EXHIBIT 4.1
Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2000-5
POOLING AND SERVICING AGREEMENT
among
CONSECO FINANCE SECURITIZATIONS CORP.
as Seller
CONSECO FINANCE CORP.
as Originator and Initial Servicer
and
U.S. BANK NATIONAL ASSOCIATION
not in its individual capacity but solely as Trustee
Dated as of October 1, 2000
TABLE OF CONTENTS
ARTICLE I DEFINITIONS........................................................................1-1
SECTION 1.01. General....................................................................1-1
SECTION 1.02. Specific Terms.............................................................1-1
SECTION 1.03. Calculations..............................................................1-33
ARTICLE II ESTABLISHMENT OF TRUST; TRANSFER OF CONTRACTS.....................................2-1
SECTION 2.01. Closing....................................................................2-1
SECTION 2.02. Conditions to the Closing..................................................2-2
SECTION 2.03. Conveyance of the Subsequent Contracts.....................................2-4
SECTION 2.04. Acceptance by Trustee......................................................2-5
SECTION 2.05. REMIC Provisions...........................................................2-6
ARTICLE III REPRESENTATIONS AND WARRANTIES...................................................3-1
SECTION 3.01. Representations and Warranties Regarding the Seller........................3-1
SECTION 3.02. Representations and Warranties Regarding Each Contract.....................3-2
SECTION 3.03. Additional Representations and Warranties..................................3-6
SECTION 3.04. Representations and Warranties Regarding the Contracts
in the Aggregate...........................................................3-6
SECTION 3.05. Representations and Warranties Regarding the Contract Files................3-8
SECTION 3.06. Repurchase of Contracts or Substitution of Contracts for Breach of
Representations and Warranties.............................................3-9
SECTION 3.07. No Repurchase or Substitution Under Certain Circumstances.................3-12
SECTION 3.08. Staged-Funding Contract Reserve Account...................................3-13
ARTICLE IV PERFECTION OF TRANSFER AND PROTECTION OF
SECURITY INTERESTS...............................................................4-1
SECTION 4.01. Custody of Contracts.......................................................4-1
SECTION 4.02. Filings....................................................................4-2
SECTION 4.03. Name Change or Relocation..................................................4-2
SECTION 4.04. Chief Executive Office.....................................................4-2
SECTION 4.05. Costs and Expenses.........................................................4-2
ARTICLE V SERVICING OF CONTRACTS.............................................................5-1
SECTION 5.01. Responsibility for Contract Administration.................................5-1
SECTION 5.02. Standard of Care...........................................................5-1
SECTION 5.03. Records....................................................................5-1
SECTION 5.04. Inspection; Computer Tape..................................................5-1
SECTION 5.05. Certificate Account........................................................5-2
SECTION 5.06. Enforcement................................................................5-4
SECTION 5.07. Trustee to Cooperate.......................................................5-5
SECTION 5.08. Costs and Expenses.........................................................5-6
SECTION 5.09. Maintenance of Insurance...................................................5-6
i
SECTION 5.10. Repossession...............................................................5-8
SECTION 5.11. Commingling of Funds.......................................................5-8
SECTION 5.12. Retitling; Security Interests..............................................5-8
SECTION 5.13. Covenants, Representations and Warranties of Servicer......................5-9
ARTICLE VI REPORTS AND TAX MATTERS...........................................................6-1
SECTION 6.01. Monthly Reports............................................................6-1
SECTION 6.02. Certificate of Servicing Officer...........................................6-1
SECTION 6.03. Other Data.................................................................6-1
SECTION 6.04. Annual Report of Accountants...............................................6-1
SECTION 6.05. Statements to Certificateholders...........................................6-2
SECTION 6.06. Payment of Taxes...........................................................6-7
ARTICLE VII SERVICE TRANSFER.................................................................7-1
SECTION 7.01. Event of Termination.......................................................7-1
SECTION 7.02. Transfer...................................................................7-1
SECTION 7.03. Trustee to Act; Appointment of Successor...................................7-2
SECTION 7.04. Notification to Certificateholders.........................................7-3
SECTION 7.05. Effect of Transfer.........................................................7-3
SECTION 7.06. Transfer of Certificate Account............................................7-3
ARTICLE VIII PAYMENTS .......................................................................8-1
SECTION 8.01. Monthly Payments...........................................................8-1
SECTION 8.02. Permitted Withdrawals from the Certificate Account.........................8-2
SECTION 8.03. Payments...................................................................8-2
SECTION 8.04. [Reserved].................................................................8-8
SECTION 8.05. Class C Subsidiary Certificateholder's Purchase Option; Auction Sale;
Additional Principal Distribution Amount...................................8-8
SECTION 8.06. Capitalized Interest Account..............................................8-10
SECTION 8.07. Pre-Funding Account.......................................................8-11
ARTICLE IX THE CERTIFICATES AND UNCERTIFICATED SUBSIDIARY
INTERESTS........................................................................9-1
SECTION 9.01. The Certificates...........................................................9-1
SECTION 9.02. Registration of Transfer and Exchange of Certificates......................9-2
SECTION 9.03. No Charge; Disposition of Void Certificates................................9-5
SECTION 9.04. Mutilated, Destroyed, Lost or Stolen Certificates..........................9-5
SECTION 9.05. Persons Deemed Owners......................................................9-6
SECTION 9.06. Access to List of Certificateholders' Names and Addresses..................9-6
SECTION 9.07. Authenticating Agents......................................................9-6
ARTICLE X INDEMNITIES ......................................................................10-1
SECTION 10.01. Seller's and Originator's Indemnities....................................10-1
SECTION 10.02. Liabilities to Obligors..................................................10-1
ii
SECTION 10.03. Tax Indemnification......................................................10-1
SECTION 10.04. Servicer's Indemnities...................................................10-1
SECTION 10.05. Operation of Indemnities.................................................10-2
SECTION 10.06. REMIC Tax Matters........................................................10-2
ARTICLE XI THE TRUSTEE......................................................................11-1
SECTION 11.01. Duties of Trustee........................................................11-1
SECTION 11.02. Certain Matters Affecting the Trustee....................................11-2
SECTION 11.03. Trustee Not Liable for Certificates or Contracts.........................11-3
SECTION 11.04. Rights of Certificateholders to Direct Trustee and to Waive Event of
Termination..............................................................11-3
SECTION 11.05. The Servicer to Pay Trustee's Fees and Expenses..........................11-4
SECTION 11.06. Eligibility Requirements for Trustee.....................................11-4
SECTION 11.07. Resignation or Removal of Trustee........................................11-5
SECTION 11.08. Successor Trustee........................................................11-5
SECTION 11.09. Merger or Consolidation of Trustee.......................................11-6
SECTION 11.10. Tax Returns..............................................................11-6
SECTION 11.11. Obligor Claims...........................................................11-6
SECTION 11.12. Appointment of Co-Trustee or Separate Trustee............................11-7
SECTION 11.13. Agents of Trustee........................................................11-8
ARTICLE XII MISCELLANEOUS...................................................................12-1
SECTION 12.01. Servicer Not to Assign Duties or Resign; Delegation of Servicing
Functions................................................................12-1
SECTION 12.02. Maintenance of Office or Agency..........................................12-1
SECTION 12.03. Termination..............................................................12-2
SECTION 12.04. Acts of Certificateholders...............................................12-3
SECTION 12.05. Calculations.............................................................12-4
SECTION 12.06. Assignment or Delegation by Originator...................................12-4
SECTION 12.07. Amendment................................................................12-5
SECTION 12.08. Notices..................................................................12-6
SECTION 12.09. Merger and Integration...................................................12-8
SECTION 12.10. Headings.................................................................12-8
SECTION 12.11. Governing Law............................................................12-8
EXHIBIT A - Form of Class A Certificate......................................................A-1
EXHIBIT B - Form of Class M-[1][2] Certificate...............................................B-1
EXHIBIT C-1 - Form of Class B-[1][2] Certificate.............................................C-1
EXHIBIT C-2 - Form of Class B-3I Certificate...............................................C-2-1
EXHIBIT D - Form of Assignment...............................................................D-1
EXHIBIT E - Form of Certificate of Officer...................................................E-1
EXHIBIT F - Form of Opinion of Counsel.......................................................F-1
iii
EXHIBIT G - Form of Trustee's Acknowledgement................................................G-1
EXHIBIT H - Form of Custodian's Acknowledgement..............................................H-1
EXHIBIT I - Form of Certificate of Servicing Officer.........................................I-1
EXHIBIT J - Form of Class C Subsidiary Certificate...........................................J-1
EXHIBIT K - Form of Class C Master Certificate...............................................K-1
EXHIBIT L-1 - Form of Certificate Regarding Repurchased
Contracts......................................................................L-1
EXHIBIT L-2 - Form of Certificate Regarding Substituted
Contracts....................................................................L-2-1
EXHIBIT M - Form of Representation Letter....................................................M-1
EXHIBIT N - Form of Monthly Report...........................................................N-1
EXHIBIT O - Form of Addition Notice..........................................................O-1
EXHIBIT P - Form of Subsequent Transfer Instrument...........................................P-1
EXHIBIT Q - Form of Officer's Certificate (Subsequent
Transfer)........................................................................Q-1
iv
AGREEMENT, dated as of October 1, 2000, among Conseco Finance
Securitizations Corp., a corporation organized and existing under the laws of
the State of Minnesota, as Seller (the "Seller"), Conseco Finance Corp., a
corporation organized and existing under the laws of the State of Delaware, as
originator of the manufactured housing installment sales contracts and
installment loan agreements described herein (the "Originator"), and as the
initial servicer (the "Servicer") and U.S. Bank National Association, a national
banking association, not in its individual capacity but solely as Trustee (the
"Trustee").
WHEREAS, in the regular course of its business, Conseco Finance Corp.
originates, purchases and services manufactured housing installment sales
contracts and installment loan agreements, which contracts provide for
installment payments by or on behalf of the owner of the manufactured home and
grant security interests in the related manufactured home (or, in certain cases,
mortgages or deeds of trust on the real estate to which such manufactured home
is deemed permanently affixed);
WHEREAS, the Seller, the Originator, the Servicer, and the Trustee wish
to set forth the terms and conditions pursuant to which the "Trust," as
hereinafter defined, will acquire the "Contracts," as hereinafter defined, and
the Servicer will manage and service the Contracts;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the parties hereto agree as provided herein:
ARTICLE I
DEFINITIONS
-----------
SECTION 1.01. General.
-------
For the purpose of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, the terms defined in this
Article include the plural as well as the singular, the words "herein," "hereof"
and "hereunder" and other words of similar import refer to this Agreement as a
whole and not to any particular Article, Section or other subdivision, and
Section references refer to Sections of the Agreement.
SECTION 1.02. Specific Terms.
--------------
"Addition Notice" means, with respect to each transfer of Subsequent
Contracts to the Trust pursuant to Section 2.03 of this Agreement, a notice,
substantially in the form of Exhibit O, which shall be given not less than five
Business Days prior to the related Subsequent Transfer Date, of the Seller's
designation of Subsequent Contracts to be sold to the Trust and the aggregate
Cut-off Date Principal Balances of such Subsequent Contracts.
"Additional Contract" means a Contract identified in the List of
Contracts delivered pursuant to Section 2.02(a) that is not an Initial Contract.
"Additional Monthly Servicing Fee" means, as of any Remittance Date, a
maximum of one-twelfth of the product of 0.50% and the Pool Scheduled Principal
Balance for the immediately preceding Remittance Date (or, with respect to the
first Remittance Date, the Cut-off Date Pool Principal Balance as of the Closing
Date).
"Additional Principal Distribution Amount" means, as to any Remittance
Date, the Amount Available remaining after payment of the amounts described in
clauses (1) through (11) of Section 8.03(a), subject to the limitations and
conditions specified in Section 8.03(a)(12).
"Adjusted Amount Available" means, as to any Remittance Date, the sum
of the Amount Available and any amount withdrawn from the Capitalized Interest
Account, Pre-Funding Account or Staged-Funding Contract Reserve Account and
deposited in the Certificate Account on such Remittance Date.
"Adjusted Certificate Principal Balance" means, as of any Remittance
Date, the sum of the Class A Principal Balance, the Class M-1 Adjusted Principal
Balance, the Class M-2 Adjusted Principal Balance, the Class B-1 Adjusted
Principal Balance and the Class B-2 Principal Balance as of that Distribution
Date.
"Advance Payment" means any payment by an Obligor in advance of the
related Due Period in which it would be due under such Contract and which
payment is not a Principal Prepayment.
"Affiliate" of any specified Person means any other Person controlling
or controlled by or under common control with such specified Person. For the
purposes of this definition, "control"
1-1
when used with respect to any specified Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" or "controlled" have meanings correlative to the foregoing.
"Agreement" means this Pooling and Servicing Agreement, as the same may
be amended or supplemented from time to time.
"Amount Available" means, as to any Remittance Date, an amount equal to
(a) the sum of
(i) the amount on deposit in the Certificate Account as
of the close of business on the last day of the
related Due Period,
(ii) any amounts required to be deposited in the
Certificate Account on the Business Day immediately
preceding such Remittance Date pursuant to Section
5.09(b), and
(iii) all collections in respect of principal on the
Contracts received after the last day of the related
Due Period up to and including the third Business Day
prior to such Remittance Date (but in no event later
than the 25th day of the month prior to such
Remittance Date), minus
(b) the sum as of the close of business on the Business Day
preceding such Remittance Date of
(i) the Amount Held for Future Distribution,
(ii) amounts permitted to be withdrawn by the Trustee from
the Certificate Account pursuant to clauses (b) -
(e), inclusive, of Section 8.02, and
(iii) with respect to all Remittance Dates other than the
Remittance Date in November 2000, all collections in
respect of principal on the Contracts received on or
after the first day of the related Due Period up to
and including the third Business Day prior to the
preceding Remittance Date (but in no event later than
the 25th day of the month prior to the preceding
Remittance Date).
"Amount Held for Future Distribution" means, as to any Remittance Date,
the total of the amounts held in the Certificate Account on the last day of the
related Due Period on account of Advance Payments in respect of such related Due
Period (not including any portion of Advance Payments received during such
related Due Period that was distributed on the prior Remittance Date pursuant to
clause (vi) of the definition of "Formula Principal Distribution Amount").
"Applicants" has the meaning assigned in Section 9.06.
1-2
"Appraised Value" means, with respect to any Manufactured Home, the
value of such Manufactured Home as determined by a professional appraiser (who
may be an employee of the Originator).
"Assumption Fee" means any assumption or other similar fee paid by the
Obligor on a Contract.
"Auction Date" has the meaning assigned in Section 8.05(e).
"Authenticating Agent" means any authenticating agent appointed
pursuant to Section 9.07.
"Average Sixty-Day Delinquency Ratio" means the arithmetic average of
the Sixty-Day Delinquency Ratios for such Remittance Date and for the two
immediately preceding Remittance Dates.
"Book-Entry Certificate" means any Certificate registered in the name
of the Depository or its nominee ownership of which is reflected on the books of
the Depository or on the books of a person maintaining an account with such
Depository (directly or as an indirect participant in accordance with the rules
of such Depository).
"Business Day" means any day other than (a) a Saturday or a Sunday, or
(b) another day on which banking institutions in the city in which a Person is
taking action hereunder are authorized or obligated by law, executive order or
governmental decree to be closed.
"Capitalized Interest Account" means the account established and
maintained pursuant to Section 8.06.
"Certificates" means the Class A, Class M, Class B, Class B-3I, and
Class C Certificates, collectively.
"Certificate Account" means the account established and maintained
pursuant to Section 5.05.
"Certificate Owner" means the person who is the beneficial owner of a
Book-Entry Certificate.
"Certificate Register" means the register maintained pursuant to
Section 9.02.
"Certificate Registrar" or "Registrar" means the registrar appointed
pursuant to Section 9.02.
"Certificateholder" or "Holder" means the person in whose name a
Certificate is registered on the Certificate Register, except that, solely for
the purposes of giving any consent, waiver, request or demand pursuant to this
Agreement, any Regular Certificate registered in the name of the Originator or
the Seller or any of their Affiliates shall be deemed not to be outstanding and
the Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite Percentage Interest necessary to effect any
such consent,
1-3
request, waiver or demand has been obtained; provided, however, that, solely for
the purpose of determining whether the Trustee is entitled to rely upon any such
consent, waiver, request or demand, only Regular Certificates which the Trustee
knows to be so owned shall be so disregarded.
"Class," "Class A," "Class M," "Class B," "Class B-3I" or "Class C"
means pertaining to each Class of Class A Certificates, Class M Certificates,
Class B Certificates, Class B-3I Certificates and/or Class C Certificates, as
the case may be.
"Class A Certificate" means any one of the Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class
A-3, Class A-4, Class A-5, Class A-6 and Class A-7 Certificates executed and
delivered by the Trustee substantially in the form set forth in Exhibit A and
evidencing an interest designated as a "regular interest" in the Master REMIC
for purposes of the REMIC Provisions.
"Class A-7 Cross-Over Date" means the Remittance Date on which the
Class A-7 Principal Balance (after giving effect to the distributions of
principal on the Class A-7 Certificates on such Remittance Date) is reduced to
zero.
"Class A Distribution Amount" means, as to any Remittance Date, the
lesser of (a) the Adjusted Amount Available for such Remittance Date (less any
amounts paid to the Servicer pursuant to Section 8.03(a)(1)) and (b) the Class A
Formula Distribution Amount for such Remittance Date; provided that after the
A-7 Cross-Over Date the Class A Distribution Amount shall be zero.
"Class A Formula Distribution Amount" means, as to any Remittance Date,
an amount equal to the sum of (a) interest (calculated in the manner specified
in Section 1.03) at (i) the Class A-1 Remittance Rate on the Class A-1 Principal
Balance, (ii) the Class A-2 Remittance Rate on the Class A-2 Principal Balance,
(iii) the Class A-3 Remittance Rate on the Class A-3 Principal Balance, (iv) the
Class A-4 Remittance Rate on the Class A-4 Principal Balance, (v) the Class A-5
Remittance Rate on the Class A-5 Principal Balance, (vi) the Class A-6
Remittance Rate on the Class A-6 Principal Balance and (vii) the Class A-7
Remittance Rate on the Class A-7 Principal Balance, in each case calculated
immediately prior to such Remittance Date, (b) the aggregate Unpaid Class A
Interest Shortfall, if any, (c) the Class A Percentage of the Formula Principal
Distribution Amount, (d) any Unpaid Class A Principal Shortfall and (e) any
Additional Principal Distribution Amount to be distributed to the Class A
Certificates pursuant to Section 8.03(a)(12); provided, however, that the
aggregate of all amounts distributed for all Remittance Dates pursuant to
clauses (c), (d) and (e) shall not exceed the sum of the Original Class A-l
Principal Balance, the Original Class A-2 Principal Balance, the Original Class
A-3 Principal Balance, the Original Class A-4 Principal Balance, the Original
Class A-5 Principal Balance, and the Original Class A-6 Principal Balance and
the Original Class A-7 Principal Balance.
"Class A Interest Distribution Amount" means, as to each Class of Class
A Certificates and any Remittance Date, the sum of the amounts specified in
clause (a)(i), (a)(ii), (a)(iii), (a)(iv), (a)(v), (a)(vi) and (a)(vii) as
applicable, of the definition of the term "Class A Formula Distribution Amount"
plus the Unpaid Class A Interest Shortfall, if any, with respect to such Class.
1-4
"Class A Interest Shortfall" means, as to any Remittance Date and with
respect to each Class of Class A Certificates, the amount, if any, by which the
amount distributed to Holders of such Class of Class A Certificates on such
Remittance Date pursuant to Section 8.03(a)(2) is less than the Class A Interest
Distribution Amount for such Class.
"Class A Percentage" means, as to any Remittance Date, a fraction,
expressed as a percentage, the numerator of which is the Class A Principal
Balance and the denominator of which is the sum of (a) the Class A Principal
Balance, (b) if the Class M-1 Distribution Test is satisfied, the Class M-1
Principal Balance, otherwise zero, (c) if the Class M-2 Distribution Test is
satisfied, the Class M-2 Principal Balance, otherwise zero, and (d) if the Class
B Distribution Test is satisfied, the sum of the Class B Principal Balance and
the Overcollateralization Amount, otherwise zero.
"Class A Principal Balance" means, as to any Remittance Date, the sum
of the Class Principal Balances of the Class A Certificates.
"Class A Principal Deficiency Amount" means, as to any Remittance Date,
the amount, if any, by which the Pool Scheduled Principal Balance plus any
Pre-Funded Amount is less than the Class A Principal Balance.
"Class A Principal Shortfall" means, as to any Remittance Date, the
amount, if any, by which the amount distributed to Holders of Class A
Certificates on such Remittance Date pursuant to Section 8.03(a)(6)(i) or (iii)
is less than the Class A Percentage of the Formula Principal Distribution Amount
for such Remittance Date. In no event, however, shall the Class A Principal
Shortfall exceed the Class A Principal Balance.
"Class A-1 Remittance Rate" means 6.98% per annum.
"Class A-2 Remittance Rate" means 7.06% per annum.
"Class A-3 Remittance Rate" means 7.21% per annum.
"Class A-4 Remittance Rate" means 7.47% per annum.
"Class A-5 Remittance Rate" means 7.70% per annum.
"Class A-6 Remittance Rate" means 7.96% per annum.
"Class A-7 Remittance Rate" means 8.20% per annum.
"Class A-1-S1 Interest" means a regular interest in the Subsidiary
REMIC which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class A-S2 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
1-5
"Class A-S3 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class A-S4 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class A-S5 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class A-S6 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class A-S7 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class B-1 Adjusted Principal Balance" means, as of any Remittance
Date, the Class B-1 Principal Balance as of that Remittance Date minus the Class
B-1 Liquidation Loss Amount (if any) as of the prior Remittance Date.
"Class B Certificate" means any one of the Class B-1 or Class B-2
Certificates.
"Class B-1 Certificate" means any one of the Class B-1 Certificates
executed and delivered by the Trustee substantially in the form set forth in
Exhibit C-1 hereto and evidencing an interest designated as a "regular interest"
in the Master REMIC for purposes of the REMIC Provisions.
"Class B-2 Certificate" means any one of the Class B-2 Certificates
executed and delivered by the Trustee substantially in the form set forth in
Exhibit C-1 hereto and evidencing an interest designated as a "regular interest"
in the Master REMIC for purposes of the REMIC Provisions.
"Class B-1 Cross-Over Date" means the Remittance Date on which the
Class B-1 Principal Balance (after giving effect to the distributions of
principal on the Class B-1 Certificates on such Remittance Date) is reduced to
zero.
"Class B-1 Distribution Amount" means, as to any Remittance Date, the
lesser of (a) the Adjusted Amount Available less the sum of (i) any amounts paid
to the Servicer pursuant to Section 8.03(a)(1), (ii) the Class A Distribution
Amount, (iii) the Class M-1 Distribution Amount, and (iv) the Class M-2
Distribution Amount and (b) the Class B-1 Formula Distribution Amount for such
Remittance Date; provided that after the Class B-1 Cross-Over Date the Class B-1
Distribution Amount shall be zero.
1-6
"Class B-2 Distribution Amount" means, as to any Remittance Date, the
lesser of (a) the Remaining Amount Available and (b) the Class B-2 Formula
Distribution Amount for such Remittance Date.
"Class B Distribution Test" means, to be considered "satisfied" for any
Remittance Date, that (i) such Remittance Date occurs in or after November 2004;
(ii) the Average Sixty-Day Delinquency Ratio for such Remittance Date is less
than or equal to 5.00%; (iii) the Cumulative Realized Losses Test for such
Remittance Date is satisfied; (iv) the Current Realized Loss Ratio for such
Remittance Date is less than or equal to 2.75%; (v) the fraction, expressed as a
percentage, the numerator of which is the sum of the Class B Principal Balance
and the Overcollateralization Amount as of such Remittance Date and the
denominator of which is the Pool Scheduled Principal Balance as of the
immediately preceding Remittance Date, is equal to or greater than 12.75%; and
(vi) the Class B Principal Balance as of such Remittance Date is greater than or
equal to $15,000,000.
"Class B-1 Formula Distribution Amount" means, as to any Remittance
Date, an amount equal to the sum of (a) interest (calculated in the manner
specified in Section 1.03) at the Class B-1 Remittance Rate on the Class B-1
Adjusted Principal Balance as of such Remittance Date, (b) any Unpaid Class B-1
Interest Shortfall, (c) the Class B Percentage of the Formula Principal
Distribution Amount, (d) any Unpaid Class B-1 Principal Shortfall, (e) any
Additional Principal Distribution Amount to be distributed to the Class B-1
Certificates pursuant to Section 8.03(a)(12), (f) any Class B-1 Liquidation Loss
Interest Amount, and (g) any Unpaid Class B-1 Liquidation Loss Interest
Shortfall; provided, however, that on the Class M-2 Cross-Over Date, the balance
of any amounts that would have been distributable on such date pursuant to
clauses (c), (d) and (e) of the term "Class M-2 Formula Distribution Amount"
(assuming a sufficient Amount Available) but for the operation of the second
proviso to such term shall instead be included in clause (c) or (e) of this
definition, as applicable; provided, further, that the aggregate of all amounts
distributed pursuant to clauses (c), (d) and (e) of this definition shall not
exceed the Original Class B-1 Principal Balance.
"Class B-2 Formula Distribution Amount" means, as to any Remittance
Date, an amount equal to the sum of (a) interest (calculated in the manner
specified in Section 1.03) at the Class B-2 Remittance Rate on the Class B-2
Principal Balance as calculated immediately prior to such Remittance Date, (b)
any Unpaid Class B-2 Interest Shortfall, (c) (i) if such Remittance Date is
prior to or on the Class B-1 Cross-Over Date, zero or (ii) if such Remittance
Date is after the Class B-1 Cross-Over Date, the Class B Percentage of the
Formula Principal Distribution Amount, (d) any Unpaid Class B-2 Principal
Shortfall, and (e) any Additional Principal Distribution Amount to be
distributed to the Class B-2 Certificates pursuant to Section 8.03(a)(12);
provided, however, that on the Class B-1 Cross-Over Date, the balance of any
amounts that would have been distributable on such date pursuant to clauses (c),
(d) and (e) of the term "Class B-1 Formula Distribution Amount" (assuming a
sufficient Remaining Amount Available) but for the operation of the second
proviso to such term shall instead be included in clause (c) or (e) of this
definition, as applicable; provided, further, that the aggregate of all amounts
distributed pursuant to clauses (c), (d) and (e) of this definition shall not
exceed the Original Class B-2 Principal Balance.
1-7
"Class B-1 Interest Deficiency Amount" means, as to the Class B-1
Certificates and any Remittance Date, the difference, if any, between (i) the
sum of the amounts described in clauses (a), (b), (f) and (g) of the definition
of the term "Class B-1 Formula Distribution Amount" and (ii) the amount
available for distribution to the Class B-1 Certificateholders pursuant to
Section 8.03(a)(5)(i) and (ii) and Section 8.03(a)(9)(iii) and (iv) on such
Remittance Date.
"Class B-1 Interest Distribution Amount" means, as to any Remittance
Date, the amount specified in clause (a) of the definition of "Class B-1 Formula
Distribution Amount" plus the Unpaid Class B-1 Interest Shortfall, if any.
"Class B-1 Interest Shortfall" means, as to any Remittance Date, the
difference, if any, between (A) the sum of (i) the amount distributed to Holders
of the Class B-1 Certificates on such Remittance Date pursuant to Sections
8.03(a)(5)(i) and (ii), and (ii) any amount distributed to the Holders of the
Class B-1 Certificates pursuant to Section 8.03(c) on such Remittance Date, and
(B) the Class B-1 Interest Distribution Amount for such Remittance Date.
"Class B-2 Interest Shortfall" means, as to any Remittance Date, the
amount, if any, by which the amount distributed to Holders of Class B-2
Certificates on such Remittance Date pursuant to Sections 8.03(a)(10)(i) and
(ii) is less than the sum of the amounts specified in clauses (a) and (b) of the
definition of the term "Class B-2 Formula Distribution Amount."
"Class B-1 Liquidation Loss Amount" means, as of any Remittance Date,
the lesser of (x) the amount, if any, by which the sum of the Class A Principal
Balance, the Class M-1 Principal Balance, the Class M-2 Principal Balance and
the Class B-1 Principal Balance for such Remittance Date exceeds the sum of the
Pre-Funded Amount plus the Pool Scheduled Principal Balance for such Remittance
Date (after giving effect to all distributions of principal on the Class A,
Class M-1, Class M-2 and Class B-1 Certificates on such Remittance Date) and (y)
the Class B-1 Principal Balance (after giving effect to all distributions of
principal on the Class B-1 Certificates on such Remittance Date).
"Class B-2 Liquidation Loss Amount" means, as to any Remittance Date,
the lesser of (x) the amount, if any, by which the sum of the Class A Principal
Balance, the Class M-1 Principal Balance, the Class M-2 Principal Balance, the
Class B-1 Principal Balance and the Class B-2 Principal Balance for such
Remittance Date exceeds the sum of the Pre-Funded Amount plus the Pool Scheduled
Principal Balance for such Remittance Date (after giving effect to all
distributions of principal on the Class A, Class M-1, Class M-2, Class B-1 and
Class B-2 Certificates on such Remittance Date) and (y) the Class B-2 Principal
Balance (after giving effect to all distributions of principal on the Class B-2
Certificates on such Remittance Date).
"Class B-1 Liquidation Loss Interest Amount" means, as to any
Remittance Date, an amount equal to interest (calculated in the manner specified
in Section 1.03) at the Class B-1 Remittance Rate on the Class B-1 Liquidation
Loss Amount (if any) for the immediately preceding Remittance Date.
"Class B-1 Liquidation Loss Interest Shortfall" means, as to any
Remittance Date, the amount, if any, by which the amount distributed to Holders
of the Class B-1 Certificates on such
1-8
Remittance Date pursuant to Section 8.03(a)(9)(iii) is less than the Class B-1
Liquidation Loss Interest Amount for such Remittance Date.
"Class B Percentage" means:
(i) as to any Remittance Date on which the Class B Distribution
Test is not satisfied and the Class A Principal Balance, the
Class M-1 Principal Balance and the Class M-2 Principal
Balance have not been reduced to zero, 0%, and
(ii) as to any other Remittance Date, a fraction, expressed as a
percentage, the numerator of which is the sum of the Class B
Principal Balance and the Overcollateralization Amount and the
denominator of which is the sum of (a) the Class A Principal
Balance, (b) the Class M-1 Principal Balance, (c) the Class
M-2 Principal Balance and (d) the sum of the Class B Principal
Balance and the Overcollateralization Amount.
"Class B Principal Balance" means, as to any Remittance Date, the sum
of the Class B-1 Principal Balance and the Class B-2 Principal Balance.
"Class B-1 Principal Balance" means, as to any Remittance Date, the
Original Class B-1 Principal Balance less all amounts previously distributed to
Holders of Class B-1 Certificates on account of principal.
"Class B-2 Principal Balance" means, as to any Remittance Date, the
Original Class B-2 Principal Balance less all amounts previously distributed to
Holders of Class B-2 Certificates on account of principal.
"Class B-1 Principal Shortfall" means, as to any Remittance Date, the
amount, if any, by which the amount distributed to Holders of Class B-1
Certificates on such Remittance Date pursuant to Section 8.03(a)(9)(ii) is less
than the Class B Percentage of the Formula Principal Distribution Amount for
such Remittance Date. In no event, however, shall the Class B-1 Principal
Shortfall exceed the Class B-1 Principal Balance.
"Class B-2 Principal Shortfall" means, as to any Remittance Date, the
amount, if any, by which the amount distributed to Holders of Class B-2
Certificates on such Remittance Date pursuant to Section 8.03(a)(10)(iv) is less
than the amount described in Section 8.03(a)(10)(iv) for such Remittance Date.
In no event, however, shall the Class B-2 Principal Shortfall exceed the Class
B-2 Principal Balance.
"Class B-1 Remittance Rate" means a floating rate (determined each Due
Period as of each Remittance Date) equal to the Weighted Average Contract Rate,
but in no event greater than 10.21% per annum.
"Class B-2 Remittance Rate" means a floating rate (determined each Due
Period as of each Remittance Date) equal to the Weighted Average Contract Rate,
but in no event greater than 9.80% per annum.
1-9
"Class B-3I Certificate" means any one of the Class B-3I Certificates
executed and delivered by the Trustee substantially in the form set forth in
Exhibit C-2 hereto and evidencing an interest designated as a "regular interest"
in the Master REMIC for purposes of the REMIC Provisions.
"Class B-3I Distribution Amount" means, as to any Remittance Date, the
lesser of (a) the Amount Available less all amounts distributed pursuant to
Sections 8.03(a)(1)-(12), and (b) the Class B-3I Formula Distribution Amount for
such Remittance Date.
"Class B-3I Formula Distribution Amount" means, as to any Remittance
Date, an amount equal to the sum of (a) the Excess Interest for such Remittance
Date, and (b) any Unpaid Class B-3I Shortfall as of such Remittance Date.
"Class B-3I Shortfall" means, as to any Remittance Date, the amount, if
any, by which (a) the Class B-3I Formula Distribution Amount for such Remittance
Date exceeds (b) the Class B-3I Distribution Amount for such Remittance Date.
"Class B-S1 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class B-S2 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class C Certificate" means any one of the Class C Subsidiary
Certificate or Class C Master Certificate.
"Class C Certificateholder" means the person in whose name a Class C
Certificate is registered on the Certificate Register.
"Class C Master Certificate" means a Class C Master Certificate
executed and delivered by the Trustee substantially in the form of Exhibit K,
and evidencing an interest designated as the "residual interest" in the Master
REMIC for purposes of the REMIC Provisions.
"Class C Master Distribution Amount" means, as to any Remittance Date,
the amount, if any, distributable pursuant to Section 8.03(a)(15).
"Class C Subsidiary Certificate" means a Class C Subsidiary Certificate
executed and delivered by the Trustee substantially in the form of Exhibit J,
and evidencing an interest designated as the "residual interest" in the
Subsidiary REMIC for purposes of the REMIC Provisions.
"Class C Subsidiary Distribution Amount" means, as to any Remittance
Date, the amounts, if any, distributable pursuant to Section 8.03(b)(6).
"Class M Certificate" means any one of the Class M-1 or M-2
Certificates executed and delivered by the Trustee.
1-10
"Class M-1 Adjusted Principal Balance" means, as to any Remittance
Date, the Class M-1 Principal Balance as of that Remittance Date minus the Class
M-1 Liquidation Loss Amount (if any) as of the prior Remittance Date.
"Class M-2 Adjusted Principal Balance" means, as to any Remittance
Date, the Class M-2 Principal Balance as of that Remittance Date minus the Class
M-2 Liquidation Loss Amount (if any) as of the prior Remittance Date.
"Class M-1 Certificate" means any one of the Class M-1 Certificates
executed and delivered by the Trustee substantially in the form set forth in
Exhibit B and evidencing an interest designated as a "regular interest" in the
Trust for the purposes of the REMIC Provisions.
"Class M-2 Certificate" means any one of the Class M-2 Certificates
executed and delivered by the Trustee substantially in the form set forth in
Exhibit B and evidencing an interest designated as a "regular interest" in the
Trust for the purposes of the REMIC Provisions.
"Class M-1 Cross-Over Date" means the Remittance Date on which the
Class M-1 Principal Balance (after giving effect to the distributions of
principal on the Class M-1 Certificates on such Remittance Date) is reduced to
zero.
"Class M-2 Cross-Over Date" means the Remittance Date on which the
Class M-2 Principal Balance (after giving effect to the distributions of
principal on the Class M-2 Certificates on such Remittance Date) is reduced to
zero.
"Class M-1 Distribution Amount" means, as to any Remittance Date, the
lesser of (a) the Adjusted Amount Available less the sum of (i) any amounts paid
to the Servicer pursuant to Section 8.03(a)(1) and (ii) the Class A Distribution
Amount and (b) the Class M-1 Formula Distribution Amount for such Remittance
Date; provided that after the Class M-1 Cross-Over Date the Class M-1
Distribution Amount shall be zero.
"Class M-2 Distribution Amount" means, as to any Remittance Date, the
lesser of (a) the Adjusted Amount Available less the sum of (i) any amounts paid
to the Servicer pursuant to Section 8.03(a)(1), (ii) the Class A Distribution
Amount, and (iii) the Class M-1 Distribution Amount and (b) the Class M-2
Formula Distribution Amount for such Remittance Date; provided that after the
Class M-2 Cross-Over Date the Class M-2 Distribution Amount shall be zero.
"Class M-1 Distribution Test" means, to be considered "satisfied" for
any Remittance Date, that (i) such Remittance Date occurs in or after November
2004; (ii) the Average Sixty-Day Delinquency Ratio for such Remittance Date is
less than or equal to 5.00%; (iii) the Cumulative Realized Losses Test for such
Remittance Date is satisfied; (iv) the Current Realized Loss Ratio for such
Remittance Date is less than or equal to 2.75%; and (v) the fraction, expressed
as a percentage, the numerator of which is the sum of the Class M-1 Principal
Balance, the Class M-2 Principal Balance, the Class B Principal Balance and the
Overcollateralization Amount as of such Remittance Date and the denominator of
which is the Pool Scheduled Principal Balance as of the immediately preceding
Remittance Date, is equal to or greater than 26.25%.
1-11
"Class M-2 Distribution Test" means, to be considered "satisfied" for
any Remittance Date, that (i) such Remittance Date occurs in or after November
2004; (ii) the Average Sixty-Day Delinquency Ratio for such Remittance Date is
less than or equal to 5.00%; (iii) the Cumulative Realized Losses Test for such
Remittance Date is satisfied; (iv) the Current Realized Loss Ratio for such
Remittance Date is less than or equal to 2.75%; and (v) the fraction, expressed
as a percentage, the numerator of which is the sum of the Class M-2 Principal
Balance, the Class B Principal Balance and the Overcollateralization Amount as
of such Remittance Date and the denominator of which is the Pool Scheduled
Principal Balance as of the immediately preceding Remittance Date, is equal to
or greater than 18.75%.
"Class M-1 Formula Distribution Amount" means, as to any Remittance
Date, an amount equal to the sum of (a) interest (calculated in the manner
specified in Section 1.03) at the Class M-1 Remittance Rate on the Class M-1
Adjusted Principal Balance as of such Remittance Date, (b) the aggregate Unpaid
Class M-1 Interest Shortfall, if any, (c) the Class M-1 Percentage of the
Formula Principal Distribution Amount, (d) any Unpaid Class M-1 Principal
Shortfall, (e) any Additional Principal Distribution Amount to be distributed to
the Class M-1 Certificates pursuant to Section 8.03(a)(12), (f) any Class M-1
Liquidation Loss Interest Amount, and (g) any Unpaid Class M-1 Liquidation Loss
Interest Shortfall; provided, however, that on the Class A-7 Cross-Over Date,
the balance of any amounts that would have been distributable on such date
pursuant to clauses (c), (d) and (e) of the term "Class A Formula Distribution
Amount" (assuming a sufficient Amount Available) but for the operation of the
proviso to such term shall instead be included in clause (c) or (e) of this
definition, as applicable; provided, further, that the aggregate of all amounts
distributed for all Remittance Dates pursuant to clauses (c), (d) and (e) shall
not exceed the Original Class M-1 Principal Balance.
"Class M-2 Formula Distribution Amount" means, as to any Remittance
Date, an amount equal to the sum of (a) interest (calculated in the manner
specified in Section 1.03) at the Class M-2 Remittance Rate on the Class M-2
Adjusted Principal Balance as of such Remittance Date, (b) the aggregate Unpaid
Class M-2 Interest Shortfall, if any, (c) the Class M-2 Percentage of the
Formula Principal Distribution Amount, (d) any Unpaid Class M-2 Principal
Shortfall, (e) any Additional Principal Distribution Amount to be distributed to
the Class M-2 Certificates pursuant to Section 8.03(a)(12), (f) any Class M-2
Liquidation Loss Interest Amount, and (g) any Unpaid Class M-2 Liquidation Loss
Interest Shortfall; provided, however, that on the Class M-1 Cross-Over Date,
the balance of any amounts that would have been distributable on such date
pursuant to clauses (c), (d) and (e) of the term "Class M-1 Formula Distribution
Amount" (assuming a sufficient Amount Available) but for the operation of the
proviso to such term shall instead be included in clause (c) or (e) of this
definition, as applicable; provided, further, that the aggregate of all amounts
distributed for all Remittance Dates pursuant to clauses (c), (d) and (e) shall
not exceed the Original Class M-2 Principal Balance.
"Class M-1 Interest Deficiency Amount" means, as to the Class M-1
Certificates and any Remittance Date, the difference, if any, between (i) the
sum of the amounts described in clauses (a), (b), (f) and (g) of the definition
of the term "Class M-1 Formula Distribution Amount" and (ii) the amount
available for distribution to the Class M-1 Certificateholders pursuant to
Section 8.03(a)(3)(i) and (ii) and Section 8.03(a)(7)(iii) and (iv) on such
Remittance Date.
1-12
"Class M-2 Interest Deficiency Amount" means, as to the Class M-2
Certificates and any Remittance Date, the difference, if any, between (i) the
sum of the amounts described in clauses (a), (b), (f) and (g) of the definition
of the term "Class M-2 Formula Distribution Amount" and (ii) the amount
available for distribution to the Class M-2 Certificateholders pursuant to
Section 8.03(a)(4)(i) and (ii) and Section 8.03(a)(8)(iii) and (iv) on such
Remittance Date.
"Class M-1 Interest Distribution Amount" means, as to any Remittance
Date, the amount specified in clause (a) of the definition of the term "Class
M-1 Formula Distribution Amount" plus the Unpaid Class M-1 Interest Shortfall,
if any.
"Class M-2 Interest Distribution Amount" means, as to any Remittance
Date, the amount specified in clause (a) of the definition of the term "Class
M-2 Formula Distribution Amount" plus the Unpaid Class M-2 Interest Shortfall,
if any.
"Class M-1 Interest Shortfall" means, as to any Remittance Date, the
difference, if any, between (A) the sum of (i) the amount distributed to Holders
of the Class M-1 Certificates on such Remittance Date pursuant to Section
8.03(a)(3)(i) and (ii), and (ii) any amount distributed to the Holders of the
Class M-1 Certificates pursuant to Section 8.03(c) on such Remittance Date, and
(B) the Class M-1 Interest Distribution Amount for such Remittance Date.
"Class M-2 Interest Shortfall" means, as to any Remittance Date, the
difference, if any, between (A) the sum of (i) the amount distributed to Holders
of the Class M-2 Certificates on such Remittance Date pursuant to Section
8.03(a)(4)(i) and (ii), and (ii) any amount distributed to the Holders of the
Class M-2 Certificates pursuant to Section 8.03(c) on such Remittance Date, and
(B) the Class M-2 Interest Distribution Amount for such Remittance Date.
"Class M-1 Liquidation Loss Amount" means, as to any Remittance Date,
the lesser of (x) the amount, if any, by which the sum of the Class A Principal
Balance and the Class M-1 Principal Balance for such Remittance Date exceeds the
sum of the Pre-Funded Amount plus the Pool Scheduled Principal Balance for such
Remittance Date (after giving effect to all distributions of principal on the
Class A and Class M-1 Certificates on such Remittance Date) and (y) the Class
M-1 Principal Balance (after giving effect to all distributions of principal on
the Class M-1 Certificates on such Remittance Date).
"Class M-2 Liquidation Loss Amount" means, as to any Remittance Date,
the lesser of (x) the amount, if any, by which the sum of the Class A Principal
Balance, the Class M-1 Principal Balance and the Class M-2 Principal Balance for
such Remittance Date exceeds the sum of the Pre-Funded Amount plus the Pool
Scheduled Principal Balance for such Remittance Date (after giving effect to all
distributions of principal on the Class A, Class M-1 and Class M-2 Certificates
on such Remittance Date) and (y) the Class M-2 Principal Balance (after giving
effect to all distributions of principal on the Class M-2 Certificates on such
Remittance Date).
"Class M-1 Liquidation Loss Interest Amount" means, as to any
Remittance Date, an amount equal to interest (calculated in the manner specified
in Section 1.03) at the Class M-1 Remittance Rate on the Class M-1 Liquidation
Loss Amount (if any) for the immediately preceding Remittance Date.
1-13
"Class M-2 Liquidation Loss Interest Amount" means, as to any
Remittance Date, an amount equal to interest (calculated in the manner specified
in Section 1.03) at the Class M-2 Remittance Rate on the Class M-2 Liquidation
Loss Amount (if any) for the immediately preceding Remittance Date.
"Class M-1 Liquidation Loss Interest Shortfall" means, as to any
Remittance Date, the amount, if any, by which the amount distributed to Holders
of the Class M-1 Certificates on such Remittance Date pursuant to Section
8.03(a)(7)(iii) is less than the Class M-1 Liquidation Loss Interest Amount for
such Remittance Date.
"Class M-2 Liquidation Loss Interest Shortfall" means, as to any
Remittance Date, the amount, if any, by which the amount distributed to Holders
of the Class M-2 Certificates on such Remittance Date pursuant to Section
8.03(a)(8)(iii) is less than the Class M-2 Liquidation Loss Interest Amount for
such Remittance Date.
"Class M-1 Percentage" means:
(i) as to any Remittance Date prior to the Class A-7 Cross-Over
Date and on which the Class M-1 Distribution Test is not
satisfied, 0%, and
(ii) as to any Remittance Date after the Class A-7 Cross-Over Date
or on which the Class M-1 Distribution Test is satisfied, a
fraction, expressed as a percentage, the numerator of which is
the Class M-1 Principal Balance and the denominator of which
is the sum of (a) the Class A Principal Balance, (b) the Class
M-1 Principal Balance, (c) if the Class M-2 Distribution Test
is satisfied, the Class M-2 Principal Balance, otherwise zero,
and (d) if the Class B Distribution Test is satisfied, the sum
of the Class B Principal Balance and the Overcollateralization
Amount, otherwise zero.
"Class M-2 Percentage" means:
(i) as to any Remittance Date prior to the Class M-1 Cross-Over
Date and on which the Class M-2 Distribution Test is not
satisfied, 0%, and
(ii) as to any Remittance Date after the Class M-1 Cross-Over Date
or on which the Class M-2 Distribution Test is satisfied, a
fraction, expressed as a percentage, the numerator of which is
the Class M-2 Principal Balance and the denominator of which
is the sum of (a) the Class A Principal Balance, (b) the Class
M-1 Principal Balance, (c) the Class M-2 Principal Balance,
and (d) if the Class B Distribution Test is satisfied, the sum
of the Class B Principal Balance and the Overcollateralization
Amount, otherwise zero.
"Class M-1 Principal Balance" means, as to any Remittance Date, the
Original Class M-1 Principal Balance less all amounts previously distributed to
Holders of Class M-1 Certificates on account of principal.
1-14
"Class M-2 Principal Balance" means, as to any Remittance Date, the
Original Class M-2 Principal Balance less all amounts previously distributed to
Holders of Class M-2 Certificates on account of principal.
"Class M-1 Principal Shortfall" means, as to any Remittance Date, the
amount, if any, by which the amount distributed to Holders of Class M-1
Certificates on such Remittance Date pursuant to Section 8.03(a)(7)(ii) is less
than the Class M-1 Percentage of the Formula Principal Distribution Amount for
such Remittance Date. In no event, however, shall the Class M-1 Principal
Shortfall exceed the Class M-1 Principal Balance.
"Class M-2 Principal Shortfall" means, as to any Remittance Date, the
amount, if any, by which the amount distributed to Holders of Class M-2
Certificates on such Remittance Date pursuant to Section 8.03(a)(8)(ii) is less
than the Class M-2 Percentage of the Formula Principal Distribution Amount for
such Remittance Date. In no event, however, shall the Class M-2 Principal
Shortfall exceed the Class M-2 Principal Balance.
"Class M-1 Remittance Rate" means a floating rate (determined each Due
Period as of each Remittance Date) equal to the Weighted Average Contract Rate,
but in no event greater than 8.40% per annum.
"Class M-2 Remittance Rate" means a floating rate (determined each Due
Period as of each Remittance Date) equal to the Weighted Average Contract Rate,
but in no event greater than 9.03% per annum.
"Class M-S1 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class M-S2 Interest" means a regular interest in the Subsidiary REMIC
which is held as an asset of the Master REMIC and is entitled to monthly
distributions as provided in Section 8.03(b).
"Class Principal Balance" means, as to any Remittance Date and each
Class of Certificates, the Original Principal Balance of such Class less all
amounts previously distributed to Holders of such Class of Certificates on
account of principal.
"Closing Date" means October 5, 2000.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral Security" means, with respect to any Contract, (i) the
security interests granted by or on behalf of the related Obligor with respect
thereto, including a first priority perfected security interest in the related
Manufactured Home, (ii) all other security interests or liens and property
subject thereto from time to time purporting to secure payment of such Contract,
whether pursuant to the agreement giving rise to such Contract or otherwise,
together with all financing statements signed by the Obligor describing any
collateral securing such Contract, (iii) all guarantees, insurance and other
agreements or arrangements of whatever character from time to time supporting or
securing payment of such Contract whether pursuant to
1-15
the agreement giving rise to such Contract or otherwise, and (iv) all records in
respect of such Contract.
"Computer Tape" means the computer tape generated by the Originator
which provides information relating to the Contracts and which was used by the
Originator in selecting the Contracts, and includes the master file and the
history file.
"Contracts" means the manufactured housing installment sales contracts
and installment loan agreements, including any Land-and-Home Contracts,
described in the List of Contracts and constituting part of the corpus of the
Trust, which Contracts are to be assigned and conveyed by the Seller to the
Trust, and includes, without limitation, all related security interests and any
and all rights to receive payments which are due pursuant thereto after the
applicable Cut-off Date, but excluding any rights to receive payments which are
due pursuant thereto on or before the applicable Cut-off Date.
"Contract File" means, as to each Contract, other than a Land-and-Home
Contract, (a) the original copy of the Contract, (b) either (i) the original
title document for the related Manufactured Home or a duplicate certified by the
appropriate governmental authority which issued the original thereof or the
application for such title document or (ii) if the laws of the jurisdiction in
which the related Manufactured Home is located do not provide for the issuance
of title documents for manufactured housing, other evidence of ownership of the
related Manufactured Home which is customarily relied upon in such jurisdiction
as evidence of title to a manufactured housing unit, (c) evidence of one or more
of the following types of perfection of the security interest in the related
Manufactured Home granted by such Contract, as appropriate: (i) notation of such
security interest on the title document, (ii) a financing statement meeting the
requirements of the UCC, with evidence of recording indicated thereon, or (iii)
such other evidence of perfection of a security interest in a manufactured
housing unit as is customarily relied upon in the jurisdiction in which the
related Manufactured Home is located, (d) the assignment of the Contract from
the originator (if other than Conseco Finance Corp.) to the Originator, (e)
evidence of any other Collateral Security, including with respect to a
Land-in-Lieu Contract, the mortgage or deed of trust, and (f) any extension,
modification or waiver agreement(s).
"Contract Rate" means, with respect to any particular Contract, the
rate of interest specified in that Contract and computed on a precomputed basis
with an actuarial rebate of unearned interest upon prepayment, provided that the
rebate upon prepayment of Contracts originated in California or Oklahoma may be
computed on the simple interest method if so required by applicable law or
regulations.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered, which office at the date of the execution of this Agreement is
located at the address set forth in Section 12.08.
"Corresponding Certificate Class" means, with respect to each Class of
Uncertificated Subsidiary Interests, as follows:
1-16
Uncertificated Subsidiary Interest Corresponding Certificate Class
-------------------------------------- -----------------------------------
Class A-S1 Class A-1
Class A-S2 Class A-2
Class A-S3 Class A-3
Class A-S4 Class A-4
Class A-S5 Class A-5
Class A-S6 Class A-6
Class A-S7 Class A-7
Class M-S1 Class M-1
Class M-S2 Class M-2
Class B-S1 Class B-1
Class B-S2 Class B-2
"Counsel for the Originator and Seller" means ▇▇▇▇▇▇ and ▇▇▇▇▇▇, P.A.,
or other legal counsel for the Originator and the Seller.
"Cumulative Realized Losses" means, as to any Remittance Date, the sum
of the Realized Losses for that Remittance Date and each preceding Remittance
Date since the Cut-off Date.
"Cumulative Realized Losses Test" means, to be considered "satisfied"
for any Remittance Date:
(i) if such Remittance Date occurs between November 1, 2004 and
October 31, 2005 (inclusive), that the Cumulative Realized
Losses as of such Remittance Date are less than or equal to
5.5% of the Cut-off Date Pool Principal Balance;
(ii) if such Remittance Date occurs between November 1, 2005 and
October 31, 2006 (inclusive), that the Cumulative Realized
Losses as of such Remittance Date are less than or equal to
7.0% of the Cut-off Date Pool Principal Balance;
(iii) if such Remittance Date occurs between November 1, 2006 and
October 31, 2007 (inclusive), that the Cumulative Realized
Losses as of such Remittance Date are less than or equal to
9.0% of the Cut-off Date Pool Principal Balance; and
(iv) if such Remittance Date occurs on or after November 1, 2007,
that the Cumulative Realized Losses as of such Remittance Date
are less than or equal to 10.5% of the Cut-off Date Pool
Principal Balance.
"Current Realized Loss Ratio" means, as to any Remittance Date, a
fraction, expressed as a percentage, the numerator of which is the aggregate
Realized Losses for such Remittance Date and each of the two immediately
preceding Remittance Dates, multiplied by four, and the denominator of which is
the arithmetic average of the Pool Scheduled Principal Balance as of the third
preceding Remittance Date and the Pool Scheduled Principal Balance as of such
Remittance Date.
"Custodian" means at any time the Trustee or a financial institution
organized under the laws of the United States or any State, which is subject to
supervision and examination by
1-17
Federal or State authorities and which is not the Originator or an Affiliate of
the Originator, that is acting at such time as Custodian of the Land-and-Home
Contract Files pursuant to Section 4.01.
"Cut-off Date" means, with respect to the Initial Contracts, August 31,
2000 or the date of origination if later; the Additional Contracts, September
30, 2000; and the Subsequent Contracts, the applicable Subsequent Cut-off Date.
"Cut-off Date Pool Principal Balance" means the aggregate of the
Cut-off Date Principal Balances of the Contracts. With respect to any
Staged-Funding Contract, the Cut-off Date Principal Balance means the principal
amount stated on such Contract.
"Cut-off Date Principal Balance" means, as to any Contract, the unpaid
principal balance thereof at the applicable Cut-off Date, after giving effect to
all installments of principal due on or prior thereto. With respect to any
Staged-Funding Contract, the Cut-off Date Principal Balance means the principal
amount stated on such Contract.
"Defaulted Contract" means a Contract with respect to which the
Servicer commenced repossession or foreclosure procedures, made a sale of such
Contract to a third party for repossession, foreclosure or other enforcement, or
as to which there was a payment delinquent 180 or more days (excluding any
Contract deemed delinquent solely because the Obligor's required monthly payment
was reduced as a result of bankruptcy or similar proceedings).
"Delinquent Contract" means a Contract that is 60 or more days
delinquent as of the applicable Cut-off Date.
"Depository" means the initial Depository, The Depository Trust
Company, the nominee of which is CEDE & CO., as the registered Holder of:
(i) one Certificate evidencing $130,000,000 in initial aggregate
principal balance of the Class A-1 Certificates,
(ii) one Certificate evidencing $67,000,000 in initial aggregate
principal balance of the Class A-2 Certificates,
(iii) one Certificate evidencing $67,000,000 in initial aggregate
principal balance of the Class A-3 Certificates,
(iv) one Certificate evidencing $101,000,000 in initial aggregate
principal balance of the Class A-4 Certificates,
(v) one Certificate evidencing $40,000,000 in initial aggregate
principal balance of the Class A-5 Certificates,
(vi) one Certificate evidencing $117,000,000 in initial aggregate
principal balance of the Class A-6 Certificates.
1-18
(vii) one Certificate evidencing $104,250,000 in initial aggregate
principal balance of the Class A-7 Certificates.
(viii) one Certificate evidencing $37,500,000 in initial aggregate
principal balance of the Class M-1 Certificates,
(ix) one Certificate evidencing $30,000,000 in initial aggregate
principal balance of the Class M-2 Certificates,
(x) one Certificate evidencing $22,500,000 in initial aggregate
principal balance of the Class B-1 Certificates, and
(xi) one Certificate evidencing $26,250,000 in initial aggregate
principal balance of the Class B-2 Certificates,
and any permitted successor depository. The Depository shall at all times be a
"clearing corporation" as defined in the Uniform Commercial Code of the State of
New York.
"Depository Participant" means a broker, dealer, bank or other
financial institution or other Person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
"Determination Date" means the third Business Day preceding each
Remittance Date during the term of this Agreement.
"Disqualified Organization" has the meaning assigned in Section
9.02(b)(3).
"Due Date" means, as to any Contract, the date of the month on which
the scheduled monthly payment for such Contract is due.
"Due Period" means with respect to any Remittance Date other than the
Remittance Date in November 2000, the period from and including the 16th day of
the second month preceding such Remittance Date, to and including the 15th day
of the month immediately preceding such Remittance Date, and with respect to the
Remittance Date in November 2000, the period from and including the Cut-off Date
for the related Contract to and including October 15, 2000.
"Electronic Ledger" means the electronic master record of installment
sale contracts of the Originator.
"Eligible Account" means, at any time, an account which is any of the
following: (i) an account maintained with an Eligible Institution; (ii) a trust
account (which shall be a "segregated trust account") maintained with the
corporate trust department of a federal or state chartered depository
institution or trust company with trust powers and acting in its fiduciary
capacity for the benefit of the Trustee hereunder, which depository institution
or trust company shall have capital and surplus (or, if such depository
institution or trust company is a subsidiary of a bank holding company system,
the bank holding company shall have capital and surplus) of not less than
$50,000,000 and the securities of such depository institution or trust company
(or, if such depository institution or trust company is a subsidiary of a bank
holding company system and
1-19
such depository institution's or trust company's securities are not rated, the
securities of the bank holding company) shall have a credit rating from each of
Moody's (if rated by Moody's), Standard & Poor's (if rated by Standard & Poor's)
and Fitch (if rated by Fitch) in one of its generic credit rating categories
which signifies investment grade; or (iii) an account that will not cause
Standard & Poor's, ▇▇▇▇▇'▇ or Fitch to downgrade or withdraw their then-current
ratings assigned to the Certificates, as confirmed in writing by Standard &
Poor's, Moody's and Fitch.
"Eligible Institution" means any depository institution (which may be
the Trustee or an Affiliate of the Trustee) organized under the laws of the
United States or any State, the deposits of which are insured to the full extent
permitted by law by the Bank Insurance Fund (currently administered by the
Federal Deposit Insurance Corporation), which is subject to supervision and
examination by federal or state authorities and whose short-term deposits have
been rated P-1 by Moody's (if rated by Moody's), A-1+ by Standard & Poor's (if
rated by Standard & Poor's) and F-1+ by Fitch (if rated by Fitch), or whose
unsecured long-term debt has been rated in one of the two highest rating
categories by Moody's, Standard & Poor's (not lower than AA) and Fitch (if rated
by Fitch) in the case of unsecured long-term debt.
"Eligible Investments" has the meaning assigned in Section 5.05(b).
"Eligible Servicer" means the Originator or any Person qualified to act
as Servicer of the Contracts under applicable federal and state laws and
regulations, which Person services not less than an aggregate of $100,000,000 in
outstanding principal amount of manufactured housing conditional sales contracts
and installment loan agreements and, so long as any FHA/VA Contract is
outstanding, which Person is qualified under FHA/VA Regulations to act as a
servicer of all such FHA/VA Contracts.
"Eligible Substitute Contract" means, as to any Replaced Contract for
which such Eligible Substitute Contract is being substituted pursuant to Section
3.06(b), a Contract that (a) as of the date of its substitution, satisfies all
of the representations and warranties (which, except when expressly stated to be
as of origination, shall be deemed to be determined as of the date of its
substitution rather than as of the Cut-off Date or the Closing Date) in Sections
3.02 and 3.03 and does not cause any of the representations and warranties in
Section 3.04, after giving effect to such substitution, to be incorrect, (b)
after giving effect to the scheduled payment due in the month of such
substitution, has a Scheduled Principal Balance that is not greater than the
Scheduled Principal Balance of such Replaced Contract, (c) has a Contract Rate
that is at least equal to the Contract Rate of such Replaced Contract, (d) has a
remaining term to scheduled maturity that is not greater than the remaining term
to scheduled maturity of the Replaced Contract, and (e) is a Land-and-Home
Contract if the Replaced Contract is a Land-and-Home Contract and is otherwise
secured by a Manufactured Home that is similar in type and value to the
collateral serving the Replaced Contract. If more than one Contract is being
substituted pursuant to Section 3.06(b) for more than one Replaced Contract on a
particular date, then the conditions specified above shall be applied to the
Contracts being substituted, in the aggregate, and the Replaced Contracts, in
the aggregate.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
1-20
"Errors and Omissions Protection Policy" means the employee errors and
omissions policy maintained by the Servicer or any similar replacement policy
covering errors and omissions by the Servicer's employees, and meeting the
requirements of Section 5.09, all as such policy relates to Contracts comprising
a portion of the corpus of the Trust.
"Event of Termination" has the meaning assigned in Section 7.01.
"Excess Interest" means, as to any Remittance Date, the sum of (a)
interest accrued on the Class A-S1 Subsidiary Interest Principal Balance as of
such Remittance Date at a rate per annum equal to the difference between the
Weighted Average Contract Rate as of such Remittance Date and the Class A-1
Remittance Rate, (b) interest accrued on the Class A-S2 Subsidiary Interest
Principal Balance at a rate per annum equal to the difference between the
Weighted Average Contract Rate as of such Remittance Date and the Class A-2
Remittance Rate, (c) interest accrued on the Class A-S3 Subsidiary Interest
Principal Balance at a rate per annum equal to the difference between the
Weighted Average Contract Rate as of such Remittance Date and the Class A-3
Remittance Rate, (d) interest accrued on the Class A-S4 Subsidiary Interest
Principal Balance at a rate per annum equal to the difference between the
Weighted Average Contract Rate as of such Remittance Date and the Class A-4
Remittance Rate, (e) interest accrued on the Class A-S5 Subsidiary Interest
Principal Balance at a rate per annum equal to the difference between the
Weighted Average Contract Rate as of such Remittance Date and the Class A-5
Remittance Rate, (f) interest accrued on the Class A-S6 Subsidiary Interest
Principal at a rate per annum equal to the difference between the Weighted
Average Contract Rate as of such Remittance Date and the Class A-6 Remittance
Rate, (g) interest accrued on the Class A-S7 Subsidiary Interest Principal at a
rate per annum equal to the difference between the Weighted Average Contract
Rate as of such Remittance Date and the Class A-7 Remittance Rate, (h) interest
accrued on the Class M-S1 Subsidiary Interest Principal Balance at a rate per
annum equal to the difference between the Weighted Average Contract Rate as of
such Remittance Date and the Class M-1 Remittance Rate, (i) interest accrued on
the Class M-S2 Subsidiary Interest Principal Balance at a rate per annum equal
to the difference between the Weighted Average Contract Rate as of such
Remittance Date and the Class M-2 Remittance Rate, (j) interest accrued on the
Class B-S1 Subsidiary Interest Principal Balance at a rate per annum equal to
the difference between the Weighted Average Contract Rate as of such Remittance
Date and the Class B-1 Remittance Rate, and (k) interest accrued on the Class
B-S2 Subsidiary Interest Principal Balance at a rate per annum equal to the
difference between the Weighted Average Contract Rate as of such Remittance Date
and the Class B-2 Remittance Rate.
"FHA/VA Contract" means a Contract that, at its origination, was
insured by the Federal Housing Administration or partially guaranteed by the
Veterans Administration.
"FHA/VA Regulations" means, as to any FHA/VA Contract, the contractual
agreements and regulations of the Federal Housing Administration or the Veterans
Administration, as the case may be, providing or governing the terms of the
insurance for such Contract by the Federal Housing Administration or the partial
guarantee for such Contract by the Veterans Administration, as the case may be.
1-21
"Fidelity Bond" means the fidelity bond maintained by the Servicer or
any similar replacement bond, meeting the requirements of Section 5.09, as such
bond relates to Contracts comprising a portion of the corpus of the Trust.
"Final Remittance Date" means the Remittance Date on which the final
distribution in respect of the Certificates will be made pursuant to Section
12.03.
"Fitch" means Fitch IBCA, Inc., or any successor thereto; provided that
if Fitch does not then have a rating outstanding on any of the Class A, Class
M-1, Class M-2 or Class B Certificates, then references herein to "Fitch" shall
be deemed to refer to the NRSRO then rating any Class of the Certificates (or,
if more than one such NRSRO is then rating any Class of the Certificates, to
such NRSRO as may be designated by the Servicer), and references herein to
ratings by or requirements of Fitch shall be deemed to have the equivalent
meanings with respect to ratings by or requirements of such NRSRO.
"Formula Principal Distribution Amount" means, as of any Remittance
Date, the sum of:
(i) all scheduled payments of principal due on each outstanding
Contract during the related Due Period as specified in the
amortization schedule at the time applicable thereto (after
adjustments for previous Partial Principal Prepayments and any
adjustment to such amortization schedule by reason of any
bankruptcy of an Obligor or similar proceeding or any
moratorium or similar waiver or grace period, or by reason of
any other waiver modification or extension granted by the
Servicer in accordance with Section 5.06); plus
(ii) all Partial Principal Prepayments applied and all Principal
Prepayments in Full received during the related Due Period;
plus
(iii) the aggregate Scheduled Principal Balance of all Contracts
that became Liquidated Contracts during the related Due Period
plus the amount of any reduction in principal balance of any
Contract during the related Due Period pursuant to bankruptcy
proceedings involving the related Obligor; plus
(iv) the aggregate Scheduled Principal Balance of all Contracts
repurchased during the related Due Period pursuant to Section
3.06; plus
(v) with respect to the Remittance Date in December 2000 the
Unfunded Contract Shortfall, if any; plus
(vi) without duplication of the foregoing, all collections in
respect of principal on the Contracts received after the last
day of the related Due Period up to and including the third
Business Day prior to such Remittance Date (but in no event
later than the 25th day of the month preceding the Remittance
Date); minus
(vii) with respect to all Remittance Dates other than the Remittance
Date in November 2000, the amount, if any, included in the
Formula Principal Distribution Amount for the preceding
Remittance Date by virtue of clause (vi) of the definition of
Formula Principal Distribution Amount; plus
1-22
(viii) on the Post Funding Remittance Date, the Pre-Funded Amount.
"Funding Termination Date" means the Business Day immediately preceding
the Remittance Date occurring in the calendar month that is the third calendar
month following the calendar month of the Closing Date, or December 31, 2000.
"Hazard Insurance Policy" means, with respect to each Contract, the
policy of fire and extended coverage insurance (and federal flood insurance, if
the Manufactured Home is secured by an FHA/VA Contract and such Manufactured
Home is located in a federally designated special flood area) required to be
maintained for the related Manufactured Home, as provided in Section 5.09, and
which, as provided in said Section 5.09, may be a blanket mortgage impairment
policy maintained by the Servicer in accordance with the terms and conditions of
said Section 5.09.
"Independent" means, when used with respect to any specified Person,
▇▇▇▇▇▇ and ▇▇▇▇▇▇, P.A. or any Person who (i) is in fact independent of the
Originator and the Servicer, (ii) does not have any direct financial interest or
any material indirect financial interest in the Originator or the Servicer or in
an Affiliate of either and (iii) is not connected with the Originator or the
Servicer as an officer, employee, promoter, underwriter, trustee, partner,
director or person performing similar functions. Whenever it is provided herein
that any Independent Person's opinion or certificate shall be furnished to the
Trustee, such opinion or certificate shall state that the signatory has read
this definition and is Independent within the meaning set forth herein.
"Initial Contracts" means certain Contracts identified in the List of
Contracts delivered pursuant to Section 2.02(a), all of which were originated on
or before September 7, 2000, and which have an aggregate principal balance as of
the Cut-off Date of approximately $363,950,052.05.
"Insurance Proceeds" means proceeds paid by any insurer pursuant to any
insurance policy or contract or any FHA/VA Contract.
"Land-and-Home Contract" means a Contract that is secured by a Mortgage
on real estate on which the related Manufactured Home is situated, and which
Manufactured Home is considered or classified as part of the real estate under
the laws of the jurisdiction in which it is located.
"Land-and-Home Contract File" means, as to each Land-and-Home Contract,
(a) the original executed copy of the Land-and-Home Contract; (b) the original
related Mortgage with evidence of recording thereon (or, if the original
Mortgage has not yet been returned by the applicable recording office, a copy
thereof, certified by such recording office, which will be replaced by the
original Mortgage when it is so returned) and any title document for the related
Manufactured Home; (c) the assignment of the Land-and-Home Contract and the
related Mortgage from the originator (if other than Conseco Finance Corp.) to
the Originator; (d) an endorsement of such Land-and-Home Contract by the Seller
to the Trustee or in blank; (e) an assignment of the related Mortgage to the
Trustee or in blank; and (f) any extension, modification or waiver agreement(s).
1-23
"Land-in-Lieu Contract" means a Contract that is secured by (i) a
security interest in a Manufactured Home and (ii) a mortgage or deed of trust on
real estate on which such Manufactured Home is situated, but such Manufactured
Home is not considered or classified as part of the real estate under the laws
of the jurisdiction in which it is located.
"Liquidated Contract" means any defaulted Contract as to which the
Servicer has determined that all amounts which it expects to recover from or on
account of such Contract have been recovered; provided that any defaulted
Contract in respect of which the related Manufactured Home and, in the case of
Land-and-Home Contracts, Mortgaged Property, have been realized upon and
disposed of and the proceeds of such disposition have been received shall be
deemed to be a Liquidated Contract.
"Liquidation Expenses" means out-of-pocket expenses (exclusive of any
overhead expenses) which are incurred by the Servicer in connection with the
liquidation of any defaulted Contract, on or prior to the date on which the
related Manufactured Home and, in the case of Land-and-Home Contracts, Mortgaged
Property, are disposed of, including, without limitation, legal fees and
expenses, and any related and unreimbursed expenditures for property taxes,
property preservation or restoration of the property to marketable condition.
"Liquidation Proceeds" means cash (including Insurance Proceeds)
received in connection with the liquidation of defaulted Contracts, whether
through repossession, foreclosure sale or otherwise, including any rental income
realized from the repossessed Manufactured Home.
"List of Contracts" means the lists identifying each Contract
constituting part of the corpus of the Trust, and which lists are either
delivered pursuant to Section 2.02(a) of this Agreement or attached to a
Subsequent Transfer Instrument as Exhibit A, as such lists may be amended from
time to time pursuant to Section 3.06(b) to add Eligible Substitute Contracts
and delete Replaced Contracts. Each List of Contracts shall set forth as to each
Contract identified on it (i) the Cut-off Date Principal Balance, (ii) the
amount of monthly payments due from the Obligor, (iii) the Contract Rate and
(iv) the maturity date.
"Loan-to-Value Ratio" means, (a) with respect to any Contract other
than a Land-in-Lieu Contract, one minus a fraction, the numerator of which is
the total amount down (which may include both cash (plus, in certain cases, fees
and insurance premiums financed, but not buydown points) and, for certain
Contracts, the amount of any equity in land on which a lien has been granted)
and the denominator of which is the sum of the original principal amount and
such amount down, and (b) with respect to Land-in-Lieu Contracts, one minus a
fraction, the numerator of which is the appraised value of land and the
denominator of which is the original principal amount.
"Manufactured Home" means a unit of manufactured housing, including all
accessions thereto, securing the indebtedness of the Obligor under the related
Contract.
"Master Certificates" means all of the Certificates other than the
Class C Subsidiary Certificate.
1-24
"Master REMIC" means one of the two separate REMICs comprising the
corpus of the Trust created by this Agreement, the assets of which shall consist
of the Uncertificated Subsidiary Interests.
"Maturity Date" means, as to any Certificate, other than a Class C
Certificate, and as to any Uncertificated Subsidiary Interest, the latest
possible maturity date for purposes of complying with the REMIC Provisions
governing "regular interests." The Maturity Dates for such Certificates and
Uncertificated Subsidiary Interests are set forth in Sections 2.05 (b) and (c).
"Monthly Report" has the meaning assigned in Section 6.01.
"Monthly Servicing Fee" means, as of any Remittance Date, one-twelfth
of the product of 0.50% and the Pool Scheduled Principal Balance for the
immediately preceding Remittance Date (or, with respect to the first Remittance
Date, the Cut-off Date Pool Principal Balance as of the Closing Date).
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or any successor
thereto; provided that, if Moody's provided a rating on any of the Certificates,
as required by Section 2.02, and does not as of any subsequent date have a
rating outstanding on any of the Class A, Class M-1, Class M-2 or Class B
Certificates, then references herein to "▇▇▇▇▇'▇" shall be deemed to refer to
the NRSRO then rating any Class of the Certificates (or, if more than one such
NRSRO is then rating any Class of the Certificates, to such NRSRO as may be
designated by the Servicer), and references herein to ratings by or requirements
of ▇▇▇▇▇'▇ shall be deemed to have the equivalent meanings with respect to
ratings by or requirements of such NRSRO.
"Mortgage" means the mortgage, deed of trust, security deed or similar
evidence of lien, creating a first lien on an estate in fee simple in the real
property securing a Land-and-Home Contract.
"Mortgaged Property" means the property subject to the lien of a
Mortgage.
"Net Liquidation Loss" means, as to a Liquidated Contract, the amount,
if any, by which (a) the outstanding principal balance of such Liquidated
Contract plus accrued and unpaid interest thereon to the date on which such
Liquidated Contract became a Liquidated Contract exceeds (b) the Net Liquidation
Proceeds for such Liquidated Contract.
"Net Liquidation Proceeds" means, as to a Liquidated Contract, all
Liquidation Proceeds received on or prior to the last day of the month in which
such Contract became a Liquidated Contract, net of Liquidation Expenses.
"NRSRO" means any nationally recognized statistical rating
organization.
"Obligor" means each Person who is indebted under a Contract.
"Officer's Certificate" means a certificate signed by the Chairman of
the Board, President or any Vice President of the Originator or the Seller and
delivered to the Trustee.
1-25
"Opinion of Counsel" means a written opinion of counsel, who may,
except as expressly provided herein, be salaried counsel for the Originator or
the Seller, acceptable to the Trustee and the Originator or the Seller, provided
that any opinion of counsel relating to the qualification of the Subsidiary
REMIC or the Master REMIC as a REMIC or compliance with the REMIC Provisions
must be an opinion of Independent counsel.
"Original Class A Principal Balance" means the Original Principal
Balance of the Class A Certificates.
"Original Principal Balance" means as to each Class of Master
Certificates, the amount set forth with respect to such Class in Section
2.05(b).
"Overcollateralization Amount" means, as of the Closing Date and the
first Remittance Date, $7,500,000 and as of any other Remittance Date, the
amount by which the aggregate Class Principal Balance of the Certificates as of
such Remittance Date is less than the sum of the Pool Scheduled Principal
Balance and the Pre-Funded Amount as of the immediately preceding Remittance
Date.
"Partial Principal Prepayment" means (a) any Principal Prepayment other
than a Principal Prepayment in Full and (b) any cash amount deposited in the
Certificate Account pursuant to the provision in Section 3.06(a) or pursuant to
Section 3.06(b).
"Paying Agent" has the meaning assigned in Section 8.01(c).
"Percentage Interest" means, as to any Certificate, the percentage
interest evidenced thereby in distributions made on the related Class, such
percentage interest being equal to, in the case of the Class A, Class M and
Class B Certificates, the percentage (carried to eight places) obtained from
dividing the denomination of such Certificate by the Original Principal Balance
of the related Class; and in the case of the Class B-3I and Class C
Certificates, the percentage specified on the face of such Certificate. The
aggregate Percentage Interests for each Class of Certificates shall equal 100%,
respectively.
"Person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust (including any beneficiary thereof),
unincorporated organization or government or any agency or political subdivision
thereof.
"Plan" has the meaning assigned in Section 9.02(b)(2).
"Pool Factor" means, at any time, the percentage derived from a
fraction, the numerator of which is the aggregate Principal Balance of each
Class of Certificates at such time and the denominator of which is the Cut-off
Date Pool Principal Balance.
"Pool Scheduled Principal Balance" means, as of any Remittance Date,
the aggregate Scheduled Principal Balance of all Contracts that were outstanding
during the related Due Period.
"Post-Funding Remittance Date" means the first Remittance Date after
the last day of the Pre-Funding Period.
1-26
"Pre-Funded Amount" means with respect to any date of determination,
the amount then on deposit in the Pre-Funding Account, after giving effect to
any sale of Subsequent Contracts to the Trust on such date, excluding any
investment earnings.
"Pre-Funding Account" means the account so designated, established and
maintained pursuant to Section 8.07.
"Pre-Funding Period" means the period beginning on the Closing Date and
ending on the earliest of (a) the date on which the amount on deposit in the
Pre-Funding Account is less than $10,000, (b) the Funding Termination Date or
(c) the date on which an Event of Termination occurs.
"Pre-Funding Subaccount" means the subaccount, if any, so designated,
established and maintained pursuant to Section 8.07.
"Principal Prepayment" means a payment or other recovery of principal
on a Contract (exclusive of Liquidation Proceeds) which is received in advance
of its scheduled due date and applied upon receipt (or, in the case of a Partial
Principal Prepayment, upon the next scheduled payment date on such Contract) to
reduce the outstanding principal amount due on such Contract prior to the date
or dates on which such principal amount is due.
"Principal Prepayment in Full" means any Principal Prepayment of the
entire principal balance of a Contract.
"Rating Agencies" means Standard & Poor's, ▇▇▇▇▇'▇ and Fitch.
"Realized Losses" means, as to any Remittance Date, the aggregate Net
Liquidation Losses of all Contracts that became Liquidated Contracts during the
immediately preceding month.
"Record Date" means the Business Day immediately preceding the related
Remittance Date.
"Regular Certificate" means a Class A, Class M, Class B or Class B-3I
Certificate.
"REMIC" means a "real estate mortgage investment conduit" as defined in
Section 860D of the Code.
"REMIC Provisions" means the provisions of the federal income tax law
relating to REMICs, which appear at Sections 860A through 860G of the Code, and
related provisions and any temporary, proposed or final regulations promulgated
thereunder, as the foregoing may be in effect from time to time.
"Remittance Date" means the first day of each month during the term of
this Agreement, or if such day is not a Business Day, the next succeeding
Business Day, commencing on November 1, 2000.
1-27
"Remittance Rate" means with respect to each Class of Certificates, the
rate set forth for such Class in Section 2.05(b).
"Replaced Contract" has the meaning assigned in Section 3.06(b).
"Repurchase Price" means, with respect to a Contract to be repurchased
pursuant to Section 3.06, an amount equal to (a) the remaining principal amount
outstanding on such Contract (or, with respect to an Unfunded Contract being
repurchased pursuant to Section 3.06(c), the Cut-off Date Principal Balance of
such Unfunded Contract), plus (b) interest at the Contract Rate on such Contract
from the end of the Due Period with respect to which the Obligor last made a
payment through the end of the immediately preceding Due Period.
"Responsible Officer" means, with respect to the Trustee, the chairman
and any vice chairman of the board of directors, the president, the chairman and
vice chairman of any executive committee of the board of directors, every vice
president, assistant vice president, the secretary, every assistant secretary,
cashier or any assistant cashier, controller or assistant controller, the
treasurer, every assistant treasurer, every trust officer, assistant trust
officer and every other officer or assistant officer of the Trustee customarily
performing functions similar to those performed by persons who at the time shall
be such officers, respectively, or to whom a corporate trust matter is referred
because of knowledge of, familiarity with, and authority to act with respect to
a particular matter.
"Scheduled Principal Balance" means, as to any Contract and any
Remittance Date or the applicable Cut-off Date, the principal balance of such
Contract as of the Due Date in the related Due Period or as of the Due Date
immediately preceding the Cut-off Date, as applicable, as the case may be, as
specified in the amortization schedule at the time relating thereto (after any
adjustment to such amortization schedule by reason of any bankruptcy of an
Obligor or similar proceeding or any moratorium or similar waiver or grace
period) after giving effect to any previous Partial Principal Prepayments and to
the payment of principal due on such Due Date and irrespective of any
delinquency in payment by, or extension granted to, the related Obligor.
"Servicer" means the Originator until any Service Transfer hereunder
and thereafter means the new servicer appointed pursuant to Article VII.
"Service Transfer" has the meaning assigned in Section 7.02.
"Servicing Officer" means any officer of the Servicer involved in, or
responsible for, the administration and servicing of Contracts whose name
appears on a list of servicing officers appearing in an Officer's Certificate
furnished to the Trustee by the Originator, as the same may be amended from time
to time.
"Sixty-Day Delinquency Ratio" means, as to any Remittance Date, a
fraction, expressed as a percentage, the numerator of which is the aggregate of
the outstanding balances of all Contracts that were delinquent 60 days or more
as of the end of the related Due Period (including Contracts in respect of which
the related Manufactured Homes have been repossessed but are still in
inventory), and the denominator of which is the Pool Scheduled Principal Balance
as of such Remittance Date.
1-28
"Staged-Funding Contract" means an Initial or Additional Contract with
respect to which the Originator has agreed to make multiple disbursements (up to
the related Cut-off Date Principal Balance) with respect to the purchase of the
related Manufactured Home and improvement of the related real estate, but not
all such disbursements have been made as of the Closing Date.
"Staged-Funding Contract Reserve Account" means the account established
and maintained pursuant to Section 3.08.
"Standard & Poor's" means Standard & Poor's Rating Services, a division
of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or any successor thereto; provided that if
Standard & Poor's does not then have a rating outstanding on any of the Class A,
Class M, or Class B Certificates, then references herein to "Standard & Poor's"
shall be deemed to refer to the NRSRO then rating any Class of the Certificates
(or, if more than one NRSRO is then rating any Class of the Certificates, to
such NRSRO as may be designated by the Servicer), and references herein to
ratings by or requirements of Standard & Poor's shall be deemed to have the
equivalent meanings with respect to ratings by or requirements of such NRSRO.
"Step-up Rate Contract" means any Contract bearing interest during an
initial period or periods at a fixed rate or fixed rates that are lower than the
fixed rate borne thereafter.
"Subsequent Contract" means a Contract sold by the Company to the Trust
pursuant to Section 2.03, such Contract being identified on Exhibit A attached
to a Subsequent Transfer Instrument.
"Subsequent Cut-off Date" means, with respect to a Subsequent Contract,
either the last day of the calendar month in which the related Subsequent
Transfer Date occurs or the last day of the preceding calendar month, as
specified by the Seller in the related Addition Notice.
"Subsequent Transfer Date" means, with respect to each Subsequent
Transfer Instrument, the date on which the related Subsequent Contracts are sold
to the Trust.
"Subsequent Transfer Instrument" means each Subsequent Transfer
Instrument dated as of a Subsequent Transfer Date executed by the Seller
substantially in the form of Exhibit P, by which the Seller sells Subsequent
Contracts to the Trust.
"Subsidiary Interest Principal Balance" means, with respect to each
Class of Uncertificated Subsidiary Interests, the Principal Balance of the
Corresponding Certificate Class.
"Subsidiary Interest Shortfall" means, with respect to each Class of
Uncertificated Subsidiary Interests and any Remittance Date, the amount, if any,
by which the amount distributed on such Class on such Remittance Date pursuant
to Section 8.03(b)(5) is less than the amount specified in Section 8.03(b)(5).
"Subsidiary REMIC" means one of the two separate REMICs comprising the
corpus of the Trust created by this Agreement, the assets of which shall consist
of (a) all the rights, benefits, and obligations arising from and in connection
with each Contract and any related Mortgage, (b) all rights under any Hazard
Insurance Policy relating to a Manufactured Home
1-29
securing a Contract for the benefit of the owner of such Contract and proceeds
from the Errors and Omissions Protection Policy and any blanket hazard policy to
the extent such proceeds relate to any Manufactured Home, (c) all rights under
any FHA/VA Regulation pertaining to any FHA/VA Contract, (d) all remittances,
deposits and payments made into the Certificate Account and amounts in the
Certificate Account (other than payments on the Subsidiary Interests), (e) all
proceeds in any way derived from any of the foregoing items, and (f) all
documents contained in the Contract Files or the Land-and-Home Contract Files.
"Transfer Agreement" means that certain Transfer Agreement between
Conseco Finance Securitizations Corp., as Purchaser, and Conseco Finance Corp.,
as Seller, dated as of even date herewith.
"Trust" means the trust created by this Agreement, known as
Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate Trust
2000-5, the corpus of which consists of (a) all the rights, benefits, and
obligations arising from and in connection with each Contract and any related
Mortgage, (b) all rights under any Hazard Insurance Policy relating to a
Manufactured Home securing a Contract for the benefit of the owner of such
Contract and proceeds from the Errors and Omissions Protection Policy and any
blanket hazard policy to the extent such proceeds relate to any Manufactured
Home, (c) all rights under any FHA/VA Regulation pertaining to any FHA/VA
Contract, (d) all rights of the Seller under the Transfer Agreement, (e) all
remittances, deposits and payments made into the Certificate Account and amounts
in the Certificate Account, (f) all proceeds in any way derived from any of the
foregoing items, (g) all documents contained in the Contract Files or the
Land-and-Home Contract Files, (h) the obligations and related demand note of the
Company delivered pursuant to Section 3.06(c) and the related Staged-Funding
Contract Reserve Account, if any, (i) the Capitalized Interest Account and (j)
the Pre-Funding Account.
"Uncertificated Subsidiary Interests" means the Class ▇-▇▇, ▇-▇▇, ▇-▇▇,
▇-▇▇, ▇-▇▇, ▇-▇▇, A-S7, M-S1, M-S2, B-S1 and B-S2 Interests, collectively.
"Undelivered Contract" means as of any date of determination an Initial
or Additional Contract identified, on the exception report attached to the
Acknowledgement delivered by the Trustee under Section 2.04, as a Land-and-Home
Contract as to which the Trustee did not receive the related Land-and-Home
Contract File as of the Closing Date and has not received the related
Land-and-Home Contract File and remitted payment to the Seller pursuant to
Section 8.07(c).
"Undelivered Contract Subaccount" means the subaccount so designated
and established and maintained pursuant to Section 8.07.
"Underwriters" means ▇▇▇▇▇▇ Brothers, Inc., Credit Suisse First Boston
Corporation, ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated and Banc of
America Securities, LLC.
"Underwriting Agreement" means the Underwriting Agreement and related
Terms Agreement, each dated as of September 28, 2000, among the Originator, the
Seller and the Underwriters.
"Unfunded Contract" has the meaning specified in Section 3.06(c).
1-30
"Unfunded Contract Shortfall" has the meaning specified in Section
3.06(c).
"Unpaid Class A Interest Shortfall" means, as to each Class of Class A
Certificates and any Remittance Date, the amount, if any, of the Class A
Interest Shortfall applicable to such Class for the prior Remittance Date, plus
accrued interest (to the extent payment thereof is legally permissible) at the
related Remittance Rate on the amount thereof from such prior Remittance Date to
such current Remittance Date (calculated in the manner specified in Section
1.03).
"Unpaid Class A Principal Shortfall" means, as to each Class of Class A
Certificates and any Remittance Date, the amount, if any, by which the aggregate
of the Class A Principal Shortfalls for prior Remittance Dates is in excess of
the amounts distributed on prior Remittance Dates to Holders of Class A
Certificates pursuant to Section 8.03(a)(6)(ii).
"Unpaid Class B-1 Interest Shortfall" means, as to any Remittance Date,
the amount, if any, of the Class B-1 Interest Shortfall for the prior Remittance
Date, plus accrued interest (to the extent payment thereof is legally
permissible) at the Class B-1 Remittance Rate on the amount thereof from such
prior Remittance Date to such current Remittance Date (calculated in the manner
specified in Section 1.03).
"Unpaid Class B-2 Interest Shortfall" means, as to any Remittance Date,
the amount, if any, of the Class B-2 Interest Shortfall for the prior Remittance
Date, plus accrued interest (to the extent payment thereof is legally
permissible) at the Class B-2 Remittance Rate on the amount thereof from such
prior Remittance Date to such current Remittance Date (calculated in the manner
specified in Section 1.03).
"Unpaid Class B-1 Liquidation Loss Interest Shortfall" means, as to any
Remittance Date, the sum of (i) the amount, if any, of the remainder of (x) the
Class B-1 Liquidation Loss Interest Amount, if any, for the immediately prior
Remittance Date, plus (y) the Unpaid Class B-1 Liquidation Loss Interest
Shortfall determined as of such immediately prior Remittance Date, minus (z) all
amounts distributed to the Holders of the Class B-1 Certificates on account of
any Unpaid Class B-1 Liquidation Loss Interest Shortfall pursuant to Section
8.03(a)(9)(iv) on such immediately prior Remittance Date, plus (ii) accrued
interest (to the extent payment thereof is legally permissible) at the Class B-1
Remittance Rate on the amount specified in clause (i) from such prior Remittance
Date to such current Remittance Date (calculated in the manner specified in
Section 1.03).
"Unpaid Class B-1 Principal Shortfall" means, as to any Remittance
Date, the amount, if any, by which the aggregate of the Class B-1 Principal
Shortfalls for prior Remittance Dates is in excess of the amounts distributed on
prior Remittance Dates to Holders of Class B-1 Certificates pursuant to Section
8.03(a)(9)(i).
"Unpaid Class B-2 Principal Shortfall" means, as to any Remittance
Date, the amount, if any, by which the aggregate of the Class B-2 Principal
Shortfalls for prior Remittance Dates is in excess of the amounts distributed on
prior Remittance Dates to Holders of Class B-2 Certificates pursuant to Section
8.03(a)(10)(iii).
1-31
"Unpaid Class B-3I Shortfall" means, as to any Remittance Date, the
amount, if any, by which the aggregate of the Class B-3I Shortfalls for prior
Remittance Dates is in excess of the amounts distributed on prior Remittance
Dates to Holders of Class B-3I Certificates pursuant to Section 8.03(a)(13) in
respect of any Unpaid Class B-3I Shortfall.
"Unpaid Class M-1 Interest Shortfall" means, as to any Remittance Date,
the amount, if any, of the Class M-1 Interest Shortfall for the prior Remittance
Date, plus accrued interest (to the extent payment thereof is legally
permissible) at the Class M-1 Remittance Rate on the amount thereof from such
prior Remittance Date to such current Remittance Date (calculated in the manner
specified in Section 1.03).
"Unpaid Class M-2 Interest Shortfall" means, as to any Remittance Date,
the amount, if any, of the Class M-2 Interest Shortfall for the prior Remittance
Date, plus accrued interest (to the extent payment thereof is legally
permissible) at the Class M-2 Remittance Rate on the amount thereof from such
prior Remittance Date to such current Remittance Date (calculated in the manner
specified in Section 1.03).
"Unpaid Class M-1 Liquidation Loss Interest Shortfall" means, as to any
Remittance Date, the sum of (i) the amount, if any, of the remainder of (x) the
Class M-1 Liquidation Loss Interest Amount, if any, for the immediately prior
Remittance Date, plus (y) the Unpaid Class M-1 Liquidation Loss Interest
Shortfall determined as of such immediately prior Remittance Date, minus (z) all
amounts distributed to the Holders of the Class M-1 Certificates on account of
any Unpaid Class M-1 Liquidation Loss Interest Shortfall pursuant to Section
8.03(a)(7)(iv) on such immediately prior Remittance Date, plus (ii) accrued
interest (to the extent payment thereof is legally permissible) at the Class M-1
Remittance Rate on the amount specified in clause (i) from such prior Remittance
Date to such current Remittance Date (calculated in the manner specified in
Section 1.03).
"Unpaid Class M-2 Liquidation Loss Interest Shortfall" means, as to any
Remittance Date, the sum of (i) the amount, if any, of the remainder of (x) the
Class M-2 Liquidation Loss Interest Amount, if any, for the immediately prior
Remittance Date, plus (y) the Unpaid Class M-2 Liquidation Loss Interest
Shortfall determined as of such immediately prior Remittance Date, minus (z) all
amounts distributed to the Holders of the Class M-2 Certificates on account of
any Unpaid Class M-2 Liquidation Loss Interest Shortfall pursuant to Section
8.03(a)(8)(iv) on such immediately prior Remittance Date, plus (ii) accrued
interest (to the extent payment thereof is legally permissible) at the Class M-2
Remittance Rate on the amount specified in clause (i) from such prior Remittance
Date to such current Remittance Date (calculated in the manner specified in
Section 1.03).
"Unpaid Class M-1 Principal Shortfall" means, as to any Remittance
Date, the amount, if any, by which the aggregate of the Class M-1 Principal
Shortfalls for prior Remittance Dates is in excess of the amounts distributed on
prior Remittance Dates to Holders of Class M-1 Certificates pursuant to Section
8.03(a)(7)(i).
"Unpaid Class M-2 Principal Shortfall" means, as to any Remittance
Date, the amount, if any, by which the aggregate of the Class M-2 Principal
Shortfalls for prior Remittance Dates is
1-32
in excess of the amounts distributed on prior Remittance Dates to Holders of
Class M-2 Certificates pursuant to Section 8.03(a)(8)(i).
"Unpaid Subsidiary Interest Shortfall" means, as to any Remittance Date
and any Class of Uncertificated Subsidiary Interests, the amount, if any, of the
Subsidiary Interest Shortfall for the prior Remittance Date with respect to such
Class, plus accrued interest (to the extent payment thereof is legally
permissible) at 1/12th of the Weighted Average Contract Rate on the amount
thereof from such prior Remittance Date to such current Remittance Date.
"Weighted Average Contract Rate" means, as to any Remittance Date, the
weighted average (determined by Scheduled Principal Balance) of the Contract
Rates of all Contracts that were outstanding during the prior related Due
Period.
SECTION 1.03. Calculations.
------------
All calculations of the amount of interest accrued on the Certificates
with respect to any Remittance Date shall be calculated on the basis of a
360-day year of twelve 30-day months.
1-33
ARTICLE II
ESTABLISHMENT OF TRUST; TRANSFER OF CONTRACTS
---------------------------------------------
SECTION 2.01. Closing.
-------
a. There is hereby created, by the Seller as settlor, a separate
trust which shall be known as Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificate Trust 2000-5. By the execution and delivery of this
Agreement, the Seller has agreed that it will elect or will cause an election to
be made to treat the pool of assets comprising each of the Subsidiary REMIC and
the Master REMIC, excluding the Staged-Funding Contract Reserve Account, the
obligation and related demand note of the Originator pursuant to Section
3.06(c), the Capitalized Interest Account and the Pre-Funding Account, as a
REMIC. The Trust shall be administered pursuant to the provisions of this
Agreement for the benefit of the Certificateholders.
b. The Seller hereby transfers, assigns, delivers, sells, sets
over and otherwise conveys to the Trustee on behalf of the Trust, by execution
of an assignment substantially in the form of Exhibit D hereto, (1) all the
right, title and interest of the Seller in and to the Contracts, including,
without limitation, all right, title and interest in and to the Collateral
Security, all rights to receive payments on or with respect to the Contracts
(other than the principal and interest due on the Contracts on or before the
applicable Cut-off Date) and all rights of the Seller under the Transfer
Agreement, (2) all rights under every Hazard Insurance Policy relating to a
Manufactured Home securing a Contract for the benefit of the owner of such
Contract, (3) all rights under all FHA/VA Regulations pertaining to any Contract
that is an FHA/VA Contract, (4) the proceeds from the Errors and Omissions
Protection Policy and all rights under any blanket hazard insurance policy to
the extent they relate to the Manufactured Homes, (5) all documents contained in
the Contract Files and the Land-and-Home Contract Files, (6) $20,504,357.70 paid
by the Underwriters of the Certificates to the Trustee by order of the Seller
out of the proceeds of the sale of the Certificates (which such Underwriters
shall, by order of the Trust, remit directly to the Staged-Funding Contract
Reserve Amount), (7) amounts on deposit in the Capitalized Interest Account, (8)
amounts on deposit in the Pre-Funding Account and (9) all proceeds and products
in any way derived from any of the foregoing.
c. The Seller agrees that it will use its best efforts
(consistent with prudent lending practices) to cause each Staged-Funding
Contract to be fully disbursed on or before the Funding Termination Date. The
additional payment obligations of any Obligor attributable to any further
disbursements on any Staged-Funding Contract made on or before the Funding
Termination Date shall automatically become the property of the Trust, without
further action by the Seller or the Trust. The payment to the Seller by the
Trust and the transfer of additional obligations to the Trust pursuant to this
Section 2.01(c) and Section 3.06(c)(ii) shall be a purchase by the Trust of
qualified mortgages pursuant to a fixed price contract within the meaning of
Section 860G(a)(3) of the Code.
d. Although the parties intend that the conveyance of the
Seller's right, title and interest in and to the Contracts and the Collateral
Security pursuant to this Agreement and each Subsequent Transfer Instrument
shall constitute a purchase and sale and not a pledge of security for loans from
the Certificateholders, it is the intent of this Agreement that if such
conveyances
2-1
are deemed to be a pledge of security for loans from the Certificateholders or
any other Persons (the "Secured Obligations"), the parties intend that the
rights and obligations of the parties to the Secured Obligations shall be
established pursuant to the terms of this Agreement. The parties also intend and
agree that the Seller shall be deemed to have granted to the Trustee, and the
Seller does hereby grant to the Trustee, a perfected first-priority security
interest in the items designated in Section 2.01(b)(1) through 2.01(b)(9) above
and in each Subsequent Transfer Instrument, and all proceeds thereof, to secure
the Secured Obligations, and that this Agreement shall constitute a security
agreement under applicable law. If the trust created by this Agreement
terminates prior to the satisfaction of the claims of any Person under any
Certificates or the Secured Obligations, the security interest created hereby
shall continue in full force and effect and the Trustee shall be deemed to be
the collateral agent for the benefit of such Person.
SECTION 2.02. Conditions to the Closing.
-------------------------
On or before the Closing Date, the Seller shall deliver or cause to be
delivered the following documents to the Trustee:
a. The List of Contracts identifying all Initial and Additional
Contracts, certified by the Chairman of the Board, President or any Vice
President of the Seller.
b. A certificate of an officer of each of the Originator and
Seller substantially in the form of Exhibit E hereto.
c. An Opinion of Counsel for each of the Originator and Seller
substantially in the form of Exhibit F hereto.
d. The Trustee's acknowledgment in the form of Exhibit G hereto.
e. A letter acceptable to the Underwriters from
PricewaterhouseCoopers LLP or another nationally recognized accounting firm,
stating that such firm has reviewed the Initial Contracts on a statistical
sampling basis and setting forth the results of such review.
f. Copies of resolutions of the board of directors of the Seller
or of the executive committee of the board of directors of the Seller approving
the execution, delivery and performance of this Agreement, the creation of the
Trust and the transactions contemplated hereunder, certified in each case by the
secretary or an assistant secretary of the Seller.
g. Officially certified recent evidence of due incorporation and
good standing of the Seller under the laws of the State of Minnesota.
h. Evidence of filing with the Secretary of State of Minnesota of
UCC-1 financing statements, (i) executed by the Originator as debtor, naming the
Seller as secured party and listing the Contracts as collateral, and (ii)
executed by the Seller as debtor, naming the Trustee as secured party and
listing the Contracts as collateral.
i. The Land-and-Home Contract File for each Initial and
Additional Contract that is a Land-and-Home Contract.
2-2
j. An executed copy of the Assignment of the Seller substantially
in the form of Exhibit D hereto.
k. An Officer's Certificate listing the Servicer's Servicing
Officers.
l. Evidence of continued coverage of the Servicer under the
Errors and Omissions Protection Policy.
m. Evidence of deposit in the Certificate Account of all funds
received with respect to the Initial and Additional Contracts after the Cut-off
Date to the Closing Date, other than amounts due on or before the Cut-off Date,
together with an Officer's Certificate to the effect that such amount is
correct.
n. An Officer's Certificate confirming that the Originator's
internal audit department has reviewed the original or a copy of each Initial
and Additional Contract and each related Contract File or Land-and-Home Contract
File, as applicable, that each Initial and Additional Contract and related
Contract File or Land-and-Home Contract File, as applicable, conforms in all
material respects with the List of Contracts and that each such Contract File or
Land-and-Home Contract File, as applicable, is complete in all material respects
and that each Manufactured Home securing a Contract is covered by a Hazard
Insurance Policy as required by Section 3.02(f).
o. A letter from ▇▇▇▇▇'▇ confirming that it has assigned the
Class A Certificates a rating of Aaa, the Class M-1 Certificates a rating of
"Aa2", the Class M-2 Certificates a rating of "A2," and the Class B-1
Certificates a rating of "Baa2."
p. A letter from Fitch confirming that it has assigned the Class
A Certificates a rating of "AAA," the Class M-1 Certificates a rating of "AA,"
the Class M-2 Certificates a rating of "A", and the Class B-1 Certificates a
rating of "BBB."
q. A letter from Standard & Poor's confirming that it has
assigned the Class A Certificates a rating of AAA, the Class M-1 Certificates a
rating of AA, the Class M-2 Certificates a rating of A, and the Class B-1
Certificates a rating of BBB.
r. The demand note described in Section 3.06(c)(v).
s. An executed copy of the Transfer Agreement.
t. Evidence of the deposit of $20,504,357.70 in the
Staged-Funding Contract Reserve Account.
u. Evidence of the deposit of $500,000 in the Capitalized
Interest Account.
v. Evidence of the deposit of $74,267,854.13 in the Pre-Funding
Account.
w. Evidence of the deposit in the Undelivered Contract Subaccount
of an amount equal to the difference between the aggregate Cut-off Date
Principal Balances of the Initial and
2-3
Additional Contracts and the aggregate Cut-off Date Principal Balances of the
Undelivered Contracts.
x. Any other documents or certificates that the Trustee may
reasonably request.
SECTION 2.03. Conveyance of the Subsequent Contracts.
--------------------------------------
a. Subject to the conditions set forth in paragraph (b) below, in
consideration of the Trustee's delivery on the related Subsequent Transfer Dates
to or upon the order of the Seller of all or a portion of the balance of funds
in the Pre-Funding Account, the Seller shall on any Subsequent Transfer Date
sell, transfer, assign, set over and convey to the Trust by execution and
delivery of a Subsequent Transfer Instrument, all the right, title and interest
of the Seller in and to the Subsequent Contracts identified on the List of
Contracts attached to the Subsequent Transfer Instrument, including all rights
to receive payments on or with respect to the Subsequent Contracts due after the
applicable Cut-off Date, and all items with respect to such Subsequent Contracts
in the related Contract Files and Land-and-Home Contract Files. The transfer to
the Trustee by the Seller of the Subsequent Contracts shall be absolute and is
intended by the Seller, the Trustee and the Certificateholders to constitute and
to be treated as a sale of the Subsequent Contracts by the Seller to the Trust.
The purchase price paid by the Trustee shall be one hundred percent
(100%) of the aggregate Cut-off Date Principal Balances of such Subsequent
Contracts. The purchase price of Subsequent Contracts shall be paid solely with
amounts in the Pre-Funding Account. This Agreement shall constitute a fixed
price contract in accordance with Section 860G(a)(3)(A)(ii) of the Code.
b. The Seller shall transfer the Subsequent Contracts to the
Trustee, and the Trustee shall release funds from the Pre-Funding Account, only
upon the satisfaction of each of the following conditions on or prior to the
related Subsequent Transfer Date:
(i) the Seller shall have provided the Trustee with an
Addition Notice at least five Business Days prior to the Subsequent
Transfer Date and shall have provided any information reasonably
requested by the Trustee with respect to the Subsequent Contracts;
(ii) the Seller shall have delivered the related
Land-and-Home Contract File for each Subsequent Land-and-Home Contract
to the Custodian at least two Business Days prior to the Subsequent
Transfer Date;
(iii) the Seller shall have delivered to the Trustee a duly
executed Subsequent Transfer Instrument substantially in the form of
Exhibit P, which shall include a List of Contracts identifying the
related Subsequent Contracts;
(iv) as of each Subsequent Transfer Date, the Seller shall
not be insolvent nor shall it have been made insolvent by such transfer
nor shall it be aware of any pending insolvency, as certified in an
Officer's Certificate substantially in the form attached hereto as
Exhibit Q;
2-4
(v) such sale and transfer shall not result in a material
adverse tax consequence to the Trust (including the Master REMIC and
the Subsidiary REMIC) or the Certificateholders;
(vi) the Pre-Funding Period shall not have ended;
(vii) the Seller shall have delivered to the Trustee an
Officer's Certificate, substantially in the form attached hereto as
Exhibit Q, confirming the satisfaction of each condition precedent and
the representations specified in this Section 2.03 and in Sections 3.01
and 3.03; and
(viii) the Seller and the Originator shall have delivered to
the Trustee Opinions of Counsel addressed to the Rating Agencies and
the Trustee with respect to the transfer of the Subsequent Contracts
substantially in the form of the Opinions of Counsel delivered to the
Trustee on the Closing Date regarding certain bankruptcy, corporate and
tax matters.
(ix) the Seller shall have delivered to the Trustee a copy
of the executed Subsequent Transfer Agreement between the Originator
and the Seller, substantially in the form of Exhibit A to the Transfer
Agreement and dated as of the Subsequent Transfer Date.
c. Before the last day of the Pre-Funding Period, the Seller
shall deliver to the Trustee:
(i) A letter from PricewaterhouseCoopers LLP or another
nationally recognized accounting firm retained by the Seller (with
copies provided to the Rating Agencies, the Underwriters and the
Trustee) that is in form, substance and methodology the same as that
delivered under Section 2.02(e) of this Agreement, except that it shall
address the Subsequent Contracts and their conformity in all material
respects to the characteristics described in Section 3.04(c) of this
Agreement.
(ii) Evidence that as a result of the purchase by the
Trust of the Subsequent Contracts, the Class A Certificates shall not
receive from any of the Rating Agencies a lower credit rating than the
rating assigned to such Certificates as of the Closing Date.
(iii) Evidence that the aggregate Cut-off Date Principal
Balance of the Subsequent Contracts, not specifically identified as
Subsequent Contracts as of the Closing Date, does not exceed 25% of the
Original Principal Balance.
SECTION 2.04. Acceptance by Trustee.
---------------------
a. On the Closing Date and each Subsequent Transfer Date, if the
conditions set forth in Section 2.02 and 2.03, respectively, have been
satisfied, the Trustee shall deliver a certificate to the Seller substantially
in the form of Exhibit G hereto acknowledging conveyance of the Contracts,
identified on the applicable List of Contracts and the related Contract Files
and Land-and-Home Contract Files to the Trustee and declaring that the Trustee,
directly or through a custodian, will hold all Contracts that have been
delivered in trust, upon the terms herein set
2-5
forth, for the use and benefit of all Certificateholders and on the Closing Date
the Trustee shall issue to or upon the order of the Seller Certificates
representing ownership of a beneficial interest in 100% of the Trust.
b. If, in its review of the Land-and-Home Contract Files as
described in Exhibit G, the Trustee or its Custodian discovers a breach of the
representations or warranties set forth in Sections 2.02(n), 3.02, 3.03, 3.04 or
3.05, the Seller and the Originator shall cure such breach or repurchase or
replace such Contract pursuant to Section 3.06.
SECTION 2.05. REMIC Provisions.
----------------
a. The Originator, as Servicer, and the Class C Subsidiary
Certificateholder and the Class C Master Certificateholder, by acceptance
thereof, each agrees that, in accordance with the requirements of Section
860D(b)(1) of the Code, the federal tax return of each of the Subsidiary REMIC
and the Master REMIC for its first taxable year shall provide that the
Subsidiary REMIC or the Master REMIC, as the case may be (excluding the
Capitalized Interest Account, the obligation and related demand note of the
Originator pursuant to Section 3.06(c), the Staged-Funding Contract Reserve
Account and the Pre-Funding Account) elects to be treated as a REMIC for such
taxable year and all subsequent taxable years. In furtherance of the foregoing,
the Trustee (at the direction of the Originator, the Seller or the Servicer) and
the Originator, the Seller and the Servicer shall take, or refrain from taking,
all such action as is necessary to maintain the status of each of the Subsidiary
REMIC or the Master REMIC as a REMIC under the REMIC provisions of the Code,
including, but not limited to, the taking of such action as is necessary to cure
any inadvertent termination of REMIC status.
b. The Regular Certificates are being issued in twelve classes
and are hereby designated by the Originator as constituting the "regular
interests" in the Master REMIC for the purposes of Section 860G(a)(1) of the
Code. The following terms of the Regular Certificates are irrevocably
established as of the Closing Date:
2-6
Pass-Through Original Class
Class Rate Per Annum Principal Balance Maturity Date
--------------------- -------------- ----------------- ------------------
Class A-1 6.98% $130,000,000 February 1, 2032
Class A-2 7.06% $ 67,000,000 February 1, 2032
Class A-3 7.21% $ 67,000,000 February 1, 2032
Class A-4 7.47% $101,000,000 February 1, 2032
Class A-5 7.70% $ 40,000,000 February 1, 2032
Class A-6 7.96% $117,000,000 February 1, 2032
Class A-7 *8.20% $104,250,000 February 1, 2032
Class M-1 *8.40% $ 37,500,000 February 1, 2032
Class M-2 *9.03% $ 30,000,000 February 1, 2032
Class B-1 *10.21% $ 22,500,000 February 1, 2032
Class B-2 *9.80% $ 26,250,000 February 1, 2032
Class B-3I **
--------------
* A floating rate (determined monthly on each Remittance Date) equal to the
Weighted Average Contract Rate, but in no event greater than the related
Remittance Rate specified above.
** The Class B-3I Certificates are interest-only Certificates entitled to the
payment of Excess Interest.
The Seller does not represent that any Class of Regular Certificates will, in
fact, mature on any given date. The Class C Master Certificate is being issued
in a single Class and is hereby designated by the Seller as constituting the
sole class of "residual interests" in the Master REMIC for purposes of Section
860G(a)(2) of the Code.
c. The Uncertificated Subsidiary Interests are being issued in
eleven classes and are hereby designated by the Seller as constituting the
"regular interests" in the Subsidiary REMIC for the purposes of Section
860G(a)(1) of the Code. The following terms of the Uncertificated Subsidiary
Interests are irrevocably established as of the Closing Date:
2-7
Original Subsidiary
Pass-Through Interest Principal
Class Rate Per Annum Balance Maturity Date
------------------- ---------------- ------------------- ------------------
Class A-S1 Weighted Average $130,000,000 February 1, 2032
Contract Rate
Class A-S2 Weighted Average $ 67,000,000 February 1, 2032
Contract Rate
Class A-S3 Weighted Average $ 67,000,000 February 1, 2032
Contract Rate
Class A-S4 Weighted Average $101,000,000 February 1, 2032
Contract Rate
Class A-S5 Weighted Average $ 40,000,000 February 1, 2032
Contract Rate
Class A-S6 Weighted Average $117,000,000 February 1, 2032
Contract Rate
Class A-S7 Weighted Average $104,250,000 February 1, 2032
Contract Rate
Class M-S1 Weighted Average $ 37,500,000 February 1, 2032
Contract Rate
Class M-S2 Weighted Average $ 30,000,000 February 1, 2032
Contract Rate
Class B-S1 Weighted Average $ 22,500,000 February 1, 2032
Contract Rate
Class B-S2 Weighted Average $ 26,250,000 February 1, 2032
Contract Rate
The Seller does not represent that any Class of Uncertificated Subsidiary
Interests will, in fact, mature on any given date. The Class C Subsidiary
Certificate is being issued in a single Class and is hereby designated by the
Seller as constituting the sole class of "residual interests" in the Subsidiary
REMIC for purposes of Section 860G(a)(2) of the Code.
d. The Closing Date, which is the day on which each of the
Subsidiary REMIC and the Master REMIC will issue all of its regular and residual
interests, is hereby designated as the "startup day" of both the Subsidiary
REMIC and the Master REMIC within the meaning of Section 860G(a)(9) of the Code.
e. After the Closing Date, neither the Trustee, the Originator,
the Seller nor any Servicer shall (i) accept any contribution of assets to the
Subsidiary REMIC or the Master REMIC, (ii) dispose of any portion of the
Subsidiary REMIC or the Master REMIC, other than as provided in Sections 3.06,
3.07 and 8.05, (iii) engage in any "prohibited transaction," as
2-8
defined in Sections 860F(a)(2) and (5) of the Code, except as may be
contemplated by Section 3.06(c), (iv) accept any contribution after the Closing
Date that is subject to the tax imposed by Section 860G(d) of the Code or (v)
engage in any activity or enter into any agreement that would result in the
receipt by the Subsidiary REMIC or the Master REMIC of any "net income from
foreclosure property" as defined in Section 860G(c)(2) of the Code, unless,
prior to any such action set forth in clauses (i), (ii), (iii), (iv) or (v) the
Trustee shall have received an unqualified Opinion of Counsel, which opinion
shall not be an expense of the Trust, stating that such action will not,
directly or indirectly, (A) adversely affect the status of the Subsidiary REMIC
or the Master REMIC as a REMIC or the status of the Uncertificated Subsidiary
Interests as "regular interests" in the Subsidiary REMIC, the status of the
Class C Subsidiary Certificates as the sole class of "residual interests" in the
Subsidiary REMIC, the status of the Regular Certificates as "regular interests"
in the Master REMIC, or the status of the Class C Master Certificates as the
sole class of "residual interests" in the Master REMIC, (B) affect the
distributions payable hereunder to the Certificateholders or (C) result in the
imposition of any lien, charge or encumbrance upon the Subsidiary REMIC or the
Master REMIC.
f. Upon the acquisition of any real property (including interests
in real property), or any personal property incident thereto, in connection with
the default of a Contract, the Servicer and the Trustee (at the direction of the
Servicer) shall take, or cause to be taken, such action as is necessary to sell
or otherwise dispose of such property within such period as is then required by
the Code in order for such property to qualify as "foreclosure property" within
the meaning of Section 860G(a)(8) of the Code, unless the Servicer and the
Trustee receive an Opinion of Counsel to the effect that the holding by the
Subsidiary REMIC or the Master REMIC of such property subsequent to the period
then permitted by the Code will not result in the imposition of any taxes on
"prohibited transactions" of the Subsidiary REMIC or the Master REMIC, as
defined in Section 860F of the Code, or cause the Subsidiary REMIC or the Master
REMIC to fail to qualify as a REMIC at any time that the Uncertificated
Subsidiary Interests, Class C Subsidiary Certificates, Regular Certificates or
Class C Master Certificates are outstanding. The Servicer shall manage,
conserve, protect and operate such real property, or any personal property
incident thereto, so that such property will not fail to qualify as "foreclosure
property," as defined in Section 860G(a)(8) of the Code, and that the
management, conservation, protection and operation of such property will not
result in the receipt by the Subsidiary REMIC or the Master REMIC of any "income
from nonpermitted assets," within the meaning of Section 860F(a)(2)(B) of the
Code.
2-9
ARTICLE III
REPRESENTATIONS AND WARRANTIES
------------------------------
Each of the Seller and Originator makes the following representations
and warranties on which the Trustee will rely in accepting the Contracts in
trust and issuing the Certificates on behalf of the Trust. The repurchase or
substitution obligation of the Originator set forth in Section 3.06 constitutes
the sole remedy available to the Trust or the Certificateholders for a breach of
a representation or warranty of the Originator set forth in Section 2.02(n),
3.02, 3.03, 3.04 or 3.05 of this Agreement.
SECTION 3.01. Representations and Warranties Regarding the Seller.
---------------------------------------------------
The Seller represents and warrants to the Trustee and the
Certificateholders, effective on the Closing Date and each Subsequent Transfer
Date, that:
a. Organization and Good Standing. The Seller is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and has the corporate power to own its assets
and to transact the business in which it is currently engaged. The Seller is
duly qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which the character of the business transacted by it or
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the business,
properties, assets, or condition (financial or other) of the Seller.
b. Authorization; Binding Obligations. The Seller has the power
and authority to make, execute, deliver and perform this Agreement and all of
the transactions contemplated under this Agreement, and to create the Trust and
cause it to make, execute, deliver and perform its obligations under this
Agreement and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement and to cause the Trust to
be created. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of the Seller enforceable in accordance with
its terms, except as enforcement of such terms may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and by the availability of equitable remedies.
c. No Consent Required. The Seller is not required to obtain the
consent of any other party or any consent, license, approval or authorization
from, or registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement.
d. No Violations. The execution, delivery and performance of this
Agreement by the Seller will not violate any provision of any existing law or
regulation or any order or decree of any court or the Articles of Incorporation
or Bylaws of the Seller, or constitute a material breach of any mortgage,
indenture, contract or other agreement to which the Seller or Originator is a
party or by which the Seller may be bound.
e. Litigation. No litigation or administrative proceeding of or
before any court, tribunal or governmental body is currently pending, or to the
knowledge of the Seller threatened,
3-1
against the Seller or any of its properties or with respect to this Agreement or
the Certificates which, if adversely determined, would in the opinion of the
Seller have a material adverse effect on the transactions contemplated by this
Agreement.
f. Licensing. The Seller is duly registered as a finance company
in each state in which Contracts were originated, to the extent such
registration is required by applicable law.
SECTION 3.02. Representations and Warranties Regarding Each Contract.
------------------------------------------------------
The Originator has made the following representations and warranties to
the Seller in the Transfer Agreement, which representations and warranties the
Seller has assigned to the Trustee for the benefit of the Certificateholders, as
of the Closing Date with respect to each Initial and Additional Contract, and as
of the applicable Subsequent Transfer Date with respect to each Subsequent
Contract identified on the List of Contracts attached to the related Subsequent
Transfer Agreement:
a. List of Contracts. The information set forth in the applicable
List of Contracts is true and correct as of its date.
b. Payments. As of the Cut-off Date, the most recent scheduled
payment was made by or on behalf of the Obligor (without any advance from the
Originator or any Person acting at the request of the Originator) or was not
past due for more than 59 days (in the case of an Initial or Additional
Contract) or 30 days (in the case of a Subsequent Contract).
c. No Waivers. The terms of the Contract have not been waived,
altered or modified in any respect, except by instruments or documents
identified in the Contract File or Land-and-Home Contract File, as applicable.
d. Binding Obligation. The Contract is the legal, valid and
binding obligation of the Obligor thereunder and is enforceable in accordance
with its terms, except as such enforceability may be limited by laws affecting
the enforcement of creditors' rights generally.
e. No Defenses. The Contract is not subject to any right of
rescission, setoff, counterclaim or defense, including the defense of usury, and
the operation of any of the terms of the Contract or the exercise of any right
thereunder will not render the Contract unenforceable in whole or in part or
subject to any right of rescission, setoff, counterclaim or defense, including
the defense of usury, and no such right of rescission, setoff, counterclaim or
defense has been asserted with respect thereto.
f. Insurance Coverage. The Manufactured Home securing the
Contract is covered by a Hazard Insurance Policy in the amount required by
Section 5.09. Each Manufactured Home secured by an FHA/VA Contract which was, at
the time of origination of the related Contract, located within a federally
designated special flood hazard area is covered by insurance coverage at least
equal to that required by Section 5.09 or such lesser coverage as may be
available under the federal flood insurance program. With respect to any other
Contract that is not an FHA/VA Contract, the Originator has obtained: (a) a
statement from the Obligor's insurance agent that the Manufactured Home was, at
the time of origination of the Contract, not in a federally designated special
flood hazard area; or (b) evidence that, at the time of origination, flood
insurance was in
3-2
effect, which coverage is at least equal to that required by Section 5.09 or
such lesser coverage as may be available under the federal flood insurance
program. All premiums due as of the Closing Date on such insurance have been
paid in full.
g. Origination. The Contract was originated by a manufactured
housing dealer and purchased by the Originator, or originated by the Originator
directly, in the regular course of its business.
h. Lawful Assignment. The Contract was not originated in and is
not subject to the laws of any jurisdiction whose laws would make the transfer
of the Contract pursuant to this Agreement or pursuant to transfers of
Certificates, or the ownership of the Contract by the Trust, unlawful or render
the Contract unenforceable.
i. Compliance with Law. At the date of origination of the
Contract, all requirements of any federal and state laws, rules and regulations
applicable to the Contract, including, without limitation, usury, truth in
lending and equal credit opportunity laws, have been complied with, and the
Originator shall for at least the period of this Agreement, maintain in its
possession, available for the Trustee's inspection, and shall deliver to the
Trustee upon demand, evidence of compliance with all such requirements. Such
compliance is not affected by the Trust's ownership of the Contract.
j. Contract in Force. The Contract has not been satisfied or
subordinated in whole or in part or rescinded, and the Manufactured Home
securing the Contract has not been released from the lien of the Contract in
whole or in part.
k. Valid Security Interest. Each Contract (other than the
Land-and-Home Contracts) creates a valid and enforceable perfected first
priority security interest in favor of the Originator in the Manufactured Home
covered thereby as security for payment of the Cut-off Date Principal Balance of
such Contract. The Originator has assigned all of its right, title and interest
in such Contract, including the security interest in the Manufactured Home
covered thereby, to the Seller, and the Seller has assigned all of its right,
title and interest in such Contract, including the security interest in the
Manufactured Home covered thereby, to the Trustee. The Trustee has and will have
a valid and perfected and enforceable first priority security interest in such
Contract and Manufactured Home.
Each Mortgage is a valid first lien in favor of the Seller on real
property securing the amount owed by the Obligor under the related Land-and-Home
Contract subject only to (a) the lien of current real property taxes and
assessments, (b) covenants, conditions and restrictions, rights of way,
easements and other matters of public record as of the date of recording of such
Mortgage, such exceptions appearing of record being acceptable to mortgage
lending institutions generally in the area wherein the property subject to the
Mortgage is located or specifically reflected in the appraisal obtained in
connection with the origination of the related Land-and-Home Contract obtained
by the Seller and (c) other matters to which like properties are commonly
subject which do not materially interfere with the benefits of the security
intended to be provided by such Mortgage. Each Land-and-Home Contract is covered
by an American Land Title Association, or equivalent form, lender's title
insurance policy. The Seller has assigned all of its right, title and interest
in such Land-and-Home Contract and related Mortgage,
3-3
including the security interest in the Manufactured Home covered thereby, to the
Trustee. The Trustee has and will have a valid and perfected and enforceable
first priority security interest in such Land-and-Home Contract.
l. Capacity of Parties. The signature(s) of the Obligor(s) on the
Contract are genuine and all parties to the Contract had full legal capacity to
execute the Contract.
m. Good Title. In the case of a Contract purchased from a
manufactured housing dealer, the Originator purchased the Contract for fair
value and took possession thereof in the ordinary course of its business,
without knowledge that the Contract was subject to a security interest. The
Originator has not sold, assigned or pledged the Contract to any person and
prior to the transfer of the Contract by the Originator to the Seller under the
terms of the Transfer Agreement, the Originator had good and marketable title
thereto free and clear of any encumbrance, equity, loan, pledge, charge, claim
or security interest and was the sole owner thereof with full right to transfer
the Contract to the Seller. With respect to any Contract bearing a stamp
indicating that such Contract has been sold to another party, such other party's
interest in such Contract has been released.
n. No Defaults. As of the applicable Cut-off Date, there was no
default, breach, violation or event permitting acceleration existing under the
Contract and no event which, with notice and the expiration of any grace or cure
period, would constitute such a default, breach, violation or event permitting
acceleration under such Contract (except payment delinquencies permitted by
clause (b) above). The Originator has not waived any such default, breach,
violation or event permitting acceleration except payment delinquencies
permitted by clause (b) above. As of the Closing Date or the Subsequent Transfer
Date, as applicable, the related Manufactured Home is, to the best of the
Originator's knowledge, free of damage and in good repair. To the best of the
Originator's knowledge, no Manufactured Home has suffered damage that is not
covered by a Hazard Insurance Policy, including, but not limited to, hurricanes,
earthquakes, floods, tornadoes, hailstorms, straight-line winds, sinkholes,
mudslides, volcanic eruptions, meteorites and other natural disasters.
o. No Liens. As of the Closing Date or the Subsequent Transfer
Date, as applicable, there are, to the best of the Originator's knowledge, no
liens or claims which have been filed for work, labor or materials affecting the
Manufactured Home or any related Mortgaged Property securing the Contract which
are or may be liens prior to, or equal or coordinate with, the lien of the
Contract.
p. Equal Installments. Except for 149 Step-up Rate Contracts
included among the Initial Contracts and 127 Step-up Rate Contracts included
among the Additional Contracts, each Contract has a fixed Contract Rate and
provides for level monthly payments which fully amortize the loan over its term.
Of the Step-up Rate Contracts which are still bearing interest at their initial
Contract Rates, 264 provide for two rate increases and the remainder provide for
a single rate increase.
q. Enforceability. The Contract contains customary and
enforceable provisions so as to render the rights and remedies of the holder
thereof adequate for the realization against the collateral of the benefits of
the security provided thereby.
3-4
r. One Original. There is only one original executed Contract
(other than the original executed copy retained by the Obligor), which Contract
has been delivered to the Trustee or its custodian on or before the Closing Date
or the Subsequent Transfer Date, as applicable. Each Contract (other than the
Land-and-Home Contracts) has been stamped to reflect the assignment of such
Contract to the Trustee.
s. Loan-to-Value Ratio. At the time of their origination all of
the Contracts had Loan-to-Value Ratios not greater than 100%; if the related
Manufactured Home was new at the time such Contract was originated, the original
principal balance of such Contract did not exceed 130% of the manufacturer's
invoice price, plus 100% of the taxes and license fees, 130% of the freight
charges, 100% of the dealer's cost of additional dealer-installed equipment (not
to exceed 25% of the original principal balance of such Contract in all states
except California; not to exceed 70% of the manufacturer's invoice price in
California if required to meet park requirements) and up to $1,500 of set-up
costs per module.
t. Primary Resident. At the time of origination of the Contract
the Obligor was the primary resident of the related Manufactured Home.
u. Not Real Estate. With respect to each Contract other than a
Land-and-Home Contract, the related Manufactured Home is not considered or
classified as part of the real estate on which it is located under the laws of
the jurisdiction in which it is located.
v. Notation of Security Interest. With respect to each Contract
other than a Land-and-Home Contract, if the related Manufactured Home is located
in a state in which notation of a security interest on the title document is
required or permitted to perfect such security interest, the title document
shows, or if a new or replacement title document with respect to such
Manufactured Home is being applied for such title document will be issued within
180 days and will show, the Originator or its assignee as the holder of a first
priority security interest in such Manufactured Home; if the related
Manufactured Home is located in a state in which the filing of a financing
statement under the UCC is required to perfect a security interest in
manufactured housing, such filings or recordings have been duly made and show
the Originator or its assignee as secured party. If the related Manufactured
Home secures a Land-and-Home Contract, such Manufactured Home is subject to a
Mortgage properly filed in the appropriate public recording office or such
Mortgage will be properly filed in the appropriate public recording office
within 180 days, naming the Seller as mortgagee. In either case, the Trustee has
the same rights as the secured party of record would have (if such secured party
were still the owner of the Contract) against all Persons (including the Seller
and the Originator and any trustee in bankruptcy of the Seller or the
Originator) claiming an interest in such Manufactured Home.
w. Secondary Mortgage Market Enhancement Act. The related
Manufactured Home is a "manufactured home" within the meaning of ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ Code, Section 5402(6). Each manufactured housing dealer from whom the
Originator purchased such Contract, if any, was then approved by the Originator
in accordance with the requirements of the Secretary of Housing and Urban
Development set forth in 24 CFR ss. 201.27. At the origination of each Contract,
the Originator was approved for insurance by the Secretary of Housing and Urban
Development pursuant to Section 2 of the National Housing Act.
3-5
x. Qualified Mortgage. The Contract represents a "qualified
mortgage" within the meaning of Section 860G(a)(3) of the Code. The Originator
represents and warrants that, either as of the date of origination or the
Closing Date, the fair market value of the property securing each Contract was
not less than 80% of the "adjusted issue price" (within the meaning of the REMIC
Provisions) of such Contract.
SECTION 3.03. Additional Representations and Warranties. The Seller
hereby represents and warrants to the Trustee for the benefit of the
Certificateholders, as of the Closing Date with respect to each Initial and
Additional Contract and as of each Subsequent Transfer Date with respect to each
Subsequent Contract identified on the List of Contracts attached to the related
Subsequent Transfer Instrument:
a. Lawful Assignment. The Contract was not originated in and is
not subject to the laws of any jurisdiction whose laws would make the transfer
of the Contract under this Agreement or pursuant to transfers of the
Certificates unlawful or render the Contract unenforceable. The Seller has duly
executed a valid blanket assignment of the Contracts transferred to the Trust,
and has transferred all its right, title and interest in such Contracts. The
blanket assignment, any and all documents executed and delivered by the Seller
pursuant to Sections 2.01(b) and 2.03(b), and this Agreement each constitutes
the legal, valid and binding obligation of the Seller enforceable in accordance
with its respective terms.
b. Good Title. The Seller is the sole owner of the Contract and
has the authority to sell, transfer and assign such Contract to the Trust under
the terms of this Agreement. There has been no assignment, sale or hypothecation
of the Contract by the Seller, which does not terminate upon sale of the
Contract to the Trust. The Seller has good and marketable title to the Contract,
free and clear of any encumbrance, equity, loan, pledge, charge, claim, lien or
encumbrance of any type and has full right to transfer the Contract to the
Trust.
SECTION 3.04. Representations and Warranties Regarding the Contracts in
---------------------------------------------------------
the Aggregate.
-------------
The Originator has represented and warranted to the Seller in the
Transfer Agreement, which representations and warranties the Seller has assigned
to the Trustee for the benefit of the Certificateholders, as of the Closing Date
with respect to the Initial and Additional Contracts, and as of each Subsequent
Transfer Date with respect to the related Subsequent Contracts, that:
a. Amounts. The aggregate principal amounts payable by Obligors
under the Contracts (assuming all Staged-Funding Contracts were fully disbursed)
as of the Cut-off Date equal the Cut-off Date Pool Principal Balance. The
aggregate principal amounts payable by Obligors under the Initial Contracts
(assuming all Staged-Funding Contracts included among the Initial Contracts were
fully disbursed) as of the Cut-off Date equal $363,950,052.05. The aggregate
principal amounts payable by Obligors under the Initial and Additional Contracts
(assuming all Staged-Funding Contracts included among the Additional Contracts
were fully disbursed) as of the Cut-off Date equal $675,732,145.87.
b. Characteristics of Initial and Additional Contracts. The
Initial and Additional Contracts have the following characteristics as of the
Cut-off Date:
3-6
(i) of the Initial Contracts, the Obligors on not more
than 13% (by Cut-off Date Pool Principal Balance) are located in any
one state; of the Initial and Additional Contracts, the Obligors on not
more than 12% are located in any one state, the Obligors on not more
than 5% are located in an area with the same zip code and the Obligors
on not more than 1% are located in California in an area with the same
zip code;
(ii) no Initial or Additional Contract has a remaining
maturity of fewer than 4 months or more than 360 months;
(iii) the final scheduled payment date on the Initial or
Additional Contract with the latest maturity is in December 2030;
(iv) of the Initial Contracts, approximately 73% (by
Cut-off Date Pool Principal Balance) is attributable to loans to
purchase new Manufactured Homes and approximately 27% to used
Manufactured Homes; of the Initial and Additional Contracts,
approximately 76% is attributable to loans to purchase new Manufactured
Homes and approximately 24% to used Manufactured Homes;
(v) no less than 38% of the Initial and Additional
Contracts (by Cut-off Date Pool Principal Balance) is attributable to
Land-and-Home Contracts;
(vi) the Weighted Average Contract Rate of the Initial and
Additional Contracts as of the Cut-off Date is at least 11.86% per
annum;
(vii) at least 73% of the Initial and Additional Contracts
(by Cut-off Date Pool Principal Balance) is attributable to loans for
the purchase of multi-section Manufactured Homes;
(viii) the weighted average (by Cut-off Date Pool Principal
Balance) loan to value ratio of the Initial and Additional Contracts is
not more than 88%;
(ix) no Initial Contract was originated before October 28,
1988 and no Additional Contract was originated before January 1, 1985;
and
(x) not more than 27% of the Initial and Additional
Contracts (by Cut-off Date Pool Principal Balance) are secured by
Manufactured Homes located in a mobile home park.
c. Characteristics of All Contracts. The Contracts have the
following characteristics as of the end of the Pre-Funding Period:
(i) the Weighted Average Contract Rate is not less than
11.80%, and not more than 55.00% of the Cut-off Date Pool Principal
Balance is attributable to Contracts with a Contract Rate of less than
11.80%;
(ii) the weighted average (by Cut-off Date Pool Principal
Balance) Loan-to-Value Ratio of the Contracts is not more than 89%;
3-7
(iii) not less than 72% of the Cut-off Date Pool Principal
Balance is attributable to loans for the purchase of new Manufactured
Homes;
(iv) not more than 30% of the Cut-off Date Pool Principal
Balance is attributable to loans for the purchase of single-section
Manufactured Homes, and not less than 70% of the Cut-off Date Pool
Principal Balance is attributable to loans for the purchase of
double-section Manufactured Homes;
(v) not less than 30% of the Cut-off Date Pool Principal
Balance is attributable to Land-and-Home Contracts;
(vi) not more than 30% of the Cut-off Date Pool Principal
Balance is attributable to loans secured by Manufactured Homes located
in parks; and
(vii) the final scheduled payment date on the Contract with
the latest maturity is not later than December 2030.
(viii) the weighted average (by Scheduled Principal Balance)
credit score (using the Originator's credit scoring system) of the
Contracts as of the Post-Funding Remittance Date will not be less than
223, and the percentage (by Scheduled Principal Balance) of the
Contracts as of the Post-Funding Remittance Date with a credit score
(using the Originator's credit scoring system) of less than 185 will
not be greater than 10%; and
(ix) not more than 9% of the Cut-off Date Pool Principal
Balance is attributable to loans for the purchase of Manufactured Homes
that had been repossessed.
d. Staged-Funding Contracts. Approximately $100,376,593.07 of the
Initial and Additional Contracts, by Cut-off Date Principal Balance, are
Staged-Funding Contracts that had not been fully disbursed by the Cut-off Date.
Approximately $79,872,235.37 of such amount has been disbursed by the Closing
Date, and approximately $20,504,357.70 remains to be disbursed on or before the
Funding Termination Date.
e. Computer Tape. The Computer Tape made available by the
Originator was complete and accurate as of its date and includes a description
of the same Contracts that are described in the List of Contracts.
f. Marking Records. By the Closing Date or Subsequent Transfer
Date, as applicable, the Originator has caused the portions of the Electronic
Ledger relating to the Contracts to be clearly and unambiguously marked to
indicate that such Contracts constitute part of the Trust and are owned by the
Trust in accordance with the terms of the trust created hereunder.
g. No Adverse Selection. Except for the effect of the
representations and warranties made in Sections 3.02 and 3.03 hereof, no adverse
selection procedures have been employed in selecting the Contracts.
3-8
SECTION 3.05. Representations and Warranties Regarding the Contract
-----------------------------------------------------
Files.
-----
The Originator has represented and warranted to the Seller in the
Transfer Agreement, which representations and warranties the Seller has assigned
to the Trustee for the benefit of the Certificateholders, as of the Closing Date
with respect to the Initial and Additional Contracts, and as of each Subsequent
Transfer Date with respect to the related Subsequent Contracts, that:
a. Possession. Immediately prior to the Closing Date or the
Subsequent Transfer Date, as applicable, the Originator will have possession of
each original Contract and the related Contract File or Land-and-Home Contract
File and there are and there will be no custodial agreements in effect
materially and adversely affecting the rights of the Originator to make, or
cause to be made, any delivery required hereunder.
b. Bulk Transfer Laws. The transfer, assignment and conveyance of
the Contracts and the Contract Files and Land-and-Home Contract Files by the
Originator pursuant to the Transfer Agreement is not subject to the bulk
transfer or any similar statutory provisions in effect in any applicable
jurisdiction.
SECTION 3.06. Repurchase of Contracts or Substitution of Contracts for
--------------------------------------------------------
Breach of Representations and Warranties.
----------------------------------------
a. The Originator shall repurchase a Contract, at its Repurchase
Price, not later than the first Determination Date that is 90 or more days after
the day on which the Originator, the Servicer, the Seller or the Trustee first
discovers or should have discovered a breach of a representation or warranty of
the Originator set forth in Sections 2.02(n), 3.02, 3.03 or 3.05 of this
Agreement that materially adversely affects the Trust's or the
Certificateholders' interest in such Contract and which breach has not been
cured; provided, however, that (i) in the event that a party other than the
Originator first becomes aware of such breach, such discovering party shall
notify the Originator in writing within five Business Days of the date of such
discovery and (ii) with respect to any Contract incorrectly described on the
List of Contracts with respect to unpaid principal balance, which the Originator
would otherwise be required to repurchase pursuant to this Section, the
Originator may, in lieu of repurchasing such Contract, deliver to the Seller for
deposit in the Certificate Account no later than the first Determination Date
that is 90 or more days from the date of such discovery cash in an amount
sufficient to cure such deficiency or discrepancy. Any such cash so deposited
shall be distributed to Certificateholders on the immediately following
Remittance Date as a collection of principal or interest on such Contract,
according to the nature of the deficiency or discrepancy. Notwithstanding any
other provision of this Agreement, the obligation of the Originator under this
Section shall not terminate upon a Service Transfer pursuant to Article VII.
Notwithstanding the foregoing, the Originator shall repurchase any Land-and-Home
Contract, at such Contract's Repurchase Price, or substitute for it an Eligible
Substitute Contract as described in Section 3.06(b), if the Seller has failed to
deliver the related Land-and-Home Contract File to the Trustee within 30 days of
the Closing Date.
b. On or prior to the date that is the second anniversary of the
Closing Date, the Originator, at its election, may substitute one or more
Eligible Substitute Contracts for any
3-9
Contracts that it is obligated to repurchase pursuant to Section 3.06(a) (such
Contracts being referred to as the "Replaced Contracts") upon satisfaction of
the following conditions:
(i) the Originator shall have conveyed to the Seller the
Contracts to be substituted for the Replaced Contracts and the Contract
Files related to such Contracts and the Originator shall have marked
the Electronic Ledger indicating that such Contracts constitute part of
the Trust;
(ii) the Contracts to be substituted for the Replaced
Contracts are Eligible Substitute Contracts and the Originator delivers
an Officers' Certificate, substantially in the form of Exhibit L-2
hereto, to the Trustee certifying that such Contracts are Eligible
Substitute Contracts;
(iii) the Originator shall have delivered to the Seller
evidence of filing of a UCC-1 financing statement executed by the
Originator as debtor, naming the Seller as secured party and the Seller
shall have delivered to the Trustee evidence of filing of a UCC-1
financing statement executed by the Seller as debtor, naming the
Trustee as secured party and filed in Minnesota, listing such Contracts
as collateral, or shall have delivered to the Seller or the Trustee, as
the case may be, an amended List of Contracts;
(iv) in respect of Eligible Substitute Contracts that are
Land-and-Home Contracts:
(x) the Originator shall have delivered to the Seller, or
its Custodian, the related Land-and-Home Contract Files; and
(y) if the sum of the aggregate principal balances of all
Land-and-Home Contracts then held by the Trustee (but excluding those
Land-and-Home Contracts, if any, that are to become Replaced Contracts
as a consequence of the substitution) and the aggregate principal
balances of all Land-and-Home Contracts that are included in the
Eligible Substitute Contracts equals or exceeds 10% of the Pool
Scheduled Principal Balance as of the Remittance Date immediately
preceding the substitution, the Originator shall have delivered to the
Trustee an opinion of counsel satisfactory to the Trustee to the effect
that the Trustee holds a perfected first priority lien in the real
estate securing such Eligible Substitute Contracts, or evidence of
recordation of the assignment to the Trustee on behalf of the Trust of
(A) each Mortgage securing such Eligible Contracts or, if less (B) of
the number of Mortgages securing such Eligible Substitute Contracts
needed to reduce the aggregate principal balances of all Land-and-Home
Contracts with respect to which such assignments are not so recorded to
less than 10% of the Pool Scheduled Principal Balance as of the
Remittance Date immediately preceding the substitution;
(v) the Originator shall have delivered to the Trustee an
Opinion of Counsel (a) to the effect that the substitution of such
Contracts for such Replaced Contracts will not cause the Trust to fail
to qualify as a REMIC at any time under then applicable
3-10
REMIC Provisions or cause any "prohibited transaction" that will result
in the imposition of a tax under such REMIC Provisions and (b) to the
effect of paragraph 9 of Exhibit F hereto; and
(vi) if the aggregate Scheduled Principal Balance of such
Replaced Contracts is greater than the aggregate Scheduled Principal
Balance of the Contracts being substituted, the Originator shall have
delivered to the Seller for deposit in the Certificate Account the
amount of such excess and shall have included in the Officers'
Certificate required by clause (ii) above a certification that such
deposit has been made.
Upon satisfaction of such conditions, the Trustee shall add such
Contracts to, and delete such Replaced Contracts from, the List of Contracts.
Such substitution shall be effected prior to the first Determination Date that
occurs 90 or more days after the Originator becomes aware, or should have become
aware, or receives written notice from the Trustee, of the breach referred to in
Section 3.06(a). Promptly after any substitution of a Contract, the Originator
shall give written notice of such substitution to the Rating Agencies.
c. (i) On or before the Funding Termination Date, the
Originator or the Seller shall deliver an Officer's Certificate to the
Trustee, stating that each Staged-Funding Contract was fully disbursed
in accordance with the terms of such Contract on or before the Funding
Termination Date, or specifying any Staged-Funding Contracts which were
not fully disbursed by the Funding Termination Date (each
Staged-Funding Contract that was not so fully disbursed being
hereinafter referred to as an "Unfunded Contract"), and the Cut-off
Date Principal Balance of each Unfunded Contract.
(ii) On or before the Funding Termination Date, the
Originator shall either repurchase any Unfunded Contract in accordance
with Section 3.06(a) (or the unfunded portion thereof, by depositing in
the Certificate Account any undisbursed amount with respect to such
Unfunded Contract), or shall substitute an Eligible Substitute Contract
for such Unfunded Contract in accordance with Section 3.06(b). With
respect to the repurchase of an Unfunded Contract pursuant to this
Section 3.06(c), an amount of the Repurchase Price equal to the
Unfunded Contract Shortfall attributable to such Unfunded Contract
shall be treated as a refund to the Trust of the purchase price paid by
the Trust for additional obligations of the Obligor on such Contract
under Section 2.01(c), and the remainder of the Repurchase Price shall
be treated as paid to the Trust for such Unfunded Contract.
(iii) If the Originator shall have failed to repurchase an
Unfunded Contract (or the unfunded portion thereof, by depositing in
the Certificate Account any undisbursed amount with respect to such
Unfunded Contract) or to substitute an Eligible Substitute Contract
therefor in accordance with subsection (ii) above, then the disbursed
principal balance of such Unfunded Contract as owned by the Trust shall
not be increased after the Funding Termination Date, notwithstanding
any further disbursements that may be made to the related Obligor by
the Originator after the Funding Termination Date. The Servicer shall
thereafter allocate principal and interest collected on the Contract
between the Trust and the Originator on a pro rata basis in accordance
with the disbursed principal balance as of the Funding Termination
Date, with the result that payments of interest and
3-11
principal collected with respect to such disbursed principal balance as
of the Funding Termination Date shall be deemed collected by the Trust.
The aggregate differential between the Cut-off Date Principal Balance
of all such Unfunded Contracts as specified in the List of Contracts
and the disbursed principal balance of such Unfunded Contracts as of
the Funding Termination Date (the "Unfunded Contract Shortfall") shall
be added to the Formula Principal Distribution Amount with respect to
the Remittance Date in January 2001.
(iv) On the Business Day prior to each Remittance Date
until and including the Remittance Date immediately following the
Funding Termination Date, the Originator shall pay any Class A Interest
Shortfall, Class M-1 Interest Shortfall, Class M-2 Interest Shortfall
or Class B-1 Interest Shortfall occurring on such Remittance Date, if
and to the extent such shortfall is caused by the difference between
(A) the interest that would have been payable on all Staged-Funding
Contracts in the related month had such Contracts been fully disbursed
on the Closing Date and (B) the interest actually payable on such
Contracts in the related month according to the terms of such
Contracts.
(v) To further evidence its obligation to repurchase
Unfunded Contracts pursuant to subsection (ii) above and to deposit any
Class A Interest Shortfall, Class M-1 Interest Shortfall, Class M-2
Interest Shortfall and Class B-1 Interest Shortfall pursuant to
subsection (iv) above, the Originator shall deliver to the Trustee, on
the Closing Date, a demand note in an amount no less than the aggregate
Cut-off Date Principal Balances of the Staged-Funding Contracts. After
the Funding Termination Date or such earlier date on which the
Originator either has fully disbursed or repurchased each
Staged-Funding Contract as required herein, the Trustee shall return
such demand note to the Originator for cancellation and/or destruction.
d. Upon receipt by the Trust by deposit in the Certificate
Account of the Repurchase Price under subsection (a) or (c) above, or the
delivery of an Eligible Substitute Contract pursuant to subsection (b) or (c)
above, and upon receipt of a certificate of a Servicing Officer in the form
attached hereto as Exhibit L-1 or L-2, the Trustee shall convey and assign to
the Originator all of the Trust's right, title and interest in the repurchased
Contract or Replaced Contract without recourse, representation or warranty,
except as to the absence of liens, charges or encumbrances created by or arising
as a result of actions of the Trustee.
e. The Originator shall defend and indemnify the Trustee and the
Certificateholders against all costs, expenses, losses, damages, claims and
liabilities, including reasonable fees and expenses of counsel, arising out of
any claims which may be asserted against or incurred by any of them as a result
of any third-party action arising out of any breach of any such representation
and warranty.
SECTION 3.07. No Repurchase or Substitution Under Certain
-------------------------------------------
Circumstances.
-------------
Notwithstanding any provision of this Agreement to the contrary, no
repurchase or substitution pursuant to Section 3.06 (other than a repurchase or
substitution pursuant to Section 3.06(c)) shall be made unless the Originator
obtains for the Trustee an Opinion of Counsel addressed to the Trustee that any
such repurchase or substitution would not, under the REMIC
3-12
Provisions, (i) cause the Subsidiary REMIC or the Master REMIC to fail to
qualify as a REMIC while any regular interest in the Subsidiary REMIC or the
Master REMIC, respectively, is outstanding, (ii) result in a tax on prohibited
transactions within the meaning of Section 860F(a)(2) of the Code or (iii)
constitute a contribution after the startup day subject to tax under Section
860G(d) of the Code. The Servicer shall attempt to obtain such Opinion of
Counsel. In the case of a repurchase or deposit pursuant to Section 3.06(a) or
3.06(c), the Originator shall, notwithstanding the absence of such opinion as to
the imposition of any tax as the result of such purchase or deposit, repurchase
such Contract or make such deposit and shall guarantee the payment of such tax
by paying to the Trustee the amount of such tax not later than five Business
Days before such tax shall be due and payable to the extent that amounts
previously paid over to and then held by the Trustee pursuant to Section 6.06
hereof are insufficient to pay such tax and all other taxes chargeable under
Section 6.06. Pursuant to Section 6.06, the Servicer is hereby directed to
withhold, and shall withhold and pay over to the Trustee, an amount sufficient
to pay such tax and any other taxes imposed on "prohibited transactions" under
Section 860F(a)(1) of the Code or imposed on "contributions after start up date"
under Section 860G(d) of the Code from amounts otherwise distributable to Class
C Subsidiary Certificateholders. The Servicer shall give notice to the Trustee
at the time of such repurchase of the amounts due from the Originator pursuant
to the guarantee of the Originator described above and notice as to who should
receive such payment.
The Trustee shall have no obligation to pay any such amounts pursuant
to this Section other than from moneys provided to it by the Originator or from
moneys held in the funds and accounts created under this Agreement. The Trustee
shall be deemed conclusively to have complied with this Section if it follows
the directions of the Originator.
In the event any tax that is guaranteed by the Originator pursuant to
this Section 3.07 is refunded to the Trust or otherwise is determined not to be
payable, the Originator shall be repaid the amount of such refund or that
portion of any guarantee payment made by the Originator that is not applied to
the payment of such tax.
SECTION 3.08. Staged-Funding Contract Reserve Account.
---------------------------------------
a. The Trustee shall establish the Staged-Funding Contract
Reserve Account on behalf of the Trust, which must be an Eligible Account, and
shall deposit therein the amount specified in Section 2.02(t). The Account shall
be entitled "U.S. Bank National Association, as Trustee for the benefit of
holders of Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2000-5."
b. Upon receipt by the Trustee of an Officer's Certificate
pursuant to Section 3.06(c)(i) to the effect that one or more Staged-Funding
Contracts have been fully disbursed in accordance with the terms of such
Contract, on or before the Funding Termination Date, the Trustee shall release
to the Seller that portion of the funds held in the Staged-Funding Contract
Reserve Account attributable to those Staged-Funding Contracts (as specified in
such Officer's Certificate).
c. If the Originator fails to satisfy its obligations under
Section 3.06(c)(ii) hereof the Trustee shall withdraw from the Staged-Funding
Contract Reserve Account that amount
3-13
necessary to satisfy the Originator's obligations under Section 3.06(c)(ii), and
shall apply said funds in the fashion provided in the second sentence in Section
3.06(c)(ii). Any amount so applied shall be deposited in the Certificate Account
and treated for all purposes under this Agreement as an amount paid by the
Originator to repurchase Contracts under Section 3.06(c).
d. The Staged-Funding Contract Reserve Account shall be part of
the Trust but not part of the Subsidiary REMIC or Master REMIC. The Trustee on
behalf of the Trust shall be the legal owner of the Staged-Funding Contract
Reserve Account. The Originator shall be the beneficial owner of the
Staged-Funding Contract Reserve Account, subject to the foregoing power of the
Trustee to apply amounts in the Staged-Funding Contract Reserve Account to
satisfy the obligations of the Originator under Section 3.06(c)(ii). Funds in
the Staged-Funding Contract Reserve Account shall, at the direction of the
Originator, be invested in Eligible Investments that mature no later than the
Funding Termination Date. All net income and gain from such investments shall be
distributed to the Originator on the Funding Termination Date. Any losses on
such investments shall be deposited in the Staged-Funding Contract Reserve
Account by the Originator out of its own funds immediately as realized. All
amounts earned on amounts on deposit in the Staged-Funding Contract Reserve
Account shall be taxable to the Originator.
e. Any funds remaining in the Staged-Funding Contract Reserve
Account after the Funding Termination Date shall be distributed to the
Originator.
3-14
ARTICLE IV
PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS
-----------------------------------------------------------
SECTION 4.01. Custody of Contracts.
--------------------
a. Subject to the terms and conditions of this Section the
Trustee appoints the Servicer to maintain custody of the Contract Files for the
benefit of the Certificateholders and the Trustee. The Custodian shall maintain
custody of the Land-and-Home Contract Files. In the event that the Trustee is no
longer acting as Custodian of the Land-and-Home Contract Files, upon execution
and delivery of an agreement between the Trustee and the Person assuming the
duties of the Trustee hereunder as Custodian with respect to the Land-and-Home
Contract Files, the replacement Custodian shall concurrently execute an
acknowledgment of receipt of the Land-and-Home Contract Files substantially in
the form of Exhibit H hereto.
b. The Servicer agrees to maintain the related Contract Files at
its office where they are currently maintained, or at such other offices of the
Servicer in the State of Minnesota as shall from time to time be identified to
the Trustee by written notice. The Servicer may temporarily move individual
Contract Files or any portion thereof without notice as necessary to conduct
collection and other servicing activities in accordance with its customary
practices and procedures.
c. As custodian, the Servicer shall have and perform the
following powers and duties:
(i) hold the Contract Files on behalf of the
Certificateholders and the Trustee, maintain accurate records
pertaining to each Contract to enable it to comply with the terms and
conditions of this Agreement, maintain a current inventory thereof,
conduct annual physical inspections of Contract Files held by it under
this Agreement and certify to the Trustee annually that it continues to
maintain possession of such Contract Files;
(ii) implement policies and procedures, in writing and
signed by a Servicing Officer, with respect to persons authorized to
have access to the Contract Files on the Servicer's premises and the
receipting for Contract Files taken from their storage area by an
employee of the Servicer for purposes of servicing or any other
purposes; and
(iii) attend to all details in connection with maintaining
custody of the Contract Files on behalf of the Certificateholders and
the Trustee.
d. In performing its duties under this Section, the Servicer
agrees to act with reasonable care, using that degree of skill and care that it
exercises with respect to similar contracts owned and/or serviced by it. The
Servicer shall promptly report to the Trustee any failure by it to hold the
Contract Files as herein provided and shall promptly take appropriate action to
remedy any such failure. In acting as custodian of the Contract Files, the
Servicer agrees further not to assert any beneficial ownership interests in the
Contracts or the Contract Files. The Servicer agrees to indemnify the
Certificateholders and the Trustee for any and all liabilities, obligations,
losses, damages, payments, costs or expenses of any kind whatsoever which may be
imposed on, incurred or asserted against the Certificateholders and the Trustee
as
4-1
the result of any act or omission by the Servicer relating to the maintenance
and custody of the Contract Files; provided, however, that the Servicer will not
be liable for any portion of any such amount resulting from the negligence or
willful misconduct of any Certificateholder or the Trustee.
SECTION 4.02. Filings.
-------
On or prior to the Closing Date, the Originator shall cause the UCC-1
financing statement referred to in Section 2.02(h) to be filed. Trustee shall
cause to be filed all necessary continuation statements of the UCC-1 financing
statement. From time to time the Servicer shall take and cause to be taken such
actions and execute such documents as are necessary to perfect and protect the
Certificateholders' interest in the Contracts and their proceeds and the
Manufactured Homes against all other persons, including, without limitation, the
filing of financing statements, amendments thereto and continuation statements,
the execution of transfer instruments and the making of notations on or taking
possession of all records or documents of title. The Servicer will maintain the
Trustee's first priority perfected security interest in each Manufactured Home
and a first lien on each Mortgaged Property so long as the related Contract is
property of the Trust.
SECTION 4.03. Name Change or Relocation.
-------------------------
a. During the term of this Agreement, the Originator shall not
change its name, identity or structure or relocate its chief executive office
without first giving notice thereof to the Seller, the Trustee and the Servicer.
In addition, following any such change in the name, identity, structure or
location of the chief executive office of the Originator, the Originator shall
give written notice of any such change to Standard & Poor's, ▇▇▇▇▇'▇ and Fitch.
b. If any change in the Originator's name, identity or structure
or the relocation of its chief executive office would make any financing or
continuation statement or notice of lien filed under this Agreement seriously
misleading within the meaning of applicable provisions of the UCC or any title
statute or would cause any such financing or continuation statement or notice of
lien to become unperfected (whether immediately or with lapse of time), the
Originator, no later than five days after the effective date of such change,
shall file, or cause to be filed, such amendments or financing statements as may
be required to preserve, perfect and protect the Certificateholders' interest in
the Contracts and proceeds thereof and in the Manufactured Homes.
SECTION 4.04. Chief Executive Office.
----------------------
During the term of this Agreement, the Originator will maintain its
chief executive office in one of the States of the United States, except
Tennessee.
SECTION 4.05. Costs and Expenses.
------------------
The Servicer agrees to pay all reasonable costs and disbursements in
connection with the perfection and the maintenance of perfection, as against all
third parties, of the Certificateholders' right, title and interest in and to
the Contracts (including, without limitation, the security interests in the
Manufactured Homes granted thereby).
4-2
ARTICLE V
SERVICING OF CONTRACTS
----------------------
SECTION 5.01. Responsibility for Contract Administration.
------------------------------------------
The Servicer will have the sole obligation to manage, administer,
service and make collections on the Contracts and perform or cause to be
performed all contractual and customary undertakings of the holder of the
Contracts to the Obligor. Conseco Finance Corp., if it is the Servicer, may
delegate some or all of its servicing duties to a wholly owned subsidiary of
Conseco Finance Corp., for so long as such subsidiary remains, directly or
indirectly, a wholly owned subsidiary of Conseco Finance Corp. Notwithstanding
any such delegation Conseco Finance Corp. shall retain all of the rights and
obligations of the Servicer hereunder. The Trustee, at the request of a
Servicing Officer, shall furnish the Servicer with any powers of attorney or
other documents necessary or appropriate to enable the Servicer to carry out its
servicing and administrative duties hereunder. Conseco Finance Corp. is hereby
appointed the Servicer until such time as any Service Transfer shall be effected
under Article VII.
SECTION 5.02. Standard of Care.
----------------
In managing, administering, servicing and making collections on the
Contracts pursuant to this Agreement, the Servicer will exercise that degree of
skill and care consistent with the highest degree of skill and care that the
Servicer exercises with respect to similar contracts serviced by the Servicer;
provided, however, that (i) such degree of skill and care shall be at least as
favorable as the degree of skill and care generally applied by servicers of
manufactured housing installment sales contracts for institutional investors and
(ii) notwithstanding the foregoing, the Servicer shall not release or waive the
right to collect the unpaid balance on any Contract. The Servicer shall comply
with FHA/VA Regulations in servicing any FHA/VA Contracts (and will pay any
required premiums) so that the related insurance of the Federal Housing
Administration or partial guarantee of the Veterans Administration remains in
full force and effect, except for good faith disputes relating to FHA/VA
Regulations that will not cause the termination or reduction of such insurance
or guarantee.
SECTION 5.03. Records.
-------
The Servicer shall, during the period it is servicer hereunder,
maintain such books of account and other records as will enable the Trustee to
determine the status of each Contract.
SECTION 5.04. Inspection; Computer Tape.
-------------------------
a. At all times during the term hereof, the Servicer shall afford
the Trustee and its authorized agents reasonable access during normal business
hours to the Servicer's records, which have not previously been provided to the
Trust, relating to the Contracts and will cause its personnel to assist in any
examination of such records by the Trustee or its authorized agents. The
examination referred to in this Section will be conducted in a manner which does
not unreasonably interfere with the Servicer's normal operations or customer or
employee relations. Without otherwise limiting the scope of the examination the
Trustee may make, the Trustee may, using generally accepted audit procedures,
verify the status of each Contract and review the
5-1
Electronic Ledger and records relating thereto for conformity to Monthly Reports
prepared pursuant to Article VI and compliance with the standards represented to
exist as to each Contract in this Agreement.
b. At all times during the term hereof, the Servicer shall keep
available a copy of the List of Contracts at its principal executive office for
inspection by Certificateholders.
c. On or before the ninth Business Day of each related Due
Period, the Servicer will provide to the Trustee a Computer Tape setting forth a
list of all the outstanding Contracts and the outstanding principal balance of
each such Contract as of the end of the next related Due Period.
SECTION 5.05. Certificate Account.
-------------------
a. On or before the Closing Date, the Servicer shall establish
the Certificate Account on behalf of the Trust, which must be an Eligible
Account. The Certificate Account shall be entitled "U.S. Bank National
Association as Trustee for the benefit of holders of Manufactured Housing
Contract Pass-Through Certificates, Series 2000-5 (Conseco Finance Corp.,
Servicer)." The Servicer shall pay into the Certificate Account as promptly as
practicable (not later than the next Business Day) following receipt thereof all
payments from Obligors and Net Liquidation Proceeds, other than late payment
penalty fees, extension fees and assumption fees, which shall be retained by the
Servicer as additional compensation for servicing the Contracts. All amounts
paid into the Certificate Account under this Agreement shall be held in trust
for the Trustee and the Certificateholders until payment of any such amounts is
authorized under this Agreement. Only the Trustee may withdraw funds from the
Certificate Account.
b. If the Servicer so directs, the institution maintaining the
Certificate Account shall, in the name of the Trustee in its capacity as such,
invest the amounts in the Certificate Account in Eligible Investments that
mature not later than one Business Day prior to the next succeeding Remittance
Date. Once such funds are invested, such institution shall not change the
investment of such funds. All income and gain from such investments shall be
added to the Certificate Account and distributed on such Remittance Date
pursuant to Section 8.03(a). An amount equal to any net loss on such investments
shall be deposited in the Certificate Account by the Class C Subsidiary
Certificateholder out of its own funds immediately as realized. The Servicer and
the Trustee shall in no way be liable for losses on amounts invested in
accordance with the provisions hereof. Funds in the Certificate Account not so
invested must be insured to the extent permitted by law by the Federal Deposit
Insurance Corporation. "Eligible Investments" are any of the following:
(i) direct obligations of, and obligations fully
guaranteed by, the United States of America, the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association, or any
agency or instrumentality of the United States of America the
obligations of which are backed by the full faith and credit of the
United States of America and which are noncallable;
(ii) (A) demand and time deposits in, certificates of
deposit of, bankers' acceptances issued by, or federal funds sold by
any depository institution or trust
5-2
company (including the Trustee or any Affiliate of the Trustee, acting
in its commercial capacity) incorporated under the laws of the United
States of America or any State thereof and subject to supervision and
examination by federal and/or state authorities, so long as, at the
time of such investment or contractual commitment providing for such
investment, the commercial paper or other short-term deposits of such
depository institution or trust company (or, in the case of a
depository institution which is the principal subsidiary of a holding
company, the commercial paper or other short-term debt obligations of
such holding company) are rated at least P-1 by ▇▇▇▇▇'▇, at least A-1
by Standard & Poor's and at least F-1 by Fitch (if rated by Fitch) and
(B) any other demand or time deposit or certificate of deposit which is
fully insured by the Federal Deposit Insurance Corporation;
(iii) shares of an investment company registered under the
Investment Company Act of 1940, whose shares are registered under the
Securities Act of 1933 and have the highest credit rating then
available from ▇▇▇▇▇'▇ and Fitch (if rated by Fitch) and are rated AAAm
or AAAm-G by Standard & Poor's and whose only investments are in
securities described in clauses (i), (ii) above and (iv) below;
(iv) repurchase obligations with respect to (A) any
security described in clause (i) above or (B) any other security issued
or guaranteed by an agency or instrumentality of the United States of
America, in either case entered into with a depository institution or
trust company (acting as principal) described in clause (ii)(A) above;
(v) securities bearing interest or sold at a discount
issued by any corporation incorporated under the laws of the United
States of America or any State thereof which have a credit rating of at
least Aa2 from ▇▇▇▇▇'▇, at least AAA by Standard & Poor's and in one of
the two highest rating categories from Fitch (if rated by Fitch) at the
time of such investment; provided, however, that securities issued by
any particular corporation will not be Eligible Investments to the
extent that investment therein will cause the then outstanding
principal amount of securities issued by such corporation and held as
part of the corpus of the Trust to exceed 10% of amounts held in the
Certificate Account;
(vi) commercial paper having a rating of at least A-1+
from Standard & Poor's and at least P-1 from ▇▇▇▇▇'▇ (if rated by
▇▇▇▇▇'▇) at the time of such investment or pledge as a security; and
(vii) other obligations or securities that are acceptable
to the Rating Agencies as an Eligible Investment hereunder and will not
reduce the rating assigned to any Class of Certificates by any of the
Rating Agencies below the lower of the then-current rating or the
rating assigned to such Certificates as of the Closing Date by such
Rating Agency, as evidenced in writing;
provided that any such investment must constitute a "cash flow investment"
within the meaning of the REMIC Provisions.
5-3
Notwithstanding the foregoing, securities that represent the right to receive
payments only of interest due on underlying obligations shall not be included as
Eligible Investments, whether or not such securities otherwise fall within (i)
through (vii) above.
The Trustee may trade with itself or an Affiliate in the purchase or sale of
such Eligible Investments.
The Originator, the Servicer and the Seller acknowledge that to the extent
regulations of the Comptroller of the Currency or other applicable regulatory
agency grant the Originator, Seller or Servicer the right to receive brokerage
confirmations of security transactions as they occur, the Originator, the Seller
and the Servicer specifically waive receipt of such confirmations.
c. If at any time the Trustee receives notice (from Standard &
Poor's, ▇▇▇▇▇'▇, Fitch or the Servicer or otherwise) that the Certificate
Account has ceased to be an Eligible Account, the Trustee must, as soon as
practicable but in no event later than 5 Business Days of the Trustee's receipt
of such notice, transfer the Certificate Account and all funds and Eligible
Investments therein to an Eligible Account. Following any such transfer, the
Trustee must notify each of the Rating Agencies and the Servicer of the location
of the Certificate Account.
SECTION 5.06. Enforcement.
-----------
a. The Servicer shall, consistent with customary servicing
procedures and the terms of this Agreement, act with respect to the Contracts in
such manner as will maximize the receipt of principal and interest on such
Contracts and Liquidation Proceeds with respect to Liquidated Contracts.
b. The Servicer may ▇▇▇ to enforce or collect upon Contracts, in
its own name, if possible, or as agent for the Trust. If the Servicer elects to
commence a legal proceeding to enforce a Contract, the act of commencement shall
be deemed to be an automatic assignment of the Contract to the Servicer for
purposes of collection only. If, however, in any enforcement suit or legal
proceeding it is held that the Servicer may not enforce a Contract on the ground
that it is not a real party in interest or a holder entitled to enforce the
Contract, the Trustee on behalf of the Trust shall, at the Servicer's expense,
take such steps as the Servicer deems necessary to enforce the Contract,
including bringing suit in its name or the names of the Certificateholders.
c. The Servicer shall exercise any rights of recourse against
third persons that exist with respect to any Contract in accordance with the
Servicer's usual practice. In exercising recourse rights, the Servicer is
authorized on the Trustee's behalf to reassign the Contract or to resell the
related Manufactured Home to the person against whom recourse exists at the
price set forth in the document creating the recourse.
d. So long as Conseco Finance Corp. is the Servicer, the Servicer
may grant to the Obligor on any Contract any rebate, refund or adjustment out of
the Certificate Account that the Servicer in good faith believes is required
because of prepayment in full of the Contract. The Servicer will not permit any
rescission or cancellation of any Contract.
e. So long as Conseco Finance Corp. is the Servicer, the Servicer
may, consistent with its customary servicing procedures and consistent with
Section 5.02, grant to the Obligor on
5-4
any Contract an extension of payments due under such Contract, provided that
Obligors may not be solicited for extensions, no such extension may extend
beyond the final scheduled payment date of the Contract with the latest
maturity, as specified in Section 3.04(c), and no more than one extension of
payments under a Contract may be granted in any twelve-month period.
f. The Servicer may enforce any due-on-sale clause in a Contract
if such enforcement is called for under its then current servicing policies for
obligations similar to the Contracts, provided that such enforcement is
permitted by applicable law and will not adversely affect any applicable
insurance policy. If an assumption of a Contract is permitted by the Servicer
upon conveyance of the related Manufactured Home, the Servicer shall use its
best efforts to obtain an assumption agreement in connection therewith and add
such assumption agreement to the related Contract File or Land-and-Home Contract
File.
g. Any provision of this Agreement to the contrary
notwithstanding, the Servicer shall not agree to the modification or waiver of
any provision of a Contract if such modification or waiver would be treated as a
taxable exchange under the REMIC Provisions.
h. In the event that any Contract that was 60 or more days
delinquent as of the Closing Date (each, a "Delinquent Contract") goes into
foreclosure, if acquiring title to the related Mortgaged Property or
Manufactured Home would cause the adjusted basis, for federal income tax
purposes, of Delinquent Contracts that are currently in foreclosure or
repossession, along with any other assets owned by the Subsidiary REMIC other
than "qualified mortgages", qualified "foreclosure property" and "permitted
investments" within the meaning of Section 860G of the Code, to exceed 0.75% of
the Pool Scheduled Principal Balance, the Servicer shall not acquire title to
that Mortgaged Property or Manufactured Home on behalf of the Subsidiary REMIC.
Instead, the Servicer shall dispose of the Mortgaged Property or Manufactured
Home for cash in a foreclosure sale. In addition, if the Servicer determines
that the adjusted basis of Delinquent Contracts that are currently in
foreclosure or repossession on any Remittance Date, along with any other assets
owned by the Subsidiary REMIC, other than "qualified mortgages", "foreclosure
property" and "permitted investments" with the meaning of Section 860G of the
Internal Revenue Code, exceeds 1.0% of the Pool Scheduled Principal Balance
after giving effect to prepayments on the Contracts, then prior to such
Remittance Date, the Servicer shall dispose of sufficient Mortgaged Properties
and Manufactured Homes securing Delinquent Contracts and acquired upon
foreclosure repossession, for cash, so that the adjusted basis of Delinquent
Contracts that are currently in foreclosure or repossession, along with any
other assets owned by the Subsidiary REMIC, other than "qualified mortgages",
"foreclosure property" and "permitted investments" within the meaning of Section
860G of the Code, will be less than 1.0% of the Pool Scheduled Principal
Balance. In either event, the Servicer may acquire, for its own account and not
on behalf of the Subsidiary REMIC, the Mortgaged Property or Manufactured Home
at the foreclosure sale for an amount not less than the greater of: (i) the
highest amount bid by any other person at the foreclosure sale, or (ii) the
estimated fair value of the Mortgaged Property or Manufactured Home, as
determined by the Servicer in good faith.
SECTION 5.07. Trustee to Cooperate.
--------------------
a. Upon payment in full on any Contract, the Servicer will notify
the Trustee and Conseco Finance Corp. (if Conseco Finance Corp. is not the
Servicer) on the next succeeding
5-5
Remittance Date by certification of a Servicing Officer (which certification
shall include a statement to the effect that all amounts received in connection
with such payments which are required to be deposited in the Certificate Account
pursuant to Section 5.05 have been so deposited). The Servicer is authorized to
execute an instrument in satisfaction of such Contract and to do such other acts
and execute such other documents as the Servicer deems necessary to discharge
the Obligor thereunder and eliminate the lien on the related real estate. The
Servicer shall determine when a Contract has been paid in full; to the extent
that insufficient payments are received on a Contract credited by the Servicer
as prepaid or paid in full and satisfied, the shortfall shall be paid by the
Servicer out of its own funds.
b. From time to time as appropriate for servicing and foreclosure
in connection with any Land-and-Home Contract, the Trustee shall, upon written
request of a Servicing Officer and delivery to the Trustee of a receipt signed
by such Servicing Officer, cause the original Land-and-Home Contract and the
related Land-and-Home Contract File to be released to the Servicer and shall
execute such documents as the Servicer shall deem necessary to the prosecution
of any such proceedings. The Trustee shall stamp the face of each such
Land-and-Home Contract to be released to the Servicer with a notation that the
Land-and-Home Contract has been assigned to the Trustee. Upon request of a
Servicing Officer, the Trustee shall perform such other acts as reasonably
requested by the Servicer and otherwise cooperate with the Servicer in
enforcement of the Certificateholders' and Class C Certificateholders' rights
and remedies with respect to Contracts.
c. The Servicer's receipt of a Land-and-Home Contract and/or
Land-and-Home Contract File shall obligate the Servicer to return the original
Land-and-Home Contract and the related Land-and-Home Contract File to the
Trustee when its need by the Servicer has ceased unless the Contract shall be
liquidated or repurchased or replaced as described in Section 3.06.
SECTION 5.08. Costs and Expenses.
------------------
All costs and expenses incurred by the Servicer in carrying out its
duties hereunder, including all fees and expenses incurred in connection with
the enforcement of Contracts (including enforcement of defaulted Contracts and
repossessions of Manufactured Homes securing such Contracts) shall be paid by
the Servicer and the Servicer shall not be entitled to reimbursement hereunder,
except that the Servicer shall be reimbursed out of the Liquidation Proceeds of
a Liquidated Contract for Liquidation Expenses incurred by it. The Servicer
shall not incur such Liquidation Expenses unless it determines in its good faith
business judgment that incurring such expenses will increase the Net Liquidation
Proceeds on the related Contract.
SECTION 5.09. Maintenance of Insurance.
------------------------
a. Except as otherwise provided in subsection (b) of this Section
5.09, the Servicer shall cause to be maintained with respect to each Contract
one or more Hazard Insurance Policies which provide, at a minimum, the same
coverage as a standard form fire and extended coverage insurance policy that is
customary for manufactured housing, issued by a company authorized to issue such
policies in the state in which the related Manufactured Home is located and in
an amount which is not less than the maximum insurable value of such
Manufactured Home or the principal balance due from the Obligor on the related
Contract, whichever is less; provided,
5-6
however, that the amount of coverage provided by each Hazard Insurance Policy
shall be sufficient to avoid the application of any co-insurance clause
contained therein; and provided, further, that such Hazard Insurance Policies
may provide for customary deductible amounts. With respect to: (a) a
Manufactured Home securing an FHA/VA Contract, if such Manufactured Home's
location was, at the time of origination of the related FHA/VA Contract, within
a federally designated special flood hazard area, the Servicer shall also cause
such flood insurance to be maintained, which coverage shall be at least equal to
the minimum amount specified in the preceding sentence or such lesser amount as
may be available under the federal flood insurance program; and (b) any Contract
that is not an FHA/VA Contract, the Originator shall obtain (i) a statement from
the Obligor's insurance agent that the Manufactured Home was, at the time of
origination of the Contract, not in a federally designated special flood hazard
area, or (ii) evidence that, at the time of origination, flood insurance was in
effect, which coverage was at least equal to the minimum amount specified in the
preceding sentence or such lesser amount as may be available under the federal
flood insurance program. Each Hazard Insurance Policy caused to be maintained by
the Servicer shall contain a standard loss payee clause in favor of the Servicer
and its successors and assigns. If any Obligor is in default in the payment of
premiums on its Hazard Insurance Policy or Policies, the Servicer shall pay such
premiums out of its own funds and may separately add such premium to the
Obligor's obligation as provided by the Contract, but shall not add such premium
to the remaining principal balance of the Contract.
b. The Servicer may, in lieu of causing individual Hazard
Insurance Policies to be maintained with respect to each Manufactured Home
pursuant to subsection (a) of this Section 5.09, and shall, to the extent that
the related Contract does not require the Obligor to maintain a Hazard Insurance
Policy with respect to the related Manufactured Home, maintain one or more
blanket insurance policies covering losses on the creditor's interest in the
Contracts resulting from the absence or insufficiency of individual Hazard
Insurance Policies. Any such blanket policy shall be substantially in the form
and in the amount carried by the Servicer as of the date of this Agreement. The
Servicer shall pay the premium for such policy on the basis described therein
and shall deposit into the Certificate Account from its own funds any deductible
amount with respect to claims under such blanket insurance policy relating to
the Contracts. The Servicer shall not, however, be required to deposit any
deductible amount with respect to claims under individual Hazard Insurance
Policies maintained pursuant to subsection (a) of this Section. If the insurer
under such blanket insurance policy shall cease to be acceptable to the
Servicer, the Servicer shall exercise its best reasonable efforts to obtain from
another insurer a replacement policy comparable to such policy.
c. With respect to each Manufactured Home that has been
repossessed in connection with a defaulted Contract, the Servicer shall either
(i) maintain one or more Hazard Insurance Policies thereon or (ii) self-insure
such Manufactured Homes and deposit into the Certificate Account from its own
funds any losses caused by damage to such Manufactured Home that would have been
covered by a Hazard Insurance Policy.
d. The Servicer shall keep in force throughout the term of this
Agreement (i) a policy or policies of insurance covering errors and omissions
for failure to maintain insurance as required by this Agreement and (ii) a
fidelity bond. Such policy or policies and such fidelity bond shall be in such
form and amount as is generally customary among Persons which service a
portfolio of manufactured housing installment sales contracts and installment
loan agreements
5-7
having an aggregate principal amount of $100,000,000 or more and which are
generally regarded as servicers acceptable to institutional investors.
SECTION 5.10. Repossession.
------------
Notwithstanding the standard of care specified in Section 5.02, the
Servicer shall commence procedures for the repossession of any Manufactured Home
or the foreclosure upon any Mortgaged Property or take such other steps that in
the Servicer's reasonable judgment will maximize the receipt of principal and
interest or Net Liquidation Proceeds with respect to the Contract secured by
such Manufactured Home or Mortgaged Property (which may include retitling or
filing a recorded assignment of the Mortgage) subject to the requirements of the
applicable state and federal law, no later than five Business Days after the
time when such Contract becomes a Defaulted Contract; provided that if the
Servicer has actual knowledge that a Mortgaged Property is affected by hazardous
waste, then the Servicer shall not cause the Trust to acquire title to such
Mortgaged Property in a foreclosure or similar proceeding. For purposes of the
proviso in the preceding sentence, the Servicer shall not be deemed to have
actual knowledge that a Mortgaged Property is affected by hazardous waste unless
it shall have received written notice that hazardous waste is present on such
property and such written notice has been made a part of the Land-and-Home
Contract File with respect to the related Contract. In connection with such
foreclosure or other conversion, the Servicer shall follow such practices and
procedures as it shall deem necessary or advisable and as shall be consistent
with Section 5.02. In the event that title to any Mortgaged Property is acquired
in foreclosure or by deed in lieu of foreclosure, the deed or certificate of
sale shall be issued to the Trustee, as Trustee, or, at its election, to its
nominee on behalf of the Trustee, as Trustee.
SECTION 5.11. Commingling of Funds.
--------------------
So long as Conseco Finance Corp. is the Servicer, any collections in
respect of Contracts collected by Conseco Finance Corp. shall, prior to the
deposit thereof in the Certificate Account, be held in bank accounts entitled
substantially as follows: "[name of depository], as agent for U.S. Bank National
Association as Trustee, other trustees, and Conseco Finance Corp., as their
interests may appear."
SECTION 5.12. Retitling; Security Interests.
-----------------------------
a. If, at any time, a Service Transfer has occurred and Conseco
Finance Corp. is no longer the Servicer and the new Servicer is unable to
foreclose upon a Manufactured Home because the title document for such
Manufactured Home does not show such Servicer or the Trustee as the holder of
the first priority security interest in the Manufactured Home, such Servicer
shall take all necessary steps to apply for a replacement title document showing
it or the Trustee as the secured party.
b. In order to facilitate the Servicer's actions, as described in
subsection (a) of this section, Conseco Finance Corp. will provide the Servicer
with any necessary power of attorney permitting it to retitle the Manufactured
Home.
c. If the Servicer is still unable to retitle the Manufactured
Home, Conseco Finance Corp. will take all actions necessary to act with the
Servicer to foreclose upon the Manufactured
5-8
Home, including, as appropriate, the filing of any UCC-1 or UCC-2 financing
statements necessary to perfect the security interest in any Manufactured Home
that constitutes a fixture under the laws of the jurisdiction in which it is
located and all actions necessary to perfect the security interest in any
Manufactured Home that is considered or classified as part of the real estate on
which it is located under the laws of the jurisdiction in which it is located.
d. The Originator shall (i) deliver to the Trustee an Opinion of
Counsel to the effect that assignment and recordation of the Mortgages, securing
Land-and-Home Contracts relating to real estate located in any state other than
those states specified in such Opinion of Counsel (the "recordation states"), is
not necessary to effect the assignment to the Trustee of the Originator's lien
on the real property securing such Land-and-Home Contracts, and (ii) file in the
appropriate recording offices within 60 days after the Closing Date (or within
30 days after receipt of the recorded Mortgage, if later) the assignments to the
Trustee on behalf of the Trust of the Mortgages securing all Land-and-Home
Contracts secured by Mortgages relating to real estate located in the
recordation states.
If at any time during the term of this Agreement, the Trustee receives
written notice from the Originator or the Servicer that the Originator does not
have a long-term senior debt rating from ▇▇▇▇▇'▇ of Baa3 or higher, from Fitch
of BBB- or higher and from Standard & Poor's of BBB- or higher, or if the
Trustee otherwise becomes aware of the same, the Trustee, at the Originator's
expense, shall file promptly in the appropriate recording offices the
assignments to the Trustee on behalf of the Trust of each Mortgage securing a
Land-and-Home Contract, unless the Originator obtains confirmation from Standard
& Poor's, ▇▇▇▇▇'▇ and Fitch that failure to file such assignments will not
result in Standard & Poor's, ▇▇▇▇▇'▇ or Fitch (as applicable) lowering,
withdrawing or qualifying its rating of any Class of Certificates.
SECTION 5.13. Covenants, Representations and Warranties of Servicer. By
its execution and delivery of this Agreement, the Servicer makes the following
representations, warranties and covenants on which the Trust relies in accepting
the Contracts and issuing the Certificates.
a. Organization and Good Standing. The Servicer is a corporation
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and has the corporate power to own its assets
and to transact the business in which it is currently engaged. The Servicer is
duly qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which the character of the business transacted by it or
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the business,
properties, assets, or condition (financial or other) of the Servicer, or its
ability to carry out its obligations hereunder.
b. Authorization; Binding Obligations. The Servicer has the power
and authority to make, execute, deliver and perform this Agreement and all of
the transactions contemplated under this Agreement and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of the Servicer enforceable in accordance
with its terms, except as enforcement of such terms may be limited by
bankruptcy, insolvency or
5-9
similar laws affecting the enforcement of creditors' rights generally and by the
availability of equitable remedies.
c. No Consent Required. The Servicer is not required to obtain
the consent of any other party or any consent, license, approval or
authorization from, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Agreement, except for such
consents, licenses, approvals and authorizations as have been obtained.
d. No Violations. The execution, delivery and performance by the
Servicer of this Agreement and the fulfillment of its terms will not violate any
provision of any existing law or regulation or any order or decree of any court
or the related Certificate of Incorporation or Bylaws of the Servicer, or
constitute a material breach of any mortgage, indenture, contract or other
agreement to which the Servicer is a party or by which the Servicer may be
bound.
e. Litigation. No litigation or administrative proceeding of or
before any court, tribunal or governmental body is currently pending, or to the
knowledge of the Servicer threatened, against the Servicer or any of its
properties or with respect to this Agreement or the Certificates which, if
adversely determined, would in the opinion of the Servicer have a material
adverse effect on the transactions contemplated by this Agreement.
f. Chief Executive Office. The chief executive office of the
Servicer is at 1100 Landmark Towers, ▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇.
g. No Default. The Servicer is not in default with respect to any
order or decree of any court or any order, regulation or demand of any federal,
state, municipal or governmental agency, which default would materially and
adversely affect its condition (financial or other) or operations or its
properties or the consequences of which would materially and adversely affect
its performance hereunder. The Servicer is not in default under any agreement
involving financial obligations or on any outstanding obligation which would
materially adversely impact its financial condition or operations or legal
documents associated with the transaction contemplated by this Agreement.
h. No Impairment. The Servicer shall do nothing to impair the
rights of the Trust, or the Certificateholders in the Certificates.
i. No Amendments. The Servicer shall not extend or otherwise
amend the terms of any Contract, except in accordance with Section 5.06.
5-10
ARTICLE VI
REPORTS AND TAX MATTERS
-----------------------
SECTION 6.01. Monthly Reports.
---------------
a. No later than 1:00 p.m. on each Determination Date, the
Servicer shall deliver to the Trustee, the Paying Agent, the Originator (if the
Originator is not the Servicer) and the Rating Agencies a "Monthly Report,"
substantially in the form of Exhibit N hereto.
b. If the applicable Monthly Report indicates that there is a
Class M-1 Interest Deficiency Amount, a Class M-2 Interest Deficiency Amount
and/or a Class B-1 Interest Deficiency Amount, the Servicer shall promptly
notify the Trustee, by telephone, of the aggregate amount of such Class M-1
Interest Deficiency Amount, Class M-2 Interest Deficiency Amount and Class B-1
Interest Deficiency Amount. On the day one Business Day prior to the related
Remittance Date, the Trustee shall determine the total amount of funds in the
Certificate Account available to pay such deficiency in accordance with Section
8.03(b) and shall promptly notify the Servicer of such amount. If the total
amount of funds in the Certificate Account is not sufficient to pay the
deficiency, the Trustee shall promptly notify the Servicer, and shall reflect
such deficiency in the reports delivered to Certificateholders pursuant to
Section 6.05.
SECTION 6.02. Certificate of Servicing Officer.
--------------------------------
Each Monthly Report pursuant to Section 6.01 shall be accompanied by a
certificate of a Servicing Officer substantially in the form of Exhibit I,
certifying the accuracy of the Monthly Report and that no Event of Termination
or event that with notice or lapse of time or both would become an Event of
Termination has occurred, or if such event has occurred and is continuing,
specifying the event and its status.
SECTION 6.03. Other Data.
----------
In addition, the Originator and (if different from the Originator) the
Servicer shall, on request of the Trustee, Standard & Poor's, ▇▇▇▇▇'▇, Fitch or
a Certificateholder, furnish the Trustee and/or Standard & Poor's, ▇▇▇▇▇'▇,
Fitch or a Certificateholder such underlying data as may be reasonably
requested.
SECTION 6.04. Annual Report of Accountants.
----------------------------
On or before May 1 of each year, commencing May 1, 2001, the Servicer
at its expense shall cause a firm of independent public accountants which is a
member of the American Institute of Certified Public Accountants to issue to the
Servicer a report that such firm has examined selected documents, records and
management's assertions relating to loans serviced by the Servicer and stating
that, on the basis of such examination, such servicing has been conducted in
compliance with the minimum servicing standards identified in the Mortgage
Bankers Association of America's Uniform Single Attestation Program for Mortgage
Bankers, or any successor uniform program, except for such significant
exceptions or errors in records that, in the opinion of such firm, generally
accepted attestation standards requires it to report.
6-1
SECTION 6.05. Statements to Certificateholders.
--------------------------------
a. The Servicer shall prepare and furnish to the Trustee the
statements specified below relating to the Class A Certificates, Class M-1
Certificates, Class M-2 Certificates, Class B-1 Certificates, Class B-2
Certificates and Class B-3I Certificates on or before the third Business Day
next preceding each Remittance Date. The Trustee and the Servicer shall inform
any Certificateholder or any Underwriter inquiring by telephone of the
information contained in the most recent Monthly Report.
b. Concurrently with each distribution charged to the Certificate
Account the Trustee, so long as it has received the Monthly Report from the
Servicer, shall forward or cause to be forwarded by mail to each Holder of a
Class A Certificate and (if the Originator is not the Servicer) the Originator a
statement setting forth the following:
(i) the amount of such distribution to Holders of each Class of
Class A Certificates allocable to interest, separately
identifying any Unpaid Class A Interest Shortfall included in
such distribution and any remaining Unpaid Class A Interest
Shortfall after giving effect to such distribution;
(ii) the amount of such distribution to Holders of each Class of
Class A Certificates allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments
included therein, and any remaining Unpaid Class A Principal
Shortfall after giving effect to such distribution;
(iii) the Class Principal Balance for each Class of Class A
Certificates, after giving effect to the distribution of
principal on such Remittance Date;
(iv) the Class A Percentage for such Remittance Date and the
following Remittance Date;
(v) the Pool Scheduled Principal Balance of the Contracts for such
Remittance Date;
(vi) the Pool Factor;
(vii) the number and aggregate principal balances of Contracts
delinquent (a) 30-59 days and (b) 60 or more days;
(viii) the number of Manufactured Homes that were repossessed during
the month ending immediately prior to such Remittance Date,
the number of repossessed Manufactured Homes that remain in
inventory as of the last day of the related Due Period and
repossessed Manufactured Homes purchased by the Originator or
a subsidiary of the Originator from the Trust (during the
related Due Period and cumulatively) by number of Contracts,
aggregate Scheduled Principal Balance of such Contracts and
aggregate purchase price;
(ix) number of Contracts and aggregate Scheduled Principal Balance
of Contracts extended or otherwise amended during the Due
Period preceding current Remittance Date.
6-2
(x) the Class M-1 Distribution Test (as set forth in Exhibit N
hereto);
(xi) the Class M-2 Distribution Test (as set forth in Exhibit N
hereto);
(xii) the Class B Distribution Test (as set forth in Exhibit N
hereto);
(xiii) the Weighted Average Contract Rate of all outstanding
Contracts;
(xiv) the Class M-1 Interest Deficiency Amount, if any, for such
Remittance Date;
(xv) the Class M-2 Interest Deficiency Amount, if any, for such
Remittance Date;
(xvi) the Class B-1 Interest Deficiency Amount, if any, for such
Remittance Date;
(xvii) the Overcollateralization Amount, if any, for such Remittance
Date; and
(xviii) the Additional Principal Distribution Amount, if any, to be
distributed on such Remittance Date pursuant to Section
8.03(a)(12)..
In the case of information furnished pursuant to clauses (i) through
(iii) above, the amounts shall be expressed as a dollar amount per Class A
Certificate with a $1,000 denomination.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish or cause to be furnished to each Person who at any
time during the calendar year was the Holder of a Class A Certificate a
statement containing the information with respect to interest accrued and
principal paid on its Certificates during such calendar year. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Trustee pursuant
to any requirements of the Code as from time to time in force.
c. On each Remittance Date, the Trustee shall forward or cause to
be forwarded by mail to each Holder of a Class M-1 Certificate a copy of the
Monthly Report forwarded to the Holders of Class A Certificates on such
Remittance Date. The Servicer shall also furnish to the Trustee, which shall
forward such report to the Class M-1 Certificateholders as part of the Monthly
Report, the following information:
(i) the amount of such distribution to Holders of Class M-1
Certificates allocable to interest, separately identifying any
Unpaid Class M-1 Interest Shortfall included in such
distribution, any remaining Unpaid Class M-1 Interest
Shortfall after giving effect to such distribution, any Class
M-1 Liquidation Loss Interest Amount included in such
distribution and any remaining unpaid Class M-1 Liquidation
Loss Interest Shortfall after giving effect to such
distribution;
(ii) the amount of such distribution to Holders of Class M-1
Certificates allocable to principal, separately identifying
the aggregate amount of any Principal Prepayments included
therein and any remaining Unpaid Class M-1 Principal Shortfall
after giving effect to such distribution;
6-3
(iii) the Class M-1 Principal Balance and the Class M-1 Adjusted
Principal Balance (if different) after giving effect to the
distribution of principal on such Remittance Date;
(iv) the Class M-1 Percentage for such Remittance Date and the
following Remittance Date; and
(v) the information described above in Section 6.05(b)(v) through
(xviii).
In the case of the information in clauses (i) through (iii) above, the
amounts shall be expressed as a dollar amount per Class M-1 Certificate with a
$1,000 denomination.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish or cause to be furnished to each Person who at any
time during the calendar year was the Holder of a Class M-1 Certificate a
statement containing the applicable distribution information provided pursuant
to this Section aggregated for such calendar year or applicable portion thereof
during which such Person was the Holder of a Class M-1 Certificate. Such
obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Trustee
pursuant to any requirements of the Code as from time to time enforced.
d. On each Remittance Date, the Trustee shall forward or cause to
be forwarded by mail to each Holder of a Class M-2 Certificate a copy of the
Monthly Report forwarded to the Holders of Class A Certificates and Class M-1
Certificates on such Remittance Date. The Servicer shall also furnish to the
Trustee, which shall forward such report to the Class M-2 Certificateholders as
part of the Monthly Report, the following information:
(i) the amount of such distribution to Holders of Class M-2
Certificates allocable to interest, separately identifying any
Unpaid Class M-2 Interest Shortfall included in such
distribution, any remaining Unpaid Class M-2 Interest
Shortfall after giving effect to such distribution, any Class
M-2 Liquidation Loss Interest Amount included in such
distribution and any remaining unpaid Class M-2 Liquidation
Loss Interest Shortfall after giving effect to such
distribution;
(ii) the amount of such distribution to Holders of Class M-2
Certificates allocable to principal, separately identifying
the aggregate amount of any Principal Prepayments included
therein and any remaining Unpaid Class M-2 Principal Shortfall
after giving effect to such distribution;
(iii) the Class M-2 Principal Balance and the Class M-2 Adjusted
Principal Balance (if different) after giving effect to the
distribution of principal on such Remittance Date;
(iv) the Class M-2 Percentage for such Remittance Date and the
following Remittance Date; and
(v) the information described above in Section 6.05(b)(v) through
(xviii).
6-4
In the case of the information in clauses (i) through (iii) above, the
amounts shall be expressed as a dollar amount per Class M-2 Certificate with a
$1,000 denomination.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish or cause to be furnished to each Person who at any
time during the calendar year was the Holder of a Class M-2 Certificate a
statement containing the applicable distribution information provided pursuant
to this Section aggregated for such calendar year or applicable portion thereof
during which such Person was the Holder of a Class M-2 Certificate. Such
obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Trustee
pursuant to any requirements of the Code as from time to time enforced.
e. On each Remittance Date, the Trustee shall forward or cause to
be forwarded by mail to each Holder of a Class B-1 Certificate a copy of the
Monthly Report forwarded to the Holders of Class A, Class M-1 and Class M-2
Certificates on such Remittance Date. The Servicer shall also furnish to the
Trustee, which shall forward such report to the Class B-1 Certificateholders as
part of the Monthly Report, the following information:
(i) the amount of such distribution to Holders of Class B-1
Certificates allocable to interest, separately identifying any
Unpaid Class B-1 Interest Shortfall included in such
distribution, any remaining Unpaid Class B-1 Interest
Shortfall after giving effect to such distribution, any Class
B-1 Liquidation Loss Interest Amount included in such
distribution and any remaining Unpaid Class B-1 Liquidation
Loss Interest Shortfall after giving effect to such
distribution;
(ii) the amount of such distribution to Holders of Class B-1
Certificates allocable to principal, separately identifying
the aggregate amount of any Principal Prepayments included
therein, and any remaining Unpaid Class B-1 Principal
Shortfall after giving effect to such distribution;
(iii) the Class B-1 Principal Balance and the Class B-1 Adjusted
Principal Balance (if different) after giving effect to the
distribution of principal on such Remittance Date;
(iv) the Class B Percentage for such Remittance Date and the
following Remittance Date; and
(v) the information described above in Section 6.05(b)(v) through
(xviii).
In the case of the information in clauses (i) through (iii) above, the
amounts shall be expressed as a dollar amount per Class B-1 Certificate with a
$1,000 denomination.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish or cause to be furnished to each Person who at any
time during the calendar year was the Holder of a Class B-1 Certificate a
statement containing the applicable distribution information provided pursuant
to this Section aggregated for such calendar year or applicable portion thereof
during which such Person was the Holder of a Class B-1 Certificate. Such
obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable
6-5
information shall be provided by the Trustee pursuant to any requirements of the
Code as from time to time enforced.
f. On each Remittance Date, the Trustee shall forward or cause to
be forwarded by mail to each Holder of a Class B-2 Certificate a copy of the
Monthly Report forwarded to the Holders of Class A, Class M-1, Class M-2 and
Class B-1 Certificates on such Remittance Date. The Servicer shall also furnish
to the Trustee, which shall forward such report to the Class B-2
Certificateholders as part of the Monthly Report, the following information:
(i) the amount of such distribution to Holders of Class B-2
Certificates allocable to interest, separately identifying any
Unpaid Class B-2 Interest Shortfall included in such
distribution and any remaining Unpaid Class B-2 Interest
Shortfall after giving effect to such distribution;
(ii) the amount of such distribution to Holders of Class B-2
Certificates allocable to principal, separately identifying
the aggregate amount of any Principal Prepayments included
therein, and any Unpaid Class B-2 Principal Shortfall after
giving effect to such distribution;
(iii) the amount, if any, by which the Class B-2 Formula
Distribution Amount for such Remittance Date exceeds the
Remaining Amount Available for such Remittance Date;
(iv) the Class B-2 Principal Balance and Class B-2 Adjusted
Principal Balance, if different, after giving effect to the
distribution of principal on such Remittance Date;
(v) the Class B Percentage for such Remittance Date and the
following Remittance Date;
(vi) the information described above in Section 6.05(b)(v) through
(xviii);
(vii) the Class B-2 Liquidation Loss Amount, if any, for such
Remittance Date; and
(viii) the Weighted Average Contract Rate of all outstanding
Contracts.
In the case of the information in clauses (i) through (iv) above, the
amounts shall be expressed as a dollar amount per Class B-2 Certificate with a
$1,000 denomination.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish or cause to be furnished to each Person who at any
time during the calendar year was the Holder of a Class B-2 Certificate a
statement containing the applicable distribution information provided pursuant
to this Section aggregated for such calendar year or applicable portion thereof
during which such Person was the Holder of a Class B-2 Certificate. Such
obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Trustee
pursuant to any requirements of the Code as from time to time enforced.
6-6
g. On each Remittance Date, the Trustee shall forward or cause to
be forwarded by mail to each Holder of a Class B-3I Certificate a copy of the
Monthly Report forwarded to the Holders of Class A, Class M-1, Class M-2, Class
B-1 and Class B-2 Certificates on such Remittance Date. The Servicer shall also
furnish to the Trustee, which shall forward such report to the Class B-3I
Certificateholders as part of the Monthly Report, the following information:
(i) the Class B-3I Formula Distribution Amount for such Remittance
Date, including any Unpaid Class B-3I Shortfall immediately
prior to such Remittance Date;
(ii) the Class B-3I Distribution Amount for such Remittance Date;
and
(iii) the Unpaid Class B-3I Shortfall immediately following such
Distribution Date.
h. Copies of all reports provided to the Trustee for the
Certificateholders shall also be provided to Standard & Poor's, ▇▇▇▇▇'▇ and
Fitch and to the Class C Certificateholders. In addition, Certificate Owners may
receive copies of any reports provided to the Trustee for the
Certificateholders, upon written request together with a certification that they
are Certificate Owners and payment of reproduction and postage expenses
associated with the distribution of such reports, from the Trustee at the
Corporate Trust Office.
SECTION 6.06. Payment of Taxes.
----------------
The Servicer shall be responsible for and agrees to prepare, make and
file all federal, state, local or other tax returns, information statements and
other returns and documents of every kind and nature whatsoever required to be
made or filed by or on behalf of the Subsidiary REMIC or Master REMIC pursuant
to the Code and other applicable tax laws and regulations. Each such return,
statement and document shall, to the extent required by the Code or other
applicable law and at the request of the Servicer, be signed on behalf of the
Subsidiary REMIC or Master REMIC by the Trustee. The Trustee shall have no
responsibility whatsoever for the accuracy or completeness of any such return,
statement or document. The Servicer agrees to indemnify the Trustee and hold it
harmless for, from, against and in respect to any and all liability, loss,
damage and expense which may be incurred by the Trustee based upon or as a
result of the Trustee's execution of any and all such tax returns, statements
and documents. The Servicer, if and for so long as it is a Class C
Certificateholder, shall be designated the "tax matters person" on behalf of the
Subsidiary REMIC and the Master REMIC, respectively, in the same manner as a
partnership may designate a "tax matters partner," as such term is defined in
Section 6231(a)(7) of the Code. To the extent permitted by the REMIC Provisions,
any subsequent holder of a Class C Certificate, by acceptance thereof,
irrevocably designates and appoints the Servicer as its agent to perform the
responsibilities of the "tax matters person" on behalf of the Subsidiary REMIC
and the Master REMIC, respectively, if, and during such time as, the Servicer is
not the holder of a Class C Certificate. The Servicer may, at its expense,
retain such outside assistance as it deems necessary in the performance of its
obligations under this paragraph.
Each of the Holders of the Certificates, by acceptance thereof, agrees
to file tax returns consistent with and in accordance with any elections,
decisions or other reports made or filed with regard to federal, state or local
taxes on behalf of the Subsidiary REMIC or the Master
6-7
REMIC. The Originator, as agent for the tax matters person, shall represent the
Subsidiary REMIC or the Master REMIC in connection with all examinations of the
Subsidiary REMIC's or the Master REMIC's affairs by tax authorities, including
resulting administrative and judicial proceedings. Each of the holders of the
Certificates, by acceptance thereof, agrees to cooperate with the Originator in
such matters and to do or refrain from doing any or all things reasonably
required by the Originator to conduct such proceedings, provided that no such
action shall be required by the Originator of any Certificateholder that would
entail unnecessary or unreasonable expenses for such Certificateholder in the
performance of such action.
The Class C Subsidiary Certificateholders and the Class C Master
Certificateholders shall pay, on behalf of the Subsidiary REMIC or the Master
REMIC, respectively, any foreign, federal, state or local income, property,
excise, sales, receipts or any other similar or related taxes or charges which
may be imposed upon the Subsidiary REMIC or the Master REMIC as a REMIC or
otherwise and shall, to the extent provided in Section 10.06, be entitled to be
reimbursed out of the Certificate Account or, if such tax or charge results from
a failure by the Trustee, the Originator or any Servicer to comply with the
provisions of Section 2.04 or 3.07, the Trustee, the Originator or such
Servicer, as the case may be, shall indemnify the Class C Certificateholders for
the payment of any such tax or charge. The Trustee shall be entitled to withhold
from amounts otherwise distributable to the Class C Certificateholders any taxes
or charges payable by the Class C Certificateholders hereunder.
In the event a Class C Certificate is transferred to a "disqualified
organization," within the meaning of Section 860E(e)(5) of the Code, pursuant to
Section 860D(a)(6)(B) of the Code the Seller shall provide to the Internal
Revenue Service and the persons specified in Sections 860E(e)(3) and (6) of the
Code all information necessary for the application of Section 860E(e) and any
other applicable provision of the Code with respect to the transfer of such
Class C Certificate to such a disqualified organization including, without
limitation, a computation showing the present value of the total anticipated
excess inclusions with respect to such Class C Certificate for periods after the
transfer as defined in the REMIC Provisions. In addition, to the extent required
by the REMIC Provisions, the Seller shall, upon the written request of persons
designated in Section 860E(e)(3) of the Code, furnish to such requesting party
and the Internal Revenue Service information sufficient to compute the present
value of anticipated excess inclusions within 60 days of the receipt of such
written request.
6-8
ARTICLE VII
SERVICE TRANSFER
----------------
SECTION 7.01. Event of Termination.
--------------------
"Event of Termination" means the occurrence of any of the following:
a. Any failure by the Servicer to make any deposit into an
account required to be made hereunder and the continuance of such failure for a
period of five Business Days after the Servicer has become aware, or should have
become aware, that such deposit was required;
b. Failure on the Servicer's part to observe or perform in any
material respect any covenant or agreement in this Agreement (other than a
covenant or agreement which is elsewhere in this Section specifically dealt
with) which continues unremedied for 30 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have been given
to the Servicer by the Trustee or to the Servicer and the Trustee by Holders of
Class A Certificates, Class M-1 Certificates, Class M-2 Certificates and Class B
Certificates evidencing, as to any such Class, Percentage Interests aggregating
not less than 25%;
c. Any assignment by the Servicer of its duties hereunder except
as specifically permitted hereunder, or any attempt to make such an assignment;
d. A court or other governmental authority having jurisdiction in
the premises shall have entered a decree or order for relief in respect of the
Servicer in an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar official) of
the Servicer, as the case may be, or for any substantial liquidation of its
affairs, and such order remains undischarged and unstayed for at least 60 days;
e. The Servicer shall have commenced a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or shall have consented to the entry of an order for relief in an
involuntary case under any such law, or shall have consented to the appointment
of or taking possession by a receiver, liquidator, assignee, trustee, custodian
or sequestrator (or other similar official) of the Servicer or for any
substantial part of its property, or shall have made any general assignment for
the benefit of its creditors, or shall have failed to, or admitted in writing
its inability to, pay its debts as they become due, or shall have taken any
corporate action in furtherance of the foregoing; or
f. The failure of the Servicer to be an Eligible Servicer.
SECTION 7.02. Transfer.
--------
If an Event of Termination has occurred and is continuing, either the
Trustee or Certificateholders with aggregate Percentage Interests representing
25% or more of the Trust, by notice in writing to the Servicer (and to the
Trustee if given by the Certificateholders) may terminate all (but not less than
all) of the Servicer's management, administrative, servicing and collection
functions (such termination being herein called a "Service Transfer"). On
receipt of
7-1
such notice (or, if later, on a date designated therein), or upon resignation of
the Servicer in accordance with Section 12.01, all authority and power of the
Servicer under this Agreement, whether with respect to the Contracts, the
Contract Files, the Land-and-Home Contract Files or otherwise (except with
respect to the Certificate Account, the transfer of which shall be governed by
Section 7.06), shall pass to and be vested in the Trustee pursuant to and under
this Section 7.02; and, without limitation, the Trustee is authorized and
empowered to execute and deliver on behalf of the Servicer, as attorney-in-fact
or otherwise, any and all documents and other instruments (including, without
limitation, documents required to make the Trustee or a successor servicer the
sole lienholder or legal title holder of record of each Manufactured Home) and
to do any and all acts or things necessary or appropriate to effect the purposes
of such notice of termination. Each of the Originator and the Servicer agrees to
cooperate with the Trustee in effecting the termination of the responsibilities
and rights of the Servicer hereunder, including, without limitation, the
transfer to the Trustee for administration by it of all cash amounts which shall
at the time be held by the Servicer for deposit, or have been deposited by the
Servicer, in the Certificate Account, or for its own account in connection with
its services hereafter or thereafter received with respect to the Contracts and
the execution of any documents required to make the Trustee or a successor
servicer the sole lienholder or legal title holder of record in respect of each
Manufactured Home. The Servicer shall be entitled to receive any other amounts
which are payable to the Servicer under the Agreement, at the time of the
termination of its activities as Servicer. The Servicer shall transfer to the
new servicer (i) the Servicer's records relating to the Contracts in such
electronic form as the new servicer may reasonably request and (ii) any
Contracts, Contract Files and Land-and-Home Contract Files in the Servicer's
possession.
SECTION 7.03. Trustee to Act; Appointment of Successor.
----------------------------------------
On and after the time the Servicer receives a notice of termination
pursuant to Section 7.02 or the resignation of the Servicer in accordance with
Section 12.01, the Trustee shall be the successor in all respects to the
Servicer in its capacity as servicer under this Agreement and the transactions
set forth or provided for herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Servicer
by the terms and provisions hereof and the Servicer shall be relieved of such
responsibilities, duties and liabilities arising after such Service Transfer;
provided, however, that (i) the Trustee will not assume any obligations of the
Originator pursuant to Section 3.06 and (ii) the Trustee shall not be liable for
any acts or omissions of the Servicer occurring prior to such Service Transfer
or for any breach by the Servicer of any of its obligations contained herein or
in any related document or agreement. As compensation therefor, the Trustee
shall be entitled to receive reasonable compensation out of the Monthly
Servicing Fee and the Additional Monthly Servicing Fee. Notwithstanding the
above, the Trustee may, if it shall be unwilling so to act, or shall, if it is
legally unable so to act, appoint, or petition a court of competent jurisdiction
to appoint, an Eligible Servicer as the successor to the Servicer hereunder in
the assumption of all or any part of the responsibilities, duties or liabilities
of the Servicer hereunder. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the Trustee may make such arrangements for the
compensation of such successor out of payments on Contracts as it and such
successor shall agree; provided, however, that no such monthly compensation
shall, without the written consent of 100% of the Certificateholders,
7-2
exceed the Monthly Servicing Fee and the Additional Monthly Servicing Fee. The
Trustee and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession.
SECTION 7.04. Notification to Certificateholders.
----------------------------------
a. Promptly following the occurrence of any Event of Termination,
the Servicer shall give written notice thereof to the Trustee, the Rating
Agencies and the Certificateholders at their respective addresses appearing on
the Certificate Register.
b. Within ten days following any termination or appointment of a
successor to the Servicer pursuant to this Article VII, the Trustee shall give
written notice thereof to the Rating Agencies and the Certificateholders at
their respective addresses appearing on the Certificate Register.
c. The Trustee shall give written notice to the Rating Agencies
at least 30 days prior to the date upon which any Eligible Servicer (other than
the Trustee) is to assume the responsibilities of Servicer pursuant to Section
7.03, naming such successor Servicer.
SECTION 7.05. Effect of Transfer.
------------------
a. After the Service Transfer, the Trustee or new Servicer may
notify Obligors to make payments directly to the new Servicer that are due under
the Contracts after the effective date of the Service Transfer.
b. After the Service Transfer, the replaced Servicer shall have
no further obligations with respect to the management, administration, servicing
or collection of the Contracts and the new Servicer shall have all of such
obligations, except that the replaced Servicer will transmit or cause to be
transmitted directly to the new Servicer for its own account, promptly on
receipt and in the same form in which received, any amounts (properly endorsed
where required for the new Servicer to collect them) received as payments upon
or otherwise in connection with the Contracts.
c. A Service Transfer shall not affect the rights and duties of
the parties hereunder (including but not limited to the indemnities of the
Servicer and the Originator pursuant to Article X and Sections 3.06, 11.06 and
11.11(f)) other than those relating to the management, administration, servicing
or collection of the Contracts.
SECTION 7.06. Transfer of Certificate Account.
-------------------------------
Notwithstanding the provisions of Section 7.02, if the Certificate
Account shall be maintained with the Servicer and an Event of Termination shall
occur and be continuing, the Servicer shall, after five days' written notice
from the Trustee, or in any event within ten days after the occurrence of the
Event of Termination, establish an Eligible Account with an institution other
than the Servicer and promptly transfer all funds in the Certificate Account to
such new account, which shall thereafter be deemed the Certificate Account for
the purposes hereof.
7-3
ARTICLE VIII
PAYMENTS
--------
SECTION 8.01. Monthly Payments.
----------------
a. Subject to the terms of this Article VIII, each Holder of a
Certificate as of a Record Date shall be paid on the next succeeding Remittance
Date by check mailed on such Remittance Date to such Certificateholder at the
address for such Certificateholder appearing on the Certificate Register (or, if
such Certificateholder holds a Class of Class A Certificates, Class M
Certificates, or Class B Certificates with an aggregate Percentage Interest of
at least 5% or a Class B-3I, Class C Subsidiary or Class C Master
Certificateholder holds Class B-3I, Class C Subsidiary or Class C Master
Certificates with an aggregate Percentage Interest of at least 20% and so
requests, by wire transfer pursuant to instructions delivered to the Trustee at
least ten days prior to such Remittance Date), the sum equal to such
Certificateholder's Percentage Interest of all amounts distributed on the
applicable Class of Certificates. Final payment of any Certificate shall be made
only upon presentation of such Certificate at the office or agency of the Paying
Agent.
b. Each distribution with respect to a Book-Entry Certificate
shall be paid to the Depository, which shall credit the amount of such
distribution to the accounts of its Depository Participants in accordance with
its normal procedures. Each Depository Participant shall be responsible for
disbursing such distribution to the Certificate Owners that it represents and to
each indirect participating brokerage firm (a "brokerage firm" or "indirect
participating firm") for which it acts as agent. Each brokerage firm shall be
responsible for disbursing funds to the Certificate Owners that it represents.
All such credits and disbursements with respect to a Book-Entry Certificate are
to be made by the Depository and the Depository Participants in accordance with
the provisions of the Book Entry Certificates. Neither the Trustee, the
Certificate Registrar, the Originator, the Seller nor the Servicer shall have
any responsibility therefor except as otherwise provided by applicable law. To
the extent applicable and not contrary to the rules of the Depository, the
Trustee shall comply with the provisions of the forms of the Class A, Class M,
and Class B Certificates as set forth in Exhibits A, B and C hereto.
c. The Trustee shall either act as the paying agent or shall
appoint an institution meeting the eligibility requirements set forth in Section
11.06 to be the paying agent (in either case, the "Paying Agent") and cause it
to make the payments to the Certificateholders required hereunder. The Trustee's
Corporate Trust Office at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇, shall initially act as Paying Agent. The Trustee
shall require the Paying Agent (if other than the Trustee) to agree in writing
that all amounts held by the Paying Agent for payment hereunder will be held in
trust for the benefit of the Certificateholders and that it will notify the
Trustee of any failure by the Servicer to make funds available to the Paying
Agent for the payment of amounts due on the Certificates.
8-1
SECTION 8.02. Permitted Withdrawals from the Certificate Account.
--------------------------------------------------
The Trustee may, from time to time as provided herein, make withdrawals
from the Certificate Account of amounts deposited in said account pursuant to
Section 5.05 that are attributable to the Contracts for the following purposes:
a. to make payments in the amounts and in the manner provided for
in Section 8.03;
b. to pay to the Originator with respect to each Contract or
property acquired in respect thereof that has been repurchased or replaced
pursuant to Section 3.06, all amounts received thereon and not required to be
distributed to Certificateholders as of the date on which the related Scheduled
Principal Balance or Repurchase Price is determined;
c. to reimburse the Servicer out of Liquidation Proceeds for
Liquidation Expenses incurred by it, to the extent such reimbursement is
permitted pursuant to Section 5.08;
d. to withdraw any amount deposited in the Certificate Account
that was not required to be deposited therein; or
e. to make any rebates or adjustments deemed necessary by the
Servicer pursuant to Section 5.06(d).
Since, in connection with withdrawals pursuant to clause (b), the
Servicer's entitlement thereto is limited to collections or other recoveries on
the related Contract, the Servicer shall keep and maintain separate accounting,
on a Contract by Contract basis, for the purpose of justifying any withdrawal
from the Certificate Account pursuant to such clause.
SECTION 8.03. Payments.
--------
a. On each Remittance Date the Trustee shall withdraw from the
Certificate Account the Amount Available (as determined on the immediately
preceding Determination Date), plus (x) on the Post-Funding Remittance Date any
Pre-Funded Amount, (y) on the Funding Termination Date any amount withdrawn from
the Staged-Funding Contract Reserve Account and deposited in the Certificate
Account as described in Section 3.08(c), and (z) on the Remittance Dates in
November 2000 and December 2000 any amount withdrawn from the Capitalized
Interest Account and deposited in the Certificate Account, and apply such funds
to make payment in the following order of priority, subject to Section 8.03(d):
1. if neither Conseco Finance Corp. nor a wholly owned
subsidiary of Conseco Finance Corp. is the Servicer, to pay the Monthly
Servicing Fee and any other compensation owed to the Servicer pursuant
to Section 7.03, except the Additional Monthly Servicing Fee;
2. after payment of the amount specified in clause (1)
above, to the Class A Certificateholders as follows:
(i) the amount in clause (a)(i) of the definition of
Class A Formula Distribution Amount to the Class A-1
Certificateholders; the amount in
8-2
clause (a)(ii) to the Class A-2 Certificateholders;
the amount in clause (a)(iii) to the Class A-3
Certificateholders; the amount in clause (a)(iv) to
the Class A-4 Certificateholders; the amount in
clause (a)(v) to the Class A-5 Certificateholders;
the amount in clause (a)(vi) to the Class A-6
Certificateholders; the amount in clause (a)(vii) to
the Class A-7 Certificateholders, or, if the
available amount is less than the sum of the amounts
specified in this clause (i), pro rata to each Class
of Class A Certificates based on the amount of
interest payable pursuant to this clause;
(ii) the aggregate Unpaid Class A Interest Shortfall pro
rata to each Class of Class A Certificates based on
the Unpaid Class A Interest Shortfall of each such
Class;
3. after payment of the amounts specified in clauses (1)
- (2) above, to the Class M-1 Certificateholders as follows:
(i) the amount in clause (a) of the definition of Class
M-1 Formula Distribution Amount;
(ii) any Unpaid Class M-1 Interest Shortfall;
4. after payment of the amounts specified in clauses (1)
- (3) above, to the Class M-2 Certificateholders as follows:
(i) the amount in clause (a) of the definition of Class
M-2 Formula Distribution Amount;
(ii) any Unpaid Class M-2 Interest Shortfall;
5. after payment of the amounts specified in clauses (1)
- (4) above, to the Class B-1 Certificateholders as follows:
(i) the amount in clause (a) of the definition of Class
B-1 Formula Distribution Amount;
(ii) any Unpaid Class B-1 Interest Shortfall;
6. after payment of the amounts specified in clauses (1)
- (5) above, to the Class A Certificateholders as follows:
(i) if there is a Class A Principal Deficiency Amount as
of such Remittance Date, the remaining Amount
Available, pro rata to each Class of Class A
Certificates based on the related Class Principal
Balance (but in no event shall such amount exceed the
related Class Principal Balance);
(ii) the Unpaid Class A Principal Shortfall to the Class
A-1, Class A-2, Class A-3, Class A-4, Class A-5,
Class A-6 and Class A-7 Certificateholders in
8-3
the order of priority set forth in clause (iii)
below, but to each Class of Class A Certificates no
more than the Unpaid Class A Principal Shortfall
attributable to such Class;
(iii) if such Remittance Date is on or prior to the Class
A-7 Cross-Over Date, the Class A Percentage of the
Formula Principal Distribution Amount to the Class A
Certificateholders as follows:
(a) to the Class A-1 Certificateholders, but in
no event more than the Class A-1 Principal
Balance;
(b) to the Class A-2 Certificateholders, but in
no event more than the Class A-2 Principal
Balance;
(c) to the Class A-3 Certificateholders, but in
no event more than the Class A-3 Principal
Balance;
(d) to the Class A-4 Certificateholders, but in
no event more than the Class A-4 Principal
Balance;
(e) to the Class A-5 Certificateholders, but in
no event more than the Class A-5 Principal
Balance;
(f) to the Class A-6 Certificateholders, but in
no event more than the Class A-6 Principal
Balance;
(g) to the Class A-7 Certificateholders, but in
no event more than the Class A-7 Principal
Balance;
7. after payment of the amounts specified in clauses (1)
- (6) above, to the Class M-1 Certificateholders as follows:
(i) any Unpaid Class M-1 Principal Shortfall;
(ii) the Class M-1 Percentage of the Formula Principal
Distribution Amount (plus, if such Remittance Date is
on the Class A-7 Cross-Over Date, the amount by which
the Class A Percentage of the Formula Principal
Distribution Amount exceeds the Class A Principal
Balance on such date), but in no event more than the
Class M-1 Principal Balance;
(iii) any Class M-1 Liquidation Loss Interest Amount;
(iv) any Unpaid Class M-1 Liquidation Loss Interest
Shortfall;
8. after payment of the amounts specified in clauses (1)
- (7) above, to the Class M-2 Certificateholders as follows:
(i) any Unpaid Class M-2 Principal Shortfall;
8-4
(ii) the Class M-2 Percentage of the Formula Principal
Distribution Amount (plus, if such Remittance Date is
on the Class M-1 Cross-Over Date, the amount, if any,
by which the sum of the Class A Percentage and the
Class M-1 Percentage of the Formula Principal
Distribution Amount exceeds the sum of the Class A
and Class M-1 Principal Balances on such date), but
in no event more than the Class M-2 Principal
Balance;
(iii) any Class M-2 Liquidation Loss Interest Amount;
(iv) any Unpaid Class M-2 Liquidation Loss Interest
Shortfall;
9. after payment of the amounts specified in clauses (1)
- (8) above, to the Class B-1 Certificateholders as follows:
(i) any Unpaid Class B-1 Principal Shortfall;
(ii) the Class B Percentage of the Formula Principal
Distribution Amount (plus, if such Remittance Date is
on the Class M-2 Cross-Over Date, the amount, if any,
by which the sum of the Class A, Class M-1 and Class
M-2 Percentages of the Formula Principal Distribution
Amount exceeds the sum of the Class A, Class M-1 and
Class M-2 Principal Balances on such date), but in no
event more than the Class B-1 Principal Balance;
(iii) any Class B-1 Liquidation Loss Interest Amount;
(iv) any Unpaid Class B-1 Liquidation Loss Interest
Shortfall;
10. after payment of the amounts specified in clauses (1)
- (9) above, to the Class B-2 Certificateholders as follows:
(i) the amount in clause (a) of the definition of Class
B-2 Formula Distribution Amount;
(ii) any Unpaid Class B-2 Interest Shortfall;
(iii) any Unpaid Class B-2 Principal Shortfall;
(iv) if such Remittance Date is on or after the Class B-1
Cross-Over Date, the Class B Percentage of the
Formula Principal Distribution Amount (minus, if such
Remittance Date is on the Class B-1 Cross-Over Date,
the amount of the Class B Percentage of the Formula
Principal Distribution Amount actually distributed to
the Class B-1 Certificateholders on such date, and
plus, if such Remittance Date is on the Class B-1
Cross-Over Date, the amount, if any, by which the
Formula Principal Distribution Amount exceeds the sum
of the Class A Principal Balance, the Class M-1
Principal Balance, the Class M-2 Principal Balance
and the Class B-1 Principal Balance on such date);
8-5
11. if Conseco Finance Corp. or a wholly owned subsidiary
of the Company is the Servicer, after payment of the amounts specified
in clauses (1) - (10) above, to pay the Monthly Servicing Fee and any
other compensation owed to the Servicer pursuant to Section 7.02, and
if Conseco Finance Corp. or a wholly owned subsidiary of Conseco
Finance is not the Servicer, to pay the Additional Monthly Servicing
Fee to the Servicer;
12. after payment of the amounts specified in clauses (1)
- (11) above, to the Certificateholders any Additional Principal
Distribution Amount, as follows and in no case more than the Class
Principal Balance of any Class:
(i) to the Class A Certificateholders (sequentially,
beginning with Class A-1), the amount, if any, by
which the aggregate Additional Principal Distribution
Amount distributed on prior Remittance Dates pursuant
to this clause (i) is less than $7,500,000; and
(ii) on each Additional Principal Payment Date (as defined
in Section 8.05(f)), to the Class M-1, Class M-2,
Class B-1 and Class B-2 Certificateholders pro rata
based upon the Class Principal Balance of each Class;
13. after payment of the amounts specified in clauses (1)
- (12) above, the Class B-3I Distribution Amount to the Class B-3I
Certificateholders;
14. after payment of the amounts specified in clauses (1)
- (13) above, to reimburse the Class C Certificateholders for expenses
incurred by and reimbursable to them pursuant to Section 10.06; and
15. after payment of the amounts specified in clauses (1)
- (14) above, any remaining funds to the Class C Master
Certificateholders.
b. On each Remittance Date, the Uncertificated Subsidiary
Interests shall receive distributions, to the extent of the Adjusted Amount
Available, in the following order of priority:
1. Each Class of Class A Uncertificated Subsidiary
Interests shall receive a distribution of principal in an amount equal
to the amount of principal distributed to its respective Corresponding
Certificate Class pursuant to Section 8.03(a)(6);
2. The Class M-S1 Interest shall receive a distribution
of principal in an amount equal to the amount of principal distributed
to the Class M-1 Certificates pursuant to Section 8.03(a)(7);
3. The Class M-S2 Interest shall receive a distribution
of principal in an amount equal to the amount of principal distributed
to the Class M-2 Certificates pursuant to Section 8.03(a)(8);
4. The Class B-S1 and Class B-S2 Interests shall receive
distributions of principal in an amount equal to the amount of
principal distributed to its respective Corresponding Certificate Class
pursuant to Section 8.03(a)(9)-(10);
8-6
5. Each Class of Uncertificated Subsidiary Interests
shall receive distributions of interest, pro rata in an amount equal to
(i) 1/12th of the Weighted Average Contract Rate times the outstanding
Subsidiary Interest Principal Balance of such Class of Uncertificated
Subsidiary Interests, plus (ii) any Unpaid Subsidiary Interest
Shortfall with respect to such Class; and
6. Any remaining Amount Available shall be distributed
to the Class C Subsidiary Certificateholders.
c. If the applicable Monthly Report indicates a Class M-1
Interest Deficiency Amount, a Class M-2 Interest Deficiency Amount and/or a
Class B-1 Interest Deficiency Amount for such Remittance Date, the Trustee shall
withdraw from the Certificate Account (to the extent of funds on deposit therein
one Business Day prior to such Remittance Date, after distribution of the Amount
Available pursuant to Section 8.03(a)) an amount equal to the Class M-1 Interest
Deficiency Amount, the Class M-2 Interest Deficiency Amount and the Class B-1
Interest Deficiency Amount (or the amount of such funds in the Certificate
Account, if less) and distribute such amount, first to the Class M-1
Certificateholders up to the amount of the Class M-1 Interest Deficiency Amount
(or pro rata, if such funds are less than the Class M-1 Interest Deficiency
Amount), if any, then to the Class M-2 Certificateholders up to the amount of
the Class M-2 Interest Deficiency Amount (or pro rata, if such funds are less
than the Class M-2 Interest Deficiency Amount), if any, and then to the Class
B-1 Certificateholders up to the amount of the Class B-1 Interest Deficiency
Amount (or pro rata, if such remaining funds are less than the Class B-1
Interest Deficiency Amount); provided, however, that (i) no such withdrawal
shall be made with respect to the Class M-1 Interest Deficiency Amount if the
Cumulative Realized Losses as of such Remittance Date are greater than
$157,500,000; (ii) no such withdrawal shall be made with respect to the Class
M-2 Interest Deficiency Amount if the Cumulative Realized Losses as of such
Remittance Date are greater than $131,250,000; (iii) no withdrawal with respect
to Class B-1 Interest Deficiency Amount shall be made if the Cumulative Realized
Losses as of such Remittance Date are greater than $105,000,000; (iv) no
withdrawal with respect to a Class M-1 Interest Deficiency Amount shall be made
if the aggregate withdrawals with respect to all prior Class M-1 Interest
Deficiency Amounts equal $2,362,500; (v) no withdrawal with respect to a Class
M-2 Interest Deficiency Amount shall be made if the aggregate withdrawals with
respect to all prior Class M-2 Interest Deficiency Amounts equal $2,031,750; and
(vi) no withdrawal with respect to a Class B-1 Interest Deficiency Amount shall
be made if the aggregate withdrawals with respect to all prior Class B-1
Interest Deficiency Amounts equal $1,722,938.
d. Notwithstanding the priorities set forth above, any Pre-Funded
Amount deposited in the Certificate Account shall be applied solely to pay
principal of the Class A Certificates sequentially, beginning with Class A-1,
and any amount withdrawn from the Capitalized Interest Account and deposited in
the Certificate Account shall be applied solely as described in Section 8.06.
e. If the Trustee shall not have received the applicable Monthly
Report by any Remittance Date, the Trustee shall distribute all funds then in
the Certificate Account to Certificateholders in accordance with Section
8.03(a), to the extent of such funds, on such Remittance Date.
8-7
SECTION 8.04. [Reserved].
--------
SECTION 8.05. Class C Subsidiary Certificateholder's Purchase Option;
-------------------------------------------------------
Auction Sale; Additional Principal Distribution Amount.
------------------------------------------------------
a. Subject to the conditions in subsection (b) below, the Class C
Subsidiary Certificateholder shall have the option to purchase all of the
Contracts and all property acquired in respect of any Contract remaining in the
Trust at a price (such price being referred to as the "Minimum Purchase Price")
equal to the greater of:
A. the sum of (x) 100% of the principal balance of each Contract
(other than any Contract as to which title to the underlying
property has been acquired and whose fair market value is
included pursuant to clause (y) below), plus (y) the fair
market value of such acquired property (as determined by the
Originator as of the close of business on the third Business
Day next preceding the date upon which notice of any such
termination is furnished to Certificateholders pursuant to
Section 12.04) or
B. the aggregate fair market value (as determined by the
Originator as of the close of business on such third Business
Day) of all of the assets of the Trust,
plus, in either case, any Unpaid Class A Interest Shortfall, any Unpaid Class
M-1 Interest Shortfall, any Unpaid Class M-1 Liquidation Loss Interest
Shortfall, any Unpaid Class M-2 Interest Shortfall, any Unpaid Class M-2
Liquidation Loss Interest Shortfall, any Unpaid Class B-1 Interest Shortfall,
any Unpaid Class B-1 Liquidation Loss Interest Shortfall and any Unpaid Class
B-2 Interest Shortfall as well as one month's interest at the applicable
Contract Rate on the Scheduled Principal Balance of each Contract (including any
Contract as to which the related Manufactured Home has been repossessed).
b. The purchase by the Class C Subsidiary Certificateholder of
all of the Contracts pursuant to Section 8.05(a) above shall be at the option of
the Class C Subsidiary Certificateholder, but shall be conditioned upon (1) the
Pool Scheduled Principal Balance, at the time of any such purchase, aggregating
not more than 20% of the Cut-off Date Pool Principal Balance, (2) such purchase
being made pursuant to a plan of complete liquidation of each of the Subsidiary
REMIC and the Master REMIC in accordance with Section 860F of the Code, as
provided in Section 12.03, (3) the Class C Subsidiary Certificateholder having
provided the Trustee and the Depository (if any) with at least 30 days' written
notice and (4) the Originator or the Servicer (as applicable) shall have
delivered to the Trustee an unqualified Opinion of Counsel stating that payment
of the purchase price to the Certificateholders will not constitute a voidable
preference or fraudulent transfer under the United States Bankruptcy Code. If
such option is exercised, the Class C Subsidiary Certificateholder, as
applicable, shall provide to the Trustee the certification required by Section
12.03, which certificate shall constitute a plan of complete liquidation of each
of the Subsidiary REMIC and the Master REMIC within the meaning of Section 860F
of the Code, and the Trustee shall promptly sign such certification and
8-8
release to the Class C Subsidiary Certificateholder, the Contract Files and
Land-and-Home Contract Files pertaining to the Contracts being repurchased.
c. The Class C Subsidiary Certificateholder may assign its rights
under this Section 8.05, separately from its other rights as Holder of the Class
C Subsidiary Certificates, by giving written notice of such assignment to the
Trustee. Following the Trustee's receipt of such notice of assignment, the
Trustee shall recognize only such assignee (or its assignee in turn) as the
Person entitled to exercise the purchase option set forth in Section 8.05(a).
d. The Servicer shall notify the Trustee and the Class C
Subsidiary Certificateholder (whether or not the Class C Subsidiary
Certificateholder has then assigned its rights under this Section 8.05 pursuant
to subsection (c)) no later than two Business Days after the Determination Date
relating to the first Due Period which includes the date on which the Pool
Scheduled Principal Balance first becomes less than or equal to 20% of the
Cut-off Date Pool Principal Balance, to the effect that the Pool Scheduled
Principal Balance is then less than or equal to 20% of the Cut-off Date Pool
Principal Balance.
e. If the Class C Subsidiary Certificateholder (or its assignee)
has not delivered to the Trustee the notice of exercise of its purchase option
described in subsection (b) by the Remittance Date occurring in the month
following the Determination Date specified in subsection (d), then promptly
after the following Remittance Date the Trustee shall begin a process for
soliciting bids in connection with an auction for the Contracts. The Trustee
shall provide the Class C Subsidiary Certificateholder (or its assignee) written
notice of such auction at least 10 Business Days prior to the date bids must be
received in such auction (the "Auction Date").
If at least two bids are received, the Trustee shall solicit and
resolicit new bids from all participating bidders until only one bid remains or
the remaining bidders decline to resubmit bids. The Trustee shall accept the
highest of such remaining bids if it is equal to or in excess of the greater of
(i) the Minimum Purchase Price and (ii) the fair market value of the Contracts
and related property (such amount being referred to as the "Minimum Auction
Price"). If less than two bids are received or the highest bid after the
resolicitation process is completed is not equal to or in excess of the Minimum
Auction Price, the Trustee shall not consummate such sale. If a bid meeting the
Minimum Purchase Price is received, then the Trustee may, and if so requested by
the Class C Subsidiary Certificateholder shall, consult with a financial
advisor, which may be an underwriter of the Certificates, to determine if the
fair market value of the Contracts and related property has been offered.
If the first auction conducted by the Trustee does not produce any bid
at least equal to the Minimum Auction Price, then the Trustee shall, beginning
on the Remittance Date occurring approximately three months after the Auction
Date for the failed first auction, commence another auction in accordance with
the requirement of this subsection (e). If such second auction does not produce
any bid at least equal to the Minimum Auction Price, then the Trustee shall,
beginning on the Remittance Date occurring approximately three months after the
Auction Date for the failed second auction, commence another auction in
accordance with the requirements of this subsection (e), and shall continue to
conduct similar auctions approximately every three months thereafter until the
earliest of (i) delivery by the Class C Subsidiary Certificateholder or
8-9
its assignee of notice of exercise of its purchase option under subsection (a),
(ii) receipt by the Trustee of a bid meeting the conditions specified in the
preceding paragraph, or (iii) the Remittance Date on which the principal balance
of all the Contracts is reduced to zero.
If the Trustee receives a bid meeting the conditions specified in this
subsection (e), then the Trustee's written acceptance of such bid shall
constitute a plan of complete liquidation within the meaning of Section 860F of
the Code, and the Trustee shall release to the winning bidder, upon payment of
the bid purchase price, the Contract Files pertaining to the Contracts being
purchased.
f. If the Class C Subsidiary Certificateholder (or its assignee)
has not delivered to the Trustee the notice of exercise of its purchase option
described in subsection (b) by the Remittance Date occurring in the month
following the Determination Date specified in subsection (d), then on the
following Remittance Date and each Remittance Date thereafter (each, an
"Additional Principal Payment Date") the Class M-1, Class M-2, Class B-1 and
Class B-2 Certificates shall be entitled to receive the Additional Principal
Distribution Amount, allocated among such classes pro rata based upon the
outstanding Principal Balance of each such Class on each such Remittance Date.
SECTION 8.06. Capitalized Interest Account.
----------------------------
a. On or before the Closing Date, the Trustee shall establish the
Capitalized Interest Account on behalf of the Trust, which must be an Eligible
Account, and shall deposit therein $500,000 received from the Seller pursuant to
Section 2.02(u). The Capitalized Interest Account shall be entitled "U.S. Bank
National Association as Trustee for the benefit of holders of Manufactured
Housing Contract Senior/Subordinate Pass-Through Certificates Series 2000-5." On
the Remittance Dates occurring in November 2000 and December 2000, if the
Monthly Report for such Remittance Date indicates that the Amount Available
(after payment of the amount specified in clause (1) of Section 8.03(a) and
including in the Amount Available only payments in respect of interest on the
Contracts) is not sufficient to pay the Class A Interest Distribution Amount,
plus the Class M-1 Interest Distribution Amount, plus the Class M-2 Interest
Distribution Amount, plus the Class B-1 Interest Distribution Amount, the
Trustee shall withdraw the amount of such deficiency, or the amount of funds in
the Capitalized Interest Account (net of any investment earnings thereon), if
less, and shall deposit such funds in the Certificate Account for distribution
on such Remittance Date in order first to pay any deficiency in the Amount
Available to pay the Class A Interest Distribution Amount, second to pay any
deficiency in the Amount Available to pay the Class M-1 Interest Distribution
Amount, third to pay any deficiency in the Amount Available to pay the Class M-2
Interest Distribution Amount, and fourth to pay any deficiency in the Amount
Available to pay the Class B-1 Interest Distribution Amount.
b. The Capitalized Interest Account shall be part of the Trust
but not part of the Subsidiary REMIC or the Master REMIC. The Trustee on behalf
of the Trust shall be the legal owner of the Capitalized Interest Account. Green
Tree Finance Corp.-Two shall be the beneficial owner of the Capitalized Interest
Account, subject to the foregoing power of the Trustee to transfer amounts in
the Capitalized Interest Account to the Certificate Account. Funds in the
Capitalized Interest Account shall, at the direction of Green Tree Finance
Corp.-Two, be
8-10
invested in Eligible Investments that mature no later than the Business Day
prior to the next succeeding Remittance Date. All net income and gain from such
investments shall be distributed to Green Tree Finance Corp.-Two on such
Remittance Date. All amounts earned on amounts on deposit in the Capitalized
Interest Account shall be taxable to Green Tree Finance Corp.-Two. Any losses on
such investments shall be deposited in the Capitalized Interest Account by Green
Tree Finance Corp.-Two out of its own funds immediately as realized.
c. Any funds remaining in the Capitalized Interest Account after
the Remittance Date in December 2000 shall be distributed to Green Tree Finance
Corp.-Two on such Remittance Date. After such date no further amounts shall be
deposited in or withdrawn from the Capitalized Interest Account.
SECTION 8.07. Pre-Funding Account.
-------------------
a. On or before the Closing Date, the Trustee shall establish the
Pre-Funding Account on behalf of the Trust, which must be an Eligible Account.
The Pre-Funding Account shall be entitled "Pre-Funding Account, U.S. Bank
National Association as Trustee for the benefit of holders of Certificates,
Series 2000-5." The Trustee shall maintain within the Pre-Funding Account two
subaccounts, the Pre-Funding Subaccount and the Undelivered Contract Subaccount.
The Undelivered Contract Subaccount pertains to those Land-and-Home Contracts
transferred to the Trust on the Closing Date that are Undelivered Contracts.
Funds deposited in the Pre-Funding Account shall be held in trust by the Trustee
for the Holders of the Certificates for the uses and purposes set forth herein.
b. The Trustee shall deposit in the Pre-Funding Subaccount the
amount received from the Seller pursuant to Section 2.02(v). Amounts on deposit
in the Pre-Funding Subaccount shall be withdrawn by the Trustee as follows:
(i) On any Subsequent Transfer Date, the Trustee shall
withdraw an amount equal to 100% of the Cut-off Date Principal Balance
of each Subsequent Contract transferred and assigned to the Trustee on
such Subsequent Transfer Date and pay such amount to or upon the order
of the Seller upon satisfaction of the conditions set forth in Section
2.03(b) with respect to such transfer and assignment.
(ii) On the Business Day immediately preceding the
Post-Funding Remittance Date, the Trustee shall deposit into the
Certificate Account any amounts remaining in the Pre-Funding
Subaccount, net of investment earnings.
c. The Trustee shall deposit in the Undelivered Contract
Subaccount the amount received from the Seller pursuant to Section 2.02(w).
Amounts on deposit in the Undelivered Contract Subaccount shall be withdrawn by
the Trustee as follows:
(i) If the Seller delivers the related Land-and-Home
Contract File for an Undelivered Contract to the Trustee at least two
Business Days before the last day of the Pre-Funding Period, the
Trustee shall withdraw an amount equal to 100% of the Cut-off Date
Principal Balance of such Contract and pay such amount to or upon the
order of the Seller.
8-11
(ii) [Reserved]
(iii) The Seller shall give the Trustee telephonic notice
of its intended delivery of Land-and-Home Contract Files. The Trustee
will use reasonable efforts to process the Land-and-Home Contract Files
and remit any amount payable for them to the Seller in a timely manner.
(iv) On the Business Day immediately preceding the
Post-Funding Remittance Date, the Trustee shall deposit into the
Certificate Account any amounts remaining in the Undelivered Contract
Subaccount, net of investment earnings.
d. The Pre-Funding Account shall be part of the Trust but not
part of the Master REMIC or Subsidiary REMIC. The Trustee on behalf of the Trust
shall be the legal owner of the Pre-Funding Account. The Seller shall be the
beneficial owner of the Pre-Funding Account, subject to the foregoing power of
the Trustee to transfer amounts in the Pre-Funding Account to the Certificate
Account. Funds in the Pre-Funding Account shall, at the direction of the
Servicer, be invested in Eligible Investments of the kind described in clauses
(i) and (ii)(A) of the definition of "Eligible Investment" and that mature no
later than the Business Day prior to the next succeeding Remittance Date. All
amounts earned on deposits in the Pre-Funding Account shall be taxable to the
Seller. Any losses on such investments shall be deposited in the Pre-Funding
Account by the Seller immediately as realized. The Trustee shall release to the
Seller all investment earnings in the Pre-Funding Account on the Post-Funding
Remittance Date.
8-12
ARTICLE IX
THE CERTIFICATES AND UNCERTIFICATED SUBSIDIARY INTERESTS
--------------------------------------------------------
SECTION 9.01. The Certificates.
----------------
a. The Uncertificated Subsidiary Interests shall be issued as
nontransferable (except to a successor Trustee) uncertificated interests
evidencing, as to each such Class, 100% of the interest in distributions
required to made to such Class, and having the original Subsidiary Interest
Principal Balance specified with respect to such Class of Uncertificated
Subsidiary Interests. The Class C Subsidiary Certificate shall be substantially
in the form set forth in Exhibit J hereto, and shall, on original issue, be
executed by the Trustee on behalf of the Trust upon order of the Originator. The
Class C Subsidiary Certificate shall be issuable in Percentage Interests, and
shall be evidenced by a single Class C Subsidiary Certificate issued on the
Closing Date to Green Tree Finance Corp.-Two.
b. The Class A, the Class M, the Class B, the Class B-3I and the
Class C Master Certificates shall be substantially in the forms set forth in
Exhibits A, B, C-1, C-2, J and K, respectively, and shall, on original issue, be
executed by the Trustee on behalf of the Trust to or upon the order of the
Originator. The Class A, the Class M, and the Class B Certificates shall be
evidenced by (i) one or more Class A-1 Certificates representing $130,000,000
initial aggregate principal balance, (ii) one or more Class A-2 Certificates
representing $67,000,000 initial aggregate principal balance, (iii) one or more
Class A-3 Certificates representing $67,000,000 initial aggregate principal
balance, (iv) one or more Class A-4 Certificates representing $101,000,000
initial aggregate principal balance, (v) one or more Class A-5 Certificates
representing $40,000,000 initial aggregate principal balance, (vi) one or more
Class A-6 Certificates representing $117,000,000 initial principal balance,
(vii) two or more A-7 Certificates representing $104,250,000 initial principal
balance, (viii) one or more Class M-1 Certificates representing $37,500,000
initial aggregate principal balance, (ix) one or more Class M-2 Certificates
representing $30,000,000 initial aggregate principal balance, (x) one or more
Class B-1 Certificates representing $22,500,000 initial aggregate principal
balance, (xi) one or more Class B-2 Certificates representing $26,250,000
initial aggregate principal balance, beneficial ownership of such Classes of
Certificates to be held through Book-Entry Certificates in minimum dollar
denominations of $1,000 and integral dollar multiples of $1,000 in excess
thereof. The Class B-3I, Class C Master, and Class C Subsidiary Certificates
shall be issuable in Percentage Interests and shall each be evidenced by a
single certificate issued on the Closing Date to Green Tree Finance Corp.-Two.
c. The Certificates shall be executed by manual signature on
behalf of the Trustee by a duly authorized Responsible Officer or authorized
signatory. Certificates bearing the signatures of individuals who were at any
time the proper officers of the Trustee shall bind the Trustee, notwithstanding
that such individuals or any of them have ceased to hold such offices prior to
the execution and delivery of such Certificate or did not hold such offices at
the date of such Certificates. No Certificate shall be entitled to any benefit
under this Agreement, or be valid for any purpose, unless such Certificate has
been executed by manual signature in accordance with this Section, and such
signature upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly executed and delivered
9-1
hereunder. All Certificates shall be dated the date of their execution, except
for those Certificates executed on the Closing Date, which shall be dated the
Closing Date.
SECTION 9.02. Registration of Transfer and Exchange of Certificates.
-----------------------------------------------------
a. The Trustee shall keep at the office or agency to be
maintained in accordance with Section 12.02 a "Certificate Register" in which
the Trustee shall provide for the registration of Certificates and of transfers
and exchanges of Certificates as herein provided. The Trustee initially appoints
itself to be the "Certificate Registrar" and transfer agent for the purpose of
registering Certificates and transfers and exchanges of Certificates as provided
herein. The Trustee will give prompt written notice to Certificateholders and
the Servicer of any change in the Certificate Registrar.
b. (1) Subject to clauses (2) and (3) below, no transfer of
a Class B-2 Certificate, Class B-3I Certificate, Class C Subsidiary Certificate
or Class C Master Certificate shall be made by the Originator or any other
Person unless such transfer is exempt from the registration requirements of the
Act, as amended, and any applicable state securities laws or is made in
accordance with the Act and laws. In the event that any such transfer is to be
made, (A) the Originator may require a written Opinion of Counsel acceptable to
and in form and substance satisfactory to the Originator that such transfer may
be made pursuant to an exemption, describing the applicable exemption and the
basis therefor, from the Act and laws or is being made pursuant to the Act and
laws, which Opinion of Counsel shall not be an expense of the Trustee or the
Originator, and (B) the Trustee shall require the transferee to execute an
investment letter substantially in the form of Exhibit M attached hereto, which
investment letter shall not be an expense of the Trustee or the Originator. Any
Class B-3I Certificateholder, Class C Subsidiary Certificateholder or Class C
Master Certificateholder desiring to effect such transfer shall, and does hereby
agree to, indemnify the Trustee, the Originator and the Certificate Registrar
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws.
(2) No transfer of a Class M-1 Certificate, Class M-2
Certificate, a Class B Certificate, a Class B3I Certificate, a Class C
Subsidiary Certificate or a Class C Master Certificate or any interest therein,
shall be made to any employee benefit plan, trust or account that is subject to
ERISA, or that is described in Section 4975(e)(1) of the Code (each, a "Plan"),
unless the prospective transferee of a Certificate or interest therein provides
the Servicer and the Trustee with a certification of facts and, at its own
expense, an Opinion of Counsel which establish to the satisfaction of the
Servicer and the Trustee that such transfer will not result in a violation of
Section 406 of ERISA or Section 4975 of the Code or cause the Servicer, the
Originator or the Trustee to be deemed a fiduciary of such Plan or result in the
imposition of an excise tax under Section 4975 of the Code.
(3) Notwithstanding anything to the contrary contained
herein, (A) neither the Class C Subsidiary Certificate nor the Class C Master
Certificate, nor any interest therein, shall be transferred, sold or otherwise
disposed of to a "disqualified organization," within the meaning of Section
860E(e)(5) of the Code (a "Disqualified Organization"), including, but not
limited to, (i) the United States, a state or political subdivision thereof, a
foreign government, an international organization or an agency or
instrumentality of any of the foregoing, (ii) an
9-2
organization (other than a cooperative described in Section 521 of the Code)
which is exempt from the taxes imposed by Chapter 1 of the Code and not subject
to the tax imposed on unrelated business income by Section 511 of the Code, or
(iii) a cooperative described in Section 1381(a)(2)(C) of the Code, and (B)
prior to any registration of any transfer, sale or other disposition of the
Class C Subsidiary Certificate or Class C Master Certificate, the proposed
transferee shall deliver to the Trustee, under penalties of perjury, an
affidavit that such transferee is not a Disqualified Organization, with respect
to which the Trustee shall have no actual knowledge that such affidavit is
false, and the transferor and the proposed transferee shall each deliver for the
Trustee an affidavit with respect to any other information reasonably required
by the Trustee pursuant to the REMIC Provisions, including, without limitation,
information regarding the transfer of noneconomic residual interests and
transfers of any residual interest to or by a foreign person; provided, however,
that, upon the delivery to the Trustee of an Opinion of Counsel, in form and
substance satisfactory to the Trustee and rendered by Independent counsel, to
the effect that the beneficial ownership of the Class C Subsidiary Certificate
or the Class C Master Certificate, as the case may be, by any Disqualified
Organization will not result in the imposition of federal income tax upon the
Subsidiary REMIC or the Master REMIC or any Certificateholder or any other
person or otherwise adversely affect the status of the Subsidiary REMIC or the
Master REMIC as a REMIC, the foregoing prohibition on transfers, sales and other
dispositions, as well as the foregoing requirement to deliver a certificate
prior to any registration thereof, shall, with respect to such Disqualified
Organization, terminate. Notwithstanding any transfer, sale or other disposition
of the Class C Subsidiary Certificate or Class C Master Certificate, or any
interest therein, to a Disqualified Organization or the registration thereof in
the Certificate Register, such transfer, sale or other disposition and any
registration thereof, unless accompanied by the Opinion of Counsel described in
the preceding sentence, shall be deemed to be void and of no legal force or
effect whatsoever and such Disqualified Organization shall be deemed to not be
the Class C Subsidiary or Class C Master Certificateholder, as the case may be,
for any purpose hereunder, including, but not limited to, the receipt of
distributions on the Class C Subsidiary Certificate or Class C Master
Certificate, and shall be deemed to have no interest whatsoever in the Class C
Subsidiary Certificate or Class C Master Certificate. Each Class C Subsidiary or
Class C Master Certificateholder, by his acceptance thereof, shall be deemed for
all purposes to have consented to the provisions of this Section 9.02(b)(3).
(4) Any transfer, sale or other disposition not in
compliance with the provisions of this Section 9.02(b) shall be deemed to be
void and of no legal force or effect whatsoever and such transferee shall be
deemed to not be the Certificateholder for any purpose hereunder, including, but
not limited to, the receipt of distributions on such Certificate, and shall be
deemed to have no interest whatsoever in such Certificate.
(5) The Trustee shall give notice to Standard & Poor's,
Moody's and Fitch promptly following any transfer, sale or other disposition of
a Class B-3I, Class C Subsidiary or Class C Master Certificate.
c. At the option of a Certificateholder, Certificates may be
exchanged for other Certificates of authorized denominations of a like aggregate
original denomination, upon surrender of such Certificates to be exchanged at
such office. Whenever any Certificates are so surrendered for exchange, the
Trustee shall execute and deliver the Certificates which the
9-3
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for transfer or exchange shall be duly endorsed by, or
shall be accompanied by a written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the holder thereof or
his or her attorney duly authorized in writing.
d. Except as provided in paragraph (e) below, the Book-Entry
Certificates shall at all times remain registered in the name of the Depository
or its nominee and at all times: (i) registration of the Class A, Class M-1,
Class M-2 and Class B Certificates may not be transferred by the Trustee except
to another Depository; (ii) the Depository shall maintain book-entry records
with respect to the Certificate Owners and with respect to ownership and
transfers of such Class A, Class M-1, Class M-2 and Class B Certificates; (iii)
ownership and transfers of registration of the Class A, Class M-1, Class M-2 and
Class B Certificates on the books of the Depository shall be governed by
applicable rules established by the Depository; (iv) the Depository may collect
its usual and customary fees, charges and expenses from its Depository
Participants; (v) the Trustee shall deal with the Depository, Depository
Participants and indirect participating firms as representatives of the
Certificate Owners of the Class A, Class M and Class B Certificates for purposes
of exercising the rights of Holders under this Agreement, and requests and
directions for and votes of such representatives shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; and
(vi) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository Participant
or brokerage firm representing such Certificate Owner. Each Depository
Participant shall only transfer Book-Entry Certificates of Certificate Owners it
represents or of brokerage firms for which it acts as agent in accordance with
the Depository's normal procedures.
e. If (x) the Seller or the Depository advises the Trustee in
writing that the Depository is no longer willing or able properly to discharge
its responsibilities as Depository and (y) the Trustee or the Originator is
unable to locate a qualified successor or (z) the Originator at its sole option
advises the Trustee in writing that it elects to terminate the book-entry system
through the Depository, the Trustee shall notify all Certificate Owners, through
the Depository, of the occurrence of any such event and of the availability of
definitive, fully registered Class A Certificates, Class M Certificates and
Class B Certificates (the "Definitive Certificates") to Certificate Owners
requesting the same. Upon surrender to the Trustee of the Class A Certificates,
Class M-1 Certificates, Class M-2 Certificates and Class B Certificates by the
Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall issue the Definitive Certificates. Neither the
Originator nor the Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying on,
such instructions. Upon the issuance of Definitive Certificates all references
herein to obligations imposed upon or to be performed by the Depository shall be
deemed to be imposed upon and performed by the Trustee, to the extent applicable
with respect to such Definitive Certificates and the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder.
9-4
f. On or prior to the Closing Date, there shall be delivered to
the Depository one Class A-1 Certificate, one Class A-2 Certificate, one Class
A-3 Certificate, one A-4 Class Certificate, one Class A-5 Certificate, one Class
A-6 Certificate, one Class A-7 Certificate, one Class M-1 Certificate, one Class
M-2 Certificate, one Class B-1 Certificate and one Class B-2 Certificate, each
in registered form registered in the name of the Depository's nominee, Cede &
Co., the total face amount of which represents 100% of the related Original
Principal Balance, respectively. If, however, the aggregate principal amount of
a Class of Class A Certificates, Class M Certificates or Class B Certificates
exceeds $400,000,000, one such Class A Certificate, Class M Certificate and/or
Class B Certificate will be issued with respect to each $400,000,000 of
principal amount and an additional Certificate of such Class or Classes will be
issued with respect to any remaining principal amount. Each such Class A, Class
M and Class B Certificate registered in the name of the Depository's nominee
shall bear the following legend:
"Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC") to Issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein."
SECTION 9.03. No Charge; Disposition of Void Certificates.
-------------------------------------------
No service charge shall be made to a Certificateholder for any transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates. All
Certificates surrendered for transfer and exchange shall be disposed of in a
manner approved by the Trustee.
SECTION 9.04. Mutilated, Destroyed, Lost or Stolen Certificates.
-------------------------------------------------
If (a) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (b) there is delivered to
the Certificate Registrar and the Trustee such security or indemnity as may be
required by each to save it harmless, then in the absence of notice to the
Certificate Registrar or the Trustee that such Certificate has been acquired by
a bona fide purchaser, the Trustee shall execute and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and original denomination. Upon the issuance of any
new Certificate under this Section 9.04, the Trustee may require the payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses connected therewith. Any
duplicate Certificate issued pursuant to this Section 9.04 shall constitute
complete and indefeasible evidence of ownership of the Percentage Interest, as
if originally issued, whether or not the mutilated, destroyed, lost or stolen
Certificate shall be found at any time.
9-5
SECTION 9.05. Persons Deemed Owners.
---------------------
Prior to due presentation of a Certificate for registration of
transfer, the Servicer, the Seller, the Trustee, the Paying Agent and the
Certificate Registrar may treat the person in whose name any Certificate is
registered as the owner of such Certificate for the purpose of receiving
remittances pursuant to Section 8.01 and for all other purposes whatsoever, and
none of the Servicer, the Seller, the Trustee, the Certificate Registrar, the
Paying Agent or any agent of the Servicer, the Seller, the Trustee, the Paying
Agent or the Certificate Registrar shall be affected by notice to the contrary.
SECTION 9.06. Access to List of Certificateholders' Names and
-----------------------------------------------
Addresses.
---------
The Certificate Registrar will furnish to the Trustee and the Servicer,
within five days after receipt by the Certificate Registrar of a request
therefor from the Trustee in writing, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Certificateholders as of
the most recent Record Date. If Holders of Certificates evidencing, as to any
Class, Percentage Interests representing 25% or more (hereinafter referred to as
"Applicants") apply in writing to the Trustee, and such application states that
the Applicants desire to communicate with other Certificateholders with respect
to their rights under this Agreement or under the Certificates and is
accompanied by a copy of the communication which such Applicants propose to
transmit, then the Trustee shall, within five Business Days after the receipt of
such application, afford such Applicants access during normal business hours to
the most recent list of Certificateholders held by the Trustee. If such list is
as of a date more than 90 days prior to the date of receipt of such Applicants'
request, the Trustee shall promptly request from the Certificate Registrar a
current list as provided above, and shall afford such Applicants access to such
list promptly upon receipt. Every Certificateholder, by receiving and holding a
Certificate, agrees with the Certificate Registrar and the Trustee that none of
the Originator, the Certificate Registrar or the Trustee shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Certificateholders hereunder, regardless of the source from
which such information was derived.
SECTION 9.07. Authenticating Agents.
---------------------
The Trustee may appoint one or more Authenticating Agents with power to
act on its behalf and subject to its direction in the execution and delivery of
the Certificates. For all purposes of this Agreement, the execution and delivery
of Certificates by the Authenticating Agent pursuant to this Section shall be
deemed to be the execution and delivery of Certificates "by the Trustee."
9-6
ARTICLE X
INDEMNITIES
-----------
SECTION 10.01. Seller's and Originator's Indemnities.
-------------------------------------
The Seller and Originator will jointly and severally defend and
indemnify the Trust, the Trustee (including the Custodian, the Paying Agent and
any other agents of the Trustee) and the Certificateholders against any and all
costs, expenses, losses, damages, claims and liabilities, including reasonable
fees and expenses of counsel and expenses of litigation of any third-party
claims (i) arising out of or resulting from the origination of any Contract
(including but not limited to truth in lending requirements) or the servicing of
such Contract prior to its transfer to the Trust (but only to the extent such
cost, expense, loss, damage, claim or liability is not provided for by the
Originator's repurchase of such Contract pursuant to Section 3.06) or (ii)
arising out of or resulting from the use or ownership of any Manufactured Homes
by the Originator or the Servicer or any Affiliate of either. Notwithstanding
any other provision of this Agreement, the obligation of the Originator under
this Section shall not terminate upon a Service Transfer pursuant to Article
VII, except that the obligation of the Originator under this Section shall not
relate to the actions of any subsequent Servicer after a Service Transfer.
SECTION 10.02. Liabilities to Obligors.
-----------------------
No obligation or liability to any Obligor under any of the Contracts is
intended to be assumed by the Trust or the Certificateholders under or as a
result of this Agreement and the transactions contemplated hereby and, to the
maximum extent permitted and valid under mandatory provisions of law, the Trust
and the Certificateholders expressly disclaim such assumption.
SECTION 10.03. Tax Indemnification.
-------------------
The Originator agrees to pay, and to indemnify, defend and hold
harmless the Trust, the Trustee (including the Custodian, the Paying Agent and
any other agents of the Trustee) and the Certificateholders from, any taxes
which may at any time be asserted with respect to, and as of the date of, the
transfer of the Contracts to the Trust, including, without limitation, any
sales, gross receipts, general corporation, personal property, privilege or
license taxes (but not including any federal, state or other taxes arising out
of the creation of the Trust and the issuance of the Certificates), any tax
imposed on the Trust as a result of the Originator's repurchase of any Contract
pursuant to Section 3.06(c), and costs, expenses and reasonable counsel fees in
defending against the same, whether arising by reason of the acts to be
performed by the Originator, the Seller, the Servicer or the Trustee under this
Agreement or imposed against the Trust, a Certificateholder or otherwise.
SECTION 10.04. Servicer's Indemnities.
----------------------
The Servicer shall defend and indemnify the Trust, the Trustee
(including the Custodian, the Paying Agent and any other agents of the Trustee)
and the Certificateholders against any and all costs, expenses, losses, damages,
claims and liabilities, including reasonable fees and expenses of counsel and
expenses of litigation, in respect of any action taken or omitted to be
10-1
taken by the Servicer with respect to any Contract. This indemnity shall survive
any Service Transfer (but the original Servicer's obligations under this Section
10.04 shall not relate to any actions of any subsequent Servicer after a Service
Transfer) and any payment of the amount owing under, or any repurchase by the
Originator of, any such Contract.
SECTION 10.05. Operation of Indemnities.
------------------------
Indemnification under this Article shall include, without limitation,
reasonable fees and expenses of counsel and expenses of litigation. If the
Originator or the Servicer has made any indemnity payments to the Trustee
pursuant to this Article and the Trustee thereafter collects any of such amounts
from others, the Trust will repay such amounts collected to the Originator or
the Servicer, as the case may be, without interest.
SECTION 10.06. REMIC Tax Matters.
-----------------
If Class C Subsidiary Certificateholders or Class C Master
Certificateholders, pursuant to Section 6.06, pay any taxes or charges imposed
upon the Subsidiary REMIC or the Master REMIC, as the case may be, as a REMIC or
otherwise, such taxes or charges, except to the extent set forth in the
following proviso, shall be expenses and costs of the Trust and the Class C
Subsidiary Certificateholders or Class C Master Certificateholders shall be
entitled to be reimbursed therefor out of the Certificate Account as provided in
Section 8.03; provided, however, that any such taxes or charges shall not be
expenses or costs of the Trust, nor will the Class C Subsidiary
Certificateholders or Class C Master Certificateholders be entitled to
reimbursement therefor out of the Certificate Account, if and to the extent that
such taxes or charges resulted from a failure by the Originator, the Trustee or
any Servicer to comply with the provisions of Section 2.04.
10-2
ARTICLE XI
THE TRUSTEE
-----------
SECTION 11.01. Duties of Trustee.
-----------------
The Trustee, prior to the occurrence of an Event of Termination and
after the curing of all Events of Termination which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If an Event of Termination has occurred (which has not
been cured), the Trustee shall exercise such of the rights and powers vested in
it by this Agreement, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform as to form to the requirements of this Agreement.
Subject to Section 11.03, no provision of this Agreement shall be
construed to relieve the Trustee from liability for its own negligent action,
its own negligent failure to act or its own misconduct; provided, however, that:
a. Prior to the occurrence of an Event of Termination, and after
the curing of all such Events of Termination which may have occurred, the duties
and obligations of the Trustee shall be determined solely by the express
provisions of this Agreement, the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement, no implied covenants or obligations shall be read into this Agreement
against the Trustee and, in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of this Agreement;
b. The Trustee shall not be liable for an error of judgment made
in good faith by a Responsible Officer of the Trustee, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
c. The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Certificateholders with aggregate Percentage Interests
representing 25% or more of the Trust relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Agreement; and
d. The Trustee shall not be charged with knowledge of any event
referred to in Section 7.01 unless a Responsible Officer of the Trustee at the
Corporate Trust Office obtains actual knowledge of such event or the Trustee
receives written notice of such event from the Servicer or the Holders of
Certificates evidencing, as to any Class, Percentage Interests representing 25%
or more.
11-1
None of the provisions contained in this Agreement shall in any event
require the Trustee to perform, or be responsible for the manner of performance
of, any of the obligations of the Originator, the Seller or the Servicer under
this Agreement, except during such time, if any, as the Trustee shall be the
successor to, and be vested with the rights, duties, powers and privileges of,
the Servicer in accordance with the terms of this Agreement. The Trustee shall
not be required to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if there is reasonable ground for believing that
the repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.
SECTION 11.02. Certain Matters Affecting the Trustee.
-------------------------------------
Except as otherwise provided in Section 11.01:
a. The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate, certificate
of a Servicing Officer, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent, order,
appraisal, bond or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
b. The Trustee may consult with counsel and any opinion of any
counsel for the Originator, the Seller or the Servicer shall be full and
complete authorization and protection in respect of any action taken or suffered
or omitted by it hereunder in good faith and in accordance with such Opinion of
Counsel;
c. The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation hereunder or in relation hereto, at the request, order or
direction of any of the Certificateholders, pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; provided, however, that nothing
contained herein shall relieve the Trustee of the obligations, upon the
occurrence of an Event of Termination (which has not been cured), to exercise
such of the rights and powers vested in it by this Agreement, and to use the
same degree of care and skill in their exercise as a prudent man would exercise
or use under the circumstances in the conduct of his own affairs;
d. Prior to the occurrence of an Event of Termination and after
the curing of all Events of Termination which may have occurred, the Trustee
shall not be bound to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing so to do by Holders of Certificates evidencing, as to any
Class, Percentage Interests representing 25% or more; provided, however, that if
the payment within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Agreement, the Trustee may require
reasonable indemnity against such cost, expense or liability as a condition to
so proceeding. The
11-2
reasonable expense of every such examination shall be paid by the Servicer or,
if paid by the Trustee, shall be reimbursed by the Servicer upon demand; and
e. The Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys or a custodian and shall not be liable for any acts or omissions of
such agents, attorneys or custodians if appointed by it with due care hereunder.
SECTION 11.03. Trustee Not Liable for Certificates or Contracts.
------------------------------------------------
The Trustee assumes no responsibility for the correctness of the
recitals contained herein or in the Certificates (other than the Trustee's
execution thereof). The Trustee makes no representations as to the validity or
sufficiency of this Agreement, of the Certificates (other than its execution
thereof) or of any Contract, Contract File, Land-and-Home Contract File or
related document. The Trustee shall not be accountable for the use or
application by the Servicer, the Originator or the Seller of funds paid to the
Originator or the Seller, as applicable, in consideration of conveyance of the
Contracts to the Trust by the Originator and the Seller or deposited into or
withdrawn from the Certificate Account by the Servicer.
SECTION 11.04. Rights of Certificateholders to Direct Trustee and to
-----------------------------------------------------
Waive Event of Termination.
--------------------------
Holders of Class A Certificates, Holders of Class M Certificates and
Holders of Class B Certificates evidencing, as to each such Class, Percentage
Interests representing 25% or more shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee; provided,
however, that, subject to Section 11.01, the Trustee shall have the right to
decline to follow any such direction if the Trustee being advised by counsel
determines that the action so directed may not lawfully be taken, or if the
Trustee in good faith shall, by a Responsible Officer or Officers of the
Trustee, determine that the proceedings so directed would be illegal or involve
it in personal liability or be unduly prejudicial to the rights of
Certificateholders not parties to such direction; and provided further that
nothing in this Agreement shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such
direction by the Certificateholders; and provided further that the Trustee shall
instead follow the directions of Holders of Class A Certificates, Holders of
Class M Certificates and Holders of Class B Certificates evidencing, as to each
such Class, Percentage Interests aggregating 51% or more whenever it receives
conflicting directions from Class A Certificateholders, Class M
Certificateholders and Class B Certificateholders. Holders of Class A
Certificates, Holders of Class M Certificates and Holders of Class B
Certificates evidencing, as to each such Class, Percentage Interests
representing 51% or more may on behalf of Certificateholders waive any past
Event of Termination hereunder and its consequences, except a default in respect
of a covenant or provision hereof which under Section 12.07 cannot be modified
or amended without the consent of all Certificateholders, and upon any such
waiver, such Event of Termination shall cease to exist and shall be deemed to
have been cured for every purpose of this Agreement; but no such waiver shall
extend to any subsequent or other Event of Termination or impair any right
consequent thereon. Following the Class M-2 Cross-Over Date, if all
distributions payable to the Class A Certificateholders and the Class M
Certificateholders have either been made or provided
11-3
for in accordance with this Agreement, then the Holders of Class B-1
Certificates may exercise the rights given to the Class A Certificateholders,
the Class M Certificateholders and Class B-1 Certificateholders under this
Section. Following the Class B-1 Cross-Over Date, if all distributions payable
to the Class A Certificateholders and the Class M Certificateholders have either
been made or provided for in accordance with this Agreement, then the Holders of
Class B-2 Certificates may exercise the rights given to the Class A
Certificateholders, the Class M Certificateholders and Class B-1
Certificateholders under this Section.
SECTION 11.05. The Servicer to Pay Trustee's Fees and Expenses.
-----------------------------------------------
The Servicer agrees:
a. to pay to the Trustee reasonable compensation for all services
rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
including the services provided in connection with any auctions pursuant to
Section 8.05(e);
b. except as otherwise expressly provided herein, to reimburse
the Trustee, to the extent requested by the Trustee, for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Agreement (including the reasonable
compensation and the expenses and disbursements of its agents and counsel, and
reasonable compensation expenses and disbursements in connection with any
auctions pursuant to Section 8.05(e)), except any such expense, disbursement or
advance as may be attributable to its negligence or bad faith; and
c. to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration of
this trust and its duties hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
All such payments by the Servicer shall be made from its own funds. The
covenants in this Section 11.05 shall be for the benefit of the Trustee in its
capacities as Trustee, Paying Agent and Certificate Registrar hereunder, and
shall survive the termination of this Agreement.
SECTION 11.06. Eligibility Requirements for Trustee.
------------------------------------
The Trustee hereunder shall at all times be a financial institution
organized and doing business under the laws of the United States of America or
any State, authorized under such laws to exercise corporate trust powers and a
Title I approved lender pursuant to FHA Regulations, shall not be an Affiliate
of the Originator, and shall have a combined capital and surplus of at least
$50,000,000 or shall be a member of a bank holding system the aggregate combined
capital and surplus of which is $50,000,000, provided that the Trustee's
separate capital and surplus shall at all times be at least the amount required
by Section 310(a)(2) of the Trust Indenture Act of 1939, as amended. If such
Person publishes reports of condition at least annually, pursuant to law or to
the requirements of a supervising or examining authority, then for the purposes
of this Section 11.06, the combined capital and surplus of such Person shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In
11-4
addition, the Trustee shall at all times have a long-term deposit rating (or, if
the Trustee is a wholly owned subsidiary of a bank holding company system and
not rated, the bank holding company shall have a long-term senior unsecured debt
rating) from Standard & Poor's of at least BBB, or as shall be otherwise
acceptable to Standard & Poor's, and a rating from ▇▇▇▇▇'▇ (if rated by ▇▇▇▇▇'▇)
of at least Baa3, or as shall be otherwise acceptable to ▇▇▇▇▇'▇ and Fitch. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 11.06, the Trustee shall resign immediately in the
manner and with the effect specified in Section 11.07.
SECTION 11.07. Resignation or Removal of Trustee.
---------------------------------
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Servicer and the
Originator. A copy of any such notice shall be sent to Standard & Poor's,
▇▇▇▇▇'▇ and Fitch. Upon receiving such notice of resignation, the Originator
shall promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to each of the Servicer and the
Originator and one copy to the successor Trustee. If no successor Trustee shall
have been so appointed and shall have accepted appointment within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 11.06 and shall fail to resign after written
request therefor by the Originator, or if at any time the Trustee shall be
legally unable to act, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Originator may remove the Trustee. If the Originator shall have removed the
Trustee under the authority of the immediately preceding sentence, the
Originator shall promptly appoint a successor Trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor Trustee.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 11.07 shall
not become effective until acceptance of appointment by the successor Trustee as
provided in Section 11.08.
SECTION 11.08. Successor Trustee.
-----------------
Any successor Trustee appointed as provided in Section 11.07 shall
execute, acknowledge and deliver to the Servicer, the Originator and to its
predecessor Trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor Trustee shall become
effective and such successor Trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as Trustee. The predecessor Trustee shall deliver or cause to be delivered
to the successor Trustee the Contracts, Contract Files and Land-and-Home
Contract Files and any related documents and statements held by it hereunder;
and, if the Land-and-Home Contract Files are then held by a custodian
11-5
pursuant to a custodial agreement, the predecessor Trustee and the custodian
shall amend such custodial agreement to make the successor Trustee the successor
to the predecessor Trustee thereunder; and the Servicer, the Originator and the
predecessor Trustee shall execute and deliver such instruments and do such other
things as may reasonably be required for fully and certainly vesting and
confirming in the successor Trustee all such rights, powers, duties and
obligations.
No successor Trustee shall accept appointment as provided in this
Section 11.08 unless at the time of such acceptance such successor Trustee shall
be eligible under the provisions of Section 11.06.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 11.08, the Servicer shall cause notice of the succession of such
Trustee hereunder to be mailed to each Certificateholder at their addresses as
shown in the Certificate Register. If the Servicer fails to mail such notice
within ten days after acceptance of appointment by the successor Trustee, the
successor Trustee shall cause such notice to be mailed at the expense of the
Servicer.
SECTION 11.09. Merger or Consolidation of Trustee.
----------------------------------
Any Person into which the Trustee may be merged or converted or with
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any Person
succeeding to the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided such Person shall be eligible under
the provisions of Section 11.06, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. The Trustee shall promptly notify Standard & Poor's,
▇▇▇▇▇'▇ and Fitch in the event it is a party to any merger, conversion or
consolidation.
SECTION 11.10. Tax Returns.
-----------
Upon the Servicer's request, the Trustee will furnish the Servicer with
all such information as the Servicer may reasonably require in connection with
preparing all tax returns of the Subsidiary REMIC and the Master REMIC and the
Trustee shall execute such returns.
SECTION 11.11. Obligor Claims.
--------------
In connection with any offset defenses, or affirmative claims for
recovery, asserted in legal actions brought by Obligors under one or more
Contracts based upon provisions therein complying with, or upon other rights or
remedies arising from, any legal requirements applicable to the Contracts,
including, without limitation, the Federal Trade Commission's Trade Regulation
Rule Concerning Preservation of Consumers' Claims and Defenses (16 C.F.R. ss.
433) as amended from time to time:
a. The Trustee is not, and shall not be deemed to be, either in
any individual capacity, as trustee hereunder or otherwise, a creditor, or a
joint venturer with or an Affiliate of, or acting in concert or cooperation
with, any seller of home improvements, in the arrangement, origination or making
of Contracts. The Trustee is the holder of the Contracts only as trustee on
behalf of the Certificateholders, and not as a principal or in any individual or
personal capacity;
11-6
b. The Trustee shall not be personally liable for or obligated to
pay Obligors any affirmative claims asserted thereby, or responsible to
Certificateholders for any offset defense amounts applied against Contract
payments, pursuant to such legal actions;
c. The Trustee will pay, solely from available Trust monies,
affirmative claims for recovery by Obligors only pursuant to final judicial
orders or judgments, or judicially approved settlement agreements, resulting
from such legal actions;
d. The Trustee will comply with judicial orders and judgments
which require its actions or cooperation in connection with Obligors' legal
actions to recover affirmative claims against Certificateholders.
e. The Trustee will cooperate with and assist Certificateholders
in their defense of legal actions by Obligors to recover affirmative claims if
such cooperation and assistance is not contrary to the interests of the Trustee
as a party to such legal actions and if the Trustee is satisfactorily
indemnified for all liability, costs and expenses arising therefrom; and
f. The Originator hereby agrees to indemnify, hold harmless and
defend the Trustee, Certificateholders from and against any and all liability,
loss, costs and expenses of the Trustee, Certificateholders resulting from any
affirmative claims for recovery asserted or collected by Obligors under the
Contracts. Notwithstanding any other provision of this Agreement, the obligation
of the Originator under this Section 11.11(f) shall not terminate upon a Service
Transfer pursuant to Article VII.
SECTION 11.12. Appointment of Co-Trustee or Separate Trustee.
---------------------------------------------
The Servicer shall have the power from time to time to appoint one or
more persons or corporations to act either as co-trustees jointly with the
Trustee, or as separate trustees, or as custodians, for the purpose of
conforming to any legal requirement, restriction or condition (i) with respect
to the holding of the Contracts, the Contract Files and the Land-and-Home
Contract Files or (ii) with respect to the enforcement of a Contract in any
state in which a Manufactured Home is located or in any state in which any
portion of the Trust is located. The separate trustees, co-trustees, or
custodians so appointed shall be trustees or custodians for the benefit of all
Certificateholders and shall, subject to the provisions of the following
paragraph, have such powers, rights and remedies as shall be specified in the
instrument of appointment; provided, however, that no such appointment shall, or
shall be deemed to, constitute the appointee an agent of the Trustee.
Every separate trustee, co-trustee and custodian shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(A) all powers, duties, obligations and rights conferred
upon the Trustee in respect of the receipt, custody and payment of
monies shall be exercised solely by the Trustee;
(B) all other rights, powers, duties and obligations
conferred or imposed upon the Trustee, to the extent also imposed upon
such separate trustees, co-trustees or custodians, shall be conferred
or imposed upon and exercised or performed by the
11-7
Trustee and such separate trustee, co-trustee, or custodian jointly,
except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed, the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including holding of the
Trust or any portion thereof in any such jurisdiction) shall be
exercised and performed by such separate trustee, co-trustee, or
custodian;
(C) no separate trustee, co-trustee or custodian
hereunder shall be personally liable by reason of any act or omission
of any other separate trustee, co-trustee or custodian hereunder; and
(D) the Servicer may at any time accept the resignation
of or remove any separate trustee, co-trustee or custodian, so
appointed by it.
If any separate trustee, co-trustee or custodian shall die, become
incapable of acting, resign or be removed, all of its estates, properties,
rights, remedies and trusts shall vest in and be exercised by the Trustee, to
the extent permitted by law, without the appointment of a new or successor
trustee or custodian. The reasonable fees and expenses of any such separate
trustee, co-trustee or custodian shall be treated as additional fees and
expenses of the Trustee subject to Section 11.05 and payable by the Servicer if
and only to the extent the Servicer shall have consented in writing to his or
its appointment, which consent shall not be unreasonably withheld.
SECTION 11.13. Agents of Trustee.
-----------------
To the extent not prohibited by law and not inconsistent with the terms
of this Agreement (including, without limitation, Section 11.12), the Trustee
may, with the prior consent of the Servicer, appoint one or more agents to carry
out ministerial matters on behalf of the Trustee under this Agreement.
11-8
ARTICLE XII
MISCELLANEOUS
-------------
SECTION 12.01. Servicer Not to Assign Duties or Resign; Delegation of
------------------------------------------------------
Servicing Functions.
-------------------
The Servicer may not sell or assign its rights and duties as Servicer
hereunder, except as expressly provided for herein, provided that the Servicer
may pledge or assign the right to receive all or any portion of the Monthly
Servicing Fee payable to it. The Servicer shall not resign from the obligations
and duties hereby imposed on it except upon determination that the performance
of its duties hereunder is no longer permissible under applicable law or is in
material conflict by reason of applicable law with any other activities carried
on by it. Any such determination permitting the resignation of the Servicer
shall be evidenced by an Opinion of Counsel for the Servicer to such effect
addressed and delivered to the Trustee. No such resignation shall become
effective until the Trustee or a successor servicer shall have assumed the
responsibilities and obligations of the Servicer in accordance with Sections
7.02 and 7.03.
Notwithstanding the foregoing:
a. Any Person into which the Servicer may be merged or
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Servicer shall be a party, or any Person succeeding
to the business of the Servicer, shall be the successor of the Servicer
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor or surviving Person to
the Servicer shall satisfy the criteria set forth in the definition of an
Eligible Servicer. The Servicer shall promptly notify Standard & Poor's, ▇▇▇▇▇'▇
and Fitch of any such merger to which it is a party.
b. Any Person acquiring all or substantially all of the
manufactured housing division of Conseco Finance Corp., who assumes all of the
obligations of the Servicer hereunder and who satisfies the criteria set forth
in the definition of "Eligible Servicer," shall become the Servicer hereunder.
The Servicer shall promptly notify Standard & Poor's, ▇▇▇▇▇'▇ and Fitch of any
such acquisition.
c. Conseco Finance Corp., if it is the Servicer, may delegate
some or all of its servicing duties to a wholly owned subsidiary of Conseco
Finance Corp., for so long as said subsidiary remains, directly or indirectly, a
wholly owned subsidiary of Conseco Finance Corp. Notwithstanding any such
delegation Conseco Finance Corp. shall retain all of the rights and obligations
of the Servicer hereunder.
SECTION 12.02. Maintenance of Office or Agency.
-------------------------------
The Trustee will maintain in St. ▇▇▇▇, Minnesota, an office or agency
where Certificates may be surrendered for registration of transfer or exchange
and where notices and demands to or upon the Trustee in respect of the
Certificates and this Agreement may be served. On the date hereof the Trustee's
office for such purposes is located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇. The Trustee will give prompt
written notice
12-1
to Certificateholders of any change in the location of the Certificate Register
or any such office or agency.
SECTION 12.03. Termination.
-----------
a. This Agreement shall terminate (after distribution of all
amounts due to Certificateholders pursuant to Sections 8.01 and 8.03) on the
earlier of (a) the Remittance Date on which the Pool Scheduled Principal Balance
is reduced to zero and all amounts payable to Certificateholders on such
Remittance Date have been distributed to Certificateholders or (b) the
Remittance Date on which the Class C Subsidiary Certificateholder purchases the
Contracts pursuant to Section 8.05; provided, that in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late Ambassador of
the United States to the Court of St. ▇▇▇▇▇, living on the date hereof; and
provided further, that the Servicer's and the Originator's representations and
warranties and indemnities by the Originator and the Servicer shall survive
termination.
b. Notice of any termination, specifying the Final Remittance
Date (which shall be a date that would otherwise be a Remittance Date) upon
which all Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee (upon direction by the Originator ten days prior to the date such
notice is to be mailed) by letter to Standard & Poor's, Fitch, ▇▇▇▇▇'▇ and the
Certificateholders mailed no later than the fifth Business Day of the month of
the Final Remittance Date specifying (1) the Final Remittance Date upon which
final payment on the Certificates will be made upon presentation and surrender
of Certificates at the office or agency of the Trustee therein designated; (2)
the amount of any such final payment; and (3) that the Record Date otherwise
applicable to such Remittance Date is not applicable, payments being made only
upon presentation and surrender of the Certificates at the office or agency of
the Trustee therein specified. Any notice of purchase of Contracts by the
Originator or the Servicer pursuant to Section 8.05 shall constitute the
adoption by the Trustee on behalf of the Certificateholders of a plan of
complete liquidation of the Subsidiary REMIC and the Master REMIC within the
meaning of Section 860F of the Code on the date such notice is given when signed
by the Trustee. Each such notice shall, to the extent required by the REMIC
Provisions or other applicable law, be signed on behalf of the Subsidiary REMIC
and the Master REMIC by the Trustee. The Trustee shall give such notice to the
Certificate Registrar at the time such notice is given to the
Certificateholders. In the event such notice is given in connection with the
sale of the Contracts pursuant to Section 8.05, the Class C Subsidiary
Certificateholder or the Trustee, as applicable, shall deposit in the
Certificate Account on the Final Remittance Date in immediately available funds
an amount equal to the above-described purchase price and upon such deposit
Certificateholders will be entitled to the amount of such purchase price but not
amounts in excess thereof, all as provided herein. Upon certification to the
Trustee by a Servicing Officer, following such final deposit the Trustee shall
promptly release to the purchaser of the Contracts pursuant to Section 8.05 the
Contract Files for the remaining Contracts, and the Trustee shall execute all
assignments, endorsements and other instruments necessary to effectuate such
transfer.
c. Upon presentation and surrender of the Certificates, the
Trustee shall cause to be distributed from the Certificate Account, in the
following order of priority, to Certificateholders
12-2
on the Final Remittance Date in proportion to their respective Percentage
Interests an amount equal to (i) as to Class A Certificates, the Class A
Principal Balance, together with any Unpaid Class A Interest Shortfall and one
month's interest at the related Remittance Rate on the related Class,
respectively (calculated in the manner specified in Section 1.03), (ii) as to
Class M-1 Certificates, the Class M-1 Principal Balance together with any Unpaid
Class M-1 Interest Shortfall, any Unpaid Class M-1 Liquidation Loss Interest
Shortfall and one month's interest at the Class M-1 Remittance Rate on the Class
M-1 Principal Balance, (iii) as to Class M-2 Certificates, the Class M-2
Principal Balance together with any Unpaid Class M-2 Interest Shortfall, any
Unpaid Class M-2 Liquidation Loss Interest Shortfall and one month's interest at
the Class M-2 Remittance Rate on the Class M-2 Principal Balance, (iv) as to
Class B-1 Certificates, the Class B-1 Principal Balance together with any Unpaid
Class B-1 Interest Shortfall, any Unpaid Class B-1 Liquidation Loss Interest
Shortfall and one month's interest at the Class B-1 Remittance Rate on the Class
B-1 Principal Balance, (v) as to Class B-2 Certificates, the Class B-2 Principal
Balance together with any Unpaid Class B-2 Interest Shortfall and one month's
interest at the Class B-2 Remittance Rate on the Class B-2 Principal Balance,
(vi) as to Class B-3I Certificates, any Unpaid Class B-3I Shortfall, and (vii)
as to Class C Master Certificates, the amount which remains on deposit in the
Certificate Account (other than amounts retained to meet claims) after
application pursuant to clauses (i)-(vi) above. The distribution on the Final
Remittance Date shall be in lieu of the distribution otherwise required to be
made on such Remittance Date in respect of each Class of Certificates.
d. In the event that all of the Certificateholders do not
surrender their Certificates for cancellation within three months after the time
specified in the above-mentioned written notice, the Originator shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Originator shall transfer
to itself all amounts remaining on deposit in the Certificate Account, to hold
in trust for Certificateholders who have not surrendered their Certificates for
cancellation, together with the final record list of Certificateholders, and the
Originator shall take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets which remain in trust hereunder.
e. Each Certificateholder hereby irrevocably approves and
appoints the Trustee as its attorney-in-fact for the purposes of adoption of the
plan of complete liquidation.
SECTION 12.04. Acts of Certificateholders.
--------------------------
a. Except as otherwise specifically provided herein, whenever
Certificateholder approval, authorization, direction, notice, consent, waiver or
other action is required hereunder, such approval, authorization, direction,
notice, consent, waiver or other action shall be deemed to have been given or
taken on behalf of, and shall be binding upon, all Certificateholders if agreed
to by Holders of Certificates of the specified Class or Classes evidencing, as
to each such Class, Percentage Interests aggregating 51% or more.
b. Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by Certificateholders may be embodied
12-3
in and evidenced by one or more instruments of substantially similar tenor
signed by such Certificateholders in person or by agent duly appointed in
writing; and except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where required, to the Servicer. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 11.01) conclusive in favor of
the Trustee, the Servicer and the Originator if made in the manner provided in
this Section.
c. The fact and date of the execution by any Certificateholder of
any such instrument or writing may be proved in any reasonable manner which the
Trustee deems sufficient.
d. The ownership of Certificates shall be proved by the
Certificate Register.
e. Any request, demand, authorization, direction, notice,
consent, waiver or other act by a Certificateholder shall bind every holder of
every Certificate issued upon the registration of transfer thereof or in
exchange therefor or in lieu thereof, in respect of anything done, or omitted to
be done by the Trustee, the Servicer or the Originator in reliance thereon,
whether or not notation of such action is made upon such Security.
f. The Trustee may require such additional proof of any matter
referred to in this Section as it shall deem necessary.
SECTION 12.05. Calculations.
------------
Except as otherwise provided in this Agreement, all interest rate and
basis point calculations under this Agreement will be made on the basis of a
360-day year and twelve 30-day months and will be carried out to at least three
decimal places.
SECTION 12.06. Assignment or Delegation by Originator.
--------------------------------------
Except as specifically authorized hereunder, and except for its
obligations as Servicer which are dealt with under Article V and Article VII,
the Originator may not convey and assign or delegate any of its rights or
obligations hereunder absent the prior written consent of Holders of
Certificates of each Class evidencing, as to each such Class, Percentage
Interests aggregating 66 2/3% or more, and any attempt to do so without such
consent shall be void. It is understood that the foregoing does not prohibit the
pledge or assignment by the Originator of any right to payment pursuant to
Article VIII.
Notwithstanding the foregoing, any person into which the Originator may
be merged or consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Originator shall be a party, or any
Person succeeding to the business of the Originator, shall be the successor of
the Originator hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. The Originator shall promptly notify Standard &
Poor's, ▇▇▇▇▇'▇ and Fitch of any such merger to which it is a party.
12-4
SECTION 12.07. Amendment.
---------
a. This Agreement may be amended from time to time by the
Originator, the Servicer and the Trustee, without the consent of any of the
Certificateholders, to correct manifest error, to cure any ambiguity, to correct
or supplement any provisions herein which may be inconsistent with any other
provisions herein, as the case may be, to make such changes as are necessary to
maintain the status of each of the Subsidiary REMIC and the Master REMIC as a
"real estate mortgage investment conduit" under the REMIC Provisions of the Code
or to otherwise effectuate the benefits of such status to the Subsidiary REMIC,
the Master REMIC and the Certificateholders, including, without limitation, to
implement any provision permitted by law that would enable a REMIC to avoid the
imposition of any tax, to add or amend any provision as required by Standard &
Poor's, ▇▇▇▇▇'▇, Fitch or any other nationally recognized statistical rating
organization in order to improve or maintain the rating of any Class of Class A
Certificates, Class M Certificates or Class B Certificates, or to make any other
provisions with respect to matters or questions arising under this Agreement
that shall not be inconsistent with the provisions of this Agreement; provided,
however, that such action shall not, as evidenced by an Opinion of Counsel for
the Originator, adversely affect in any material respect the interests of any
Certificateholder.
b. This Agreement may also be amended from time to time by the
Servicer, the Originator and the Trustee, with the consent of Holders of
Certificates of each Class affected thereby evidencing, as to each such Class,
Percentage Interests aggregating 51% or more, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall (a) reduce
in any manner the amount of, or delay the timing of, collections of payments on
the Contracts or distributions which are required to be made on any Certificate,
(b) reduce the aforesaid percentage required to consent to any such amendment,
without the consent of the holders of all Certificates then outstanding, (c)
result in the disqualification of either the Subsidiary REMIC or the Master
REMIC as a REMIC under the Code, (d) adversely affect the status of either the
Subsidiary REMIC or the Master REMIC as a REMIC or the status of the Regular
Certificates as "regular interests" in the Master REMIC or (e) cause any tax
(other than any tax imposed on "net income from foreclosure property" under
Section 860G(c)(1) of the Code that would be imposed without regard to such
amendment) to be imposed on the Trust, including, without limitation, any tax
imposed on "prohibited transactions" under Section 860F(a)(1) of the Code or on
"contributions after the startup date" under Section 860G(d)(1) of the Code.
This Agreement may not be amended without the consent of all Class C
Certificateholders, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement which would
modify in any manner the rights of the Class C Certificateholders.
c. This Agreement shall not be amended under this Section without
the consent of 100% of Certificateholders if such amendment would result in the
disqualification of either Subsidiary REMIC or the Master REMIC as a REMIC under
the Code.
d. Concurrently with the solicitation of any consent pursuant to
this Section 12.07, the Trustee shall furnish written notification to Standard &
Poor's, Moody's and Fitch of such solicitation. Promptly after the execution of
any amendment pursuant to this Section 12.07, the
12-5
Trustee shall furnish written notification of the substance of such amendment to
Fitch, Moody's and each Certificateholder.
e. It shall not be necessary for the consent of
Certificateholders under this Section 12.07 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable requirements as the Trustee may prescribe.
f. The Trustee may, but shall not be obligated to, enter into any
such amendment which affects the Trustee's own rights, duties or immunities
under this Agreement or otherwise.
g. In connection with any amendment pursuant to this Section, the
Trustee shall be entitled to receive an unqualified Opinion of Counsel to the
Servicer to the effect that such amendment is authorized or permitted by the
Agreement.
h. In the absence of the consent described in subsection (c) of
this Section, in connection with any amendment pursuant to this Section, the
Trustee shall have received an unqualified Opinion of Counsel, the expense of
which shall not be an expense of the Trust, stating that any such amendment (i)
will not adversely affect the status of the Subsidiary REMIC or the Master REMIC
as a REMIC or the status of the Regular Certificates as "regular interests" in
the Master REMIC, and (ii) will not cause any tax (other than any tax imposed on
"net income from foreclosure property" under Section 860G(c)(1) of the Code that
would be imposed without regard to such amendment) to be imposed on the Trust,
including, without limitation, any tax imposed on "prohibited transactions"
under Section 860F(a)(1) of the Code or on "contributions after the startup
date" under Section 860G(d)(1) of the Code.
i. Upon the execution of any amendment or consent pursuant to
this Section 12.07, this Agreement shall be modified in accordance therewith,
and such amendment or consent shall form a part of this Agreement for all
purposes, and every Certificateholder hereunder shall be bound thereby.
SECTION 12.08. Notices.
-------
All communications and notices pursuant hereto to the Servicer, the
Originator and the Trustee shall be in writing and delivered or mailed to it at
the appropriate following address:
If to the Seller:
Conseco Finance Securitizations Corp.
300 Landmark Towers
▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
12-6
If to the Originator or Servicer:
Conseco Finance Corp.
1100 Landmark Towers
▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Trustee:
U.S. Bank National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to Standard & Poor's:
Standard & Poor's Rating Services,
a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Asset Backed Securities
Surveillance Group
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to Fitch:
Fitch IBCA, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to Moody's:
▇▇▇▇▇'▇ Investors Service, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Structured Financing, Manufactured Housing
Surveillance Group
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as the party may designate by notice to the other
parties hereto, which notice shall be effective when received.
12-7
All communications and notices pursuant hereto to a Certificateholder
shall be in writing and delivered or mailed at the address shown in the
Certificate Register.
SECTION 12.09. Merger and Integration.
----------------------
Except as specifically stated otherwise herein, this Agreement sets
forth the entire understanding of the parties relating to the subject matter
hereof, and all prior understandings, written or oral, are superseded by this
Agreement. This Agreement may not be modified, amended, waived or supplemented
except as provided herein.
SECTION 12.10. Headings.
--------
The headings herein are for purposes of reference only and shall not
otherwise affect the meaning or interpretation of any provision hereof.
SECTION 12.11. Governing Law.
-------------
This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of Minnesota.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized this 5th
day of October, 2000.
CONSECO FINANCE CORP.
By
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Vice President and Treasurer
CONSECO FINANCE SECURITIZATIONS CORP.
By
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Vice President and Treasurer
U.S. BANK NATIONAL ASSOCIATION
not in its individual capacity but
solely as Trustee
By
-----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇-▇▇▇▇
Assistant Vice President
12-8
EXHIBIT A
---------
FORM OF CLASS A CERTIFICATE
---------------------------
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE.
Class A-[1][2][3][4][5][6][7] No.
(Senior)
Cut-off Date: as defined in the Remittance Rate: ____%
Pooling and Servicing Agreement [Floating Rate equal to the Weighted
dated as of October 1, 2000 Average Contract Rate (subject to a
maximum of ___%)]
First Remittance Date: Denomination: $___________
November 1, ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ of
All Class A-[1][2][3][4][5][6][7]
Servicer: Certificates: $___________
Conseco Finance Corp.
Maturity Date: February 1, 2032
(or if such day is not a
Business Day, then the next
succeeding Business Day)
CUSIP: _____
MANUFACTURED HOUSING CONTRACT
-----------------------------
SENIOR/SUBORDINATE PASS-THROUGH CERTIFICATES,
---------------------------------------------
SERIES 2000-5, CLASS A-[1][2][3][4][5][6][7](SENIOR)
----------------------------------------------------
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR AN INTEREST IN
CONSECO FINANCE CORP. OR ANY AFFILIATE THEREOF, EXCEPT TO THE EXTENT SET FORTH
IN THE AGREEMENT.
This certifies that Cede & Co. is the registered owner of the undivided
Percentage Interest represented by the original principal amount set forth above
in Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate
Trust 2000-5 (the "Trust"), which includes among its assets a pool of
manufactured housing installment sale contracts and installment loan agreements
(including, without limitation, all related security interests and any and all
rights to
A-1
receive payments which are due pursuant thereto after the applicable Cut-off
Date. The Trust has been created pursuant to a Pooling and Servicing Agreement
(the "Agreement"), dated as of October 1, 2000, among Conseco Finance Corp., as
Originator and Servicer (the "Originator"), Conseco Finance Securitizations
Corp., as Seller (the "Seller"), and U.S. Bank National Association, as Trustee
of the Trust (the "Trustee"). This Certificate is one of the Certificates
described in the Agreement and is issued pursuant and subject to the Agreement.
By acceptance of this Certificate the holder assents to and becomes bound by the
Agreement. To the extent not defined herein, all capitalized terms have the
meanings assigned to such terms in the Agreement.
The Agreement contemplates, subject to its terms, payment on the first
day (or if such day is not a Business Day, the next succeeding Business Day)
(the "Remittance Date") of each month commencing in November, 2000, so long as
the Agreement has not been terminated, by check (or, if such Certificateholder
holds a Class of Class A Certificates with an aggregate Percentage Interest of
at least 5% and so desires, by wire transfer pursuant to instructions delivered
to the Trustee at least 10 days prior to such Remittance Date) to the registered
Certificateholder at the address appearing on the Certificate Register as of the
Business Day immediately preceding such Remittance Date, in an amount equal to
the Certificateholder's Percentage Interest of the portion of the Class A
Distribution Amount to be distributed to such Class of Class A Certificates. The
Maturity Date of this Certificate is February 1, 2032 or the next succeeding
Business Day if such February 1 is not a Business Day.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds in the Certificate Account to the extent
available for distribution to the Certificateholder as provided in the Agreement
for payment hereunder and that the Trustee in its individual capacity is not
personally liable to the Certificateholder for any amounts payable under this
Certificate or the Agreement or, except as expressly provided in the Agreement,
subject to any liability under the Agreement. By acceptance of this Certificate,
the Certificateholder agrees to disclosure of his, her or its name and address
to other Certificateholders under the conditions specified in the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and immunities of the Trustee. Copies of the Agreement
and all amendments thereto will be provided to any Certificateholder free of
charge upon a written request to the Trustee.
As provided in the Agreement and subject to the limitations set forth
therein, the transfer of this Certificate is registrable in the Certificate
Register of the Certificate Registrar upon surrender of this Certificate for
registration of transfer at the office or agency maintained by the Trustee in
St. ▇▇▇▇, Minnesota, accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by the
holder thereof or his or her attorney duly authorized in writing, and thereupon
one or more new Certificates evidencing the same aggregate Percentage Interest
will be issued to the designated transferee or transferees.
[Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC") to Issuer or its
agent for registration of
A-2
transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to such other
entity as is requested by an authorized representative of DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.]
The Originator, the Seller, the Servicer, the Trustee, the Paying Agent
and the Certificate Registrar and any agent of the Originator, the Seller, the
Servicer, the Trustee, the Paying Agent or the Certificate Registrar may treat
the person in whose name this Certificate is registered as the owner hereof for
all purposes, and neither the Originator, the Seller, the Servicer, the Trustee,
the Paying Agent, the Certificate Registrar nor any such agent shall be affected
by any notice to the contrary.
A-3
IN WITNESS WHEREOF, Manufactured Housing Contract Senior/ Subordinate
Pass-Through Certificate Trust 2000-5 has caused this Certificate to be duly
executed by the manual signature of a duly authorized officer of the Trustee.
Dated: MANUFACTURED HOUSING CONTRACT
SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
TRUST 2000-5
By U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------------
Authorized Signatory
A-4
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ______________________________ the within Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificate and does hereby irrevocably
constitute and appoint ______________________________ Attorney to transfer the
said certificate on the Certificate Register maintained by the Trustee, with
full power of substitution in the premises.
Date: By
-----------------------------------
Signature
A-5
EXHIBIT B
---------
FORM OF CLASS M-[1][2] CERTIFICATE
----------------------------------
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES [AND THE CLASS M-1 CERTIFICATES] AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE RESOLD OR TRANSFERRED EXCEPT IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
Class M-[1][2] No.
(Subordinate)
Cut-off Date: as defined in the Remittance Rate: Floating Rate equal
Pooling and Servicing Agreement to the Weighted Average Contract Rate
dated as of October 1, 2000 (subject to a maximum of ______%)
Denomination: $_____________
Aggregate Denomination of All Class
First Remittance Date: M-[1][2] Certificates: $_____________
November 1, 2000
Maturity Date:
Servicer: February 1, 2032
Conseco Finance Corp. (or if such day is not a Business
Day, then the next succeeding
Business Day)
CUSIP: _____
MANUFACTURED HOUSING CONTRACT
-----------------------------
SENIOR/SUBORDINATE PASS-THROUGH CERTIFICATES,
---------------------------------------------
SERIES 2000-5, CLASS M-[1][2] (SUBORDINATE)
-------------------------------------------
B-1
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR AN INTEREST IN
CONSECO FINANCE CORP. OR ANY AFFILIATE THEREOF, EXCEPT TO THE EXTENT SET FORTH
IN THE AGREEMENT.
This certifies that Cede & Co. is the registered owner of the undivided
Percentage Interest represented by the original principal amount set forth above
in Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate
Trust 2000-5 (the "Trust"), which includes among its assets a pool of
manufactured housing installment sale contracts and installment loan agreements
(including, without limitation, all related security interests and any and all
rights to receive payments which are due pursuant thereto after the applicable
Cut-off Date). The Trust has been created pursuant to a Pooling and Servicing
Agreement (the "Agreement"), dated as of October 1, 2000 among Conseco Finance
Corp., as Originator and Servicer (the "Originator"), Conseco Finance
Securitizations Corp., as Seller (the "Seller"), and U.S. Bank National
Association, as Trustee of the Trust (the "Trustee"). This Certificate is one of
the Certificates described in the Agreement and is issued pursuant and subject
to the Agreement. By acceptance of this Certificate the holder assents to and
becomes bound by the Agreement. To the extent not defined herein, all
capitalized terms have the meanings assigned to such terms in the Agreement.
The Agreement contemplates, subject to its terms, payment on the first
day (or if such day is not a Business Day, the next succeeding Business Day)
(the "Remittance Date") of each month commencing in November 2000, so long as
the Agreement has not been terminated, by check (or, if such Certificateholder
holds a Class M-[1][2] Certificate with an aggregate Percentage Interest of at
least 5% and so desires, by wire transfer pursuant to instructions delivered to
the Trustee at least 10 days prior to such Remittance Date) to the registered
Certificateholder at the address appearing on the Certificate Register as of the
Business Day immediately preceding such Remittance Date, in an amount equal to
the Certificateholder's Percentage Interest of the Class [M-1/M-2] Distribution
Amount for such Remittance Date. The Maturity Date of this Certificate is
February 1, 2032 or the next succeeding Business Day if such February 1 is not a
Business Day.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds in the Certificate Account to the extent
available for distribution to the Certificateholder as provided in the Agreement
for payment hereunder and that the Trustee in its individual capacity is not
personally liable to the Certificateholder for any amounts payable under this
Certificate or the Agreement or, except as expressly provided in the Agreement,
subject to any liability under the Agreement. By acceptance of this Certificate,
the Certificateholder agrees to disclosure of his, her or its name and address
to other Certificateholders under the conditions specified in the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and immunities of the Trustee. Copies of the Agreement
and all amendments thereto will be provided to any Certificateholder free of
charge upon a written request to the Trustee.
As provided in the Agreement and subject to the limitations set forth
therein, the transfer of this Certificate is registrable in the Certificate
Register of the Certificate Registrar upon
B-2
surrender of this Certificate for registration of transfer at the office or
agency maintained by the Trustee in St. ▇▇▇▇, Minnesota, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder thereof or his or her attorney
duly authorized in writing, and thereupon one or more new Certificates
evidencing the same aggregate Percentage Interest will be issued to the
designated transferee or transferees.
[Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC") to Issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
The Originator, the Seller, the Servicer, the Trustee, the Paying Agent
and the Certificate Registrar and any agent of the Originator, the Seller, the
Servicer, the Trustee, the Paying Agent or the Certificate Registrar may treat
the person in whose name this Certificate is registered as the owner hereof for
all purposes, and neither the Originator, the Seller, the Servicer, the Trustee,
the Paying Agent, the Certificate Registrar nor any such agent shall be affected
by any notice to the contrary.
B-3
IN WITNESS WHEREOF, Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificate Trust 2000-5 has caused this Certificate to be duly
executed by the manual signature of a duly authorized officer of the Trustee.
Dated: MANUFACTURED HOUSING CONTRACT
SENIOR/SUBORDINATE PASS-THROUGH
CERTIFICATE TRUST 2000-5
By U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------------
Authorized Signatory
B-4
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto _____________________________ the within Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificate and does hereby irrevocably
constitute and appoint _____________________________ Attorney to transfer the
said certificate on the Certificate Register maintained by the Trustee, with
full power of substitution in the premises.
Dated: By
-----------------------------------
Authorized Signatory
B-5
EXHIBIT C-1
-----------
FORM OF CLASS B-[1][2] CERTIFICATE
----------------------------------
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE Class A
CERTIFICATES, THE CLASS M-1 CERTIFICATES [,] [AND] THE CLASS M-2 CERTIFICATES
[AND THE CLASS B-1 CERTIFICATES] AS DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE RESOLD OR TRANSFERRED EXCEPT IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
Class B-[1][2] No.
(Subordinate)
Cut-off Date: as defined in the Remittance Rate: Floating Rate
Pooling and Servicing Agreement equal to the Weighted Average
dated as of October 1, 2000 Contract Rate (subject to a
maximum of ____%) Denomination:
$___________
First Remittance Date:
November 1, 2000 Aggregate Denomination of All
Class B-[1][2] Certificates:
Servicer: $___________
Conseco Finance Corp.
Maturity Date: February 1, 2032
(or if such day is not a
Business Day, then the next
succeeding Business Day)
CUSIP: _____
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
------------------------------------------------
PASS-THROUGH CERTIFICATES, SERIES 2000-5, CLASS B-[1][2] (SUBORDINATE)
----------------------------------------------------------------------
C-1
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR AN INTEREST IN
CONSECO FINANCE CORP. OR ANY AFFILIATE THEREOF, EXCEPT TO THE EXTENT SET FORTH
IN THE AGREEMENT.
This certifies that Cede & Co. is the registered owner of the undivided
Percentage Interest represented by the original principal amount set forth above
in Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate
Trust 2000-5 (the "Trust"), which includes among its assets a pool of
manufactured housing installment sale contracts and installment loan agreements
(including, without limitation, all related security interests and any and all
rights to receive payments which are due pursuant thereto after the applicable
Cut-off Date). The Trust has been created pursuant to a Pooling and Servicing
Agreement (the "Agreement"), dated as of October 1, 2000, among Conseco Finance
Corp., as Originator and Servicer (the "Originator"), Conseco Finance
Securitizations Corp., as Seller (the "Seller"), and U.S. Bank National
Association, as Trustee of the Trust (the "Trustee"). This Certificate is one of
the Certificates described in the Agreement and is issued pursuant and subject
to the Agreement. By acceptance of this Certificate the holder assents to and
becomes bound by the Agreement. To the extent not defined herein, all
capitalized terms have the meanings assigned to such terms in the Agreement.
The Agreement contemplates, subject to its terms, payment on the first
day (or if such day is not a Business Day, the next succeeding Business Day)
(the "Remittance Date") of each month commencing in November, 2000 so long as
the Agreement has not been terminated, by check (or, if such Certificateholder
holds a Class of Class B Certificates with an aggregate Percentage Interest of
at least 5% and so desires, by wire transfer pursuant to instructions delivered
to the Trustee at least 10 days prior to such Remittance Date) to the registered
Certificateholder at the address appearing on the Certificate Register as of the
Business Day immediately preceding such Remittance Date, in an amount equal to
the Certificateholder's Percentage Interest of the Class [B-1/B-2] Distribution
Amount for such Remittance Date. The Maturity Date of this Certificate is
February 1, 2032, or the next succeeding Business Day if such February 1 is not
a Business Day.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds in the Certificate Account to the extent
available for distribution to the Certificateholder as provided in the Agreement
for payment hereunder and that the Trustee in its individual capacity is not
personally liable to the Certificateholder for any amounts payable under this
Certificate or the Agreement or, except as expressly provided in the Agreement,
subject to any liability under the Agreement. By acceptance of this Certificate,
the Certificateholder agrees to disclosure of his, her or its name and address
to other Certificateholders under the conditions specified in the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and immunities of the Trustee. Copies of the Agreement
and all amendments thereto will be provided to any Certificateholder free of
charge upon a written request to the Trustee.
As provided in the Agreement and subject to the limitations set forth
therein, the transfer of this Certificate is registrable in the Certificate
Register of the Certificate Registrar upon
C-2
surrender of this Certificate for registration of transfer at the office or
agency maintained by the Trustee in St. ▇▇▇▇, Minnesota, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder thereof or his or her attorney
duly authorized in writing, and thereupon one or more new Certificates
evidencing the same aggregate Percentage Interest will be issued to the
designated transferee or transferees.
[Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC") to Issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or in such other name as
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
The Originator, the Seller, the Servicer, the Trustee, the Paying Agent
and the Certificate Registrar and any agent of the Originator, the Seller, the
Servicer, the Trustee, the Paying Agent or the Certificate Registrar may treat
the person in whose name this Certificate is registered as the owner hereof for
all purposes, and neither the Originator, the Seller, the Servicer, the Trustee,
the Paying Agent, the Certificate Registrar nor any such agent shall be affected
by any notice to the contrary.
C-3
IN WITNESS WHEREOF, Manufactured Housing Contract Senior/ Subordinate
Pass-Through Certificate Trust 2000-5 has caused this Certificate to be duly
executed by the manual signature of a duly authorized officer of the Trustee.
Dated: MANUFACTURED HOUSING CONTRACT
SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
TRUST 2000-5
By U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------------
Authorized Officer
C-4
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ______________________________ the within Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificate and does hereby irrevocably
constitute and appoint ______________________________ Attorney to transfer the
said certificate on the Certificate Register maintained by the Trustee, with
full power of substitution in the premises.
Dated: By
-----------------------------------
Signature
C-5
EXHIBIT C-2
-----------
FORM OF CLASS B-3I CERTIFICATE
------------------------------
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE
CODE.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, THE CLASS M CERTIFICATES AND THE CLASS B CERTIFICATES AS DESCRIBED
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
Class B-3I No._____
(Subordinate)
Cut-off Date: as defined in the Percentage Interest: _____%
Pooling and Servicing Agreement
dated as of October 1, 2000
First Remittance Date: Maturity Date:
November 1, 2000 February 1, 2032
(or if such day is not a
Business Day, then the next
succeeding Business Day)
Servicer:
Conseco Finance Corp.
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
------------------------------------------------
PASS-THROUGH CERTIFICATES, SERIES 2000-5, CLASS B-3I (SUBORDINATE)
------------------------------------------------------------------
C-2-1
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR AN INTEREST IN
CONSECO FINANCE CORP. OR ANY AFFILIATE THEREOF, EXCEPT TO THE EXTENT SET FORTH
IN THE AGREEMENT.
This certifies that Green Tree Finance Corp.-Two is the registered
owner of the undivided Percentage Interest set forth above in Manufactured
Housing Contract Senior/Subordinate Pass-Through Certificate Trust 2000-5 (the
"Trust"), which includes among its assets a pool of manufactured housing
installment sale contracts and installment loan agreements (including, without
limitation, all related security interests and any and all rights to receive
payments which are due pursuant thereto after the applicable Cut-off Date). The
Trust has been created pursuant to a Pooling and Servicing Agreement (the
"Agreement"), dated as of October 1, 2000, among Conseco Finance Corp., as
Originator and Servicer (the "Originator"), Conseco Finance Securitizations
Corp., as Seller (the "Seller"), and U.S. Bank National Association, as Trustee
of the Trust (the "Trustee"). This Certificate is one of the Certificates
described in the Agreement and is issued pursuant and subject to the Agreement.
By acceptance of this Certificate the holder assents to and becomes bound by the
Agreement. To the extent not defined herein, all capitalized terms have the
meanings assigned to such terms in the Agreement.
The Agreement contemplates, subject to its terms, payment on the first
day (or if such day is not a Business Day, the next succeeding Business Day)
(the "Remittance Date") of each related Due Period commencing in November 2000
so long as the Agreement has not been terminated, by check (or, if such
Certificateholder holds Class B-3I Certificates with an aggregate Percentage
Interest of at least 5% and so desires, by wire transfer pursuant to
instructions delivered to the Trustee at least 10 days prior to such Remittance
Date) to the registered Certificateholder at the address appearing on the
Certificate Register as of the Business Day immediately preceding such
Remittance Date, in an amount equal to the Certificateholder's Percentage
Interest of the Class B-3I Distribution Amount for such Remittance Date. The
Maturity Date of this Certificate is February 1, 2032 or the next succeeding
Business Day if such February 1 is not a Business Day.
THIS CERTIFICATE IS AN INTEREST ONLY CERTIFICATE. THE HOLDER OF THIS
CERTIFICATE SHALL NOT BE ENTITLED TO ANY DISTRIBUTIONS OF PRINCIPAL WITH RESPECT
TO THE CONTRACTS.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds in the Certificate Account to the extent
available for distribution to the Certificateholder as provided in the Agreement
for payment hereunder and that the Trustee in its individual capacity is not
personally liable to the Certificateholder for any amounts payable under this
Certificate or the Agreement or, except as expressly provided in the Agreement,
subject to any liability under the Agreement. By acceptance of this Certificate,
the Certificateholder agrees to disclosure of his, her or its name and address
to other Certificateholders under the conditions specified in the Agreement.
This Certificate does not purport to summarize the Agreement and
reference is made to the Agreement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and immunities of the Trustee. Copies of the
C-2-2
Agreement and all amendments thereto will be provided to any Certificateholder
free of charge upon a written request to the Trustee.
As provided in the Agreement and subject to the limitations set forth
therein, the transfer of this Certificate is registrable in the Certificate
Register of the Certificate Registrar upon surrender of this Certificate for
registration of transfer at the office or agency maintained by the Trustee in
St. ▇▇▇▇, Minnesota, accompanied by a written instrument of transfer in form
satisfactory to the Trustee and the Certificate Registrar duly executed by the
holder thereof or his or her attorney duly authorized in writing, and thereupon
one or more new Certificates evidencing the same aggregate Percentage Interest
will be issued to the designated transferee or transferees.
The Originator, the Seller, the Servicer, the Trustee, the Paying Agent
and the Certificate Registrar and any agent of the Originator, the Seller, the
Servicer, the Trustee, the Paying Agent or the Certificate Registrar may treat
the person in whose name this Certificate is registered as the owner hereof for
all purposes, and neither the Originator, the Seller, the Servicer, the Trustee,
the Paying Agent, the Certificate Registrar nor any such agent shall be affected
by any notice to the contrary.
C-2-3
IN WITNESS WHEREOF, Manufactured Housing Contract Senior/ Subordinate
Pass-Through Certificate Trust 2000-5 has caused this Certificate to be duly
executed by the manual signature of a duly authorized officer of the Trustee.
Dated: MANUFACTURED HOUSING CONTRACT
SENIOR/SUBORDINATE PASS-THROUGH
CERTIFICATE TRUST 2000-5
By U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------------
Authorized Officer
C-2-4
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ______________________________ the within Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificate and does hereby irrevocably
constitute and appoint ______________________________ Attorney to transfer the
said certificate on the Certificate Register maintained by the Trustee, with
full power of substitution in the premises.
Dated: By
-----------------------------------
Signature
C-2-5
EXHIBIT D
---------
FORM OF ASSIGNMENT
------------------
In accordance with the Pooling and Servicing Agreement (the
"Agreement") dated as of October 1, 2000 among Conseco Finance Corp., as
Originator and Servicer (the "Originator"), Conseco Finance Securitizations
Corp., as Seller (the "Seller") and U.S. Bank National Association, as Trustee
(the "Trustee"), the Seller does hereby transfer, assign, set over and otherwise
convey to the Trustee (i) all the right, title and interest of the Seller in and
to the Contracts, including, without limitation, all right, title and interest
in and to the Collateral Security and all rights to receive payments on or with
respect to the Contracts (other than principal and interest due on the Contracts
on or before the applicable Cut-off Date), (ii) all rights under every Hazard
Insurance Policy relating to a Manufactured Home securing a Contract for the
benefit of the owner of such Contract, (iii) all rights under all FHA/VA
Regulations pertaining to any Contract that is an FHA/VA Contract, (iv) all
rights of the Seller under the Transfer Agreement, (v) the proceeds from the
Errors and Omissions Protection Policy and all rights under any blanket hazard
insurance policy to the extent they relate to the Manufactured Homes, (vi) all
documents contained in the Contract Files and the Land-and-Home Contract Files,
(vii) amounts on deposit in the Capitalized Interest Account, the Pre-Funding
Account and the Staged-Funding Reserve Account, and (viii) all proceeds and
products in any way derived from any of the foregoing. Capitalized terms used
herein but not defined herein have the meanings assigned to them in the
Agreement.
This Assignment is made pursuant to and upon the representation and
warranties on the part of the undersigned contained in Article III of the
Agreement and no others.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed this ___ day of October, 2000.
CONSECO FINANCES SECURITIZATIONS
CORP.
By
-----------------------------------
[Name]
[Title]
D-1
EXHIBIT E
---------
FORM OF CERTIFICATE OF OFFICER
------------------------------
[CONSECO FINANCE CORP.]
[CONSECO FINANCE SECURITIZATIONS CORP.]
OFFICER'S CERTIFICATE
We, ______________ and ______________, hereby certify that we are the
duly elected _________________ and ______________, respectively, of [Conseco
Finance Corp. ("Conseco Finance")] [Conseco Finance Securitizations Corp.
("Conseco Securitizations")], and that as such we are duly authorized to execute
and deliver this Certificate on behalf of [Conseco Finance] [Conseco
Securitizations] in connection with the Pooling and Servicing Agreement, dated
as of October 1, 2000 (the "Pooling and Servicing Agreement") among Conseco
Finance Corp., Conseco Finance Securitizations Corp. and U.S. Bank National
Association, as Trustee, and the Underwriting Agreement relating to the Class A,
Class M-1, Class M-2 and Class B Certificates, dated September 28, 2000, (the
"Underwriting Agreement"), among Conseco Finance Corp., Conseco Finance
Securitizations Corp. and ▇▇▇▇▇▇ Brothers Inc., Credit Suisse First Boston
Corporation, ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated and Banc of
America Securities, LLC (the "Underwriters") (all capitalized terms used herein
without definition having the respective meanings specified in the Pooling and
Servicing Agreement and the Underwriting Agreement) and further certify as
follows:
1. Attached hereto as Exhibits I and II, respectively, are true
and correct copies of the [Certificate] [Articles] of Incorporation and
[Restated] Bylaws of [Conseco Finance] [Conseco Securitizations], together with
all amendments thereto, both of which are in full force and effect on the date
hereof.
2. No proceedings looking toward merger, liquidation, dissolution
or bankruptcy of [Conseco Finance] [Conseco Securitizations] are pending or
contemplated.
3. There is no litigation pending, or to our knowledge,
threatened, which, if determined adversely to [Conseco Finance] [Conseco
Securitizations], would affect adversely the sale of the Contracts, the
execution, delivery or enforceability of the Pooling and Servicing Agreement,
the Transfer Agreement and the Underwriting Agreement (the "Transaction
Documents")[, or the ability of Conseco Finance to service and administer the
Contracts in accordance with the terms of the Pooling and Servicing Agreement].
4. Each person who, as an officer or representative of [Conseco
Finance] [Conseco Securitizations], signed the Transaction Documents, or any
other document delivered prior hereto or on the date hereof in connection with
the sale and servicing of the Contracts in accordance with the Transaction
Documents, was at the time of such signing and is as of the date hereof duly
elected or appointed, qualified and acting as such officer or representative,
and the signatures of such persons appearing on such documents are their genuine
signatures.
E-1
5. Neither the execution and delivery by [Conseco Finance]
[Conseco Securitizations] of the Transaction Documents, nor its compliance with
the terms and provisions thereof, will conflict with, or result in a breach of,
any of the terms of, or constitute a default under, any judgment, order,
injunction or decree of any domestic court or governmental authority to which
[Conseco Finance] [Conseco Securitizations] is subject or any indenture,
agreement, contract or commitment to which [Conseco Finance] [Conseco
Securitizations] is a party or by which it is bound, which conflict, breach or
default presents a reasonable possibility of having a materially adverse effect
on the business or operations of [Conseco Finance] [Conseco Securitizations]. No
UCC-1 financing statements or statements of assignment listing [Conseco Finance]
[Conseco Securitizations] as debtor and describing any of the Contracts as
collateral other than the UCC-1 financing statement in favor of the Trustee,
have been signed on behalf of [Conseco Finance] [Conseco Securitizations] and
filed by any person after and prior to the date hereof.
6. Attached hereto as Exhibit IV is a certified true copy of the
resolutions of the Board of Directors of [Conseco Finance] [Conseco
Securitizations] (the "Resolutions") adopted with respect to the authorization
of [Conseco Finance] [Conseco Securitizations] to take such actions and enter
into such agreements as are necessary to sell and service the Contracts in
accordance with the Transaction Documents; said resolutions have not been
amended, modified, annulled or revoked and are in full force and effect on the
date hereof.
[7. The Registration Statement and the Prospectus, at the time the
Registration Statement became effective did comply, and as of the date hereof
comply, in all material respects with the requirements of the Securities Act of
1933, as amended (the "1933 Act") and the Regulations. The Registration
Statement, at the time it became effective did not, and as of the date hereof
does not, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading. The Prospectus as of the date thereof did not, and as of
the date hereof does not, contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this subsection
shall not apply to statements in, or omissions from, the Registration Statement
or Prospectus made in reliance upon and in conformity with information furnished
to [Conseco Finance] [Conseco Securitizations] in writing by the Underwriters
expressly for use in the Registration Statement or Prospectus. The conditions to
the use by [Conseco Finance] [Conseco Securitizations] of registration statement
on Form S-3 under the 1933 Act, as set forth in the General Instructions to Form
S-3, have been satisfied with respect to the Registration Statement and the
Prospectus. There are no contracts or documents of [Conseco Finance] [Conseco
Securitizations] which are required to be filed as exhibits to the Registration
Statement pursuant to the 1933 Act or the Regulations which have not been so
filed.]
8. Each of the representations and warranties contained in
[Sections 3.01 and 3.03 of the Pooling and Servicing Agreement] [Section 3.1
(other than Section 3.1(a)) of the Transfer Agreement] and Section 1 of the
Underwriting Agreement is true and correct on and as of the date hereof. [To the
best of our knowledge, the representations and warranties of Conseco Finance
contained in Section 3.1(a) of the Transfer Agreement are true and correct on
the date hereof.]
E-2
9. [Conseco Finance] [Conseco Securitizations] has complied with
all the agreements by which it is bound in connection with the transactions
contemplated by the Transaction Documents, and has satisfied all the conditions
on its part to be performed or satisfied prior to the Closing Date in connection
with the transactions contemplated by the Transaction Documents.
10. The Transaction Documents have been duly executed by [Conseco
Finance] [Conseco Securitizations] pursuant to and in compliance with the
Resolutions.
11. No event with respect to [Conseco Finance] [Conseco
Securitizations] has occurred or is continuing which would constitute an Event
of Termination or an event that with notice or lapse of time or both would
become an Event of Termination under the Pooling and Servicing Agreement.
IN WITNESS WHEREOF, I have affixed hereunto my signature this ___ day
of October, 2000.
[CONSECO FINANCE CORP.]
By
-----------------------------------
[Name]
[Title]
[CONSECO FINANCE SECURITIZATIONS
CORP.]
By
-----------------------------------
[Name]
[Title]
E-3
EXHIBIT F
---------
FORM OF OPINION OF COUNSEL
--------------------------
The opinion of ▇▇▇▇▇▇ and ▇▇▇▇▇▇, Professional Association shall be to
the effect that undefined capitalized terms have the meanings set forth in the
Pooling and Servicing Agreement):
1. The Originator is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware, with
corporate power to execute, deliver and perform its obligations under the
Pooling and Servicing Agreement, the Transfer Agreement and the Underwriting
Agreement (collectively, the "Transaction Documents") (including the Limited
Guaranty contained in the Pooling and Servicing Agreement). The Seller is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Minnesota, with corporate power to execute, deliver and
perform in its obligations under the Transaction Documents.
2. The Transaction Documents (including the Limited Guaranty
contained in the Pooling and Servicing Agreement) have been duly authorized by
all requisite corporate action, duly executed and delivered by the Originator
and the Seller, and constitute the valid and binding obligations of the
Originator and the Seller enforceable in accordance with their terms. The
Certificates have been duly authorized by all requisite corporate action and,
when duly and validly executed by the Trustee in accordance with the Pooling and
Servicing Agreement, will be validly issued and outstanding and entitled to the
benefits of the Pooling and Servicing Agreement.
3. No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required to be obtained by the
Originator or the Seller for the consummation of the transactions contemplated
by the Transaction Documents, except such as may be required under blue sky laws
under any jurisdiction in connection with the offering of the Certificates by
the Underwriters pursuant to the Underwriting Agreement.
4. The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as now in effect, and the Trust
is not required to be registered as an investment company under the Investment
Company Act of 1940.
5. Neither the transfer of the Contracts by the Originator to the
Seller, nor the assignment of the Originator's security interest on the related
Manufactured Homes, nor the issuance or sale of the Certificates, nor the
execution and delivery of the Transaction Documents, nor the consummation of any
other of the transactions contemplated in the Transaction Documents nor the
fulfillment of the terms of the Certificates or the Transaction Documents by the
Originator, will conflict with, or result in a breach, violation or acceleration
of, or constitute a default under, any term or provision of the Certificate of
Incorporation or Bylaws of the Originator or of any indenture or other agreement
or instrument known to us to which the Originator is a party or by which it is
bound, or result in a violation of, or contravene the terms of
F-1
any statute, order or regulation, applicable to the Originator, of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over it.
6. Neither the transfer of the Contracts by the Seller to the
Trustee acting on behalf of the Trust, nor the assignment of the Seller's
security interest on the related Manufactured Homes, nor the issuance or sale of
the Certificates, nor the execution and delivery of the Transaction Documents,
nor the consummation of any other of the transactions contemplated in the
Transaction Documents, nor the fulfillment of the terms of the Certificates or
the Transaction Documents by the Seller, will conflict with, or result in a
breach, violation or acceleration of, or constitute a default under, any term or
provision of the Articles of Incorporation or Bylaws of the Seller or of any
indenture or other agreement or instrument known to us to which the Seller is a
party or by which it is bound, or result in a violation of, or contravene the
terms of any statute, order or regulation, applicable to the Seller, of any
court, regulatory body, administrative agency or governmental body having
jurisdiction over it.
7. There are no actions or proceedings pending, nor to the best
of our knowledge, are there any investigations pending or overtly threatened
against the Originator or the Seller before any court, administrative agency or
other tribunal (A) asserting the invalidity of the Transaction Documents, the
Certificates, the hazard or flood insurance policies applicable to any Contracts
or the Errors and Omissions Protection Policy, (B) seeking to prevent the
issuance of the Certificates or the consummation of any of the transactions
contemplated by the Transaction Documents, (C) which is likely materially and
adversely to affect the performance by the Originator or the Seller of its
obligations under, or the validity or enforceability of, the Transaction
Documents or the Certificates, or (D) seeking adversely to affect the federal
income tax attributes of the Certificates described in the Prospectus and the
Prospectus Supplement under the heading "Federal Income Tax Consequences."
8. The transfer of the Initial and Additional Contracts to the
Trust in accordance with Section 2.01 of the Pooling and Servicing Agreement
would not be avoidable as a preferential transfer under Section 547 of the
United States Bankruptcy Code (11 U.S.C. ss. 547), as in effect on the date
hereof, in the event that the Originator became a debtor under the United States
Bankruptcy Code.
9. Pursuant to the Transfer Agreement the Originator has
transferred to the Seller all of the Originator's right, title and interest in
the Contracts, free and clear of any and all other assignments, encumbrances,
options, rights, claims, liens or security interests (except tax or possessory
liens) that may affect the right of the Seller in and to such Contracts, and has
delivered the Land-and-Home contract Files to the Trustee (as the Seller's
designee) or its custodian. No filing or other action, other than the filing of
a financing statement on Form UCC-1 with the Secretary of State of the State of
Minnesota identifying the Contracts as collateral and naming the Originator as
debtor and the Seller as secured party, and the filing of continuation
statements as required by the Transfer Agreement, is necessary to perfect as
against third parties the assignment of the Contracts by the Originator to the
Seller. We have separately provided you with our opinion concerning whether such
assignment could be recharacterized as a pledge rather than a sale in the event
the Originator became a debtor under the United States Bankruptcy Code. However,
in the event such assignment were recharacterized as a pledge securing a loan
from the Seller to the Originator, it is our opinion that the Seller would be
deemed to have a valid and
F-2
perfected security interest in the Initial and Additional Contracts and the
proceeds thereof, which security interest would be prior to any other security
interest that may be perfected under the Uniform Commercial Code as in effect in
the State of Minnesota and over any "lien creditor" (as defined in Minn. Stat.
ss.336.9-301(3)) who becomes such after the Closing Date, except that a
subsequent purchaser of any Contract who gives new value and takes possession
thereof in the ordinary course of his business would have priority over the
Seller's security interest in such Contracts, if such purchaser acts without
knowledge that such Contract was subject to a security interest. We have assumed
for the purposes of this opinion that during the term of the Pooling and
Servicing Agreement the Trustee, or its custodian, shall maintain possession of
the Land-and-Home Contract Files for the purpose of perfecting the assignment to
the Seller of the Contracts. We express no opinion with respect to the
enforceability of any individual Contract or the existence of any claims, rights
or other matters in favor of any Obligor.
10. Pursuant to the Pooling and Servicing Agreement the Seller has
transferred to the Trustee acting on behalf of the Trust all of the Seller's
right, title and interest in the Contracts, free and clear of any and all other
assignments, encumbrances, options, rights, claims, liens or security interests
(except tax or possessory liens) that may affect the right of the Trustee in and
to such Contracts, and has delivered the Land-and-Home Contract Files to the
Trustee or its custodian. No filing or other action, other than the filing of a
financing statement on Form UCC-1 with the Secretary of State of the State of
Minnesota identifying the Contracts as collateral and naming the Seller as
debtor and the Trustee as secured party, and the filing of continuation
statements as required by the Pooling and Servicing Agreement, is necessary to
perfect as against third parties the assignment of the Contracts by the Seller
to the Trustee. We have separately provided you with our opinion concerning
whether such assignment could be recharacterized as a pledge rather than a sale
in the event the Seller became a debtor under the United States Bankruptcy Code.
However, in the event such assignment were recharacterized as a pledge securing
a loan from the Certificateholders to the Seller, it is our opinion that the
Trustee would be deemed to have a valid and perfected security interest in the
Contracts and the proceeds thereof, which security interest would be prior to
any other security interest that may be perfected under the Uniform Commercial
Code as in effect in the State of Minnesota and over any "lien creditor" (as
defined in Minn. Stat. ss.336.9-301(3)) who becomes such after the Closing Date,
except that a subsequent purchaser of any Contract, who gives new value and
takes possession thereof in the ordinary course of his business would have
priority over the Trustee's security interest in such Contract, if such
purchaser acts without knowledge that such Loan was subject to a security
interest. We have assumed for the purposes of this opinion that during the term
of the Pooling and Servicing Agreement the Trustee, or its custodian, shall
maintain possession of the Land-and-Home Contract Files for the purpose of
perfecting the assignment to the Trustee of the Contracts. We express no opinion
with respect to the enforceability of any individual Contract or the existence
of any claims, rights or other matters in favor of any Obligor.
11. In reliance upon certain representations and warranties set
forth in the Pooling and Servicing Agreement and assuming that the Originator
and the Trustee comply with the requirements of the Pooling and Servicing
Agreement, including the filing on behalf of each of the Master REMIC and
Subsidiary REMIC of a proper election to be taxed as a REMIC, as of the date
hereof the Master REMIC and Subsidiary REMIC created pursuant to the Pooling and
Servicing Agreement will each qualify as a REMIC. Further, the Regular
Certificates will evidence ownership of the "regular interests" in the Master
REMIC and the Class C Master Certificates and Class C Subsidiary Certificates
will
F-3
evidence ownership of the single class of "residual interest" in the Master
REMIC and Subsidiary REMIC respectively. For Minnesota income and franchise tax
purposes, and subject to the foregoing assumptions, and the provisions of
Minnesota law as of the date hereof, the Trust (excluding the Capitalized
Interest Account and the Pre-Funding Account) will not be subject to tax and the
income of the Trust will be taxable to the holders of interests therein, all in
accordance with the provisions of the Code concerning REMICs. Moreover,
ownership of Certificates will not be a factor in determining whether such owner
is subject to Minnesota income and franchise taxes. Therefore, if the owner of
Certificates is not otherwise subject to Minnesota income or franchise taxes in
the State of Minnesota, such owner will not become subject to such Minnesota
taxes solely by virtue of owning Certificates.
12. The transfer of the Initial and Additional Contracts and the
proceeds thereof by the Originator to the Seller on the date hereof pursuant to
the Transfer Agreement would not be avoidable as a fraudulent transfer under the
Uniform Fraudulent Transfer Act as in effect in Minnesota on the date hereof
(Minn. Stat. ▇▇.▇▇. 513.41 through 513.51), nor, should the Originator become a
debtor under the United States Bankruptcy Code, as a fraudulent transfer under
Section 548 of the United States Bankruptcy Code (11 U.S.C. ss. 548) as in
effect on the date hereof.
13. The transfer of the Initial and Additional Contracts and the
proceeds thereof by the Seller to the Trustee on the date hereof pursuant to the
Pooling and Servicing Agreement would not be avoidable as a fraudulent transfer
under the Uniform Fraudulent Transfer Act as in effect in Minnesota on the date
hereof (Minn. Stat. ▇▇.▇▇. 513.41 through 513.51), nor, should the Seller become
a debtor under the United States Bankruptcy Code, as a fraudulent transfer under
Section 548 of the United States Bankruptcy Code (11 U.S.C. ss. 548) as in
effect on the date hereof.
F-4
EXHIBIT G
---------
FORM OF TRUSTEE'S ACKNOWLEDGEMENT
---------------------------------
U.S. Bank National Association, a national banking association, acting
as trustee (the "Trustee") of the trust created pursuant to the Pooling and
Servicing Agreement, dated as of October 1, 2000, among Conseco Finance Corp.
(the "Originator"), Conseco Finance Securitizations Corp. (the "Seller") and the
Trustee (the "Pooling and Servicing Agreement") (all capitalized terms used
herein without definition having the respective meanings specified in the
Pooling and Servicing Agreement), acknowledges, pursuant to Section 2.03 of the
Pooling and Servicing Agreement, that the Trustee has received and holds in
trust thereunder the following (i) all right, title and interest in and to the
manufactured housing contracts identified on the List of Contracts [delivered
pursuant to Section 2.02(a) of the Pooling and Servicing Agreement] [delivered
with the Subsequent Transfer Instrument of even date herewith] (the
"Contracts"), including, without limitation, all right, title and interest in
and to the Collateral Security and all rights to receive payments on or with
respect to the Contracts (other than the principal and interest due on the
Contracts on or before the applicable Cut-off Date), (ii) all rights under every
Hazard Insurance Policy relating to a Manufactured Home securing a Contract for
the benefit of the creditor of such Contract, (iii) all rights under all FHA/VA
Regulations pertaining to any FHA/VA Contract, (iv) the proceeds from the Errors
and Omissions Protection Policy and all rights under any blanket hazard
insurance policy to the extent they relate to the Manufactured Homes, (v) all
rights of the Seller under the Transfer Agreement, (vi) all documents contained
in the Contract Files and the Land-and-Home Contract Files, (vii) amounts on
deposit in the Capitalized Interest Account, the Pre-Funding Account and the
Staged-Funding Reserve Account and (viii) all proceeds and products in any way
derived from any of the foregoing.
The Trustee further acknowledges that the Trustee, directly or through
a custodian, will hold said rights, interests and proceeds in trust for the use
and benefit of all Certificateholders.
G-1
IN WITNESS WHEREOF, U.S. Bank National Association, as Trustee, has
caused this acknowledgment to be executed by its duly authorized officer as of
the ___ day of October, 2000
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By
-----------------------------------
Name:
Title:
G-2
EXHIBIT H
---------
FORM OF CUSTODIAN'S ACKNOWLEDGEMENT
-----------------------------------
U.S. Bank Trust National Association, a national banking association
(the "Custodian") acting as Custodian under a Custodial Agreement (the
"Custodial Agreement") dated as of October 1, 2000, between the Custodian and
U.S. Bank National Association, as Trustee (the "Trustee") under the Pooling and
Servicing Agreement dated as of October 1, 2000 among Conseco Finance Corp., as
Originator and Servicer (the "Originator"), Conseco Finance Securitizations
Corp., as Seller (the "Seller"), and the Trustee, pursuant to which the
Custodian holds on behalf of the Trustee certain "Land-and-Home Contract Files,"
as described in the Pooling and Servicing Agreement, hereby acknowledges receipt
of such Land-and-Home Contract Files, except as noted on the exception list
attached hereto. The Custodian further acknowledges that it will, within 90 days
of the date of the Custodial Agreement, conduct a review of the Land-and-Home
Contract Files and confirm to the Trustee and the Originator that each
Land-and-Home Contract File includes (a) an original executed copy of the
Land-and-Home Contract, (b) an original or a copy of the related Mortgage, (c)
an assignment of the Land-and-Home Contract and the related Mortgage from the
originator (if other than the Originator) to the Originator, (d) an endorsement
of the Land-and-Home Contract by the Originator to the Trustee or in blank, (e)
an assignment of the related Mortgage to the Trustee or in blank, and (f) any
extension, modification or waiver agreement(s), except as noted on the document
exception listing to be attached to such confirmation. The Custodian will not
otherwise review the Land-and-Home Contracts and Land-and-Home Contract Files
for compliance with the terms of the Pooling and Servicing Agreement.
IN WITNESS WHEREOF, U.S. Bank Trust National Association has caused
this acknowledgment to be executed by its duly authorized officer as of the ___
day of October, 2000.
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Custodian
By
-----------------------------------
Its
----------------------------------
H-1
EXHIBIT I
---------
FORM OF CERTIFICATE OF SERVICING OFFICER
----------------------------------------
CONSECO FINANCE CORP.
The undersigned certifies that he is a [title] of Conseco Finance
Corp., a Delaware corporation (the "Company"), and that as such he is duly
authorized to execute and deliver this certificate on behalf of the Company
pursuant to Section 6.02 of the Pooling and Servicing Agreement (the
"Agreement") dated as of October 1, 2000 among the Company, Conseco Finance
Securitizations Corp. and U.S. Bank National Association, as Trustee (all
capitalized terms used herein without definition having the respective meanings
specified in the Agreement), and further certifies that:
1. The Monthly Report for the period from ______________ to
________________ attached to this certificate is complete and accurate in
accordance with the requirements of Sections 6.01 and 6.02 of the Agreement; and
2. As of the date hereof, no Event of Termination or event that
with notice or lapse of time or both would become an Event of Termination has
occurred.
IN WITNESS WHEREOF, I have affixed hereunto my signature the ___ day of
_________, ____.
CONSECO FINANCE CORP.
By
-----------------------------------
[Name]
[Title]
I-1
EXHIBIT J
---------
FORM OF CLASS C SUBSIDIARY CERTIFICATE
--------------------------------------
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
UNCERTIFICATED SUBSIDIARY INTERESTS AS DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE RESOLD OR TRANSFERRED EXCEPT IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE. THIS CERTIFICATE MAY ONLY BE TRANSFERRED TO A PERMITTED TRANSFEREE
(AS DEFINED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN); ANY SUCH
TRANSFER MUST ALSO SATISFY THE OTHER REQUIREMENTS OF SECTION 9.02 OF SUCH
POOLING AND SERVICING AGREEMENT.
Class C Subsidiary No.
(Subordinate)
Cut-off Date: as defined in the Percentage Interest: 100%
Pooling and Servicing Agreement
dated as of October 1, 2000
First Remittance Date:
November 1, 2000
J-1
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
------------------------------------------------
PASS-THROUGH CERTIFICATES, SERIES 2000-5, CLASS C SUBSIDIARY
------------------------------------------------------------
(RESIDUAL INTEREST)
-------------------
Cut-off Date Pool Principal Balance: $742,500,000
This certifies that Green Tree Finance Corp.-Two is the registered
owner of the Residual Interest represented by this Certificate, and entitled to
certain distributions out of Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificate Trust 2000-5 (the "Trust"), which includes among its
assets a pool of manufactured housing installment sale contracts and installment
loan agreements (including, without limitation, all related security interests
and any and all rights to receive payments which are due pursuant thereto after
the applicable Cut-off Date) (the "Contracts"). The Trust has been created
pursuant to a Pooling and Servicing Agreement (the "Agreement"), dated as of
October 1, 2000, among Conseco Finance Corp., as Originator and Servicer (the
"Originator"), Conseco Finance Securitizations Corp., as Seller (the "Seller"),
and U.S. Bank National Association, as Trustee of the Trust (the "Trustee").
This Class C Subsidiary Certificate is one of the Class C Subsidiary
Certificates described in the Agreement and is issued pursuant and subject to
the Agreement. By acceptance of this Class C Subsidiary Certificate the holder
assents to and becomes bound by the Agreement. To the extent not defined herein,
all capitalized terms have the meanings assigned to such terms in the Agreement.
The Agreement contemplates, subject to its terms, payment on the first
day (or if such day is not a Business Day, the next succeeding Business Day)
(the "Remittance Date") of each month commencing in November 2000, so long as
the Agreement has not been terminated, by check (or, if such Class C Subsidiary
Certificateholder holds Class C Subsidiary Certificates with an aggregate
Percentage Interest of at least 20% and so desires, by wire transfer pursuant to
instructions delivered to the Trustee at least ten days prior to such Remittance
Date) to the registered Class C Subsidiary Certificateholder at the address
appearing on the Certificate Register as of the Business Day immediately
preceding such Remittance Date, in an amount equal to the Class C Subsidiary
Distribution Amount.
The Class C Subsidiary Certificateholder, by its acceptance of this
Certificate, agrees that it will look solely to the funds in the Certificate
Account to the extent available for distribution to the Class C Subsidiary
Certificateholder as provided in the Agreement for payment hereunder and that
the Trustee in its individual capacity is not personally liable to the Class C
Subsidiary Certificateholder for any amounts payable under this Certificate or
the Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement. By acceptance of this Certificate, the
Certificateholder agrees to disclosure of his, her or its name and address to
other Certificateholders under the conditions specified in the Agreement.
This Class C Subsidiary Certificate does not purport to summarize the
Agreement and reference is made to the Agreement for information with respect to
the interests, rights, benefits, obligations, proceeds and duties evidenced
hereby and the rights, duties and immunities of the Trustee. Copies of the
Agreement and all amendments thereto will be provided to any Class C
Certificateholder free of charge upon a written request to the Trustee.
J-2
As provided in the Agreement and subject to the limitations set forth
therein, the transfer of this Class C Subsidiary Certificate is registrable in
the Certificate Register of the Certificate Registrar upon surrender of this
Class C Subsidiary Certificate for registration of transfer at the office or
agency maintained by the Trustee in St. ▇▇▇▇, Minnesota, accompanied by a
written instrument of transfer in form satisfactory to the Trustee and the
Certificate Registrar duly executed by the holder thereof or his or her attorney
duly authorized in writing, and thereupon one or more new Class C Subsidiary
Certificates evidencing the same aggregate amount of Class C Subsidiary
Certificates will be issued to the designated transferee or transferees.
As provided in the Agreement and subject to certain limitations therein
set forth, this Class C Subsidiary Certificate is exchangeable for new Class C
Subsidiary Certificates of authorized denominations evidencing the same
aggregate Percentage Interest as requested by the holder surrendering the same.
The Originator, the Servicer, the Trustee, the Paying Agent and the
Certificate Registrar and any agent of the Originator, the Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the person in
whose name this Class C Subsidiary Certificate is registered as the owner hereof
for all purposes, and neither the Originator, the Servicer, the Trustee, the
Paying Agent, the Certificate Registrar nor any such agent shall be affected by
any notice to the contrary.
The holder of this Class C Subsidiary Certificate, by acceptance
hereof, agrees that, in accordance with the requirements of Section 860D(b)(1)
of the Code, the federal tax return of the Trust for its first taxable year
shall provide that the Subsidiary REMIC elects to be treated as a "real estate
mortgage investment conduit" (a "REMIC") under the Code for such taxable year
and all subsequent taxable years. The Uncertificated Subsidiary Interests shall
be "regular interests" in the Subsidiary REMIC and the Class C Subsidiary
Certificates shall be the "residual interest" in the Subsidiary REMIC. In
addition, the holder of this Class C Subsidiary Certificate, by acceptance
hereof, (i) agrees to file tax returns consistent with and in accordance with
any elections, decisions or other reports made or filed with regard to federal,
state or local taxes on behalf of the Subsidiary REMIC, and (ii) agrees to
cooperate with the Originator in connection with examinations of the Subsidiary
REMIC's affairs by tax authorities, including administrative and judicial
proceedings, and (iii) makes the additional agreements, designations and
appointments, and undertakes the responsibilities, set forth in Section 6.06 of
the Agreement.
J-3
IN WITNESS WHEREOF, Manufactured Housing Contract Senior/ Subordinate
Pass-Through Certificate Trust 2000-5 has caused this Certificate to be duly
executed by the manual signature of a duly authorized officer of the Trustee.
Dated: MANUFACTURED HOUSING CONTRACT
SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
TRUST 2000-5
By U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------------
Authorized Officer
J-4
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto the within Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificate, and does hereby irrevocably constitute and appoint Attorney to
transfer the said certificate on the Certificate Register maintained by the
Trustee, with full power of substitution in the premises.
Dated: By
-----------------------------------
Signature
J-5
EXHIBIT K
---------
FORM OF CLASS C MASTER CERTIFICATE
----------------------------------
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, THE CLASS M CERTIFICATES, THE CLASS B-1 CERTIFICATES, THE CLASS
B-2 CERTIFICATES AND THE CLASS B-3I CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND
LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE RESOLD OR TRANSFERRED EXCEPT IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 9.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE. THIS CERTIFICATE MAY ONLY BE TRANSFERRED TO A PERMITTED TRANSFEREE
(AS DEFINED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN); ANY SUCH
TRANSFER MUST ALSO SATISFY THE OTHER REQUIREMENTS OF SECTION 9.02 OF SUCH
POOLING AND SERVICING AGREEMENT.
Class C Master No.
(Subordinate)
Cut-off Date: as defined in the Percentage Interest: 100%
Pooling and Servicing Agreement
dated as of October 1, 2000
First Remittance Date:
November 1, 2000
K-1
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
------------------------------------------------
PASS-THROUGH CERTIFICATES, SERIES 2000-5, CLASS C MASTER
--------------------------------------------------------
(RESIDUAL INTEREST)
-------------------
Cut-off Date Pool Principal Balance: $742,500,000
This certifies that Green Tree Finance Corp.-Two is the registered
owner of the Residual Interest represented by this Certificate, and entitled to
certain distributions out of Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificate Trust 2000-5 (the "Trust"), which includes among its
assets a pool of manufactured housing installment sale contracts and installment
loan agreements (including, without limitation, all related security interests
and any and all rights to receive payments which are due pursuant thereto after
the applicable Cut-off Date) (the "Contracts"). The Trust has been created
pursuant to a Pooling and Servicing Agreement (the "Agreement"), dated as of
October 1, 2000, among Conseco Finance Corp., as Originator and Servicer (the
"Originator"), Conseco Finance Securitizations Corp., as Seller (the "Seller"),
and U.S. Bank National Association, as Trustee of the Trust (the "Trustee").
This Class C Master Certificate is one of the Class C Master Certificates
described in the Agreement and is issued pursuant and subject to the Agreement.
By acceptance of this Class C Master Certificate the holder assents to and
becomes bound by the Agreement. To the extent not defined herein, all
capitalized terms have the meanings assigned to such terms in the Agreement.
The Agreement contemplates, subject to its terms, payment on the first
day (or if such day is not a Business Day, the next succeeding Business Day)
(the "Remittance Date") of each month commencing in November 2000, so long as
the Agreement has not been terminated, by check (or, if such Class C Master
Certificateholder holds Class C Master Certificates with an aggregate Percentage
Interest of at least 20% and so desires, by wire transfer pursuant to
instructions delivered to the Trustee at least ten days prior to such Remittance
Date) to the registered Class C Master Certificateholder at the address
appearing on the Certificate Register as of the Business Day immediately
preceding such Remittance Date, in an amount equal to the Class C Master
Distribution Amount.
The Class C Master Certificateholder, by its acceptance of this
Certificate, agrees that it will look solely to the funds in the Certificate
Account to the extent available for distribution to the Class C Master
Certificateholder as provided in the Agreement for payment hereunder and that
the Trustee in its individual capacity is not personally liable to the Class C
Master Certificateholder for any amounts payable under this Certificate or the
Agreement or, except as expressly provided in the Agreement, subject to any
liability under the Agreement. By acceptance of this Certificate, the
Certificateholder agrees to disclosure of his, her or its name and address to
other Certificateholders under the conditions specified in the Agreement.
This Class C Master Certificate does not purport to summarize the
Agreement and reference is made to the Agreement for information with respect to
the interests, rights, benefits, obligations, proceeds and duties evidenced
hereby and the rights, duties and immunities of the Trustee. Copies of the
Agreement and all amendments thereto will be provided to any Class C Master
Certificateholder free of charge upon a written request to the Trustee.
K-2
As provided in the Agreement and subject to the limitations set forth
therein, the transfer of this Class C Master Certificate is registrable in the
Certificate Register of the Certificate Registrar upon surrender of this Class C
Master Certificate for registration of transfer at the office or agency
maintained by the Trustee in St. ▇▇▇▇, Minnesota, accompanied by a written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by the holder thereof or his or her attorney duly
authorized in writing, and thereupon one or more new Class C Master Certificates
evidencing the same aggregate amount of Class C Master Certificates will be
issued to the designated transferee or transferees.
As provided in the Agreement and subject to certain limitations therein
set forth, this Class C Master Certificate is exchangeable for new Class C
Master Certificates of authorized denominations evidencing the same aggregate
Percentage Interest as requested by the holder surrendering the same.
The Originator, the Servicer, the Trustee, the Paying Agent and the
Certificate Registrar and any agent of the Originator, the Servicer, the
Trustee, the Paying Agent or the Certificate Registrar may treat the person in
whose name this Class C Master Certificate is registered as the owner hereof for
all purposes, and neither the Originator, the Servicer, the Trustee, the Paying
Agent, the Certificate Registrar nor any such agent shall be affected by any
notice to the contrary.
The holder of this Class C Master Certificate, by acceptance hereof,
agrees that, in accordance with the requirements of Section 860D(b)(1) of the
Code, the federal tax return of the Trust for its first taxable year shall
provide that the Master REMIC elects to be treated as a "real estate mortgage
investment conduit" (a "REMIC") under the Code for such taxable year and all
subsequent taxable years. The Regular Certificates shall be "regular interests"
in the Master REMIC and the Class C Master Certificates shall be the "residual
interest" in the Master REMIC. In addition, the holder of this Class C Master
Certificate, by acceptance hereof, (i) agrees to file tax returns consistent
with and in accordance with any elections, decisions or other reports made or
filed with regard to federal, state or local taxes on behalf of the Master
REMIC, and (ii) agrees to cooperate with the Originator in connection with
examinations of the Master REMIC's affairs by tax authorities, including
administrative and judicial proceedings, and (iii) makes the additional
agreements, designations and appointments, and undertakes the responsibilities,
set forth in Section 6.06 of the Agreement.
K-3
IN WITNESS WHEREOF, Manufactured Housing Contract Senior/ Subordinate
Pass-Through Certificate Trust 2000-5 has caused this Certificate to be duly
executed by the manual signature of a duly authorized officer of the Trustee.
Dated: MANUFACTURED HOUSING CONTRACT
SENIOR/SUBORDINATE PASS-THROUGH
CERTIFICATE TRUST 2000-5
By U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------------
Authorized Officer
K-4
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ________________ the within Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificate, and does hereby irrevocably
constitute and appoint ________________ Attorney to transfer the said
certificate on the Certificate Register maintained by the Trustee, with full
power of substitution in the premises.
Date: By
-----------------------------------
Signature
K-5
EXHIBIT L-1
-----------
FORM OF CERTIFICATE REGARDING REPURCHASED CONTRACTS
---------------------------------------------------
CONSECO FINANCE CORP.
CERTIFICATE REGARDING REPURCHASED CONTRACTS
The undersigned certifies that he is a [title] of Conseco Finance
Corp., a Delaware corporation (the "Company"), and that as such he is duly
authorized to execute and deliver this certificate on behalf of the Company
pursuant to Section 3.06 of the Pooling and Servicing Agreement (the
"Agreement"), dated as of October 1, 2000 among the Company, Conseco Finance
Securitizations Corp. and U.S. Bank National Association, as Trustee (all
capitalized terms used herein without definition having the respective meanings
specified in the Agreement), and further certifies that:
1. The Contracts on the attached schedule are to be repurchased
by the Company on the date hereof pursuant to Section 3.06 of the Agreement.
2. Upon deposit of the Repurchase Price for such Contracts, such
Contracts may, pursuant to Section 3.06 of the Agreement, be assigned by the
Trustee to the Company.
IN WITNESS WHEREOF, I have affixed hereunto my signature this ___ day
of _______, ____.
CONSECO FINANCE CORP.
By
-----------------------------------
[Name]
[Title]
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
-----------
FORM OF CERTIFICATE REGARDING SUBSTITUTED CONTRACTS
---------------------------------------------------
CONSECO FINANCE CORP.
CERTIFICATE REGARDING SUBSTITUTED CONTRACTS
The undersigned certify that they are [title] and [title], respectively
of Conseco Finance Corp., a corporation organized under the laws of Delaware
("the Company"), and that as such they are duly authorized to execute and
deliver this certificate on behalf of the Company pursuant to Section 3.06(b) of
the Pooling and Servicing Agreement (the "Agreement"), dated as of October 1,
2000 among the Company, Conseco Finance Securitizations Corp. and U.S. Bank
National Association, as Trustee (all capitalized terms used herein without
definition having the respective meanings specified in the Agreement), and
further certify that:
1. The Contract and Contract File [or Land-and-Home Contract
File, as applicable] for each such Eligible Substitute Contract [are being held
by the Company, as Servicer] have been delivered to [the Trustee or its
Custodian] [_________, the successor Servicer].
2. The Contracts on the attached schedule are to be substituted
on the date hereof pursuant to Section 3.06(b) of the Agreement and each such
Contract is an Eligible Substitute Contract [description how the Contracts
satisfy the definition of "Eligible Substitute Contract"].
3. The UCC-1 financing statements in respect of the Contracts to
be substituted, in the form required by Section 3.06 (b)(iii) of the Agreement,
have been filed with the appropriate offices.
4. (x) the Company shall have delivered to the Trustee, or
its Custodian, the related Land-and-Home Contract Files; and
(y) the Company has delivered to the Trustee an opinion
of counsel satisfactory to the Trustee to the effect that the Trustee holds a
perfected first priority lien in the real estate securing such Eligible
Substitute Contracts, or evidence of recordation of the assignment to the
Trustee on behalf of the Trust of each Mortgage securing such Eligible
Contracts.
5. There has been deposited in the Certificate Account the
amounts listed on the schedule attached hereto as the amount by which the
Scheduled Principal Balance of each Replaced Contract exceeds the Scheduled
Principal Balance of each Contract being substituted therefor.
L-2-1
IN WITNESS WHEREOF, we have affixed hereunto our signatures this ___
day of _______ ____.
CONSECO FINANCE CORP.
By
-----------------------------------
[Name]
[Title]
L-2-2
EXHIBIT M
---------
FORM OF REPRESENTATION LETTER
-----------------------------
U.S. Bank National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Conseco Finance Securitizations Corp.
300 Landmark Towers
▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
RE: Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2000-5, Class [B-3I/C Subsidiary/C
Master]
[The undersigned purchaser (the "Purchaser") understands that the
purchase of the above-referenced certificates (the "Certificates") may be made
only by institutions which are "Accredited Investors" under Regulation D, as
promulgated under the Securities Act of 1933, as amended (the "1933 Act"), which
includes banks, savings and loan associations, registered brokers and dealers,
insurance companies, investment companies, and organizations described in
Section 501(c)(3) of the Internal Revenue Code, corporations, business trusts
and partnerships, not formed for the specific purpose of acquiring the
Certificates offered, with total assets in excess of $5,000,000. The undersigned
represents on behalf of the Purchaser that the Purchaser is an "Accredited
Investor" within the meaning of such definition. The Purchaser is urged to
review carefully the responses, representations and warranties it is making
herein.]
Representations and Warranties
------------------------------
The Purchaser makes the following representations and warranties in
order to permit the Trustee, Conseco Finance Securitizations Corp., and
[underwriter of the Class B-3I/Class C Subsidiary/Class C Master Certificates]
to determine its suitability as a purchaser of Certificates and to determine
that the exemption from registration relied upon by Conseco Finance
Securitizations Corp. under Section 4(2) of the 1933 Act is available to it.
1. The Purchaser understands that the Certificates have not been
and will not be registered under the 1933 Act and may be resold (which resale is
not currently contemplated) only if registered pursuant to the provisions of the
1933 Act or if an exemption from registration is available, that Conseco Finance
Securitizations Corp. is not required to register the Certificates and that any
transfer must comply with Section 9.02 of the Pooling and Servicing Agreement
relating to the Certificates.
2. The Purchaser will comply with all applicable federal and
state securities laws in connection with any subsequent resale of the
Certificates.
3. [The Purchaser is a sophisticated institutional investor and
has knowledge and experience in financial and business matters and is capable of
evaluating the merits and risks of
M-1
its investment in the Certificates and is able to bear the economic risk of such
investment. The Purchaser has reviewed the Prospectus dated September 28, 2000
and related Prospectus Supplement dated September 28, 2000, with respect to the
Certificates, and has been given such information concerning the Certificates,
the underlying installment sale contracts and Conseco Finance Securitizations
Corp. as it has requested.]
4. The Purchaser is acquiring the Certificates as principal for
its own account (or for the account of one or more other institutional investors
for which it is acting as duly authorized fiduciary or agent) for the purpose of
investment and not with a view to or for sale in connection with any
distribution thereof, subject nevertheless to any requirement of law that the
disposition of the Purchaser's property shall at all times be and remain within
its control.
5. The Purchaser does not qualify as (i) an employee benefit plan
(a "Plan") as defined in section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), whether or not it is subject to the
provisions of Title I of ERISA, (ii) a plan described in section 4975(e)(1) of
the Internal Revenue Code of 1986 (also a "Plan"), or (iii) an entity whose
underlying assets are deemed to be assets of a Plan by reason of such Plan's
investment in the entity (as determined under Department of Labor Regulations,
29 C.F.R. ss.2510.3-101 (1990)).
6. The Purchaser understands that such Certificate will bear a
legend substantially as set forth in the form of Certificate included in the
Pooling and Servicing Agreement.
7. The Purchaser, as holder of the Class B-3I/C Subsidiary/C
Master Certificate, acknowledges (i) it may incur tax liabilities in excess of
any cash flows generated by the interest and (ii) it intends to pay the taxes
associated with holding the Class B-3I/C Subsidiary/C Master Certificate as they
become due.
8. The Purchaser agrees that it will obtain from any purchaser of
the Certificates from it the same representations, warranties and agreements
contained in the foregoing paragraphs 1 through 7 and in this paragraph 8.
The representations and warranties contained herein shall be binding
upon the heirs, executors, administrators and other successors of the
undersigned. If there is more than one signatory hereto, the obligations,
representations, warranties and agreements of the undersigned are made jointly
and severally.
M-2
Executed at ______________________, ________________, this _____ day of
_________________.
Purchaser's Name (Print)
By
-----------------------------------
Signature
Its
Address of Purchaser
-----------------
-------------------------------------
Purchaser's Taxpayer Identification
Number
-------------------------------------
-------------------------------------
M-3
EXHIBIT N
---------
FORM OF MONTHLY REPORT
----------------------
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATES, SERIES 2000-5
Distribution Date: ______
Class A-1 Certificates
----------------------
1 (a) Amount Available (including Monthly
Servicing Fee) ______
(b) Class M-1 Interest Deficiency Amount (if any), Class M-2
Interest Deficiency Amount (if any) and Class B-1 Interest
Deficiency Amount (if any) withdrawn for prior
Remittance Date ______
(c) Amount Available after giving effect to
withdrawal of Class M-1 Interest
Deficiency Amount, Class M-2 Interest
Deficiency Amount and Class B-1
Interest Deficiency Amount for prior
Remittance Date ______
(d) Amount withdrawn from [Capitalized Interest]
[Pre-Funding] [Staged-Funding Contract Reserve] Account ______
Interest
--------
Class A Certificates
--------------------
2. Aggregate Class A-1 interest
(a) Interest accrued at Class A-1 Remittance Rate (6.98%) ______
(b) Class A-1 Interest paid ______
(c) Interest accrued at Class A-2 Remittance Rate (7.06%) ______
(d) Class A-2 Interest paid ______
(e) Interest accrued at Class A-3 Remittance Rate (7.21%) ______
(f) Class A-3 Interest paid ______
(g) Interest accrued at Class A-4 Remittance Rate (7.47%) ______
(h) Class A-4 Interest paid ______
(i) Interest accrued at Class A-5 Remittance Rate (7.70%) ______
(j) Class A-5 Interest paid ______
(k) Interest accrued at Class A-6 Remittance Rate (7.96%) ______
(l) Class A-6 Interest paid ______
N-1
(m) Interest accrued at Class A-7 Remittance Rate (8.20% unless the ______
Weighted Average Contract Rate is less than 8.20%)
(n) Class A-7 Interest paid ______
(o) Class A Interest Shortfall ______
3. Amount applied to Unpaid Class A Interest Shortfall ______
(a) Class A-1 ______
(b) Class A-2 ______
(c) Class A-3 ______
(d) Class A-4 ______
(e) Class A-5 ______
(f) Class A-6 ______
(g) Class A-7 ______
4. Remaining Unpaid Class A Interest Shortfall ______
Class M-1 Certificates
----------------------
5. Class M-1 Interest on Class M-1 Adjusted
Principal Balance ______
(a) Class M-1 Adjusted Principal Balance ______
(b) Interest accrued at Class M-1 Remittance Rate (8.40%,
unless the Weighted Average Contract Rate
is less than 8.40%) ______
(c) Interest paid on Class M-1 Adjusted
Principal Balance ______
(d) Class M-1 Interest Shortfall ______
6. Amount applied to Unpaid Class M-1
Interest Shortfall ______
7. Remaining Unpaid Class M-1
Interest Shortfall ______
Class M-2 Certificates
----------------------
8. Class M-2 Interest on Class M-2 Adjusted
Principal Balance ______
(a) Class M-2 Adjusted Principal Balance ______
(b) Interest accrued at Class M-2 Remittance Rate (9.03%,
unless the Weighted Average Contract Rate
is less than 9.03%) ______
N-2
(c) Interest paid on Class M-2 Adjusted
Principal Balance ______
(d) Class M-2 Interest Shortfall ______
9. Amount applied to Unpaid Class M-2
Interest Shortfall ______
10. Remaining Unpaid Class M-2
Interest Shortfall ______
Class B-1 Certificates
----------------------
11. Class B-1 interest on Class B-1 Adjusted
Principal Balance
(a) Class B-1 Adjusted Principal Balance ______
(b) Interest accrued at Class B-1 Remittance Rate
(10.21%, unless the Weighted Average Contract
Rate is less than 10.21%) ______
(c) Interest paid on Class B-1 Adjusted
Principal Balance ______
(d) Class B-1 Interest Shortfall ______
12. Amount applied to Unpaid
Class B-1 Interest Shortfall ______
13. Remaining Unpaid Class B-1
Interest Shortfall ______
Principal
---------
14. Formula Principal Distribution Amount: ______
(a) Scheduled principal ______
(b) Principal Prepayments ______
(c) Liquidated Contracts ______
(d) Repurchases ______
(e) Plus principal received during the
first 10 days of the next Due Period ______
(f) Minus principal received during the
first 10 days of the prior Due Period ______
[(g) Pre-Funded Amount/Unfunded Contract Shortfall] ______
N-3
15. Pool Scheduled Principal Balance ______
16. Overcollateralization Amount (before principal distributions) ______
17. Additional Principal Distribution Amount ______
Class A Certificates
--------------------
18. Unpaid Class A Principal Shortfall
(if any) following prior Remittance Date
(a) Class A-1 ______
(b) Class A-2 ______
(c) Class A-3 ______
(d) Class A-4 ______
(e) Class A-5 ______
(f) Class A-6 ______
(g) Class A-7 ______
19. Class A Percentage for such
Remittance Date ______
20. Class A Percentage for the following
Remittance Date ______
21. Class A principal distribution (including Class A Percentage of
Formula Principal Distribution Amount, Unpaid Class A Principal
Shortfall and any Additional Principal Distribution Amount paid) ______
(a) Class A-1 ______
(b) Class A-2 ______
(c) Class A-3 ______
(d) Class A-4 ______
(e) Class A-5 ______
(f) Class A-6 ______
(g) Class A-7 ______
22. (a) Class A-1 Principal Balance ______
(b) Class A-2 Principal Balance ______
(c) Class A-3 Principal Balance ______
(d) Class A-4 Principal Balance ______
(e) Class A-5 Principal Balance ______
(f) Class A-6 Principal Balance ______
(g) Class A-7 Principal Balance ______
N-4
23. Unpaid Class A Principal Shortfall
(if any) following current
Remittance Date
(a) Class A-1 ______
(b) Class A-2 ______
(c) Class A-3 ______
(d) Class A-4 ______
(e) Class A-5 ______
(f) Class A-6 ______
(g) Class A-7 ______
Class M-1 Distribution Test, Class M-2 Distribution Test
--------------------------------------------------------
and Class B-1 Distribution Test
-------------------------------
(calculations applicable on and after the Remittance Date occurring in November 2004)
24. Average Sixty-Day Delinquency Ratio Test
(a) Sixty-Day Delinquency Ratio for current Remittance Date ______
(b) Average Sixty-Day Delinquency Ratio
(arithmetic average of ratios for this
month and two preceding months;
may not exceed 5.0%) ______
25. Cumulative Realized Losses Test
Cumulative Realized Losses for current Remittance Date (as a percentage
of Cut-off Date Pool Principal Balance; may not exceed 5.5% from
November 1, 2004 to October 31, 2005; 7.0% from November 1, 2005 to
October, 2006; 9.0% from November 1, 2006 to
October 31, 2007; and 10.5% thereafter) ______
26. Current Realized Losses Test
(a) Current Realized Losses
for current Remittance Date ______
(b) Current Realized Loss Ratio (total Realized Losses for most
recent three months, multiplied by 4, divided by arithmetic
average of Pool Scheduled Principal Balances
N-5
for third preceding Remittance Date and for current Remittance
Date; may not exceed 2.75%) ______
27. Class M-1 Principal Balance Test
Sum of Class M-1 Principal Balance, Class M-2 Principal Balance, Class
B Principal Balance and the Overcollateralization Amount before
distributions on current Remittance Date) divided by Pool Scheduled
Principal Balance as of preceding Remittance
Date is equal to or greater than 26.25%. ______
28. Class M-2 Principal Balance Test
Sum of Class M-2 Principal Balance, Class B Principal Balance and the
Overcollateralization Amount (before distributions on current
Remittance Date) divided by Pool Scheduled Principal Balance as of
preceding Remittance Date is equal to or
greater than 18.75%. ______
29. Class B Principal Balance Test
(a) The Class B Principal Balance
(before any distributions on current
Remittance Date) as of such Remittance
Date is greater than $15,000,000 ______
(b) Sum of Class B Principal Balance and the Overcollateralization
Amount (before distributions on current Remittance Date)
divided by Pool Scheduled Principal Balance as of preceding
Remittance Date is equal to or greater
than 12.75%. ______
Class M-1 Certificates
----------------------
30. Class M-1 Percentage for such
Remittance Date ______
31. Class M-1 Percentage for the following
Remittance Date ______
N-6
32. Class M-1 principal distribution:
(a) Current (Class M-1 Percentage of Formula Principal
Distribution Amount) ______
(b) Unpaid Class M-1 Principal Shortfall ______
(c) Additional Principal Distribution Amount ______
33. Unpaid Class M-1 Principal Shortfall
(if any) following current
Remittance Date ______
34. Class M-1 Liquidation Loss Interest
(a) Class M-1 Liquidation Loss Amount ______
(b) Amount applied to Class M-1
Liquidation Loss Interest Amount ______
(c) Remaining Class M-1 Liquidation Loss
Interest Amount ______
(d) Amount applied to Unpaid Class M-1
Loss Interest Shortfall ______
(e) Remaining Unpaid Class M-1
Liquidation Loss Interest Shortfalls ______
Class M-2 Certificates
----------------------
35. Class M-2 Percentage for such
Remittance Date ______
36. Class M-2 Percentage for the following
Remittance Date ______
37. Class M-2 principal distribution
(a) Current (Class M-2 Percentage of Formula Principal
Distribution Amount) ______
(b) Unpaid Class M-2 Principal Shortfall ______
(c) Additional Principal Distribution Amount ______
N-7
38. Unpaid Class M-2 Principal Shortfall
(if any) following current
Remittance Date ______
39. Class M-2 Liquidation Loss Interest
(a) Class M-2 Liquidation Loss Amount ______
(b) Amount applied to Class M-2
Liquidation Loss Interest Amount ______
(c) Remaining Class M-2 Liquidation Loss
Interest Amount ______
(d) Amount applied to Unpaid Class M-2
Loss Interest Shortfall ______
(e) Remaining Unpaid Class M-2
Liquidation Loss Interest Shortfalls ______
Class B Certificates
--------------------
40. (a) Class B Percentage for such
Remittance Date ______
(b) Class B Percentage for the following
Remittance Date ______
41. Class B-1 principal distribution
(a) Current (Class B Percentage of
Formula Principal Distribution Amount) ______
(b) Unpaid Class B-1 Principal Shortfall ______
(c) Additional Principal Distribution Amount ______
42. Unpaid Class B-1 Principal Shortfall ______
43. Class B-1 Principal Balance ______
44. Class B-1 Liquidation Loss Interest
(a) Class B-1 Liquidation Loss Amount ______
N-8
(b) Amount applied to Class B-1
Liquidation Loss Interest Amount ______
(c) Remaining Class B-1 Liquidation Loss
Interest Amount ______
(d) Amount applied to Unpaid Class B-1
Liquidation Loss Interest Shortfall ______
(e) Remaining Unpaid Class B-1 Liquidation
Loss Interest Shortfall ______
Class B-2 Certificates
----------------------
45. Remaining Amount Available ______
Interest
--------
46. Interest accrued at Class B-2 Remittance Rate (9.80%,
unless the Weighted Average Contract Rate
is less than 9.80%) ______
47. Class B-2 Interest paid ______
48. Current interest ______
49. Amount applied to Unpaid Class
B-2 Interest Shortfall ______
50. Remaining Unpaid Class B-2
Interest Shortfall ______
Principal
---------
51. Unpaid Class B-2 Principal Shortfall
(if any) following prior Remittance Date ______
52. Class B-2 Liquidation Loss
Amount ______
53. Current principal (zero until Class B-1
paid down; thereafter, Class B Percentage
of Formula Principal Distribution Amount) ______
54. Additional Principal Distribution Amount ______
N-9
55. Class B-2 Principal Balance ______
Class B-3I Certificates
-----------------------
56. Excess Interest ______
57. Class B-3I Formula Distribution Amount
(Excess Interest plus Unpaid Class B-3I Shortfall) ______
58. Class B-3I Distribution Amount (lesser of remaining
Amount Available and line 57) ______
59. Class B-3I Shortfall (line 57 minus line 58) ______
60. Unpaid Class B-3I Shortfall ______
Class A, Class M and Class B Certificates
-----------------------------------------
61. Aggregate Scheduled Principal Balance of delinquent Contracts
as of Determination Date
(a) 30 - 59 days ______
(b) 60 days or more ______
62. Manufactured Homes repossessed ______
63. Manufactured Homes repossessed
but remaining in inventory ______
64. Repossessed Manufactured Homes purchased by Originator
or Subsidiary
(a) number of Contracts
current month ______
cumulative ______
(b) Scheduled Principal Balance
current month ______
cumulative ______
(c) Purchase Price
current month ______
cumulative ______
N-10
65. Weighted Average Contract Rate
of all outstanding Contracts ______
Class M and Class B Certificates
--------------------------------
66. Class M-1 Interest Deficiency Amount on
such Remittance Date ______
67. Class M-2 Interest Deficiency Amount on
such Remittance Date ______
68. Class B-1 Interest Deficiency Amount on
such Remittance Date ______
Please contact Bondholder Services Department of U.S. Bank National Association,
1-800-934-6802 with any questions regarding this Statement or your Distribution.
N-11
EXHIBIT O
---------
FORM OF ADDITION NOTICE
-----------------------
______________, 2000
U.S. Bank National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Pooling and Servicing Agreement (the "Agreement"), dated as of
October 1, 2000, among Conseco Finance Corp. (the "Company"),
Conseco Finance Securitizations Corp. (the "Seller") and U.S.
Bank National Association as Trustee (the "Trustee") relating
to Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificates, Series 2000-5
Ladies and Gentlemen:
Capitalized terms not otherwise defined in this Notice have the
meanings given them in the Agreement. The Seller hereby notifies the Trustee of
an assignment to the Trust of Subsequent Contracts on the date and in the
amounts set forth below:
Subsequent Transfer Date: _________________
Cut-off Date Principal Balance of Subsequent Contracts to be assigned
to Trust on Subsequent Transfer Date: $_____________
Please acknowledge your receipt of this notice by countersigning the
enclosed copy in the space indicated below and returning it to the attention of
the undersigned.
Very truly yours,
CONSECO FINANCE SECURITIZATIONS CORP.
By
-----------------------------------
Name:
Title:
ACKNOWLEDGED AND AGREED:
U.S. BANK NATIONAL ASSOCIATION
By
-----------------------------
Name:
Title:
O-1
EXHIBIT P
---------
FORM OF SUBSEQUENT TRANSFER INSTRUMENT
--------------------------------------
In accordance with the Pooling and Servicing Agreement (the
"Agreement") dated as of October 1, 2000, among Conseco Finance Corp. (the
"Originator"), Conseco Finance Securitizations Corp. (the "Seller") and U.S.
Bank National Association as Trustee (the "Trustee"), the Seller does hereby
transfer, assign, set over and otherwise convey, without recourse, to
Manufactured Housing Contract Senior/Subordinate Pass-Through Certificate Trust
2000-5, created by the Agreement, to be held in trust as provided in the
Agreement, (i) all the right, title and interest of the Seller in and to the
Subsequent Contracts identified on the list attached hereto as Exhibit A (the
"Subsequent Contracts"), including, without limitation, all right, title and
interest in and to the Collateral Security and all rights to receive payments on
or with respect to the Subsequent Contracts (other than the principal and
interest due on the Subsequent Contracts on or before the applicable Cut-off
Date), (ii) all rights under every Hazard Insurance Policy relating to a
Manufactured Home securing a Subsequent Contract for the benefit of the owner of
such Subsequent Contract, (iii) all rights under all FHA/VA Regulations
pertaining to any Subsequent Contract that is an FHA/VA Contract, (iv) the
proceeds from the Errors and Omissions Protection Policy and all rights under
any blanket hazard insurance policy to the extent they relate to the
Manufactured Homes, (v) all documents contained in the Contract Files and the
Land-and-Home Contract Files relating to the Subsequent Contracts, (vi) all
rights of the Seller under the Subsequent Transfer Agreement of even date
herewith between the Originator and the Seller and (vii) all proceeds and
products of the foregoing.
This Assignment is made pursuant to and upon the representation and
warranties on the part of the undersigned contained in Section 2.03 and Article
III of the Agreement and no others. All undefined capitalized terms used in this
Assignment have the meanings given them in the Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed this __ day of ________, 2000.
CONSECO FINANCE SECURITIZATIONS CORP.
By
-----------------------------------
Name:
Title:
P-1
EXHIBIT Q
---------
FORM OF OFFICER'S CERTIFICATE (SUBSEQUENT TRANSFER)
---------------------------------------------------
The undersigned certifies that [s]he is a [title] of Conseco Finance
Securitizations Corp., a Minnesota corporation (the "Company"), and that as such
[s]he is duly authorized to execute and deliver this certificate on behalf of
the Company in connection with the Pooling and Servicing Agreement dated as of
October 1, 2000 (the "Agreement") among the Company, Conseco Finance Corp. and
U.S. Bank National Association as Trustee. All capitalized terms used herein
without definition have the respective meanings specified in the Agreement. The
undersigned further certifies that:
1. This Certificate is delivered in connection with the sale to
the Trust on __________________ (the "Subsequent Transfer Date") of Contracts
(the "Subsequent Contracts") identified in the List of Contracts attached to the
Subsequent Transfer Instrument of even date herewith.
2. As of the Subsequent Transfer Date, all representations and
warranties in Section 3.01 of the Agreement are true and correct and all
representations and warranties in Section 3.03 of the Agreement with respect to
the Subsequent Contracts are true to the best of [her][his] knowledge.
3. All conditions precedent to the sale of the Subsequent
Contracts to the Trust under Section 2.03 of the Agreement have been satisfied.
4. As of the Subsequent Transfer Date, the Company is not
insolvent and will not be made insolvent by the transfer of the Subsequent
Contracts, and the undersigned is not aware of any pending insolvency of the
Company.
IN WITNESS WHEREOF, I have affixed hereunto my signature this ___ day
of _________, 2000.
By
-----------------------------------
Name:
Title:
Q-1