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FIELDSTONE INVESTMENT CORPORATION AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

As filed with the Securities and Exchange Commission on January 31, 2005

Registration No. 333-114802

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

AMENDMENT NO. 9
TO
FORM S-11
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933

Fieldstone Investment Corporation
(Exact Name of Registrant as Specified in Its Governing Instruments)

11000 Broken Land Parkway
Suite 600
Columbia, Maryland 21044
(410) 772-7200
(Address, Including Zip Code and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices)

Michael J. Sonnenfeld
President and Chief Executive Officer
Fieldstone Investment Corporation
11000 Broken Land Parkway
Suite 600
Columbia, Maryland 21044
(410) 772-7200
(Name, Address, Including Zip Code and Telephone Number, Including Area Code, of Agent for Service)

Copies to:

        Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement.

        If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. /x/

        If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

        If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o

        The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to section 8(a), may determine.

SUBJECT TO COMPLETION, DATED                        , 2005

The information in this prospectus is not complete and may be changed or supplemented. None of the securities described in this prospectus can be sold by the selling stockholders until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell the securities, nor is it a solicitation to buy the securities, in any state where any offer or sale of the securities is not permitted.

PROSPECTUS

43,328,933 Shares

Fieldstone Investment Corporation
Common Stock

        We are a self-managed, fully integrated mortgage banking company that originates, securitizes, sells and services non-conforming and conforming single-family residential mortgage loans secured primarily by first liens. We have elected to be taxed as a real estate investment trust, or REIT, for federal income tax purposes, commencing with our taxable year ended December 31, 2003.

        This prospectus covers the resale of up to 43,328,933 shares of our common stock that the selling stockholders listed beginning on page 155 of this prospectus may offer for sale from time to time following the effective date of the registration statement of which this prospectus is a part. We are registering these shares of common stock to provide the selling stockholders with registered securities, but this prospectus does not necessarily mean that the selling stockholders will offer or sell those shares. We are filing the registration statement pursuant to contractual obligations that exist with the selling stockholders.

        No public market currently exists for our common stock, and our common stock is not currently listed on any national exchange or market system. However, shares of our common stock have been sold and may continue to be sold from time to time in private transactions at negotiated prices.

        Our common stock has been approved for quotation on the NASDAQ National Market System under the symbol "FICC." Until such time as our common stock is listed on NASDAQ, we expect that the selling stockholders will sell their shares at prices between $16.00 and $18.00 per share, if any shares are sold. After our common stock is quoted on NASDAQ, the selling stockholders may sell all or a portion of these shares from time to time in market transactions through any stock exchange or market on which our common stock is then listed, in negotiated transactions or otherwise, and at prices and on terms that will be determined by the then prevailing market price or at negotiated prices.

        We are not offering for sale any shares of our common stock in the registration statement of which this prospectus is a part. We will not receive any of the proceeds from sales of our shares by the selling stockholders, but will incur expenses. Our common stock is subject to transfer restrictions principally intended to preserve our status as a REIT. See "Description of Capital Stock—Restrictions on Ownership and Transfer."

        Investing in our common stock involves risks. See "Risk Factors" beginning on page 12 of this prospectus for risk factors relevant to an investment in our common stock, including, among others:

•

We have a limited operating history with respect to our portfolio strategy, which limits your ability to evaluate a key component of our business strategy and our growth prospects and increases your investment risk.



•

We have invested the substantial majority of our shareholders' equity in a portfolio of non-conforming mortgage loans held for investment financed by pledging the loans to secure mortgage-backed securities. If we do not receive the payments from the loans that we anticipate, due to either early prepayment of the loans or default by more borrowers than we have anticipated, our revenues may be insufficient to cover our costs to originate, the interest expense and losses on these loans, as well as the repayment of principal on the warehouse or securitization debt used to finance these loans.



•

We require substantial cash to fund our loan originations, to pay our loan origination expenses and to hold our loans pending sale or securitization, and if it is not available, our business, financial condition and results of operations will be significantly harmed.




•

Fluctuating or rising interest rates may adversely affect our earnings or ability to borrow under our warehouse lines of credit and repurchase facilities.



•

The use of securitizations with over-collateralization requirements may have a negative effect on our cash flow if our loan delinquencies exceed certain levels.



•

We have not established a minimum distribution payment level, and we cannot assure you of our ability to make distributions to our stockholders in the future.



•

If we fail to qualify or remain qualified as a REIT in any taxable year, we would be subject to federal income tax on our taxable income at regular corporate rates, thereby reducing our net income and the amount of funds available for making distributions to our stockholders, and the taxable income of our securitization trusts may be subject to an entity level tax.



•

We may become subject to liability and incur increased expenditures as a result of our recent restatement of our financial statements.

        Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is                        , 2005

        You may rely only on information contained in this prospectus or to which we have referred you. We have not authorized anyone to provide you with information that is different. This prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any shares of our common stock in any jurisdiction in which an offer or solicitation is not authorized or in which the person making the offer or solicitation is not qualified to do so, or to any person to whom it is unlawful to make an offer or solicitation. Neither the delivery of this prospectus nor any sale made hereunder shall, under any circumstances, create an implication that there has been no change in our affairs since the date of this prospectus.

TABLE OF CONTENTS

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SUMMARY

        This summary highlights the material information contained elsewhere in this prospectus but does not contain all of the information that you should consider before investing. You should read the entire prospectus, including "Risk Factors" and our financial statements and the related notes appearing elsewhere in this prospectus, before deciding to invest in our common stock. In this prospectus, unless the context indicates otherwise, references to "our company," "we," "our" and "us" refer to the activities of, and the assets and liabilities of, the business and operations of Fieldstone Investment Corporation (Fieldstone Investment) and its subsidiaries. References to "Fieldstone Mortgage" refer to the activities of our principal operating subsidiary, Fieldstone Mortgage Company.

Our Company

        We are a self-managed, fully integrated mortgage banking company that originates, securitizes, sells and services non-conforming and conforming single-family residential mortgage loans secured primarily by first liens. Our goal is to be an efficient, low-cost originator of high quality residential mortgages and to provide exemplary service to our customers. We retain a significant portion of our non-conforming loans in an investment portfolio, and our current strategy is to own a portfolio of loans with a principal balance approximately equal to 12 times our shareholders' equity. We will finance this portfolio with a combination of long-term securitization debt, short-term warehouse debt and our equity. We retain the servicing rights with respect to non-conforming loans in our portfolio in order to monitor and improve their performance. We continue to sell a portion of the non-conforming loans and all of the conforming loans that we originate on a whole loan, servicing-released basis.

        We have elected to be taxed as a real estate investment trust, or REIT, for federal income tax purposes, commencing with our taxable year ended December 31, 2003. We intend to distribute to our stockholders all or substantially all of our REIT taxable income each year in order to comply with the distribution requirements of the Internal Revenue Code and to avoid federal income tax. We intend to retain our net gains on sales of loans to build our capital base. In order to meet some of the requirements to qualify as a REIT, we conduct all of our loan origination, processing, underwriting, sales and servicing functions through our primary operating subsidiary, Fieldstone Mortgage, which we have elected to treat as a taxable REIT subsidiary. Fieldstone Mortgage funds the conforming and non-conforming loans we intend to sell.

        We originate our loans through our two primary divisions: non-conforming and conforming. Each division operates both wholesale and retail offices. Fieldstone Mortgage continues to originate all of our conforming and non-conforming loans. However, with respect to non-conforming loans held for investment, Fieldstone Mortgage closes the loans using funds advanced by Fieldstone Investment and simultaneously assigns the loans to Fieldstone Investment.

        The conforming loans that we originate generally meet the underwriting criteria of the government-sponsored entities, Fannie Mae (formally, the Federal National Mortgage Association) and Freddie Mac (formally, the Federal Home Loan Mortgage Corporation), the Federal Housing Association (FHA) or the Veterans Administration (VA), or the criteria of institutional investors.

        The non-conforming loans that we originate are underwritten in accordance with our underwriting guidelines. We base our underwriting decisions on our assessment of the borrower's willingness and ability to pay, as reflected in the borrower's historical patterns of debt repayment, the amount of equity in the borrower's property, the borrower's debt ratios and other factors. We believe that we have developed underwriting processes and criteria that generate high quality borrower data and valid appraisals, give us the ability to make sound underwriting and pricing decisions and allow us to approve and fund loans efficiently.

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        The following table shows our total fundings of non-conforming and conforming loans for the three and nine months ended September 30, 2004 and for the years ended December 31, 2003 and 2002:

        We finance our mortgage originations on a short-term basis through a variety of warehouse lines of credit and repurchase facilities. We retain a substantial portion of our non-conforming loans in our investment portfolio on a long-term basis, financed largely by issuing mortgage-backed securities secured by these loans. These securitizations are structured as financings for accounting purposes; therefore, we do not recognize a gain or loss on our securitization of these loans. We record interest income generated by the loans and recognize interest expense on the mortgage-backed securities over the life of the loans and corresponding mortgage-backed securities debt.

        We generate earnings from the non-conforming loans we retain primarily through:

•

net interest income, which is the difference between the interest income we receive from the loans and the interest expense paid under our warehouse lines and repurchase facilities and to the holders of the mortgage-backed securities;

        less

•

losses due to defaults and delinquencies on the loans; and



•

servicing fees and selling and general administrative expenses that we must pay.

Our net interest income will vary based upon, among other things, the difference between the weighted average interest earned on the loans and the interest payable to our warehouse lenders and the holders of the mortgage-backed securities, the performance of the underlying loans and the amount and timing of borrower prepayments of the underlying loans.

        We sell all of our conforming loans as well as the non-conforming loans held for sale on a "servicing-released" basis, which means we sell the loans together with the servicing rights to the buyer of the loans. These transactions are typically referred to as whole loan sales. We aggregate these loans into mortgage pools and sell these pools of mortgages to third parties on a servicing-released basis. We generally sell our loans held for sale within 45 days of funding. We perform the initial interim servicing functions for all of our loans. We intend to develop our servicing capability to allow us to permanently service the portfolio of non-conforming loans held for investment, but until this capability is developed,

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we contract with third parties to service these loans for us. We perform the initial interim servicing functions for these loans between the time of origination and the time of transfer of servicing to the long-term servicer of these loans, which is generally within 90 days after funding.

        Under our whole loan sale strategy, our income is generated primarily by:

•

the sale of loans at a premium to our weighted average origination costs (net of origination fee income); and



•

net interest income, which is the difference between the interest income we receive from the loans and our interest expense paid under our warehouse lines and repurchase facilities used to fund the loans.

Risk Factors

        Investing in our common stock involves risks. See "Risk Factors" beginning on page 12 of this prospectus for risk factors relevant to an investment in our common stock, including, among others:

•

We have a limited operating history with respect to our portfolio strategy, which limits your ability to evaluate a key component of our business strategy and our growth prospects and increases your investment risk.



•

We have invested the substantial majority of our shareholders' equity in a portfolio of non-conforming mortgage loans held for investment financed by pledging the loans to secure mortgage-backed securities. If we do not receive the payments from the loans that we anticipate, due to either early prepayment of the loans or default by more borrowers than we have anticipated, our revenues may be insufficient to cover our costs to originate, the interest expense and losses on these loans, as well as the repayment of principal on the warehouse or securitization debt used to finance these loans.



•

We require substantial cash to fund our loan originations, to pay our loan origination expenses and to hold our loans pending sale or securitization, and if it is not available, our business, financial condition and results of operations will be significantly harmed.



•

Fluctuating or rising interest rates may adversely affect our earnings or ability to borrow under our warehouse lines of credit and repurchase facilities.



•

The use of securitizations with over-collateralization requirements may have a negative effect on our cash flow if our loan delinquencies exceed certain levels.



•

We have not established a minimum distribution payment level. If the cash we generate from our operations is insufficient to make our REIT distributions, we may need to borrow funds on a short-term basis to make distributions to stockholders. We cannot assure you of our ability to make distributions to our stockholders in the future.



•

If we fail to qualify or remain qualified as a REIT in any taxable year, we would be subject to federal income tax on our taxable income at regular corporate rates, thereby reducing our net income and the amount of funds available for making distributions to our stockholders, and our taxable income of our securitization trusts may be subject to an entity level tax.



•

We may become subject to liability and incur increased expenditures as a result of our recent restatement of our financial statements.

Recent Developments

        On January 14, 2005, we announced that we would restate our audited financial statements for the year ended December 31, 2003, and our unaudited financial statements for each of the first three

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quarters of 2004, to eliminate the use of cash flow hedge accounting treatment under Statement of Financial Accounting Standards No. 133 (Statement 133) for our interest rate swap transactions in place during these periods. Cash flow hedge accounting would result in recognizing the mark to market of the remaining effective future value of the interest rate swaps' cash flow on our balance sheet in accumulated other comprehensive income, the impact of which would be reflected in total shareholders' equity but not our reported net income.

        We designed our interest rate swap transactions to allow us to match-fund the interest rates on our assets and liabilities by fixing the interest rates that we pay on our warehouse and securitization debt, which bear interest at variable rates, during the period that our mortgage loan assets have a fixed interest rate, generally during the first two years of the mortgages' lives. These interest rate swaps were an effective economic hedge of our debt expense, and we attempted to document the swaps transactions to meet the requirements of Statement 133 in order for the swaps to be eligible for cash flow hedge accounting.

        We have now determined that our interest rate swaps did not qualify for cash flow hedge accounting under Statement 133, and we have restated our financial statements primarily to reclassify the effective portion of the mark to market of the changes in fair market value of our interest rate swaps from accumulated other comprehensive income into current period earnings. This reclassification had no effect on our REIT taxable income, which is the basis for determining the dividends we pay to our stockholders. Periods prior to the fourth quarter of 2003 are not impacted because we did not engage in interest rate swap transactions prior to December 2003.

        A summary of the impact of the restatement on net income and shareholders' equity is as follows (in thousands):

        For all prior periods affected, and for future periods unless and until we elect and satisfy all of the requirements of Statement 133 for cash flow hedge accounting, the period to period changes in the fair market value of our interest rate swaps will be recognized as either an increase or decrease in our current period net income through other income (expense)—portfolio derivatives. We are currently

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assessing alternative hedge strategies and methods of documenting our hedging relationships in order to permit us to achieve cash flow hedge accounting for interest rate swaps we enter into in the future. There can be no assurance that we will be able to design a hedge strategy that will meet the technical requirements of Statement 133. For tax accounting purposes, these interest rate swaps will continue to be accounted for as hedges of warehouse and securitization debt financing mortgage loans under Section 1221 of the Internal Revenue Code, and, therefore, the mark to market gains and losses will not be recognized for calculating REIT taxable income or for the REIT income tests.

Our Principal Office

        Our principal offices are located at 11000 Broken Land Parkway, Suite 600, Columbia, Maryland 21044. Our telephone number is (410) 772-7200. Our website is www.FieldstoneInvestment.com. Fieldstone Mortgage's website is www.fmcc.com or www.FieldstoneMortgage.com. The information on our websites does not constitute a part of this prospectus.

Restrictions on Ownership of Our Common Stock

        Due to limitations on the concentration of ownership of REIT shares imposed by the Internal Revenue Code, our charter documents generally prohibit any stockholder from actually or constructively owning more than 9.8% of the outstanding shares of our common stock. Our board may, in its sole discretion, waive the ownership limit with respect to a particular stockholder if our board is presented with satisfactory evidence that the ownership will not then or in the future jeopardize our REIT status. Our charter also prohibits certain cooperatives, governmental entities and tax-exempt organizations that are exempt from the unrelated business income tax from owning our shares because a tax could be imposed on us if our shares are held by these entities.

Our Corporate History, Formation and Tax Status

        Fieldstone Mortgage has been acquiring and selling mortgage loans since its formation in 1995 as a Maryland corporation. Fieldstone Mortgage began originating mortgage loans in 1996. Fieldstone Mortgage was acquired in 1998 by Fieldstone Holdings Corp. (Fieldstone Holdings). Fieldstone Investment was formed as a Maryland corporation on August 20, 2003 to be the successor to Fieldstone Holdings. On November 14, 2003, Fieldstone Holdings merged with and into Fieldstone Investment, with Fieldstone Investment being the surviving entity, and as a result, Fieldstone Mortgage became the principal operating subsidiary of Fieldstone Investment.

        Prior to 2003, Fieldstone Holdings operated as a regular taxable C corporation. Effective January 1, 2003, Fieldstone Holdings made an election to be taxed as an S corporation. Effective November 13, 2003, prior to merging with Fieldstone Investment, Fieldstone Holdings revoked its S corporation status. We have elected to be taxed as a REIT for federal income tax purposes, effective November 13, 2003. Our qualification as a REIT depends upon our ability to meet, on a continuing basis, various complex requirements under the Internal Revenue Code relating to, among other things, the sources of our gross income, the composition and values of our assets, our distribution levels and the diversity of ownership of our capital stock. We believe that we are organized as required to qualify as a REIT under the Internal Revenue Code and that our manner of operation will enable us to meet the requirements for taxation as a REIT for federal income tax purposes.

        As a REIT, we generally are not subject to federal income tax on the REIT taxable income that we distribute currently to our stockholders. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax at regular corporate rates. Even if we qualify as a REIT, we may be subject to some federal, state and local taxes on our income and property. We have elected to treat Fieldstone Mortgage as our taxable REIT subsidiary. Fieldstone Mortgage is a regular taxable corporation that is subject to federal, state and local income tax on profits it earns on its mortgage

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origination business, including profits from the sale of conforming loans and any non-conforming loans not held in our portfolio.

Our Distribution Policy

        To satisfy the requirements to qualify as a REIT, and to reduce our liability to pay taxes on our income, we will make regular quarterly distributions of all or substantially all of our REIT taxable income to our stockholders. Under the Internal Revenue Code, REITs are subject to numerous organizational and operational requirements, including a requirement that they distribute at least 90% of their REIT taxable income, excluding net capital gains, to their stockholders on an annual basis. If we fail to qualify as a REIT, we will be subject to tax as a regular corporation and may face substantial tax liability. Even if we qualify as a REIT, we may be subject to certain federal, state and local taxes on a portion of our income and property. Our REIT taxable income, and our cash available for distribution, will not include any earnings of Fieldstone Mortgage that we choose to retain in that subsidiary (by not making a dividend of those earnings to Fieldstone Investment). Any distributions we make will be at the discretion of our board of directors and will depend upon, among other things, our actual results of operations. Our actual results of operations and our ability to pay distributions will be affected by a number of factors, including the net interest income we receive from the non-conforming loans we retain in our portfolio, the revenue we receive from the securitization and sale of loans, our operating expenses and any other expenditures. In addition, if our minimum distribution required to maintain our REIT status exceeds our cash available for distribution because our income for tax purposes exceeds our cash flow from operations, we could be forced to borrow funds, sell assets or raise capital on unfavorable terms in order to maintain our REIT status.

        We have not established a minimum distribution payment level, and we cannot assure you of our ability to make distributions to our stockholders in the future. We anticipate that our distributions generally will be taxable as ordinary income to our stockholders, although if we were to restructure our investment portfolio and sell loans held in the portfolio, a portion of any distributions may be designated by us as capital gain, based on the tax accounting for our income. In addition, a portion of our dividend will be classified as excess inclusion income. If our distributions exceed our accumulated REIT taxable income, as calculated for federal income tax purposes, distributions may constitute a return of capital for tax purposes. We will furnish annually to each of our stockholders a statement setting forth distributions paid during the preceding year and their characterization for tax purposes. See "Material Federal Income Tax Considerations."

144A Offering

        We sold a total of 47.15 million shares of our common stock in the fourth quarter of 2003. Of these shares, we sold 36.56 million shares at $13.95 per share to Friedman, Billings, Ramsey & Co., Inc., or FBR, as initial purchaser, on November 14, 2003, and an additional 195,400 shares of our common stock at $13.95 per share to FBR, as initial purchaser, on December 11, 2003, pursuant to the exercise by FBR of its option to purchase shares to cover additional allotments. FBR resold 33,166,835 shares to investors at a price of $15.00 per share in transactions not involving registration under the Securities Act. As part of this same offering, we sold 10,398,936 shares of our common stock (including 356,540 shares sold to our employees and directors in a directed share program) directly in a private placement in reliance on the exemption from registration provided in Section 4(2) of the Securities Act and Rule 506 of Regulation D thereunder, at a price of $15.00 per share. FBR received a fee of $1.05 per share as placement agent in respect of the shares sold in the private placement (except for the shares sold in the directed share program for which no fee was paid). We also issued 400,000 shares of our common stock to FBR as consideration for financial advisory services, at a price of $0.01 per share. The value of the shares issued to FBR for its financial advisory services was approximately $6.0 million.

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The shares sold to FBR and those sold by us directly in the private placement are collectively referred to as the 144A Offering.

        Our net proceeds from the 144A Offering were approximately $658.1 million. We have used the net proceeds as follows:

•

approximately $188.1 million to redeem 94.83% of our common stock outstanding immediately prior to the closing of the 144A Offering;



•

approximately $33.0 million to repay in full the principal and interest on our subordinated debt outstanding immediately prior to the closing of the 144A Offering;



•

approximately $4.4 million to pay advisory, legal and accounting fees incurred in connection with the 144A Offering, including fees incurred in connection with filing the registration statement of which this prospectus is a part, and the reimbursement of certain fees and expenses incurred by FBR; and



•

the remainder, $432.6 million, for building our investment portfolio, working capital and other general corporate purposes, including repaying outstanding borrowings under our warehouse lines and repurchase facilities.

        For a more detailed discussion of the 144A Offering see "Our Structure and Formation Transactions; 144A Offering."

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The Offering

        This prospectus covers the resale of up to 43,328,933 shares of our common stock, which represents 88.7% of our total outstanding common stock. We issued and sold 47,150,000 shares in the 144A Offering. FBR has represented to us that the shares it purchased in the 144A Offering and those it placed on our behalf were resold to qualified institutional buyers, as defined in Rule 144A under the Securities Act, institutional accredited investors, as defined in Rule 501 under the Securities Act, or to non-U.S. persons, as defined in Regulation S under the Securities Act, initially at a price of $15.00 per share.

(1)

Includes (i) 42,553,073 of the 47,150,000 shares issued and sold in the 144A Offering and (ii) 775,860 shares owned by Michael J. Sonnenfeld, our president and chief executive officer, prior to the 144A Offering.

(2)

Includes (i) 47.15 million shares issued and sold in the 144A Offering, (ii) 400,000 shares issued to FBR in consideration for financial advisory services rendered, (iii) 775,860 shares owned by Michael J. Sonnenfeld, our president and chief executive officer, prior to the 144A Offering, (iv) 496,866 shares of restricted stock issued to our directors, officers and key employees under our Equity Incentive Plan and (v) 16,900 shares issued upon the exercise of options. Excludes 736,600 shares issuable upon the exercise of options outstanding on January 31, 2005.

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Summary Selected Historical Consolidated Financial Data
(In Thousands)

        The following table presents summary selected historical consolidated financial data for Fieldstone Investment, including the financial data for Fieldstone Holdings, deemed to be our predecessor for accounting purposes. The historical financial statements represent the combined financial condition and results of operations of Fieldstone Investment and its subsidiaries. In addition, the historical consolidated financial data included below for the years ended December 31, 1999 through 2002 and the three and nine months ended September 30, 2003 reflect our business strategy prior to the completion of the 144A Offering. See "Business" beginning on page 97. Accordingly, our historical financial results will not be indicative of our future performance. In addition, because the information in this table is only a summary and does not provide all of the information contained in our financial statements, including related notes, you should read "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements, including the related notes, contained elsewhere in this prospectus.

        Our consolidated statements of condition as of December 31, 2003 and September 30, 2004 and our consolidated statements of operations for the three and nine months ended September 30, 2004 and year ended December 31, 2003 have been restated to reflect the elimination of the use of cash flow hedge accounting treatment for our interest rate swap transactions in effect during such periods. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Restatement of Consolidated Financial Statements" and Note 2 to our financial statements contained elsewhere in this prospectus.