent entities that primarily
install and maintain systems.  Larger local and regional full service firms and
national companies with branch offices such as ADT, Alert Monitoring Companies,
Brinks Home Security, Inc., and Network Security City Branches, Inc. as well as
numerous regional and local security companies, also may be present in each
geographic market.

Recent studies estimate that approximately 18% of the nation's homes are
protected by security alarms connected to central station monitoring facilities.
Most alarm dealers serve both commercial and residential markets.  Larger
companies have historically dominated the commercial market, while smaller
companies typically concentrated on the residential market, where there has been
a low economic barrier to entry and where low overhead and administrative costs
of the smaller companies allow them to charge prices competitive with those
charged by their larger competitors.

Dealers in the security alarm industry generally sell or lease, maintain,
monitor and service alarm equipment (directly through their own facilities or
indirectly through a contractual relationship with a third party) installed with
their customers.

Generally, the dealer and customer enter into a monitoring agreement with
respect to the security alarm system when the equipment is installed.  The
typical monitoring agreement provides that the dealer will monitor the system
for a specified fee, payable monthly, quarterly or annually in advance, subject
to change in rates at the end of the contract term.  These agreements generally
provide for a three-year term renewable automatically for successive one year
terms unless terminated by either party by written notice within 60 days prior
to the annual anniversary date.

Further, alarm equipment may be sold or leased by a dealer to its customers.  A
typical leasing agreement provides that title to the alarm equipment remains
with the dealer and that the dealer is required to maintain the system in good
working order, subject to the limitations contained in such agreement,
throughout the term of the lease.  The dealer generally receives a fixed leasing
and maintenance fee, payable monthly, quarterly or annually in advance.  The
initial term of the lease is generally three to five years, automatically
renewing from year to year thereafter.  The dealer may increase the fee during
the process of renewing the lease.

Monitoring agreements and lease agreements typically provide that the dealer is
not responsible for interruption of monitoring services due to conditions or
circumstances beyond its control, and include a limitation of liability
provision which specifies that the dealer is not to be considered an insurer of
the system and that the system or service supplied will not avert or prevent
occurrences or the consequences therefrom which the system or service is
designed to detect.  Generally, these clauses typically specify that the
dealer's liability is limited to an amount equal to a percentage of the annual
service charge or a fixed dollar amount, whichever is greater, in the event of a
failure of the system or service.


                                        4
<PAGE>

A customer Contract in the security alarm industry may include obligations for
the sale or lease of equipment, monitoring, maintenance and/or service, with a
single periodic fee payable in respect of all such services.

The fee for residential and light commercial monitoring varies depending upon
geographic location, sophistication of the security alarm system, the monitoring
equipment used and type of customer Contracts.

THE COMPANY'S CONTRACT ACQUISITIONS
During 1992, 1993, and 1994, SAMCO utilized the proceeds of short-term
borrowings from SFD Holding, its primary Member, to acquire Contracts pending
the sale to investors of its Notes.  Each Contract acquired (i) includes the
obligation to provide central station monitoring for the customer in
consideration for the customer's payment of a periodic monitoring fee, (ii) may
include, and convey title to the Company of, ownership of the monitoring
equipment installed at the customer's residence or place of business, and (iii)
may also include an obligation to provide, and the right to receive revenues
for, servicing of equipment.

The Company has not acquired equity interests in security alarm monitoring or
installation companies; but rather, has acquired Contracts owned or generated by
such companies.  The Company does not engage in unrelated businesses.

Contracts were purchased at a price multiple of the periodic cash flow they
generate.  The Company believes that current industry acquisition prices may
vary widely because such prices are a function of (among other things): (i)
supply and demand at the time of the acquisition; (ii) the particular
circumstances of each seller, including its attrition history; (iii) various
factors relating to the Contracts, including whether or not monitoring can
easily be converted to the acquirer's central monitoring station facilities and
whether a large or small group of homogeneous Contracts is involved; (iv) the
number of Contracts to be acquired; (v) the specific terms of the acquisition,
including the levels of seller guarantees and cash hold-backs; and (vi) the
results of arm's length negotiations.  Generally, a seller of Contracts will
agree for a predetermined period of time to replace Contracts as to which
attrition has occurred with performing Contracts and/or agree to reimburse the
buyer for Contracts as to which attrition has occurred.

Westinghouse Electric Corporation ("Westinghouse"), in performing Contract
acquisition services for the Company, pursuant to an operational services
agreement (the "Operational Services Agreement") referred to below, identified
for acquisition Contracts owned by Westinghouse, whether internally generated or
acquired from unaffiliated third parties.  In evaluating its acquisitions, the
Company, with the assistance of Coopers & Lybrand L.L.P. and other of its
industry consultants, reviewed each proposed acquisition in light of the factors
summarized in the preceding paragraph and other information available to it at
such time.

Westinghouse was reimbursed at the time of acquisition of Contracts for its
direct costs incurred in performing Contract acquisition services (including any
necessary conversion activities), including the regular salaries and reasonable
benefit costs of Westinghouse employees who performed such acquisition services.


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Pursuant to the Operational Services Agreement, Westinghouse and the Company
agreed to an Exclusivity Period (the "Exclusivity Period") during which (i)
Westinghouse would not acquire Contracts for any entity other than the Company,
and (ii) the Company had a right of first refusal to acquire Contracts offered
for sale by third parties.  Such Exclusivity Period ended on April 10, 1994.

The Company does not intend to purchase additional Contracts in the future.

SALE OF SECURITY ALARM BUSINESS BY WESTINGHOUSE
On December 30, 1996, Westinghouse sold its security alarm business to WestSec,
Inc. ("WestSec"), a subsidiary of Western Resources, Inc.  In connection with
the sale, Westinghouse assigned all of its rights, title and interest under the
Operational Services Agreement to WestSec, and WestSec assumed all of
Westinghouse's liabilities and obligations under the Operational Services
Agreement.  In conjunction with Westinghouse's sale and assignment and WestSec's
assumption of obligations, the Company, Westinghouse, WestSec and Westar
Capital, Inc. an affiliate of WestSec ("Westar"), entered into a Consent,
Assignment, Assumption, and Modification Agreement ("the Consent Agreement").

Pursuant to the Consent Agreement, Westar has guaranteed all obligations and
liabilities of WestSec under the Operational Services Agreement and various
related agreements (collectively the "OSA Agreements"), Westinghouse has
agreed to remain liable under certain specified obligations in the OSA
Agreements, and Westar is required to furnish to the Company, no later than
March 31, 1997, an irrevocable letter of credit to secure certain
obligations of Westar, WestSec and Westinghouse under the OSA Agreements.

WestSec has agreed to purchase the Contracts securing each series of Notes at a
price intended to provide for sufficient funds to repay in full the principal of
and accrued and unpaid interest on the Notes upon the stated maturity of the
Notes.  To the extent that such purchase price is less than the amount of
the required funds, Westinghouse has agreed, subject to certain conditions, to
pay the difference to the Company.  In addition, Westinghouse has agreed to
provide certain other indemnities to the Company (see Item 7 - Management's
Discussion and Analysis - Contract Repurchase - Series A, Series B, and
Series C Notes).

Due to such sale, all references in this Form 10-K to "the Servicer" shall mean
Westinghouse with regard to all time periods prior to December 31, 1996 and
WestSec with regard to all time periods thereafter.

CONTRACT MONITORING SERVICES Pursuant to the Operational Services Agreement,
the Servicer's alarm monitoring responsibilities with respect to Contracts
acquired by the Company include (i) operating and maintaining in good working
condition all equipment owned by it and associated with its Central
Monitoring Station facilities; (ii) performing such tests as are necessary to
ensure that all such equipment is capable and properly configured to receive
accurately all signals emitted from customers' alarm systems; (iii)
undertaking to ensure that all customers' alarm systems remain properly
connected to the Servicer's Central Monitoring Station facilities; (iv)
maintaining or causing to be maintained adequate skilled staff at its Central
Monitoring Station facilities 24 hours per day, 7 days per week, without
interruption; (v) monitoring all incoming signals 24 hours per day, 7 days
per week, without interruption (other than interruptions, in the case

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of the activities referred to in clause (iv) above and this clause (v),
caused by any event outside of the direct control of the Servicer and which
could not have been avoided or mitigated by the exercise of due care by the
Servicer); (vi) verifying and responding to all incoming security alarm
system signals promptly, diligently and appropriately at all times,
reasonably ensuring that the parties designated by the subject customer
(either individuals or public authorities) are notified; (vii) conducting
follow-up investigations where appropriate of all security alarm signals
received at the Servicer's Central Monitoring Station facilities from
customer's alarm systems; (viii) cooperating with customers to reduce the
incidence of false alarms; and (ix) taking any other appropriate action
required or contemplated in customers' Contracts in response to all signals
received at the Servicer's Central Monitoring Station facilities.

In June 1995, Westinghouse's Central Monitoring Station facility was relocated
from Las Colinas to Irving, both suburbs of Dallas, Texas (the "Irving Central
Monitoring Station").  The Irving Central Monitoring Station, constructed for
Westinghouse Security Systems ("WSS"), is one of the largest 24-hour central
monitoring station facilities in the industry and has the capacity to monitor up
to 550,000 security alarm system customers.  The Irving Central Monitoring
Station monitors over 320,000 customer accounts in 44 states in the continental
United States.  The Irving Central Monitoring Station was acquired by WestSec
as part of the purchase of the security alarm business from Westinghouse.

The Irving Central Monitoring Station is a specialized center which is staffed
by trained professional operators, 24 hours a day, 7 days a week.  The operators
use computers, controlled by specially written computer programs, to assist them
in identifying and reporting alarm signals.  If a customer's alarm system is
activated and an individual zone, such as an alarmed door or window or a heat
sensor, senses an intrusion or a fire, the alarm system automatically signals
the Irving Central Monitoring Station. The nature of the occurrence and a
summary of the customer's account data, including the phone numbers of the
customer's designated contact parties, which includes local police, fire and
emergency units, are indicated on a computer screen.  The operator will normally
use his/her computer to phone the customer for a pass code in order to detect
false alarms.  If no one is home, the operator promptly contacts the parties
designated in the customer's service file.  If an incorrect pass code is
received, the operator promptly dispatches the appropriate emergency service
unit such as the police or fire department.  A report of the date and time of
the signal, a description of the nature of the occurrence and of the actions
taken by the operators (including phone numbers called) is recorded and retained
at the Irving Central Monitoring Station for a period of time.

In addition to the Irving Central Monitoring Station, WSS has independently
developed and brought on line a physically remote backup monitoring station (the
"Backup Monitoring Station"), which is interconnected with the automation
systems at the Irving Central Monitoring Station, to provide near real time data
base synchronization.  The Backup Monitoring Station is tied to the AT&T network
via special connections to the Fort Worth long distance facility, and provides
transparent connectivity and uninterrupted service to customers when the site is
activated either during an exercise or in a real emergency.

Underwriters Laboratories Inc. ("UL"), an independent, not-for-profit testing
organization, has established a certification program for central monitoring
station facilities (the "Certification Program").  Central monitoring station
facilities which are certified under such Certification Program are periodically
checked by UL inspection personnel to provide an on-going confirmation of the


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facilities' certification.  The inspection procedures include a review of the
facility and its operating practices.  The Irving Central Monitoring Station
received approval for UL Listing on June 8, 1992.  In addition, on March 7,
1994, the Irving Central Monitoring Station received certification from UL for
the monitoring of residential fire systems.

The Servicer also provides general and administrative services pursuant to
the Operational Services Agreement.  These services include: (i) billing each
customer in accordance with the terms of such customer's Contract,
instructing that payment by the customer be delivered to an address which is
a lock box account controlled by the Company; (ii) collecting past due
amounts from customers in accordance with procedures established by the
Company and the Servicer; (iii) responding promptly to customers' inquiries
pertaining to services provided to them pursuant to their Contracts or
otherwise provided to them by the Servicer under the Operational Services
Agreement; (iv) obtaining and maintaining all licenses, permits and other
governmental authorizations and approvals required for the performance by the
Servicer of its activities under the Operational Services Agreement; (v)
processing new Contracts and endeavoring to renew existing Contracts; (vi)
maintaining current records for each customer; and (vii) performing general
office and clerical services in connection with the foregoing activities.

If the Servicer decides to discontinue its residential and commercial
security monitoring business, the Servicer may terminate the Operational
Services Agreement at any time upon twelve-months prior written notice to the
Company.  At any time subsequent to the notice, the Company may terminate the
Operational Services Agreement and enter into arrangements for the monitoring
of the customers' alarm systems with other companies selected by the Company.
The Servicer is obligated to cooperate fully with the orderly transfer of
responsibilities (including the transfer of all information relating to
customers of, and Contracts owned by, the Company) from the Servicer to such
third parties and to pay all costs and expenses incurred by the Company in
connection with such transfer.  There can be no assurance that any such third
parties will be available or, even if available, that such agreements can be
reached for comparable services and at comparable cost.

OPERATIONAL SERVICES AGREEMENT
The Operational Services Agreement, unless sooner terminated pursuant to the
provisions thereof, expires five years from April 10, 1994, the date of the
expiration of the Exclusivity Period.

The Company pays to the Servicer a fee equal in amount to 35% of the
aggregate fees payable under the Contracts and received in good funds in the
subject month from customers for the monitoring services performed by the
Servicer (aggregate monitoring revenues or "AMR").  Of the monitoring fee
payable to the Servicer, 25% of the AMR for the subject month (whether the
particular customer pays monthly, quarterly or, in some instances, annually)
is immediately due and payable to the Servicer on the 14th day of the
following month (the "Servicer Basic Monitoring Fee") and 10% of the AMR for
such month is subordinate in right of payment to all quarterly payments of
scheduled principal and interest on the Notes due in the calendar quarter
during which such subordinated monitoring fee is due, and to all payments of
principal and interest on the Notes which are past due, if any (the "Servicer
Subordinated Monitoring Fee").  Subject to the preceding sentence, the
Servicer Subordinated Monitoring Fee is payable on the 16th day of the first
month after the quarter in which such fee was collected and will accrue
without interest.

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The Operational Services Agreement provides that the Servicer shall perform
all of its obligations thereunder at the same high professional standard
which it brings to all of its business endeavors and completely and totally
in keeping with the highest moral and ethical standards, and will deal with
the Company fairly, honestly, and in good faith.  The Operational Services
Agreement also provides that the Servicer will indemnify and hold harmless
the Company and any of its Managers, officers, Members, employees or
Affiliates from and against any losses or expenses resulting from the failure
of the Servicer to perform or otherwise fulfill or comply with any of its
agreements or undertakings thereunder.

In the event that the Debt Service Coverage Ratio with respect to any series
of Notes for any year commencing on December 31 of the year in which such
series of Notes was issued, or any anniversary of such December 31 with
respect to such series of Notes (i) is less than 1.60 to 1.00, and (ii) with
respect to each year commencing after December 31 of the year in which such
series of Notes was issued, has decreased by 5% or more compared to the
initial year's Debt Service Coverage Ratio, and as a result thereof, the
Company elects to prepay the Notes of such series, and, in connection
therewith, the Contracts which are the Collateral for such series of Notes
are sold, then, with respect to such Contracts, the obligations of each of
the Company and the Servicer under the Operational Services Agreement will
cease.  If the Debt Service Coverage Ratio for all series of Notes for any
year ending December 31 fails to meet the tests described in clauses (i) and
(ii) above, then the Company may, at its option, terminate the Operational
Services Agreement and arrange for monitoring services by someone other than
the then current Servicer.

COMPETITION
The security alarm business is highly competitive and includes large national
and regional companies, as well as smaller local dealers/installers.
Competition is based on the cost of providing a given service and the quality of
the service.  During recent years, consolidation has begun to occur in the
industry, partially as a result of companies realizing that monitoring costs are
relatively fixed and profits can be increased directly by increasing the number
of Contracts monitored.  The Company anticipates that this industry
consolidation will continue.  The Company's competitors include national
companies that are currently, or may become, vertically integrated to the point
of generating their own Contracts by selling the installation of security alarm
systems.  In many instances, these larger companies install alarm systems at a
loss in order to obtain multi-year monitoring Contracts that permit such
companies to recover this installation investment through the monitoring
revenues received.  In recent years, certain of the competitors have experienced
financial difficulty and have filed for protection under federal bankruptcy
laws.

REGULATION
Various state and local authorities regulate the performance of monitoring
services.  Certain localities in which Contract customers may be located may
have laws or ordinances imposing penalties for false alarms with respect to
which police or fire personnel are summoned to such customer's home or
business. Some of these local ordinances may impose fines on the monitoring
company rather than on the customer.  Similarly, many localities have
ordinances requiring licensing of security alarm monitoring companies.  These
ordinances may impose licensing fees.  Under the Operational Services
Agreement, the Servicer is required to obtain and maintain all licenses and
permits required in connection with its performance thereunder of the
monitoring services and customer servicing obligations, except

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where the failure to obtain and maintain any such licenses and permits does not
have a material adverse effect on the business of the Company.

CUSTOMER SERVICING
Under the Operational Services Agreement, the Servicer is required to provide
or cause to be provided, to the extent requested by any customer or required
by any such customer's Contract, all activities necessary or, in the good
faith judgment of the Servicer, desirable to repair and/or maintain in good
working order the security alarm system located on such customer's premises.
The Servicer's servicing obligations include, among other things, promptly
responding to requests by, and scheduling service calls for, any customer for
repair and maintenance of such customer's security alarm system, and
establishing repair and maintenance capabilities necessary to service each
customer's security alarm system.

Certain Contracts acquired by the Company include only an obligation to
monitor, while other Contracts include both monitoring and servicing
obligations.  With respect to any Contract that does not include a servicing
obligation, the Servicer is required, pursuant to the Operational Services
Agreement, to provide, for a fee payable directly to the Servicer and at the
customer's request, servicing of such customer's security alarm system.
Contracts which include a servicing obligation either (a) distinguish that
portion of the aggregate periodic fee attributable to monitoring from that
portion attributable to servicing or (b) do not distinguish any portion of
the aggregate periodic fee as attributable to a particular service.

Under the Operational Services Agreement (a) to the extent that any Contracts
distinguish a portion of the aggregate periodic payments by the customers as
attributable to servicing and the Company paid a purchase price for such
Contracts based on a multiple of the aggregate periodic payments thereunder,
or (b) to the extent that any Contracts do not distinguish any portion of the
aggregate periodic payments as attributable to a particular service, the
Servicer is not entitled to receive any payment for performing servicing
obligations under such Contracts, and the entire periodic payments thereunder
are deemed attributable to monitoring.  To the extent that any Contracts
distinguish a portion of the aggregate periodic payments as attributable to
servicing and the Company paid a purchase price for such Contracts based on a
multiple of only that portion of the aggregate periodic payment attributable
to monitoring, the Servicer is entitled, under the Operational Service
Agreement, to receive the full amount of the portion of the aggregate
periodic payment attributable to servicing.

EMPLOYEES
The Company does not have any full-time employees.

CONTRACTS OWNED BY THE COMPANY
During the years ended December 31, 1994, 1993, and 1992, the Company had
acquired an aggregate of 101,672 Contracts for an aggregate purchase price of
$76,947,795 with a recurring annual revenue of $30,550,214.  There have been no
additional Contract acquisitions since 1994, other than the replacement of
Contracts pursuant to the terms of the purchase agreements for the original
Contracts.  The majority of the Contracts are located in California, Florida,
Georgia, Tennessee and Texas.  The functional breakdown of the Contracts is
approximately 93% residential and 7% light commercial.


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ATTRITION EXPERIENCE
Attrition of Contracts is the loss of customers, which results in decreased cash
flow.  There are two major components resulting in attrition: (i) customers who
fail to make payments within a reasonable time for monitoring services billed;
and (ii) customers who elect to terminate their monitoring services for various
reasons (e.g., relocation, poor service, or contract expiration).

The tables below set forth information with respect to the experience of
Westinghouse, as seller of the Contracts which have been acquired by the
Company, for the periods indicated relating to attrition of its portfolio of
Contracts.  Westinghouse has advised the Company that during the ordinary course
of business the customer collection and cancellation experience fluctuates
within a range from fiscal quarter to fiscal quarter.  Westinghouse believes
that the respective percentages stated for delinquencies and for the
cancellation rate are within this expected fluctuation experience.

                         CUSTOMER COLLECTION EXPERIENCE

Billings for Contract monitoring services
for the period April 1, 1996 to September 30, 1996: *           $14,574,953

Collection status as of December 31, 1996:

Outstanding balance for delinquent Contracts
(more than or equal to 90 days past due)                           $566,660

Delinquencies as a percentage of billings: **                           3.9%

                        CUSTOMER CANCELLATION EXPERIENCE

Period: January 1, 1996 to December 31, 1996

Customer cancellations: ***                                          19,580

Weighted average number of Contracts
in seller's portfolio during the period:                            166,822

Customer cancellation rate:                                            11.7%

*    Delinquent accounts for the period prior to April 1, 1996 are included in
     customer cancellations in the "Customer Cancellation Experience" table, and
     billings from October 1 through December 31, 1996, if not paid, were not
     delinquent as of December 31, 1996.

**   Typically, some, but not all, delinquencies become canceled accounts.  See
     note *** below.

***  Customer cancellations include (i) cancellations due to nonpayment; and
     (ii) cancellations for reasons other than nonpayment.


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A summary of accounts which attrited during 1996, 1995, and 1994 and the related
replacement activity is as follows:

                                                   1996      1995      1994
                                                   ----      ----      ----
Number of attrited contracts                     10,705     8,815     7,195
Number of attrited Contracts replaced with
 Contracts (*)                                    1,655       225     1,490
Number of replacement Contracts (*)               1,509       299     1,558
Number of Contracts replaced with purchase
 price refunds                                       69     1,172     2,267

(*) The guarantees provide that attrited Contracts are to be replaced with
Contracts of an equal RMR value.  Therefore, the difference in the number of
replacement Contracts is the result of different RMR amounts between the
attrited Contracts and the replacement Contracts.

Gross attrition is calculated as a percent of Contracts originally securing the
Notes.  Gross attrition percentages for the Contracts collateralizing the
Company's Notes are as follows:

                                                   1996      1995      1994
                                                   ----      ----      ----
Series A                                            6.6%      9.9%      7.4%
Series B                                           10.3%     11.5%      5.1%
Series C (*)                                       12.9%      7.3%     23.8%(**)

(*) Additional Series C Contracts were acquired on February 28, 1994.  Includes
5,035 Contracts which are not collateral for the Series C Notes.

(**) The Company's experience has indicated that attrition rates are greatest
during the initial twelve months of a customer's contract.  The rate of
attrition for this Series was stable over the latter half of 1994 with a slight
downward trend during the fourth quarter.  Attrition of contracts acquired in
November 1993 and February 1994 was favorable compared to the rate experienced
in the initial months for the contracts acquired in June 1993.

ATTRITION GUARANTEES - SERIES A, SERIES B AND SERIES C NOTES
Pursuant to the Consent Agreement, as of December 30, 1996, attrition guarantees
previously provided by Westinghouse will be  provided by WestSec.

Westinghouse, as seller of Contracts to the Company, had the obligation to
provide guarantees that capped the Company's exposure to attrition.  Such
guarantees generally capped attrition at 0% for a period of time after
acquisition followed by a period of time during which attrition is capped
annually at certain percentages.  During the period when a 0% attrition
guarantee was in effect, Westinghouse generally had the option to replace
attrited accounts either with cash (in an amount equal to the original purchase
price paid to Westinghouse for the attrited account) or with replacement
Contracts.  Among other things, a replacement Contract must be current in all
payments due from the customer and must have a RMR not less than the attrited
account being replaced.  A 0% attrition guarantee provides that SAMCO may lose
no more than three months of revenue for each attrited Contract.  Approximately
78% of the Contracts originally purchased by the Company were covered by
attrition guarantees at December 31, 1996.  Pursuant to the Consent Agreement,
beginning in 1997, all Contracts originally purchased by the Company will be
covered by attrition guarantees provided by WestSec.


                                       12
<PAGE>

Attrition guarantees for Contracts owned by the Company are as follows:

SERIES A - During 1993, 1994, 1995, and 1996, approximately one-half of the
Series A Contracts had guarantees capping attrition while the balance were no
longer under guarantee.  The guaranteed Contracts had attrition caps of 7%, 7%,
8%, 8% in 1993, 1994, 1995, and 1996, respectively.  Pursuant to the Consent
Agreement, all Series A Contracts will be guaranteed for 1997 and for the period
January 1, 1998 to February 15, 1998, with attrition caps of 9% and 1.125%,
respectively.

SERIES B - For the Series B Contracts, the Servicer  has guaranteed (i) that
during the seven-month period ending October 31, 1993, attrited accounts
would not exceed 0%; and (ii)  during each of the four 12 month periods
commencing on November 1, 1993 and ending on October 31, 1997, attrited
accounts will not exceed 9.25%.  Westinghouse had the option during the
period when its 0% attrition guarantee was in effect to replace attrited
accounts either with cash (in an amount equal to the original purchase price
paid to Westinghouse for the attrited account) or with replacement Contracts.
When the 9.25% attrition guarantee is in effect, the Servicer must replace
attrited accounts with Contracts.

SERIES C - For the Series C Contracts acquired on June 30, 1993, the Servicer
has guaranteed (i) that during the 12 month period ending June 30, 1994,
attrited accounts would not exceed 0%; and (ii) during each of the four 12
month periods, commencing on July 1, 1994 and ending on June 30, 1998,
attrited accounts will not exceed 10%; and (iii) during one final three month
period commencing on July 1, 1998 and ending on October 31, 1998, attrited
accounts will not exceed 2.5%.

For the Series C Contracts acquired on November 30, 1993 and February 28,
1994, the respective 0%, 12 month guarantee periods expired on November 30,
1994 and February 28, 1995; the respective 10%, 12 month guarantee periods
are from December 1, 1994 to November 30, 1998 and from March 1, 1995 to
February 28, 1999, and the respective 2.5%, 3 month guarantee periods are
from December 1, 1998 to February 28, 1999; and from March 1, 1999 to May 31,
1999.

For the Series C Contracts, Westinghouse had the option during the period
when its 0% attrition guarantee was in effect to replace attrited accounts
either with cash (in an amount equal to the original purchase price paid to
Westinghouse for the attrited account) or with replacement Contracts;
provided, however, that Westinghouse could not have  replaced more than half
of the Contracts which became attrited accounts in any calendar month with
cash. Pursuant to the Consent Agreement, WestSec must replace all Series C
accounts above an attrition cap of 10% with Contracts. When the 10% attrition
guarantee is in effect,  the Servicer must replace attrited accounts with
Contracts.

INVESTMENT CONTRACTS - 5,035 of the Contracts acquired on June 30, 1993,
November 30, 1993 and February 28, 1994 were not utilized as collateral for the
Company's Series C Notes.  The attrition guarantees for these Contracts are
identical to those of the Series C Contracts described above.


                                       13
<PAGE>

ITEM 2. PROPERTIES
The Company does not own any material properties and is not a party to any
material leases.

ITEM 3. LEGAL PROCEEDINGS
None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.


                                       14
<PAGE>

                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

There is no organized trading market for the Noteholders or members of the
Company.

ITEM 6. SELECTED FINANCIAL DATA

The following table sets forth the selected financial information regarding the
Company's financial position as of December 31, 1996, 1995, 1994, 1993 and 1992
and  the  results of operations for the periods then ended.  This information
should be read in conjunction with Management's Discussion and Analysis of
Financial Condition and Results of Operations and the Financial Statements and
Supplementary Data, which are included in Items 7 and 8 of this report,
respectively.

<TABLE>
<CAPTION>

                                                          1996           1995           1994           1993           1992
                                                          ----           ----           ----           ----           ----
<S>                                                  <C>             <C>           <C>             <C>           <C>

Total revenue                                        $ 23,230,617    $25,979,002   $ 26,752,768    $16,619,820   $  2,437,395
                                                     ------------    -----------   ------------   ------------   ------------
                                                     ------------    -----------   ------------   ------------    -----------
Net (loss) income                                    ($ 2,459,963)   ($2,123,749)  $    133,235    $   273,107   ($   899,079)
                                                     ------------    -----------   ------------   ------------   ------------
                                                     ------------    -----------   ------------   ------------    -----------
Cash flow from operations                            $  8,613,984    $ 9,683,149   $  9,064,373   $  6,952,895   $  1,746,159
                                                     ------------    -----------   ------------   ------------   ------------
                                                     ------------    -----------   ------------   ------------    -----------
 Notes payable (current and non-current):
     Series A                                        $ 13,506,863    $15,928,365   $ 18,263,116   $ 21,009,544   $ 25,000,000
     Series B                                        $  5,359,744    $ 6,422,734   $  7,335,227   $  8,273,196   $          0
     Series C                                        $ 28,845,893    $34,506,447   $ 40,798,349   $ 27,068,694   $          0
                                                     ------------    -----------   ------------   ------------   ------------
                                                     ------------    -----------   ------------   ------------    -----------
Total assets at December 31                          $ 53,601,399    $65,894,252   $ 77,883,745   $ 67,045,755   $ 42,252,222
                                                     ------------    -----------   ------------   ------------   ------------
                                                     ------------    -----------   ------------   ------------   ------------
SERIES A
Debt Service Coverage (at 9%)                             1.66           1.73           1.83           1.85           1.81
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----
Interest Coverage (at 9%)                                 3.42           3.32           3.26           3.12           2.82
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----

Debt Service Coverage (at 11%)                            1.50           1.55           1.62           1.63           1.58
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----
Interest Coverage (at 11%)                                2.80           2.71           2.66           2.55           2.30
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----

SERIES B
Debt Service Coverage (at 9%)                             1.86           1.89           1.95           1.94            n/a
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----
Interest Coverage (at 9%)                                 3.76           3.50           3.38           3.19            n/a
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----

Debt Service Coverage (at 11%)                            1.68           1.68           1.73           1.71            n/a
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----
Interest Coverage (at 11%)                                3.08           2.86           2.77           2.61            n/a
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----

SERIES C
Debt Service Coverage (at 9%) (*)                         1.89           2.04           1.97           2.28            n/a
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----
Interest Coverage (at 9%)                                 3.59           3.60           3.24           2.91            n/a
                                                          ----           ----           ----           ----           ----
                                                          ----           ----           ----           ----           ----

</TABLE>

(*) The first required principal payment on the Series C Notes was August 15,
1994.


                                       15
<PAGE>

SAMCO began acquiring Contracts on July 15, 1992.  As a result, financial data
for the years ended December 31, 1993 and the period ending December 31, 1992
are not fully comparable.  Additionally, net income for the year ended December
31, 1993 includes a non-recurring dividend of $1,389,306.

Financial data for the year ended 1994 reflects the acquisition of contracts on
February 28, 1994 and the ownership of the contracts acquired June 30 and
November 30, 1993 for a full year.


                                       16
<PAGE>

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

LIQUIDITY AND CAPITAL RESOURCES - 1996
The Company's net loss for the year ending December 31, 1996 is due primarily to
amortization expense, a non-cash charge against earnings, which resulted
primarily from attrition of certain contracts in 1996.  The Company's net cash
from operating activities decreased as attrition reduced monitoring revenue from
customers.  During 1996, the Company paid scheduled and additional principal of
$2,421,502, $1,062,990 and $5,660,554 to the Series A, Series B, and Series C
Noteholders, respectively.

Attrition, which is the loss of customers, results in decreased cash flow.  In
order to control the Company's exposure to attrition and the resulting loss of
revenue, the Company has received from the Servicer certain attrition guarantees
(see Item-1 Business - Attrition Guarantees).  These guarantees generally
provide for the replacement of Contracts, with either cash or Contracts, by
the Servicer if attrition exceeds certain levels.  Pursuant to the Consent
Agreement, as of December 31, 1996, 100% of the Series A, Series B and Series C
Contracts owned by the Company are covered by attrition guarantees by the
Servicer (See Item 1. - Business - Attrition Guarantees - Series A, Series B,
and Series C Notes).

The Company's revenues from Contracts have been sufficient to pay the Servicer
Basic Monitoring Fee, scheduled principal and interest on the Notes, third party
operating expenses, taxes of the Company's Members (but only Member's taxes in
respect of any allocations of taxable income from the Company), subordinated
fees, to establish necessary reserves, if any, and to continue to make
additional principal payments.  The Company expects this trend to continue in
1997.

Series A and Series B Notes bear interest on the outstanding principal at a per
annum floating rate of 2.50 percentage points above the minimum denomination
five-year certificate of deposit average rate (the "Benchmark CD Rate"), as
reported by the Bank Rate Monitor in its last report of the immediately
preceding calendar quarter, but in no event less than 9% per annum or more than
11% per annum.  At December 31, 1996, the Benchmark CD Rate was 5.4%.
Accordingly, the outstanding principal on the Series A and Series B Notes will
earn interest at 9% per annum through May 15, 1997.

Debt Service and Interest Coverage ratios are calculated based on the number of
"active" accounts at the end of the period.  An active account is one where the
customer's alarm system is being monitored.  Generally, accounts are monitored
until they become 70 days delinquent.  As indicated in Item 6 - Selected
Financial Data, the Debt Service and Interest Coverage ratios for each Series of
Notes at December 31, 1996 continue to be consistent with prior years.

CONTRACT REPURCHASE - SERIES A, SERIES B, AND SERIES C NOTES
At maturity, the Company is obligated to repay the then outstanding principal
balance of the Notes.  Pursuant to the Consent Agreement, as each series of
Notes mature, WestSec shall purchase all of the Contracts securing such
series of Notes for an amount equal to the greater of (i) the fair market
value of such Contracts as determined by an nationally recognized independent
valuation firm jointly selected by WestSec and SAMCO; or (ii) thirty (30)
times the recurring monthly fees and charges

                                       17
<PAGE>

payable by customers pursuant to such Contracts.  Westinghouse has agreed that
if the purchase price payable by WestSec for a particular Series of Notes is
less than the amount of all principal and accrued and unpaid interest on such
series of Notes, upon notice from SAMCO to Westinghouse, Westinghouse will remit
to SAMCO, at the same time the WestSec price is required to be paid, in
immediately available funds, the amount in excess of the WestSec price so that
the total paid to SAMCO will equal the amount of all principal and accrued and
unpaid interest on such Series of Notes.  Such notice shall be given by SAMCO to
Westinghouse at least five business days prior to the stated maturity date of
each Series of Notes.

The Consent Agreement requires WestSec to furnish to SAMCO, no later than
March 31, 1997, an irrevocable and unconditional letter of credit issued by
and drawn upon a "AA" rated bank, in form and substance reasonably
satisfactory to SAMCO and Westinghouse, in favor of SAMCO in the amount of
$85 million (the "LC").  The LC will secure obligations of Westar, WestSec
and Westinghouse under the OSA Agreements and the Consent Agreement.

The Company does not anticipate the purchase of additional Contracts.  As of
December 31, 1996, the Company had no material capital commitments.

Should WestSec become unable to perform any of its contractual obligations with
respect to the Company in the future, there can be no assurance that any third
parties will be available or, even if available, that agreements could be
reached with such third parties for comparable services and at comparable cost.
Such a situation could have a materially adverse impact on the Company.

RESULTS OF OPERATIONS - 1996
For the year ended December 31, 1996, SAMCO derived 98% of its income from
monitoring revenues and the balance from interest income on short term
investments.

The decrease in the Company's monitoring revenues for the year ending
December 31, 1996 compared to the corresponding period in 1995 is a result of
the attrition of certain contracts in 1996. Accordingly, the related monitoring
fee expense decreased in 1996.  An increase in attrition expense was offset by a
decrease in amortization expense as attrition decreases the amortizable base of
Contracts.  Interest expense decreased in 1996 as the Company continues to pay
down scheduled and additional principal.  The bad debt expense of $751,164 on
the Company's Statement of Operations in 1996 represents actual revenue loss on
attrited Contracts and the potential revenue loss on Contracts with balances
greater than 90 days past due as of December 31, 1996.

The Company's operating expenses include monitoring fees, general and
administrative expenses, including (i) lockbox bank fees, (ii) audit and tax
fees, (iii) printing and mailing of quarterly and annual reports to investors,
(iv) trustee fees, (v) legal and consulting fees, and (vi) subordinated fees and
expenses.  The Company's other expenses include bad debt expense, interest
expense and amortization of (i) Contracts and (ii) debt issuance costs.

Most of the Contracts owned by the Company have a three year term, provide for
automatic renewal and allow the Company to increase the customers' monitoring
fee at certain times after the initial term. The Company has no intention of
increasing monitoring fees in the immediate future.


                                       18
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES - 1995
The Company's net loss for the year ending December 31, 1995 was due primarily
to higher amortization expense, a non-cash charge against earnings, as a result
of the attrition of certain contracts in 1995.  Although the Company experienced
higher attrition for the year ending December 31, 1995 than in the year ending
December 31, 1994, its net cash from operating activities increased as a result
of lower interest expense on the Secured Five Year Notes.  During 1995, the
Company paid scheduled and additional principal of $2,334,751, $912,493 and
$6,291,902 to the Series A, Series B, and Series C Noteholders, respectively.

Attrition resulted in decreased cash flow.  As of December 31, 1995,
approximately 50% of the Series A Contracts and 100% of the Series B and Series
C Contracts owned by the Company were covered by attrition guarantees by
the Servicer.

The Company's revenues from Contracts were sufficient to pay the Servicer
Basic Monitoring Fee, scheduled principal and interest on the Notes, third party
operating expenses, taxes of the Company's Members (but only Member's taxes in
respect of any allocations of taxable income from the Company), subordinated
fees, to establish necessary reserves, if any, and to continue to make
additional principal payments.

At December 31, 1995, the Benchmark CD Rate was 5.19%.  Accordingly, the
outstanding principal on the Series A and Series B Notes earned interest at
9% per annum through May 15, 1996.

Debt Service and Interest Coverage ratios are calculated based on the number of
"active" accounts at the end of the period.  An active account is one where the
customer's alarm system is being monitored.  Generally, accounts are monitored
until they become 70 days delinquent.  Previous to the fourth quarter of 1994,
accounts were active until they became 100 days delinquent.  Westinghouse made
this change to a more aggressive service termination policy because they
believed it would have a positive effect on the collection of delinquent
balances.  As indicated in Item 6 - Selected Financial Data, the Debt Service
and Interest Coverage ratios for each Series of Notes at December 31, 1995 were
strong.

The Company did not purchase any additional Contracts in 1995.  As of December
31, 1995, the Company had no material capital commitments.

RESULTS OF OPERATIONS - 1995
For the year ended December 31, 1995, SAMCO derived 98% of its income from
monitoring revenues and the balance from interest income on short term
investments.

The decrease in the Company's monitoring revenues for the year ending
December 31, 1995 compared to the corresponding period in 1994 was due to the
expiration, in 1995, of the Westinghouse guarantees of 0% attrition on the
Series C contracts.  As a result, amortization of the Contracts increased as the
0% attrition on the Series C contracts expired. Accordingly, the related
monitoring fee expense has decreased.  Interest expense decreased as the
Company continued to pay down scheduled and additional principal.  The bad debt
expense of $748,309 on the Company's


                                       19
<PAGE>

Statement of Operations represents actual revenue loss on attrited Contracts and
the potential revenue loss on Contracts with balances greater than 90 days past
due as of December 31, 1995.

The Company's operating expenses included monitoring fees, general and
administrative expenses, including (i) lockbox bank fees, (ii) audit and tax
fees, (iii) printing and mailing of quarterly and annual reports to investors,
(iv) trustee fees, (v) legal and consulting fees, and (vi) subordinated fees and
expenses.  The Company's other expenses include bad debt expense, interest
expense and amortization of (i) Contracts and (ii) debt issuance costs.

The Company did not increase monitoring fees during 1995, although it was
permitted to do so under certain renewed Contracts.

LIQUIDITY AND CAPITAL RESOURCES - 1994
The Company's cash and cash equivalents balance of $10,880,686 at December 31,
1994 includes $7,603,224 from operations.  The remaining $3,277,462 includes
NDC's $1,000,000 capital contribution, and the liquidation preference and
dividends of $6,389,306 received from NBII on June 30, 1993 less $4,111,844 used
to purchase contracts on February 28, 1994.

On February 28, 1994, the Company acquired 22,199 Contracts from Westinghouse
for an aggregate purchase price of $17,911,844.  The Company financed the
acquisition in part by utilizing a $15 million borrowing facility through its
primary Member, SFD Holding.

On March 9, 1994, the Company issued its remaining Series C Notes to investors
in the amount of $17,931,306.  After the payment of underwriting discounts and
certain other fees and expenses of the Company of $1,434,504 in the aggregate, a
portion of the remaining $16,496,802 was used to repay the aforementioned
borrowing.  By the end of the first quarter of 1994, the Company had issued
$45,000,000 of Series C Notes which at the time of issuance were collateralized,
in the aggregate, by 52,840 Contracts.

The Company had issued Secured Five Year Notes totaling $79,417,821 in order to
finance the acquisition of Contracts and derives its income primarily from the
receipt of RMR on the Contracts.  Except for the Basic Monitoring Fee paid to
the Servicer, all fees and expenses  were subordinated to quarterly payments of
interest and scheduled principal on the Notes.  In addition, after payment of
all subordinated amounts and the establishment of necessary reserves, if any,
Excess Cash, if any, is required to be distributed to Noteholders quarterly as
additional principal.  Including the distribution paid on February 15, 1995, the
Company paid additional principal of $4,411,884, $1,472,319, and $4,343,042
to the Series A, Series B, and Series C Noteholders, respectively.

Despite the rise in short term interest rates throughout 1994, the outstanding
principal on the Series A and Series B Notes earned interest at 9% during 1994.
At December 31, 1994, the Benchmark CD Rate was 6.49%.  Accordingly, the
outstanding principal on the Series A and Series B Notes  earned interest at 9%
per annum through May 15, 1995.


                                       20
<PAGE>

Debt Service and Interest Coverage ratios are calculated based on the number of
"active" accounts at the end of the period.  An active account is one where the
customer's alarm system is being monitored.  Generally, accounts are monitored
until they become 70 days delinquent.  Prior to the fourth quarter of 1994,
accounts were active until they became 100 days delinquent.  Westinghouse
believed that a more aggressive service termination policy would have a positive
effect on the collection of delinquent balances.  As indicated in Item 6 -
Selected Financial Data, the Debt Service and Interest Coverage ratios for each
Series of Notes at December 31, 1994 continued to be strong.

The Company's revenues from Contracts were sufficient to pay the Servicer Basic
Monitoring Fee, scheduled principal and interest on the Notes, third party
operating expenses, taxes of the Company's Members (but only Member's taxes in
respect of any allocations of taxable income from the Company), subordinated
fees, to establish necessary reserves, if any, and to continue to make
additional principal payments.

Attrition resulted in decreased cash flow.  As of December 31, 1994,
approximately 50% of the Series A Contracts and 100% of the Series B and Series
C Contracts owned by the Company were covered by attrition guarantees by
Westinghouse.

As of December 31, 1994, the Company had no material capital commitments.

RESULTS OF OPERATIONS - 1994
For the year ended December 31, 1994, SAMCO derived 99% of its income from
monitoring revenues and the balance from interest income on short term
investments.

Results of operations for the years ended December 31, 1994 and December 31,
1993 are not fully comparable.  The Company's monitoring revenues for the year
ended December 31, 1994 increased substantially compared to 1993 commensurate
with its acquisition of 22,199 Contracts on February 28, 1994 and a full year of
ownership of contracts acquired on June 30, 1993, and November 30, 1993.  The
increase in Contracts owned, monitoring revenues and Notes outstanding resulted
in a corresponding increase in virtually all expense categories. In addition,
results for the year ended December 31, 1993 included a non-recurring dividend
of $1,389,306. The bad debt expense of $907,246 on the Company's' Statement of
Operations represents actual revenue loss on attrited Contracts and the
potential revenue loss on Contracts with balances greater than 90 days past due
as of December 31, 1994.

The Company's operating expenses included monitoring fees, general and
administrative expenses, including (i) lockbox bank fees, (ii) audit and tax
fees, (iii) printing and mailing of quarterly and annual reports to investors,
(iv) trustee fees, (v) legal and consulting fees, and (vi) subordinated fees and
expenses.  The Company's other expenses include bad debt expense, interest
expense and amortization of (i) Contracts and (ii) debt issuance costs.  In July
1994, the Company contracted with another servicer to process lockbox
remittances.  This  resulted in a savings in lockbox fees.


                                       21
<PAGE>

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See Appendix A to this report.

ITEM 9. CHANGES IN AND DISAGREEMENT WITH ACCOUNTANTS ON ACCOUNTING AND
     FINANCIAL DISCLOSURE

None.


                                       22
<PAGE>

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Certain directors and officers of SFD Holding have been designated as Managers
of SAMCO.  A manager is similar to a director of a corporation, and may
designate one or more persons as officers of the limited liability company.  The
principal business occupations during the past five years for the Managers and
officers of SAMCO are set forth below.  Messrs. Micucci, Ziegler, Calhoun,
Zuccaro and Boyce hold similar positions with NYLIFE Equity Inc., which is the
general partner of three series of publicly offered oil and gas limited
partnerships known as NYLOG I, NYLOG II and NYLOG III.  Messrs. Micucci,
Ziegler, Calhoun, Drath, Zuccaro and Boyce also hold similar positions with
NYLIFE Realty Inc. ("NYLIFE Realty"), which is the managing general partner of a
publicly offered real estate related limited partnership known as NYLIFE Realty
Income Partners I, L.P.

Name                     Age       Title
----                     ---       -----

Kevin M. Micucci         38   Manager and President
Jean E. Hoysradt         46   Manager and Vice President of Investment
Robert Ziegler           42   Vice President of Administration and Secretary
Jay S. Calhoun           41   Vice President and Treasurer
Scott J. Drath           33   Manager, Vice President and Controller
Richard W. Zuccaro       47   Tax Vice President
Jefferson C. Boyce       39   Manager

Kevin M. Micucci became a manager and the President of the Company in February
1996.  Previously, he was Vice President of Finance from June 1994 and Vice
President and Controller from October 1991.  Mr. Micucci has been a Vice
President of New York Life Insurance Company in the Structured Finance
Department since March 1996; prior thereto, he was Corporate Vice President from
March 1991 to March 1996, an Assistant Vice President from July 1989 to March
1991, and Director of Financial Reporting from August 1987 to July 1989.  He was
a Senior Accountant in the Direct Investments Department of E.F. Hutton &
Company Inc., a securities broker-dealer, from 1984 to 1987 and was a Senior
Accountant in the Audit Department of Alexander Grant & Company from 1981 to
1984.  Mr. Micucci received a B.S. degree from St. John's University and is a
Certified Public Accountant.

Jean E. Hoysradt has been a Manager and Vice President of Investment of the
Company since January 1992.  Ms. Hoysradt has been a Senior Vice President of
New York Life Insurance Company in charge of the Investment Department since
March 1992.  She was a Vice President in the Investment Department in charge of
private placements from 1990 to 1992.  Before joining New York Life Insurance
Company, Ms. Hoysradt was a Managing Director with Manufacturers Hanover Trust
Company from 1988 to 1990.  She began her career in 1974 at The Equitable Life
Assurance Society of the U.S. as a private placement analyst, and was Vice
President in portfolio management upon her departure in 1984.  From 1984 to
1988, she was a Vice President in structured real estate finance


                                       23
<PAGE>

with The First Boston Corporation.  A 1972 graduate of Duke University, Ms.
Hoysradt received her M.B.A. from Columbia University in 1974.

Robert Ziegler has been Vice President of Administration and Secretary of the
Company since January 1992.  Mr. Ziegler has been Vice President of New York
Life Insurance Company in the Structured Finance Department since March 1996,
and prior thereto, was Corporate Vice President of the department since January
1989.  He was an Assistant Vice President from July 1987 to December 1988.  He
was a Vice President of B&D Equities Inc. and Damson Investor Services
Corporation from 1986 to 1987 and was an Assistant Vice President of Citibank,
N.A. from 1981 to 1986.  Mr. Ziegler received a B.B.A. degree and an M.B.A.
degree from Baruch College.

Jay S. Calhoun has been Vice President and Treasurer of the Company since March
1993.  Mr. Calhoun is Treasurer and a Vice President of New York Life Insurance
Company.  He was named Vice President and Associate Treasurer of New York Life
Insurance Company in March 1992 and, prior to that time, served as a Corporate
Vice President in the Treasury Department.  Mr. Calhoun received a B.A. degree
from Princeton University and an M.S. degree in Business Policy from Columbia
University.

Scott J. Drath has been a Manager, Vice President and Controller of the Company
since October 1996.  Mr. Drath has been a Corporate Vice President in the
Structured Finance Department of New York Life Insurance Company since May 1996.
Mr. Drath was Director of Accounting for Prins Recycling Corp. from May 1995 to
April 1996.  Prior thereto, he was an Assistant Vice President in the Structured
Finance Department of New York Life Insurance Company from April 1994 to May
1995 and a Director of Accounting from September 1991 to April 1994.  Mr. Drath
received a Bachelor of Accountancy Degree from George Washington University and
an M.B.A. degree in Finance from New York University.

Richard W. Zuccaro has been Tax Vice President of the Company since January
1992.  Mr. Zuccaro has been a Vice President of New York Life Insurance Company
since April 1995, and prior thereto, was a Corporate Vice President from May
1986 to April 1995 and was an Assistant Vice President of New York Life
Insurance Company from November 1981 to May 1986.  Mr. Zuccaro received a B.B.A.
degree in Accounting from the University of Oklahoma.

Jefferson C. Boyce has been a Manager of the Company since June 1993.  Mr.
Boyce is a Senior Vice President of New York Life Insurance Company.  Since
1994 he has been responsible for the Mutual Funds (MainStay Retail and
MainStay Institutional Funds), and Structured Finance Departments, as well as
NYLIFE Securities Inc. In 1992, he became Chief Administrative Officer for
the Pension, Mutual Funds, and Structured Finance Departments, as well as the
Corporate Quality, Human Resources, and Employees' Health Departments.  Mr.
Boyce received a B.B.S. degree in Finance from Baruch College and has
completed the Advanced Management Program at the Harvard Business School.

                                       24
<PAGE>

ITEM 11. EXECUTIVE COMPENSATION

Separate compensation is not paid by the Company to its Managers or to its
officers for serving in such positions.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

                                               Amount and Nature
    Title of         Name and Address            of Beneficial      Percent of
      class          Beneficial Owner              Ownership           Class
      -----          ----------------              ---------           -----

        -        NYLIFE SFD Holding Inc.    Voting interest of the    83.33%
                 51 Madison Avenue                  Company
                 New York, NY 10010

        -        NYLIFE Depositary Corp.    Voting interest of the    16.67%
                 51 Madison Avenue                  Company
                 New York, NY 10010


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information regarding certain payments to members of the Company and their
affiliates and certain contractual arrangements and related transactions are
contained in Notes 4 and 6 to the Financial Statements on pages  F-8 through
F-15 of this Form 10-K.


                                       25
<PAGE>

                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

(a)  1.   Financial Statements - see Index of Financial Statements included
     under Item 8,  Appendix A, on page F-2 of this report.

     2.   All schedules for which provision is made in the applicable accounting
     regulations of the Securities and Exchange Commission have been omitted
     since either: (1) the information required is disclosed in the financial
     statements and the notes thereto; (2) the schedules are not required under
     the related instructions; or (3) the schedules are inapplicable.

     3.   Exhibits:

     Number and Description
     Under Regulation S-K
     --------------------

     The following reflects all applicable Exhibits required under Item 601 of
     Regulation S-K:

     (3)       ARTICLES OF INCORPORATION AND BY-LAWS

     3.1       Articles of Organization of Company.  *

     3.2       Amended Regulations of Company.  *

     3.3       Amendment to Articles of Organization of Company.  *

     (4)       INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
               INDENTURES:

     4.1       Indenture.  *

     4.2       Form of Global Note, included as Exhibit A to Exhibit 4.1.  *

     4.3       Form of Definitive Note, included as Exhibit B to Exhibit 4.1.  *

     4.4       Form of Security Agreement, included as Exhibit C to Exhibit 4.1.
               *

     4.5       Form of First Supplemental Indenture.  *

     4.6       Form of Second Supplemental Indenture.  *

     (10)      MATERIAL CONTRACTS

     10.1      Revised Form of Escrow Agreement.  *


                                       26
<PAGE>


     10.2      Operational Services Agreement.  *

     10.3      Form of Lock-Box Agreement, included as Exhibit D to Exhibit 4.1.
               *

     10.4      Agreement of Limited Partnership of Westinghouse Security
               Systems, L.P.  *

     10.5      Indemnification Agreement.  *

     10.6      Consulting Agreement with Coopers & Lybrand.  *

     10.7      Consulting Agreement with BK Financial, Inc.  *

     10.8      Consulting Agreement with Capital Recovery, Inc.  *

     10.9      Letter Agreement among Westinghouse Electric Corporation,
               Westinghouse Security Systems, L.P., the Company and NYLIFE
               Bridge Investor Inc., dated as of November 15, 1991.  *

     10.10     Accounts Purchase Agreement dated as of July 15, 1992 among the
               Company, Westinghouse Security Systems, L.P. and Westinghouse
               ElectricCorporation.  *

     10.11     Accounts Purchase Agreement dated as of September 16, 1992 among
               the Company, Westinghouse Security Systems, L.P. and Westinghouse
               Electric Corporation.  *

     10.12     Accounts Purchase Agreement dated as of November 19, 1992 among
               the Company, Westinghouse Security Systems, L.P. and Westinghouse
               ElectricCorporation.  *

     10.13     Accounts Purchase Agreement dated as of December 14, 1992 among
               the Company, Westinghouse Security Systems, L.P. and Westinghouse
               ElectricCorporation.  *

     10.14     Demand Subordinated Note from Company to NYLIFE Asset Finance
               Corporation dated December 14, 1992.  *

     10.15     Amendment No. 1, dated as of March 18, 1993 to Accounts Purchase
               Agreement dated December 14, 1992 among Westinghouse Security
               Systems, L.P., Westinghouse Electric Corporation and NYLIFE
               Structured Asset Management Company Ltd. *

     10.16     Letter Agreement dated March 18, 1993 amending certain sections
               of the Accounts Purchase Agreements dated July 15, 1992,
               September 16, 1992 and November 19, 1992 among Westinghouse
               Security Systems, L.P. and NYLIFE Structured Asset Management
               Company Ltd.  *


                                       27
<PAGE>

     10.17     Accounts Purchase Agreement dated as of June 18, 1993 among the
               Company and Westinghouse Electric Corporation.  *

     10.18     Demand Subordinated Note from Company to NAFCO Inc., formerly
               NYLIFE Asset Finance Corporation dated June 30, 1993.  *

     10.19     Demand Subordinated Note from Company to NAFCO Inc., formerly
               NYLIFE Asset Finance Corporation dated November 30, 1993.  *

     10.20     Demand Subordinated Note from Company to NAFCO Inc., formerly
               NYLIFE Asset Finance Corporation dated February 28, 1994.  *

     10.21     Consent, Assignment, Assumption, Amendment and Modification
               Agreement dated December 30, 1996 between NYLIFE Structured Asset
               Management Company Ltd.; Westinghouse Electric Corporation,
               WestSec, Inc. and Westar Capital, Inc.*

     (27)      FINANCIAL DATA SCHEDULE


--------------------------------
     *         Previously filed.


                                       28
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                              NYLIFE Structured Asset Management
                              Company Ltd.

                                   By:  /s/ Kevin M. Micucci
                                        --------------------
                                        Kevin M. Micucci
                                        Manager and President
                                        (Principal Executive Officer and
                                        Principal Financial and Accounting
                                        Officer)
                                        March 31, 1997

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities of and on the dates indicated.

Signature                   Title                                Date
---------                   -----                                ----

/s/ Kevin M. Micucci        Manager and President                March 31, 1997
----------------------      (Principal Executive Officer and
     Kevin M. Micucci       Principal Financial and
                            Accounting Officer)

/s/ Jean E. Hoysradt        Manager and Vice President           March 31, 1997
----------------------      of Investment
    Jean E. Hoysradt

/s/ Robert Ziegler          Vice President of Administration     March 31, 1997
----------------------      and Secretary
    Robert Ziegler

/s/ Jay S. Calhoun          Vice President and Treasurer         March 31, 1997
----------------------
    Jay S. Calhoun

/s/ Scott J. Drath          Manager, Vice President and          March 31, 1997
----------------------      Controller
    Scott J. Drath

/s/ Richard W. Zuccaro      Tax Vice President                   March 31, 1997
----------------------
    Richard W. Zuccaro

/s/ Jefferson C. Boyce      Manager                              March 31, 1997
----------------------
    Jefferson C. Boyce


                                       29
<PAGE>

                                  APPENDIX A TO

                           ANNUAL REPORT ON FORM 10-K

                       ITEM 8 AND ITEM 14 (A) (1) AND (2)

          FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES AS OF

                        DECEMBER 31, 1996,  1995 AND 1994

                 NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.


                                       F-1
<PAGE>

Form 10-K -- Item 8 and  Item 14 (a) (1) and (2)

NYLIFE Structured Asset Management Company Ltd.

INDEX OF FINANCIAL STATEMENTS


Report of Independent Accountants                                          F-3

Statement of Financial Position as of December 31, 1996 and 1995           F-4

Statement of Operations and (Accumulated Deficit) and Retained
Earnings for the Years Ended December 31, 1996, 1995 and 1994              F-5

Statement of Changes in Members' Capital for the Years Ended
December 31, 1996, 1995 and 1994                                           F-6

Statement of Cash Flows for the Years Ended December 31, 1996,
1995 and 1994                                                              F-7

Notes to the Financial Statements                                  F-8 to F-15


     All schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission have been omitted since
either (1) the information required is disclosed in the financial statements and
the notes thereto; (2) the schedules are not required under the related
instructions; or (3) the schedules are inapplicable.


                                       F-2
<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS

March 28, 1997

To the Managers and Members of
NYLIFE Structured Asset Management Company Ltd.


In our opinion, the accompanying statement of financial position and the related
statements of operations and (accumulated deficit) retained earnings, changes in
members' capital and cash flows present fairly, in all material respects, the
financial position of NYLIFE Structured Asset Management Company Ltd. at
December 31, 1996, and 1995 and the results of its operations and its cash flows
for the years ended December 31, 1996, 1995 and 1994, in conformity with
generally accepted accounting principles.  These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits.  We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation.  We believe that our
audits provide a reasonable basis for the opinion expressed above.




PRICE WATERHOUSE LLP
NEW YORK


                                       F-3
<PAGE>

                 NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
                         STATEMENT OF FINANCIAL POSITION
<TABLE>
<CAPTION>

                                                               ASSETS

                                                                                                       December 31,
                                                                                                 1996                1995
                                                                                             ------------        ------------
<S>                                                                                          <C>                 <C>

CURRENT ASSETS

  Cash and cash equivalents                                                                  $  7,162,877        $  6,527,623
  Segregated cash and cash equivalents                                                          4,279,050           5,399,963
  Monitoring revenue and interest receivables
   (net of allowance of $1,066,458 and $777,516, respectively)                                  2,058,034           2,760,630
  Due from WestSec                                                                                 24,775                   -
                                                                                             ------------        ------------

      Total current assets                                                                     13,524,736          14,688,216
                                                                                             ------------        ------------

  Security alarm monitoring contracts held for sale (Notes 3 and 5)                            38,454,921                   -
  Investment in security alarm monitoring contracts (Note 5)
   (net of accumulated amortization of $22,965,463)                                                     -          48,424,894
  Debt issuance costs paid to affiliates
    (net of accumulated amortization of $4,731,684 and $3,572,284, respectively)                1,621,742           2,781,142
                                                                                             ------------        ------------

         Total assets                                                                        $ 53,601,399        $ 65,894,252
                                                                                             ------------        ------------
                                                                                             ------------        ------------

                                                  LIABILITIES AND MEMBERS' CAPITAL
CURRENT LIABILITIES

  Monitoring fees payable                                                                     $   752,722         $   943,869
  Accounts payable and accrued liabilities                                                        332,369             334,493
  Due to affiliates (Note 6)                                                                      187,460             204,690
  Due to Westinghouse                                                                                   -              14,351
  Unearned revenue                                                                              2,772,608           3,129,618
  Interest payable (Note 5)                                                                       552,942             658,924
  Notes payable (Note 5)                                                                        3,970,891           3,970,891
                                                                                             ------------        ------------

      Total current liabilities                                                                 8,568,992           9,256,836
                                                                                             ------------        ------------

  Notes payable (Note 5)                                                                       43,741,609          52,886,655
                                                                                             ------------        ------------

         Total liabilities                                                                     52,310,601          62,143,491
                                                                                             ------------        ------------

MEMBERS' CAPITAL

  Contributed capital                                                                           6,000,000           6,000,000
  Distributions to members                                                                       (632,753)           (632,753)
  Accumulated deficit                                                                          (4,076,449)         (1,616,486)
                                                                                             ------------        ------------

         Total members' capital                                                                 1,290,798           3,750,761
                                                                                             ------------        ------------

         Total liabilities and members' capital                                              $ 53,601,399        $ 65,894,252
                                                                                             ------------        ------------
                                                                                             ------------        ------------

</TABLE>


               See accompanying notes to the financial statements.


                                       F-4
<PAGE>

                 NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
                STATEMENT OF OPERATIONS AND (ACCUMULATED DEFICIT)
                                RETAINED EARNINGS

<TABLE>
<CAPTION>

                                                                                          For the year ended December 31,
                                                                                        1996           1995           1994
                                                                                   ------------   ------------   ------------
<S>                                                                                <C>            <C>            <C>

REVENUE
    Monitoring revenue                                                             $ 22,844,144   $ 25,554,085   $ 26,443,105
    Interest                                                                            386,473        424,917        309,663
                                                                                   ------------   ------------   ------------

           Total revenue                                                             23,230,617     25,979,002     26,752,768
                                                                                   ------------   ------------   ------------

EXPENSES

    Monitoring fees                                                                   7,732,543      8,682,022      8,937,611
    Interest expense                                                                  4,684,855      5,509,539      6,191,171
    General and administrative expense                                                  379,276        373,985        372,729
    Consulting fees                                                                     285,416        285,416        285,416
    Asset management fee to affiliate                                                   555,971        625,765        649,011
    Equity return fee to affiliate                                                      217,385        217,385        208,132
    Bad debt expense                                                                    751,164        748,309        907,246
    Amortization of security alarm monitoring contracts                               9,924,570     10,291,906      7,573,313
    Amortization of debt issuance costs paid to affiliates                            1,159,400      1,368,424      1,494,904
                                                                                   ------------   ------------   ------------

         Total expenses                                                              25,690,580     28,102,751     26,619,533
                                                                                   ------------   ------------   ------------

    Net (loss) income                                                                (2,459,963)    (2,123,749)       133,235

    (Accumulated deficit) retained earnings at beginning of year                     (1,616,486)       507,263        374,028
                                                                                   ------------   ------------   ------------

   (Accumulated deficit) retained earnings at end of year                          $ (4,076,449)  $ (1,616,486)  $    507,263
                                                                                   ------------   ------------   ------------
                                                                                   ------------   ------------   ------------

</TABLE>


               See accompanying notes to the financial statements.


                                       F-5
<PAGE>

                 NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
                    STATEMENT OF CHANGES IN MEMBERS' CAPITAL
              FOR THE YEARS ENDED DECEMBER 31, 1996 , 1995 AND 1994


                                                      NYLIFE           Total
                                    NYLIFE SFD      Depositary       Members'
                                   Holding Inc.       Corp.          Capital
                                   ------------    -----------     -----------

Balance at January 1, 1994          $ 5,189,602    $ 1,037,930       6,227,532

Net income                              111,025         22,210         133,235

Distributions to members               (405,198)       (81,059)       (486,257)
                                    -----------    -----------     -----------

Balance at December 31, 1994          4,895,429        979,081       5,874,510

Net loss                             (1,769,720)      (354,029)     (2,123,749)
                                    -----------    -----------     -----------

Balance at December 31, 1995          3,125,709        625,052       3,750,761

Net loss                             (2,049,887)      (410,076)     (2,459,963)
                                    -----------    -----------     -----------

Balance at December 31, 1996        $ 1,075,822    $   214,976     $ 1,290,798
                                    -----------    -----------     -----------
                                    -----------    -----------     -----------

               See accompanying notes to the financial statements.


                                       F-6
<PAGE>

                 NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
                             STATEMENT OF CASH FLOWS
                INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

<TABLE>
<CAPTION>

                                                                                          For the year ended December 31,
                                                                                        1996           1995           1994
                                                                                   ------------   ------------   ------------
<S>                                                                                <C>            <C>            <C>

Cash flows from operating activities:
 Net (loss) income                                                                 $ (2,459,963)  $ (2,123,749)  $    133,235
 Adjustments to reconcile net loss to net
  cash provided by operating activities:
   Amortization of security alarm monitoring contracts                                9,924,570     10,291,906      7,573,313
   Amortization of debt issuance costs                                                1,159,400      1,368,424      1,494,904
   Bad debt expense                                                                     751,164        748,309        907,246

Changes in assets and liabilities:
  Increase in monitoring revenue and interest receivables                               (48,568)      (275,143)    (2,190,079)
  Increase in due from WestSec                                                          (24,775)             -              -
  (Decrease) increase in monitoring fees payable                                       (191,147)        (4,844)       189,622
  (Decrease) increase in accounts payable and accrued liabilities                        (2,124)        64,551       (124,587)
  (Decrease) increase in due to affiliates                                              (17,230)       (17,473)        98,340
  (Decrease) increase in due to Westinghouse                                            (14,351)      (120,230)       110,700
  (Decrease) increase in unearned revenue                                              (357,010)      (138,052)       668,458
  (Decrease) increase in interest payable                                              (105,982)      (110,550)       203,221
                                                                                   ------------   ------------   ------------
   Net cash provided by operating activities                                          8,613,984      9,683,149      9,064,373
                                                                                   ------------   ------------   ------------

Cash flows from investing activities:
    Investment in security alarm contracts                                                    -              -    (17,911,844)
    Purchase price refunds - investment in security alarm
     monitoring contracts                                                                45,403        902,897      1,834,760
                                                                                   ------------   ------------   ------------
    Net cash provided by (used in) investing activities                                  45,403        902,897    (16,077,084)
                                                                                   ------------   ------------   ------------

Cash flows from financing activities:
    Distribution to members                                                                   -              -       (486,257)
    Proceeds from Demand Subordinated Notes                                                   -              -     15,000,000
    Repayments on Demand Subordinated Notes                                                   -              -    (15,000,000)
    Proceeds from issuance of Notes                                                           -              -     17,931,306
    Debt issuance costs paid to affiliate                                                     -              -     (1,434,504)
    Principal payments on Notes                                                      (9,145,046)    (9,539,146)    (7,886,048)
                                                                                   ------------   ------------   ------------
    Net cash (used in) provided by financing activities                              (9,145,046)    (9,539,146)     8,124,497
                                                                                   ------------   ------------   ------------
 Net (decrease) increase in cash and cash equivalents                                  (485,659)     1,046,900        111,786

Cash and cash equivalents (including segregated cash and
 cash equivalents) at beginning of year                                              11,927,586     10,880,686      9,768,900
                                                                                   ------------   ------------   ------------
Cash and cash equivalents (including segregated cash and
 cash equivalents) at end of year                                                  $ 11,441,927   $ 11,927,586   $ 10,880,686
                                                                                   ------------   ------------   ------------
                                                                                   ------------   ------------   ------------

Supplemental disclosure of cash flow information:
    Cash paid during the year for interest                                         $  4,790,832   $  5,620,089   $  5,987,950
                                                                                   ------------   ------------   ------------
                                                                                   ------------   ------------   ------------

</TABLE>



               See accompanying notes to the financial statements.


                                       F-7
<PAGE>

                 NYLIFE STRUCTURED ASSET MANAGEMENT COMPANY LTD.
                        NOTES TO THE FINANCIAL STATEMENTS
                           DECEMBER 31, 1996 AND 1995

NOTE 1 - ORGANIZATION

NYLIFE Structured Asset Management Company Ltd. (the "Company" or "SAMCO") is a
limited liability company formed under the laws of the State of Texas on October
18, 1991.  The entity offers its equity investors limited liability protection
while providing them with flow through tax treatment.

SAMCO has two members.  The principal member is NYLIFE SFD Holding Inc. ("SFD
Holding", formerly NAFCO Inc.). The other member is NYLIFE Depositary
Corporation ("NDC").  Both members are Delaware corporations and wholly owned
subsidiaries of NYLIFE Inc. (a direct wholly owned subsidiary of New York Life
Insurance Company, "New York Life").  Certain directors and officers of SFD
Holding have been designated as managers of SAMCO.  A manager is similar to a
director of a corporation, and may designate one or more persons as officers of
the limited liability company.

On January 15, 1992, SFD Holding and NDC (collectively, the "Members") purchased
membership interests in SAMCO of 83.33% and 16.67%, respectively.  SFD Holding
made an initial capital contribution to SAMCO of 500 shares of $1 par value,
nonvoting, nonconvertible, 24.39% cumulative preferred stock of NYLIFE Bridge
Investor Inc. ("NBII", a subsidiary of SFD Holding prior to its liquidation on
June 30, 1993).  The preferred stock was originally recorded by SAMCO at
$5,000,000 which represents SFD Holding's recorded carrying value for the
preferred stock.  NDC made an initial capital contribution of $1,000,000 in
cash.  SAMCO had no operations prior to January 15, 1992.

SAMCO has issued secured five year floating rate notes and secured five year
fixed rate notes (the "Notes"), in order to finance the acquisition of security
alarm monitoring contracts (the "Contracts").  Such Contracts consist of the
obligations and payment rights with respect to monitoring services, and in
certain instances repair and maintenance services, for security alarm systems in
residential homes and light commercial businesses.  Security alarm monitoring is
the process of notifying designated parties (either individuals or public
authorities) if an unauthorized entry, fire, medical or other emergency signal
from a customer alarm system is received at a central monitoring station.

Capitalized terms used in these Notes to the Financial Statements unless
otherwise defined herein, shall have the meanings set forth in Section 1.1 of
the Operational Services Agreement and the Trustee Indenture.

Pursuant to the Consent Agreement (see Note 3), all references in these Notes
to the Financial Statements to "the Servicer" shall mean Westinghouse Electric
Corporation ("Westinghouse") with regard to all periods prior to December 31,
1996 and WestSec, Inc. ("WestSec"), a subsidiary of Western Resources, Inc.
with regard to all time periods thereafter.

                                       F-8
<PAGE>

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from the estimates.

CASH AND CASH EQUIVALENTS Cash and cash equivalents includes investments in
highly liquid money market funds. Such funds invest in short-term obligations
of the United States government.  The carrying value of cash and cash
equivalents approximates fair value.

SEGREGATED CASH AND CASH EQUIVALENTS
Under the terms of the Indenture dated July 15, 1992 between the Company and
U.S. Trust Company of New York (the "Trustee"), cash receipts for each series of
Notes are maintained in a segregated account and used to pay obligations to
Noteholders and fees and expenses related to such series.  Such receipts are
invested by the Trustee in highly liquid money market funds. Such funds invest
in short-term obligations of the United States government.  The carrying value
of segregated cash and cash equivalents approximates fair value.

DEBT ISSUANCE COSTS PAID TO AFFILIATES
Costs incurred in the issuance of Notes, including underwriting discounts,
offering and organization costs and financial advisory fees, are capitalized and
amortized using the interest method over the life of the Notes.

MONITORING REVENUE RECOGNITION
The Company derives its revenues almost exclusively from the receipt of customer
payments for alarm monitoring services.  The Company recognizes revenue as the
monitoring services are provided (accrual basis).

MONITORING FEES
The Servicer is entitled to payment of 25% of aggregate monthly revenue
("AMR") for the performance of monitoring services under the Contracts (the
"Servicer Basic Monitor Fee"), the effect of which is that the Servicer will
receive the Servicer Basic Monitoring Fee before the Noteholders receive
their quarterly payments.  The Servicer is also entitled to an additional 10%
of AMR for the performance of such services (the "Servicer Subordinated
Monitoring Fee") which is subordinate to the payment of (i) the Servicer
Basic Monitoring Fee, (ii) principal and interest on the Notes, (iii) taxes
on operating income and (iv) administrative expenses.

AMORTIZATION OF SECURITY ALARM MONITORING CONTRACTS
The Company's investment in Contracts is amortized over the estimated lives of
the Contracts of approximately 12 years, as adjusted for attrited (terminated)
Contracts.


                                       F-9
<PAGE>

INCOME TAXES
No provision for federal income taxes is recorded in the financial statements
because the Company is not subject to federal income taxes.  The tax effect of
its activities accrues to the Members.

NOTE 3 - SALE OF THE SECURITY BUSINESS BY WESTINGHOUSE

CONSENT AGREEMENT
On December 30, 1996, Westinghouse sold its security alarm business to
WestSec.  In connection with the sale, Westinghouse assigned all of its
rights, title and interest under the Operational Services Agreement to
WestSec, and WestSec assumed all of Westinghouse's liabilities and
obligations under the Operational Services Agreement.  In conjunction with
Westinghouse's sale and assignment and WestSec's assumption, the Company,
Westinghouse, WestSec and Westar Capital, Inc. an affiliate of WestSec
("Westar"), entered into a Consent, Assignment, Assumption, and Modification
Agreement ("the Consent Agreement").

Pursuant to the Consent Agreement, Westar has guaranteed all obligations and
liabilities of WestSec under the Operational Services Agreement and various
related agreements (collectively the "OSA Agreements"), Westinghouse has agreed
to remain liable under certain specified obligations in the OSA Agreements, and
Westar has agreed to furnish to the Company an irrevocable letter of credit to
secure certain obligations of Westar, WestSec and Westinghouse under the OSA
Agreements.

CONTRACT PURCHASE
In connection with the Consent Agreement, WestSec has committed to purchase,
and the Company has committed to sell, the Contracts securing each series of
Notes at fixed dates in the future for a determinable price; such price is
supported by a letter of credit from WestSec and, subject to certain
conditions, guarantees by Westinghouse. The Company expects to realize a gain
on each of these future sales. As a result of entering into the Consent
Agreement, the Company has under Statement of Financial Accounting Standard
No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" (SFAS No. 121), reclassified its Investment in
Security Alarm Monitoring Contracts as held for sale.  In accordance with
SFAS No. 121, the Company has reported such Contracts at the lower of carrying
amount or fair value less cost to sell and has discontinued amortization of
the Contracts effective December 30, 1996 (See Contract Repurchase - Series A,
Series B, and Series C Notes" in Management's Discussion and Analysis of
Financial Condition and Results of Operations for further information regarding
the Consent Agreement affecting these consolidated financial statements).

The Consent Agreement requires WestSec to furnish to SAMCO a clean, irrevocable
and unconditional letter of credit issued by and drawn upon a "AA" rated bank,
in form and substance reasonably satisfactory to SAMCO and Westinghouse, in
favor of SAMCO in the amount of $85 million (the "LC").  The LC will secure
obligations of Westar, WestSec and Westinghouse under the OSA Agreements and the
Consent Agreement.

NOTE 4 - ISSUANCE OF NOTES AND ACQUISITION OF CONTRACTS

SERIES A, SERIES B, AND SERIES C NOTES
During the year ended December 31, 1992, SAMCO issued three traunches of its
Secured Five Year Notes: Series A, Floating Rate (the "Series A Notes") in the
amount of $25,000,000.  At issuance, the Series A Notes were collateralized by
33,029 Contracts.


                                      F-10
<PAGE>

During the year ended December 31, 1993, SAMCO issued its Secured Five Year
Notes: Series B, Floating Rate (the "Series B Notes") in the amount of
$9,417,821.  At issuance, the Series B Notes were collateralized by 10,768
Contracts.

During the years ended December 31, 1994 and December 31, 1993, SAMCO issued
three traunches of its Secured Five Year Notes: Series C, Fixed Rate (the
"Series C Notes") in the amount of $45,000,000. At issuance, the Series C Notes
were collateralized by 52,840 Contracts.

Interest is payable quarterly on each February 15, May 15, August 15 and
November 15 prior to maturity and on the maturity date.  Scheduled principal
payments are calculated to retire 5% of the original principal amount of the
Series A Notes, Series B Notes, and Series C Notes each year.  Principal is
payable quarterly on February 15, May 15, August 15 and November 15.  In
addition, after payment of all subordinated amounts and the establishment of
necessary reserves, if any, excess cash, if any, is required to be distributed
to Noteholders quarterly as additional principal.  The first principal payments
on the Series A, Series B, and Series C Notes were made on February 15, 1993,
August 15, 1993, and August 15, 1994, respectively.

The Series A and Series B Notes bear interest on the outstanding principal at a
per annum floating rate of 2.50 percentage points above the minimum denomination
five-year certificate of deposit average rate, as reported by Bank Rate Monitor
in its last report of the immediately preceding calendar quarter, but in no
event less than 9% per annum or more than 11% per annum.  Accordingly, at
December 31, 1996, the rate on the Series A and Series B Notes was 9%.

The Series C Notes bear interest on the outstanding principal at a per annum
rate of 9%.

ATTRITION GUARANTEES- SERIES A, SERIES B, AND SERIES C NOTES
Pursuant to the Consent Agreement, as of December 31, 1996, attrition guarantees
previously provided by Westinghouse will be  provided by WestSec.

Westinghouse, as seller of Contracts to the Company, had the obligation to
provide guarantees that capped the Company's exposure to attrition.  Such
guarantees generally capped attrition at 0% for a period of time after
acquisition followed by a period of time during which attrition is capped
annually at certain percentages.  During the period when a 0% attrition
guarantee was in effect, Westinghouse generally had the option to replace
attrited accounts either with cash (in an amount equal to the original purchase
price paid to Westinghouse for the attrited account) or with replacement
Contracts.  Among other things, a replacement Contract must be current in all
payments due from the customer and must have a RMR not less than the attrited
account being replaced.  A 0% attrition guarantee provides that SAMCO may lose
no more than three months of revenue for each attrited Contract.  Approximately
78% of the Contracts originally purchased by the Company were covered by
attrition guarantees at December 31, 1996.  Pursuant to the Consent Agreement,
beginning in 1997, all Contracts originally purchased by the Company will be
covered by attrition guarantees provided by WestSec.


                                      F-11
<PAGE>

Attrition guarantees for Contracts owned by the Company are as follows:

SERIES A - During 1993, 1994, 1995, and 1996, approximately one-half of the
Series A Contracts had guarantees capping attrition while the balance were no
longer under guarantee.  The guaranteed Contracts had attrition caps of 7%, 7%,
8%, 8% in 1993, 1994, 1995, and 1996, respectively.  Pursuant to the Consent
Agreement, all Series A Contracts will be guaranteed for 1997 and for the period
January 1, 1998 to February 15, 1998, with attrition caps of 9% and 1.125%,
respectively.

SERIES B - For the Series B Contracts, the Servicer  has guaranteed (i) that
during the seven-month period ending October 31, 1993, attrited accounts
would not exceed 0%; and (ii)  during each of the four 12 month periods
commencing on November 1, 1993 and ending on October 31, 1997, attrited
accounts will not exceed 9.25%.  Westinghouse had the option during the
period when its 0% attrition guarantee was in effect to replace attrited
accounts either with cash (in an amount equal to the original purchase price
paid to Westinghouse for the attrited account) or with replacement Contracts.
When the 9.25% attrition guarantee is in effect,  the Servicer must replace
attrited accounts with Contracts.

SERIES C - For the Series C Contracts acquired on June 30, 1993, the Servicer
has guaranteed (i) that during the 12 month period ending June 30, 1994,
attrited accounts would not exceed 0%; and (ii)  during each of the four 12
month periods, commencing on July 1, 1994 and ending on June 30, 1998, attrited
accounts will not exceed 10%; and (iii) during one final three month period
commencing on July 1, 1998 and ending on October 31, 1998, attrited accounts
will not exceed 2.5%.

For the Series C Contracts acquired on November 30, 1993 and February 28, 1994,
the respective 0%, 12 month guarantee periods expired on November 30, 1994 and
February 28, 1995; the respective 10%, 12 month guarantee periods are from
December 1, 1994 to November 30, 1998 and from March 1, 1995 to February 28,
1999; and the respective 2.5%, 3 calendar-month guarantee periods are from
December 1, 1998 to February 28, 1999 and from March 1, 1999 to May 31, 1999.

For the Series C Contracts, Westinghouse had the option during the period when
its 0% attrition guarantee was in effect to replace attrited accounts either
with cash (in an amount equal to the original purchase price paid to
Westinghouse for the attrited account) or with replacement Contracts; provided,
however, that Westinghouse could not have  replaced more than half of the
Contracts which became attrited accounts in any calendar month with cash.
Pursuant to the Consent Agreement, WestSec must replace all Series C accounts
above an attrition cap of 10% with Contracts. When the 10% attrition guarantee
is in effect,  the Servicer must replace attrited accounts with Contracts.


                                      F-12
<PAGE>

INVESTMENT CONTRACTS - 5,035 of the Contracts acquired on June 30, 1993,
November 30, 1993 and February 28, 1994 were not utilized as collateral for the
Company's Series C Notes.  The attrition guarantees for these Contracts are
identical to those of the Series C Contracts described above.

NOTE 5 - SECURITY ALARM MONITORING CONTRACTS AND NOTES PAYABLE

The carrying amount of SECURITY ALARM MONITORING CONTRACTS HELD FOR SALE in
the Statement of Financial Position at December 31, 1996 includes Contracts
collateralizing Series A, B and C Notes as follows:

                       Series A      Series B      Series C       Total (*)
                       --------      --------      --------       ---------
Carrying amount        $9,111,822    $3,710,713    $23,558,603    $36,381,138

(*) Excludes 5,035 Contracts acquired from the June 30, 1993, November 30,
1993, and February 29, 1994 acquisitions which are NOT collateral for any
series of Notes and therefore are not subject to the Indenture.  The carrying
amount of these contracts at December 31, 1996 is $2,073,783.  Amortization
expense on those Contracts for the period January 1, 1996 to December 30,
1996 was $551,919.

Prior to the reclassification of the Contracts as held for sale effective
December 30, 1996, the Contracts were being amortized over an estimated life
of 12 years, as adjusted for attrited Contracts.  Amortization expense for
the period January 1, 1996 to December 30, 1996 for Series A, B and C
Contracts was $2,286,671, $877,422 and $6,208,558, respectively.

INVESTMENT IN SECURITY ALARM MONITORING CONTRACTS in the Statement of
Financial Position at December 31, 1995 includes Contracts collateralizing
Series A, B and C Notes as follows:

<TABLE>
<CAPTION>

                                                        AT DECEMBER 31, 1995
                                                                       Series A       Series B       Series C       Total(*)
                                                                     -----------     ----------    -----------    -----------
<S>                                                                  <C>             <C>           <C>            <C>

Investment in security alarm monitoring contracts                    $23,000,000     $8,665,057    $41,401,352    $73,066,409
Less: Purchase price refunds                                           2,234,314        890,055      2,221,003      5,345,372
      Accumulated amortization (**)                                    4,712,209      1,889,234      6,362,837     12,964,280
      Accumulated attrition (**)                                       4,609,538      1,297,633      3,075,018      8,982,189
                                                                     -----------     ----------    -----------    -----------
           Net investment                                            $11,443,939     $4,588,135    $29,742,494    $45,774,568
                                                                     -----------     ----------    -----------    -----------
                                                                     -----------     ----------    -----------    -----------

</TABLE>

(*) Excludes 5,035 Contracts acquired from the June 30, 1993, November 30, 1993,
and February 28, 1994 acquisitions which are NOT collateral for any series of
Notes and therefore are not subject to the Indenture. Net investment in these
contracts at December 31, 1995 is $2,650,326.

(**) These amounts are combined and classified as amortization in the financial
statements.


                                      F-13
<PAGE>


INTEREST PAYABLE and NOTES PAYABLE in the Statement of Financial Position at
December 31 ,1996 and December 31, 1995 include amounts relating to Series A, B
and C Notes as follows:

<TABLE>
<CAPTION>

                                                        AT DECEMBER 31, 1996
                                                                       Series A       Series B       Series C        Total
                                                                     -----------     ----------    -----------    -----------
<S>                                                                  <C>             <C>           <C>            <C>

Interest payable                                                     $   156,532     $   62,114    $   334,296    $   552,942
                                                                     -----------     ----------    -----------    -----------
                                                                     -----------     ----------    -----------    -----------

Notes payable - current                                              $ 1,250,000     $  470,891    $ 2,250,000    $ 3,970,891
Notes payable - non-current                                           12,256,863      4,888,853     26,595,893     43,741,609
                                                                     -----------     ----------    -----------    -----------
   Total                                                             $13,506,863     $5,359,744    $28,845,893    $47,712,500
                                                                     -----------     ----------    -----------    -----------
                                                                     -----------     ----------    -----------    -----------


                                                        AT DECEMBER 31, 1995
                                                                       Series A       Series B       Series C        Total
                                                                     -----------     ----------    -----------    -----------
<S>                                                                  <C>             <C>           <C>            <C>

Interest payable                                                     $   184,595     $   74,432    $   399,897    $   658,924
                                                                     -----------     ----------    -----------    -----------
                                                                     -----------     ----------    -----------    -----------

Notes payable - current                                              $ 1,250,000     $  470,891    $ 2,250,000    $ 3,970,891
Notes payable - non-current                                           14,678,365      5,951,843     32,256,447     52,886,655
                                                                     -----------     ----------    -----------    -----------
   Total                                                             $15,928,365     $6,422,734    $34,506,447    $56,857,546
                                                                     -----------     ----------    -----------    -----------
                                                                     -----------     ----------    -----------    -----------

</TABLE>


NOTE 6 - RELATED PARTIES

DUE TO AFFILIATES in the Statement of Financial Position at December 31, 1996
and December 31, 1995, includes (i) the asset management fee payable to SFD
Holding of $133,114 and $149,150,  respectively, and (ii) the equity return fee
payable to SFD Holding of $54,346 and $54,346, respectively, and (iii) general
and administrative expenses of $1,194 for 1995.

UNDERWRITING DISCOUNTS
NYLIFE Securities Inc. (a wholly owned subsidiary of NYLIFE Inc.), the sales
agent, received Underwriting Discounts equal to 4% of the gross proceeds of the
Notes.

FINANCIAL ADVISORY FEE
SFD Holding received a Financial Advisory Fee equal to 2% of gross proceeds of
the Notes for its assistance in structuring the issuance of Notes and the
acquisition of Contracts.

OFFERING AND ORGANIZATION REIMBURSEMENT
SFD Holding received an Offering and Organizational Expense allowance of 2% of
the gross proceeds of the Notes.  Any Offering and Organizational Expenses
which, when aggregated with Underwriting Discounts and the Financial Advisory
Fee, exceeded 8% of the gross proceeds of the Notes, were paid by SFD Holding.

EQUITY RETURN FEE
For providing equity (through an affiliate) to Westinghouse Security Systems,
L.P., a partnership formed in 1991 to acquire Contracts, SFD Holding is entitled
to receive annually (but paid quarterly), an amount equal to .75% of the first
12 full months of AMR.  This payment is subordinate to the payment of (i) the
Servicer Basic Monitoring Fee, (ii) principal and interest on the Notes, (iii)
taxes on operating income and (iv) administrative expenses.


                                      F-14
<PAGE>

ASSET MANAGEMENT FEE
SFD Holding is entitled to receive an annual asset management fee equal to 1% of
the product of (A) the purchase price multiple of the Contracts then securing
the Notes, and (B) the average monthly monitoring revenues for the Contracts
then securing the Notes, with the product multiplied by (C) the aggregate number
of Contracts then securing the Notes.  Such fee is subordinate to the payment of
(i) the Servicer Basic Monitoring Fee, (ii) principal and interest on the Notes,
(iii) the Servicer Subordinated Monitoring Fee, (iv) taxes on operating income,
(v) administrative expenses and (vi) the equity return fee.

NOTE 7 - SUBSEQUENT EVENTS

DISTRIBUTION TO SERIES A NOTEHOLDERS
On February 15, 1997, SAMCO distributed $775,652 to the Series A Noteholders
which included (i) interest at an annualized rate of 9.00%; (ii) the required
quarterly principal repayment of 1.25% and (iii) an additional principal
repayment of .63%.  Subsequent to this distribution, the outstanding principal
amount of the Series A Notes is $13,037,613.

DISTRIBUTION TO SERIES B NOTEHOLDERS
On February 15, 1997, SAMCO distributed $340,267 to the Series B Noteholders
which included (i) interest at an annualized rate of 9.00%; (ii) the required
quarterly principal repayment of 1.25% and (iii) an additional principal
repayment of 1.07%.  Subsequent to this distribution, the outstanding principal
amount of the Series B Notes is $5,141,062

DISTRIBUTION TO SERIES C NOTEHOLDERS
On February 15, 1997, SAMCO distributed $1,770,372 to the Series C Noteholders
which included (i) interest at an annualized rate of 9.00%, (ii) the required
quarterly principal repayment of 1.25%, and (iii) additional principal repayment
of 1.23%.  Subsequent to this distribution, the outstanding principal amount of
the Series C Notes is $27,729,893.


                                      F-15