SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): May 15, 1996
BLUEGREEN CORPORATION
(Exact name of registrant as specified in its charter)
Massachusetts 0-19292 03-0300793
(State or other jurisdiction of (Commission (IRS Employer
incorporation file number) Identification number)
5295 Town Center Road, Boca Raton, Florida 33486
(Address of principal executive offices) (Zip Code)
407-361-2700
(Registrant's telephone number, including area code)
None
(Former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events
On May 15, 1996, Bluegreen Corporation (the "Company") sold, or otherwise
absolutely transferred and assigned, $13.2 million aggregate principal amount of
mortgage notes receivable (the "Mortgage Pool") to Bluegreen Receivables Finance
Corporation I, a wholly-owned subsidiary of the Company (the "Depositor"), and
the Depositor sold the Mortgage Pool to Bluegreen REMIC Trust, Series 1996-1
(the "1996 REMIC Trust"). Simultaneous with the sale, the 1996 REMIC Trust
issued three classes of Fixed Rate REMIC Mortgage Pass- Through Certificates
(the "Certificates"). Each Certificate evidences a fractional undivided interest
in the Mortgage Pool. The Certificates were issued pursuant to the terms of a
Pooling and Servicing Agreement dated as of April 15, 1996 (the "Pooling
Agreement") among the Company, the Depositor, Bluegreen Corporation REMIC Trust
Series 1996-1 and First Trust National Association, as trustee. The initial
principal balances of the Class A and Class B certificates were approximately
$11.8 million and $1.3 million, respectively. The Class R Certificates have no
initial principal balance and do not bear interest. The Class A and Class B
Certificates bear interest at a rate of 8.8% and 9.8%, respectively.
The 1996 REMIC Trust consists of a pool of fixed and adjustable rate first
mortgage loans secured by land property sold by the Company. The fixed interest
rate mortgages represent approximately 82% of the total pool, while the variable
interest rate mortgages represent approximately 18%. The weighted average
interest rate on the fixed and variable rate mortgages was approximately 10.55%
and 13.65%, respectively. Collections of principal and interest on the Mortgage
Pool, net of certain servicing and trustee fees, are remitted to
Certificateholders on a monthly basis. The proceeds of collections on the
Mortgage Pool are distributed to the Certificateholders in the order of priority
specified in the Pooling Agreement. The Class B and R Certificates are
subordinated to the Class A Certificates and the R Certificates are subordinated
to the Class B Certificates, as provided in the Pooling Agreement.
On May 15, 1996, the Depositor sold the Class A Certificates issued under the
Pooling Agreement to an institutional investor for aggregate proceeds of
approximately $11.8 million in a private placement transaction and retained the
Class B and Class R Certificates. The terms of the REMIC financing were
determined by arm's length negotiations between the parties. The Certificates
have not been, and will not be registered under the Securities Act of 1933, as
amended, and may not be offered or sold in the United States absent registration
or an applicable exemption from the registration requirements. A portion of the
proceeds from the transaction was used to repay approximately $5.6 million of
outstanding debt. The balance of the proceeds, after payment of transaction
expenses and fees, resulted in an increase of more than $5.8 million in the
Company's unrestricted cash.
The Company will be paid an annualized servicing fee of .5% of the scheduled
principal balance of those notes in the Mortgage Pool on which the periodic
payment of principal and interest is collected in full. Under the terms of the
Pooling Agreement, the Company has the obligation to repurchase or replace
mortgage loans in the Mortgage Pool with respect to which there was a breach of
the Company's representations and warranties contained in the Pooling Agreement
at the date of sale, which breach materially and adversely affects the rights of
Certificateholders. In addition, the Company, as servicer, is required to make
advances of delinquent payments to the extent deemed recoverable. However, the
certificates are not obligations of the Company, the Depositor or any of their
affiliates and the Company has no obligation to repurchase or replace mortgage
loans solely due to delinquency.
A copy of the Pooling Agreement is attached hereto as Exhibit 99.2 and is
incorporated herein by reference. The foregoing description of the REMIC
financing is subject to, and qualified in its entirety by, reference to such
Exhibit.
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(c) Exhibits
Exhibit Description of Exhibit
99.1 Press Release dated May 15, 1996 issued by
Bluegreen Corporation
99.2 Pooling and Servicing Agreement dated as of
April 15, 1996 by and
among Bluegreen Corporation REMIC Trust Series
1995-1, Bluegreen
Corporation, Bluegreen Receivables Finance Corporation I and
First Trust National Association, as Trustee
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Bluegreen Corporation
xxx
---------------------
Date: May 31, 1996 Alan L. Murray
Treasurer and Chief Financial
Officer
<PAGE>
EXHIBIT 99.1
Press Release
Contact: Mary Jo Wiegand, Vice President and Director of Investor Relations
BLUEGREEN CORPORATION ANNOUNCES PRIVATE PLACEMENT OF REAL ESTATE
MORTGAGE INVESTMENT CONDUIT (REMIC) PASS-THROUGH CERTIFICATES
Boca Raton, Florida, May 16, 1996 - Bluegreen Corporation (NYSE:BXG)
today announced that it has completed the sale of approximately $11.8 million
aggregate principal amount of Class A Fixed Rate REMIC Pass- Through
Certificates in a private placement. The securities were not registered under
federal or state laws and may not be reoffered or resold absent registration or
an applicable exemption from registration requirements. At the date of issue,
the fixed interest rate on the $11.8 million aggregate principal amount of Class
A Certificates was set at 8.8%.
The outstanding principal balance of the mortgage loans sold to the
REMIC trust approximated $13.2 million. The REMIC, which will be serviced by the
Company, consists of a pool of fixed and adjustable rate first mortgage loans
secured by land property sold by Bluegreen. The fixed interest rate mortgages
represent approximately 82% of the total pool, while the variable interest rate
mortgages represent approximately 18%. The weighted average interest rate on the
fixed and variable rate mortgages was approximately 10.55% and 13.65%,
respectively.
A portion of the proceeds from the transaction was used to repay
approximately $5.6 million of outstanding debt. An additional $263,000 was used
to fund a cash reserve account. The balance of the proceeds, after payment of
issuance expenses, resulted in an increase to Bluegreen's unrestricted cash of
approximately $5.8 million.
Bluegreen's business is about lifestyles and the choices people make
concerning where they reside, where they relax and where they vacation. The
Company offers colorful places to live and play in twenty-one of the United
States and is headquartered in Boca Raton, Florida.
xxx
<PAGE>
EXHIBIT 99.2 EXECUTION COPY
BLUEGREEN CORPORATION REMIC TRUST, SERIES 1996-1
Issuer,
BLUEGREEN CORPORATION
Individually
and as
Servicer,
BLUEGREEN RECEIVABLES FINANCE CORPORATION I
Depositor
and
FIRST TRUST NATIONAL ASSOCIATION
Trustee
--------------------------
POOLING AND SERVICING AGREEMENT
Dated as of April 15, 1996
--------------------------
Fixed Rate REMIC Mortgage Pass-Through Certificates,
Class A, Class B and Class R
DS1-260817.6
<PAGE>
TABLE OF CONTENTS
ARTICLE I DEFINITIONS.........................................................1
ARTICLE II CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES..................22
Section 2.1 Conveyance of Mortgage Loans.....................................22
Section 2.2 Acceptance by Trustee............................................24
Section 2.3 Representations and Warranties of Bluegreen......................26
Section 2.4 Execution, Countersignature and Delivery of Certificates.........41
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS...................42
Section 3.1 Servicer.........................................................42
Section 3.2 Collection of Certain Mortgage Loan Payments;
Collection Account; Certificate Account;
Reserve Account....................................43
Section 3.3 Collection of Taxes, Assessments and Other Items.................47
Section 3.4 Permitted Withdrawals from the Certificate Account...............47
Section 3.5 Maintenance of Hazard Insurance..................................49
Section 3.6 Assumption and Modification Agreements...........................50
Section 3.7 Realization upon Defaulted Mortgage Loans;
Title and Management of REO Property...............50
Section 3.8 Trustee to Cooperate; Release of Mortgage Documents..............52
Section 3.9 Servicing Compensation; Payment of Certain
Expenses by the Servicer...........................53
Section 3.10 Annual Statement as to Compliance................................53
Section 3.11 Annual Independent Public Accountant's
Servicing Report...................................54
Section 3.12 Access to Certain Documentation and Information
Regarding the Mortgage Loans...................................54
Section 3.13 Maintenance of Certain Servicing Policies........................54
Section 3.14 Preparation of Tax Returns and Other Reports.....................55
Section 3.15 Trustee's Interest in the Trust Fund.............................56
ARTICLE IV SERVICER'S CERTIFICATE; MONTHLY ADVANCES..........................57
Section 4.1 Servicer's Certificate...........................................57
Section 4.2 Monthly Advances.................................................59
Section 4.3 Reports of Foreclosures and Abandonment
of Mortgaged Property..............................59
<PAGE>
ARTICLE V PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS......................60
Section 5.1 Distributions; Accrual of Interest...............................60
Section 5.2 Statements to Certificateholders.................................62
ARTICLE VI THE CERTIFICATES................................................. 64
Section 6.1 The Certificates.................................................64
Section 6.2 Registration of Transfer and Exchange of Certificates............66
Section 6.3 Mutilated, Destroyed, Lost or Stolen Certificates................71
Section 6.4 Persons Deemed Owners............................................72
ARTICLE VII BLUEGREEN AND THE SERVICER.......................................72
Section 7.1 Liability of Bluegreen and the Servicer..........................72
Section 7.2 Merger or Consolidation of, or Assumption of the
Obligations of, Bluegreen and the Servicer.........73
Section 7.3 Limitation on Liability of Bluegreen, the Servicer
and Others.....................................................73
Section 7.4 Bluegreen and the Servicer Not to Resign.........................74
Section 7.5 Sale, Assignment or Delegation of Duties by Servicer.............74
ARTICLE VIII DEFAULT.........................................................75
Section 8.1 Events of Default................................................75
Section 8.2 Trustee to Act; Appointment of Successor.........................77
Section 8.3 Notification to Certificateholders and Rating Agency.............79
ARTICLE IX THE TRUSTEE.......................................................79
Section 9.1 Duties of Trustee................................................79
Section 9.2 Certain Matters Affecting the Trustee............................81
Section 9.3 Trustee Not Liable for Certificates or Mortgage Loans............82
Section 9.4 Trustee May Own Certificates.....................................83
Section 9.5 Trustee's Fees and Expenses......................................83
Section 9.6 Eligibility Requirements for Trustee.............................83
Section 9.7 Resignation or Removal of Trustee................................84
Section 9.8 Successor Trustee................................................85
Section 9.9 Merger or Consolidation of Trustee...............................85
Section 9.10 Appointment of Co-Trustee or Separate Trustee....................86
ARTICLE X TERMINATION........................................................87
Section 10.1 Termination Upon Repurchase by Bluegreen or
Liquidation of All Mortgage Loans. ............................87
Section 10.2 Additional Termination Requirements.............................89
<PAGE>
ARTICLE XI REMIC ADMINISTRATION..............................................90
Section 11.1 REMIC Administration............................................90
Section 11.2 REO Property....................................................94
Section 11.3 Modifications of Mortgage Loans.................................95
Section 11.4 Prohibited Transactions and Activities..........................96
Section 11.5 Indemnification with Respect to Certain Taxes and
Loss of REMIC Status..............................96
ARTICLE XII MISCELLANEOUS PROVISIONS.........................................97
Section 12.1 Amendment of Agreement..........................................97
Section 12.2 Recordation of Agreement........................................98
Section 12.3 Limitation on Rights of Certificateholders......................99
Section 12.4 Governing Law..................................................100
Section 12.5 Notices........................................................100
Section 12.6 Severability of Provisions.....................................100
Section 12.7 Assignment.....................................................101
Section 12.8 Certificates Nonassessable and Fully Paid......................101
Section 12.9 Reports to Rating Agency.......................................101
Section 12.10 Counterparts...................................................101
Section 12.11 Headings Not to Affect Interpretation..........................101
EXHIBITS
Exhibit A - Form of Class A Certificate
Exhibit B - Form of Class B Certificate
Exhibit C - Form of Class R Certificate
Exhibit D - Mortgage Loan Schedule
Exhibit E - Forms of Lock-Box Agreement and Automated Wire Service Agreement
Exhibit F-1(a)- Form of Class R Affidavit (US Holder)
Exhibit F-1(b)- Form of Class R Affidavit (Foreign Holder)
Exhibit F-2(a)- Form of Class R Transferee's Letter (US Holder)
Exhibit F-2(b)- Form of Class R Transferee's Letter (Foreign Holder)
Exhibit G - Form of Nonrecoverable Advance Certificate
Exhibit H-A - Form of Class A Transferee's Agreement
Exhibit H-B - Form of Class B Transferee's Agreement
Exhibit I-1 - Form of Initial Certification
Exhibit I-2 - Form of Interim Certification
Exhibit I-3 - Form of Final Certification
<PAGE>
POOLING AND SERVICING AGREEMENT, dated as of April 15, 1996, among
BLUEGREEN CORPORATION REMIC TRUST, SERIES 1996-1, as Issuer ("BRT"), BLUEGREEN
CORPORATION, individually ("Bluegreen") and as Servicer (the "Servicer"),
BLUEGREEN RECEIVABLES FINANCE CORPORATION I, as depositor ("Depositor"), and
FIRST TRUST NATIONAL ASSOCIATION, as trustee (the "Trustee").
W I T N E S S E T H
In consideration of the mutual agreements herein contained, BRT,
Bluegreen, the Servicer, the Depositor and the Trustee agree as follows:
ARTICLE I DEFINITIONS
Whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article:
Accepted Servicing Practices: As defined in Section 3.1.
Affiliate: When used with respect to any Person, any officer, director
or partner of such Person or any other Person which, directly or indirectly
through one or more intermediaries, controls, is controlled by or is under
common control with such Person. For the purposes of this definition, "control"
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, relation to individuals or
otherwise and the terms "controlling" and "controlled" have meanings correlative
to the foregoing.
Agreement: This Pooling and Servicing Agreement and all amendments and
supplements hereto.
Amount Available: As to any Remittance Date, an amount equal to the sum
(without duplication) of (i) the aggregate amount on deposit in the Collection
Account (not including any amounts therein due on or before the Cut-off Date)
and the Certificate Account as of the close of business on the Determination
Date related to such Remittance Date, in each case including any net investment
income thereon, (ii) any Monthly Advance (except to the extent of any advance
which is deemed to be a Nonrecoverable Advance), (iii) any Substitution
Adjustment and (iv) the Purchase Price of any Defective Mortgage Loan to be
purchased pursuant to Section 2.2 or Section 2.3 hereof, less the sum of (x) the
Amount Held for Future Distribution and (y) amounts permitted
<PAGE>
to be withdrawn from the Certificate Account pursuant to clauses (i)-(ix) and
(xi) inclusive of Section 3.4 or clauses (i) and (iii) of Section 3.2(c),
respectively.
Amount Held for Future Distribution: As to any Remittance Date, the
total of all amounts held in the Collection Account or in the Certificate
Account on the preceding Determination Date on account of (i) Unscheduled
Payments received subsequent to the related Collection Period and (ii) Periodic
Payments due subsequent to the related Collection Period; provided, that in no
event shall any amount be included in the Amount Held for Future Distribution
for a period in excess of twelve months.
Appraised Value: With respect to any Mortgaged Property,the sales price
of such Mortgaged Property to the Obligor on the related Mortgage Loan.
Assignment: With respect to each Mortgage, (i) the original instrument
of assignment, recorded in the real estate records of the appropriate public
office in which the related Mortgage is recorded, of each Mortgage made by the
mortgagee thereunder to the Trustee or, if such original instrument of
assignment has not yet been so recorded or returned to the Trustee, the original
instru ment of assignment or a copy thereof certified by the Depositor to be a
true and correct copy thereof, and (ii) if applicable, each original intervening
instrument of assignment of such Mortgage made by each mortgagee thereunder,
showing a chain of title from the original mortgagee thereunder to the mortgagee
that is transferring such Mortgage to the Trustee as set forth in clause (i)
above, or, if any such original instrument of assignment has not yet been so
recorded or returned to the Trustee, a copy thereof certified by the Depositor
to be a true and correct copy thereof; each such instrument of assignment may be
a blanket assignment covering more than one Mortgage to the extent permitted by
applicable law. Any certification referred to in clauses (i) or (ii) above may
be in the form of one blanket certification delivered to the Trustee with
respect to the documents referred to therein.
BRT: Bluegreen Corporation REMIC Trust, Series 1996-1, the trust
formed pursuant to this Agreement to hold the Trust Fund and issue the
Certificates.
Base Principal Distribution Amount: For any Remittance Date, an amount
equal to the sum (without duplication) of (i) the aggregate payments in respect
of principal received on or with respect to the Mortgage Loans, whether (A) paid
by the Obligor thereunder, (B) paid by Bluegreen with respect to any Mortgage
Loan repurchased pursuant to this Agreement or (C) advanced by the Servicer on
the Mortgage Loans, in each such case including all scheduled principal
payments, Unscheduled Payments, any Substitution Adjustment and the principal
portion of the Purchase Price of any Defective Mortgage Loan repurchased by
Bluegreen, to the extent that such amounts are included in the Amount Available
for such Remittance Date and (ii) the dollar amount of the
<PAGE>
principal portion of all Realized Losses on the Mortgage Loans incurred during
the preceding Collection Period.
Bluegreen: Bluegreen Corporation, a Massachusetts corporation, or its
successor in interest or any successor under this Agreement as herein provided.
Business Day: Any day on which each of the Trustee, the Servicer and
commercial banks in New York, New York and Boca Raton, Florida, is open for the
purpose of conducting a commer cial banking business.
Certificate: Any one of the Class A Certificates, Class B Certificates
or Class R Certificates.
Certificate Account: The Eligible Account or Accounts created and
maintained with the Trustee pursuant to Section 3.2(c) and collectively entitled
"First Trust National Association, as trustee for the benefit of the holders of
Bluegreen Corporation REMIC Trust, Series 1996-1, Fixed Rate REMIC Mortgage
Pass-Through Certificates" or other substantially similar title which begins
"First Trust National Association, as trustee."
Certificateholder or Holder: The Person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purpose of
the taking of any action under Article VIII or Section 12.1, or giving any
consent pursuant to this Agreement, any Certificate registered in the name of
Bluegreen or any Affiliate thereof shall be deemed not to be outstanding and the
Percentage Interest evidenced thereby shall not be taken into account in
determining whether the requisite amount of Percentage Interests necessary to
take any such action or to effect any such consent has been obtained, provided,
however, that, if any such Person (including Bluegreen or any Affiliate thereof)
owns 100% of the Percentage Interests evidenced by a Class of Certificates, such
Certificates shall be deemed to be outstanding for purposes of any provision of
Section 12.1 that requires the consent of the Holders of Certificates of a
particular Class as a condition to the taking of any action hereunder.
Certificate Register and Certificate Registrar: The register
maintained pursuant to, and the registrar provided for in, Section 6.2.
Class: All certificates whose form is identical except for variations
in Percentage Interest.
Class A Certificate: Any one of the Certificates signed and
countersigned by the Trustee in substantially the form set forth in Exhibit A
hereto.
<PAGE>
Class A Certificateholder: The registered holder of a Class A
Certificate.
Class A Cross-Over Remittance Date: Any Remittance Date for which:
(a) the Class B Principal Balance (less any amounts previously added to
the Class B Principal Balance as a result of any interest shortfall on a prior
Remittance Date) is equal to or greater than 20% of the Outstanding Pool
Principal Balance, each measured as of the preceding Remittance Date;
(b) no Retention Event exists as of such Remittance Date or existed on
either or both of the two immediately preceding Remittance Dates; and
(c) to the extent a Retention Event has previously occurred (at any
time, and whether or not cured), the Reserve Account as of such Remittance Date
is not less than 5% of the Outstanding Pool Principal Balance.
Class A Pass-Through Rate: During each Interest Accrual Period, a rate
per annum equal to 8.8%. Interest at the Class A Pass-Through Rate shall be
calculated on the basis of a 360-day year consisting of twelve, 30-day months.
Class A Percentage: For any Remittance Date, the greater of (a) the
percentage equivalent, not to exceed 100%, of a fraction, the numerator of which
is the Class A Principal Balance as of the close of business on the preceding
Remittance Date and the denominator of which is the aggregate of the Class A and
Class B Principal Balances (exclusive, in the case of the Class B Certificates,
of any interest accrued thereon that has not been paid and has been added to
principal pursuant to Section 5.1) as of the close of business on such preceding
Remittance Date (or, in each case, as of the Cut-off Date for the first
Remittance Date) or (b) the percentage equivalent, not to exceed 100%, of a
fraction, the numerator of which is the Class A Principal Balance as of the
close of busi ness on the next preceding Remittance Date and the denominator of
which is the aggregate Princi pal Balance of the Mortgage Loans as of the close
of business on such next preceding Remittance Date (or, in each case, as of the
Cut-off Date for the first Remittance Date).
Class A Principal Balance: As of the Closing Date, $11,836,375.41. As
of any Remittance Date, the Class A Principal Balance as of the Closing Date
plus all interest accrued thereon that has not been paid to the Class A
Certificateholders and has been added to principal pursuant to Section 5.1 up to
and including such Remittance Date, less all amounts distributed to the Holders
of the Class A Certificates on account of principal up to and including such
Remittance Date.
<PAGE>
Class A Principal Distribution Amount: For each Remittance Date (x)
that is not a Class A Cross-Over Remittance Date, the Base Principal
Distribution Amount or (y) that is a Class A Cross-Over Remittance Date, the
product of (i) the Class A Percentage and (ii) the Base Principal Distribution
Amount PLUS in the case of either (x) or (y), any portion of the Class A
Principal Distribution Amount for any previous Remittance Date which was not
paid to the Class A Certificateholders pursuant to Section 5.1 (after giving
effect to any payments made from the Reserve Account) and remains unpaid as of
such Remittance Date.
Class B Certificate: Any one of the Certificates signed and
countersigned by the Trustee in substantially the form set forth in Exhibit B
hereto.
Class B Certificateholder: The registered Holder of a Class B
Certificate.
Class B Pass-Through Rate: During each Interest Accrual Period, a rate
per annum equal to 9.8%. Interest at the Class B Pass-Through Rate shall be
calculated on the basis of a 360-day year consisting of twelve, 30-day months.
Class B Percentage: For any Remittance Date, (a) 100% minus (b) the
Class A Percentage for such Remittance Date.
Class B Principal Balance: As of the Closing Date $1,315,152.82. As of
any Remittance Date, the Class B Principal Balance as of the Closing Date plus
all interest accrued thereon that has not been paid to the Class B
Certificateholders and has been added to principal pursuant to Section 5.1 up to
and including such Remittance Date, less all amounts distributed to the Holders
of the Class B Certificates on account of principal up to and including such
Remittance Date.
Class B Principal Distribution Amount: For each Remittance Date (x)
that is not a Class A Cross-Over Remittance Date, zero ($0) or (y) for each
Remittance Date that is a Class A CrossOver Remittance Date, the sum of (a) the
product of (i) the Class B Percentage and (ii) the Base Principal Distribution
Amount and (b) any portion of the Class B Principal Distribution Amount for any
previous Remittance Date which was not paid to the Class B Certificateholders
pursuant to Section 5.1 (after giving effect to any payments made from the
Reserve Account) and remains unpaid as of such Remittance Date.
Class Principal Balance: Any of the Class A or Class B Principal
Balances.
Class R Certificate: Any one of the Certificates signed and
countersigned by the Trustee in substantially the form set forth in Exhibit C
hereto.
<PAGE>
Class R Certificateholder: The registered Holder of a Class R
Certificate.
Closing Date: May 15, 1996.
Code: The Internal Revenue Code of 1986, as amended, any successor
statutes thereto, and applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form and proposed regulations thereunder,
to the extent that, by reason of their proposed effective date, such proposed
regulations would apply to the Trust Fund.
Collection Account: The Eligible Account or Accounts created and
maintained pursuant to Section 3.2(b) and collectively entitled "First Trust
National Association, as trustee for the benefit of the holders of Bluegreen
Corporation REMIC Trust, Series 1996-1, Fixed Rate REMIC Mortgage Pass-Through
Certificates" or other substantially similar title which begins "First Trust
National Association, as trustee."
Collection Period: With respect to any Remittance Date, the period
commencing on the 16th day of the second month preceding the month of such
Remittance Date and ending on the 15th day of the month immediately preceding
the month of such Remittance Date.
Controlling Class: The Class A Certificates until the Class A Principal
Balance is reduced to zero ($0), and thereafter the Class B Certificates.
Corporate Trust Office: The corporate trust office of the Trustee in
Minneapolis or St. Paul, Minnesota, at which at any particular time its
corporate trust business shall be administered, which office at the date of the
execution of this Agreement is located at 180 East 5th Street, St. Paul,
Minnesota 55101.
Current Index: As to any adjustable-rate Mortgage Loan, a value of the
applicable Index in effect no more than three months prior to the Rate
Adjustment Date for such Mortgage Loan.
Cut-off Date: With respect to any Mortgage Loans transferred to the
Trust Fund on the Closing Date, April 15, 1996. With respect to any Mortgage
Loan substituted for another Mortgage Loan in accordance with the terms of this
Agreement, the end of the Collection Period prior to the Collection Period in
which such Mortgage Loan is substituted.
Cut-off Date Pool Principal Balance: The aggregate of the Cut-off Date
Principal Balances of the Mortgage Loans.
<PAGE>
Cut-off Date Principal Balance: As to any Mortgage Loan, the unpaid
principal balance thereof on the Cut-off Date, excluding all payments of
principal due on or before the Cut-off Date whether or not received on or before
the Cut-off Date, but before giving effect to Periodic Payments of principal due
after the Cut-off Date but received on or before the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
in the scheduled monthly payment for such Mortgage Loan by a court of competent
jurisdiction in a proceeding under the Bankruptcy Code, except such a reduction
resulting from a Deficient Valuation.
Default: As defined in Section 3.7.
Defective Mortgage Loan: Any Mortgage Loan which is required to be
replaced by a Qualified Replacement Mortgage Loan or Loans or repurchased by
Bluegreen pursuant to Sections 2.2 and 2.3.
Deficient Valuation: With respect to any Mortgage Loan, the positive
difference, if any, between (x) the then outstanding principal balance of the
Mortgage Loan and (y) the valuation of the related Mortgaged Property by a court
of competent jurisdiction, which valuation results from a proceeding initiated
under the Bankruptcy Code.
Depositor: Bluegreen Receivables Finance Corporation I, a Delaware
corporation.
Determination Date: With respect to any Remittance Date, the fifth
Business Day prior thereto.
Development: Any parcel of land some or all of which is mortgaged to
secure a Mortgage Loan.
Disqualified Organization: Any of (i) the United States, (ii) any state
or political subdivision thereof, (iii) any foreign government, (iv) any
international organization, (v) any agency or instrumentality of any of the
foregoing, (vi) any tax-exempt organization (other than a cooperative described
in Section 521 of the Code) which is exempt from the tax imposed by Chapter 1 of
the Code unless such organization is subject to the tax imposed by Section 511
of the Code, (vii) any organization described in Section 1381(a)(2)(C) of the
Code, or (viii) any other entity designated as a Disqualified Organization by
relevant legislation amending the REMIC Provisions and in effect at or proposed
to be effective as of the time of the determination. In addition, a corporation
will not be treated as an instrumentality of the United States or of any state
or political subdivision thereof if all of its activities are subject to tax and
a majority of its board of
<PAGE>
directors is not selected by such governmental unit. The terms "United States"
and "international organization" shall have the meanings set forth in Section
7701 of the Code.
Eligible Account: A segregated account that is either (i) maintained
with a depository institution or trust company the long-term unsecured debt
obligations of which (or, in the case of a depository institution or trust
company that is the principal subsidiary of a holding company, the debt
obligations of such holding company) have been rated by a Rating Organization in
one of its two highest rating categories (provided that the Collection Account
may be maintained with Fleet Bank unless and until (x) the long-term unsecured
debt obligations of its holding company are no longer rated by a Rating
Organization in one of its three highest categories and (y) the Rating Agency
determines that such failure to be so rated could result in a downgrading of the
rating then assigned to the Class A Certificate or the holders of Certificates
representing a majority of the principal balance of the Controlling Class shall
advise the Trustee and the Servicer in writing that the Collection Account shall
no longer be maintained at Fleet Bank), or (ii) a segregated trust account or
accounts maintained with a federal or state chartered depository institution or
trust company with trust powers acting in its fiduciary capacity, provided,
however, that if the trust account is maintained with a state chartered
depository institution, the long-term unsecured debt obligations of such
institution are rated by a Rating Organization in one of its four highest rating
categories.
ERISA: The Employee Retirement Income Security Act of 1974, as amended
Event of Default: As defined in Section 8.1.
Extended Period: As defined in Section 11.2.
Extension: As defined in Section 11.2.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
Floor Interest Rate: For any adjustable rate Mortgage Loan, an interest
rate 2% below the initial interest rate on such Mortgage Loan. The interest rate
shall not decrease below the Floor Interest Rate during the term of the Mortgage
Loan.
Foreign Holder Letter: As defined in Section 6.2.
Gross Margin: With respect to the adjustable-rate Mortgage Loans, the
amount set forth in each related Mortgage Note which is added to the Index on
each Rate Adjustment Date to arrive at the Mortgage Interest Rate for each such
Mortgage Loan, subject to any Periodic Rate Cap, Life
<PAGE>
time Rate Cap or Floor Interest Rate. The parties acknowledge that the
applicable Gross Margin on certain Mortgage Loans may increase from that in
effect on the Cut-off Date in certain circumstances.
Hazardous Materials: As defined in Section 2.3.
Independent: When used with respect to any specified Person means such
a Person who (i) is in fact independent of Bluegreen, (ii) does not have any
material indirect financial interest in Bluegreen or in any Affiliate thereof,
and (iii) is not connected with Bluegreen as an officer, employee, promoter,
trustee, partner, director or person performing similar functions.
Index: With respect to the adjustable-rate Mortgage Loans, the
applicable index set forth in each related Mortgage Note which is added to the
Gross Margin on each Rate Adjustment Date to arrive at the Mortgage Interest
Rate for each such Mortgage Loan, subject to any Periodic Rate Cap, Lifetime
Rate Cap or Floor Interest Rate.
Installment Due Date: As to each Mortgage Loan, the date set forth on
the related Mortgage Note as the date on which a Periodic Payment is due.
Insurance Proceeds: Proceeds paid by any insurer pursuant to any
insurance policy covering a Mortgage Property and any insurance policy required
to be maintained by the Servicer pursuant to Section 3.5.
Interest Accrual Period: With respect to any Remittance Date, the
period beginning on the 16th day of the second month preceding the month of such
Remittance Date and ending on the 15th day of the month next preceding the month
of such Remittance Date.
IRS: As defined in Section 3.14.
Lifetime Rate Cap: As to each adjustable-rate Mortgage Loan, the lesser
of (i) the rate, if any, set forth as such on the related Mortgage Note or (ii)
the highest rate permitted by applicable law.
Liquidated Mortgage Loan: As to any Remittance Date, any defaulted
Mortgage Loan as to which the Servicer has determined during the preceding
Collection Period that all amounts which it expects to recover from or on
account of such Mortgage Loan have been recovered.
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Liquidation Expenses: Reasonable and customary expenses incurred by the
Servicer in connection with the liquidation of any defaulted Mortgage Loan or
property acquired in respect thereof, including, without limitation, legal fees
and expenses, any unreimbursed amount expended by the Servicer pursuant to
Sections 3.5 and 3.7 respecting the related Mortgage Loan (to the extent such
amount is reimbursable pursuant to Section 3.5 or 3.7, as the case may be), any
commissions and advertising expenses (provided that the commissions payable
hereunder, including commissions payable to any Affiliate of Bluegreen, shall
not exceed 15% of the purchase price), any and all accrued and unpaid Servicing
Fees and any unreimbursed expenditures for real property taxes or for property
restoration or preservation relating to the real property that secured such
Mortgage Loan.
Liquidation Proceeds: Amounts received by the Servicer as a result of
condemnation awards or similar payments (to the extent the same are not required
to be paid to the related Obligor pursuant to law or the terms of the applicable
Mortgage) and amounts received in connection with the liquidation of defaulted
Mortgage Loans or property acquired in respect thereof, whether through
trustee's sale, foreclosure sale or otherwise, other than amounts required to be
paid to the Obligor pursuant to law or the terms of the applicable Mortgage.
Losses: As defined in Section 11.5.
Lot: A legally subdivided piece, parcel or tract of land in a
Development, which is mortgaged to secure a Mortgage Loan.
Loan-to-Value Ratio: As of any date, the fraction, expressed as a
percentage, the numerator of which is the then unpaid Principal Balance of a
particular Mortgage Loan and the denominator of which is the Appraised Value.
Major Certificateholder: As of any date, each institutional holder of
Certificates evidencing not less than 20% of the outstanding principal balance
of a Class.
Monthly Advance: With respect to a Mortgage Loan and any Determination
Date, any advance made by the Servicer pursuant to Section 4.2, the amount of
which shall be equal to any in stallments of principal and interest (less, in
each case, the Servicing Fee) on such Mortgage Loan which (x) were due after the
Cut-off Date, were delinquent as of the end of the related Collection Period and
had not been received as of the close of business on such Determination Date and
(y) were not the subject of a previous Monthly Advance, which advance is not
determined by the Servicer to be a Nonrecoverable Advance.
<PAGE>
Mortgage: The mortgage, deed of trust, contract right, security
agreement and all agreements and other documents securing a Mortgage Note.
Mortgage Documents: With respect to each Mortgage Loan, (a) the
original Mortgage Note executed by the Obligor, endorsed by the current holder
thereof to the order of the Trustee, without recourse, representation or
warranty express or implied (except, to the extent the holder is Bluegreen, as
provided in this Agreement), and including all intervening endorsements of the
Mort gage Note showing a complete chain of title from the original holder
thereof to the holder so endorsing to the order of the Trustee, (b) the Mortgage
executed by the Obligor (which shall be either the original recorded Mortgage
or, if the original recorded Mortgage is retained by the public recording office
or has been lost as certified by an officer of the Depositor, then a copy of
such recorded Mortgage with evidence of recordation in the public recording
office (as certified by the county recorder or other appropriate filing
officer), or, if the original Mortgage has not yet been recorded, a copy thereof
certified by the Depositor to be a true and correct copy thereof, provided that
the original Mortgage has been delivered to the appropriate recording office for
recordation, (c) the Assignment, (d) the original of all guaranties or other
documentation, if any, of which a Responsible Officer of the Trustee has been
notified in writing by an officer of the Depositor whereby the indebtedness
evidenced by the Mortgage Note has been guaranteed by any Person other than the
maker thereof or otherwise modified by any Person, (e) the original of all
assumption and modification agreements, if any, and (f) the title insurance
policy, or title insurance commitment letter with respect to such Mortgage, if
any. Any certification referred to in or deliv ered pursuant to clauses (b) or
(c) above may be in the form of one blanket certification delivered to the
Trustee with respect to the documents referred to therein.
Mortgage Interest Rate: With respect to any Mortgage Loan and
Installment Due Date, the per annum rate of interest applicable to the Periodic
Payment due on such Installment Due Date.
Mortgage Loan: Each Mortgage and Mortgage Note transferred and assigned
to and held by the Trustee pursuant to this Agreement and which are listed on
the Mortgage Loan Schedule from time to time.
Mortgage Loan Schedule: The schedule of Mortgage Loans which are
included in the Trust Fund as of the Cut-off Date and attached hereto as Exhibit
D, such schedule setting forth the following information as to each Mortgage
Loan: (i) the customer loan number; (ii) the Obligor's name, address, city and
state; (iii) the county (or other recording jurisdiction) and state of the
Mortgaged Property; (iv) the frequency of scheduled payments; (v) the Appraised
Value of the Mortgaged Property; (vi) the original amount financed by the
Obligor; (vii) the Cut-off Date Principal Balance; (viii) the principal and
interest due on the Mortgage Loan on the next Installment Due Date; (ix) the
current Mortgage Interest Rate; (x) the date the Mortgage was
<PAGE>
originated; (xi) the next Installment Due Date; (xii) the original amortization
term; (xiii) the remaining amortization term; (xiv) the type of Mortgage Loan
(fixed or adjustable); (xv) the Index used to determine the interest rate, if
applicable; (xvi) the minimum Gross Margin used to determine the interest rate,
if applicable; and (xvii) any lifetime rate cap and any floor interest rate.
Mortgage Note: The note or other evidence of indebtedness evidencing
the indebtedness of an Obligor under a Mortgage Loan.
Mortgaged Property: The fee simple interest in real property securing
a Mortgage Note.
Net Liquidation Proceeds: The amount derived by subtracting from the
Liquidation Proceeds of any defaulted Mortgage Loan the related Liquidation
Expenses.
Nondisqualification Opinion: An opinion of Independent counsel that a
contemplated action will neither cause the Trust REMIC to fail to qualify as a
REMIC at any time that Class A or Class B Certificates are outstanding nor cause
a "prohibited transaction" or "prohibited contribution" tax to be imposed on the
Trust REMIC.
Non-Performing Mortgage Loan: As of any date of determination, any
Mortgage Loan which has a Periodic Payment which was over 90 days past due,
including any REO Property.
Nonrecoverable Advance: Any portion of a Monthly Advance previously
made or proposed to be made in respect of a Mortgage Loan which has not been
previously reimbursed to the Servicer and which, in the sole determination of
the Servicer, will not or, in the case of a proposed Monthly Advance, would not
be ultimately recoverable from Liquidation Proceeds or other recoveries in
respect of the related Mortgage Loan. The determination by the Servicer that it
has made a Nonrecoverable Advance or that any proposed advance, if made, would
constitute a Nonrecoverable Advance, shall be evidenced by an Officers'
Certificate of the Servicer substantially in the form of Exhibit G hereto
delivered to the Trustee and the Holders of the Class A Certificates and
detailing the reasons for such determination.
Obligor: All Persons obligated to make payments with respect to a
Mortgage Loan.
Occupant: As defined in Section 2.3.
Officers' Certificate: A Certificate signed by the Chairman of the
Board, the President, a Vice President or the Chief Financial Officer, and
co-signed by the Clerk, one of the Assistant Clerks, the Secretary or one of the
Assistant Secretaries, the Treasurer or one of the Assistant Treasurers of a
Person and delivered to the Trustee.
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Opinion of Counsel: A written opinion of counsel acceptable to the
Trustee and, for so long as the Class A Certificates are outstanding, the
Holders of Certificates representing a majority of the Class A Principal
Balance.
Ownership Interest: As to any Certificate, any ownership interest in
such Certificate, including any interest in such Certificate as the Holder
thereof and any other interest therein, whether direct or indirect, legal or
beneficial.
Outstanding Mortgage Loan: As to any Installment Due Date, a Mortgage
Loan that was not the subject of a Principal Prepayment in Full prior to such
Installment Due Date, that did not become a Liquidated Mortgage Loan prior to
such Installment Due Date and was not repurchased prior to such Installment Due
Date pursuant to Section 2.2 or Section 2.3.
Outstanding Pool Principal Balance: For any Remittance Date, the
aggregate principal balances of all outstanding Mortgage Loans as of the end of
the preceding Collection Period provided that, for purposes of this definition,
Mortgage Loans with respect to which the related Mortgaged Property has been
foreclosed upon (or otherwise comparably converted) and is then in inventory
awaiting resale shall be deemed outstanding.
Pass-Through Rate: Any of the Class A or Class B Pass-Through Rates.
Percentage Interest: As to any Class A or Class B Certificate, the
percentage interest evi denced thereby in the distributions required to be made
hereunder with respect to the related Class, and derived by dividing the
denomination of such Certificate by the aggregate denominations of all
Certificates of such Class. As to any Class R Certificate, the percentage
interest set forth on the face thereof.
Periodic Payment: As to any Mortgage Loan and Installment Due Date, the
payment due thereon in accordance with the amortization schedule at the time
applicable thereto without regard to any adjustment to such amortization
schedule by reason of any bankruptcy or similar proceeding or any moratorium or
similar waiver or grace period and assuming, in the case of a defaulted Mortgage
Loan which is not a Liquidated Mortgage Loan and as to which title to the
underlying Mortgaged Property has been acquired, that such amortization schedule
has continued in effect notwithstanding the related foreclosure or other
acquisition of title.
Periodic Rate Cap: The provision in certain of the adjustable-rate
Mortgage Notes that limits permissible changes in the Mortgage Interest Rate on
any Rate Adjustment Date.
<PAGE>
Permitted Investments: At any time, any one or more of the following
bligations and securities:
(i) obligations of the United States or any agency thereof,
provided the timely payment of such obligations are backed by the full
faith and credit of the United States;
(ii) general obligations of or obligations guaranteed by any
state of the United States or the District of Columbia receiving one of
the two highest long-term debt ratings of a Rating Organization, or
such lower rating as will not result in the downgrading or withdrawal
of the rating then assigned to the Class A Certificates by the Rating
Agency and, for so long as the Class A Certificates are outstanding,
are acceptable to the Holders of Certificates representing a majority
of the Class A Principal Balance;
(iii) commercial or finance company paper which is then rated
in the high est rating category of a Rating Organization, issued by an
entity whose unsecured long-term debt obligations are rated in one of
the three highest rating categories of a Rating Organization, or in
each case such lower category as will not result in the downgrading or
withdrawal of the rating then assigned to the Class A Certificates by
the Rating Agency and, for so long as the Class A Certificates are
outstanding, are acceptable to the Holders of Certificates representing
a majority of the Class A Principal Balance;
(iv) certificates of deposit, demand or time deposits, federal
funds or bankers' acceptances issued by any depository institution or
trust company incorporated under the laws of the United States or of
any state thereof and subject to supervision and examination by federal
and/or state banking authorities, provided that the commercial paper
and/or long-term unsecured debt obligations of such depository
institution or trust company (or in the case of the principal
depository institution in a holding company system, the commercial
paper or long-term unse cured debt obligations of such holding company)
are then rated in one of the two highest rating categories for such
securities of a Rating Organization, or such lower categories as will
not result in the downgrading or withdrawal of the rating then assigned
to the Class A Certificates by the Rating Agency and, for so long as
the Class A Certificates are outstanding, are acceptable to the Holders
of Certificates representing a majority of the Class A Principal
Balance;
<PAGE>
(v) guaranteed reinvestment agreements issued by any
bank, insurance company or other corporation acceptable to the Rating
Agency at the time of the issuance of such agreements and, for so long
as the Class A Certificates are outstanding, are acceptable to the
Holders of Certificates representing a majority of the Class A
Principal Balance;
(vi) repurchase obligations with respect to any security
described in clauses (i) and (ii) above, in either case entered into
with a depository institution or trust company (acting as principal)
described in clause (iv) above;
(vii) overnight investments in units of short-term taxable
money market funds composed of obligations with maturities not in
excess of 30 days and backed by the full faith and credit of the United
States;
(viii) such other investments bearing interest or sold at a
discount accept able to the Rating Agency as will not result in the
downgrading or withdrawal of the rating then assigned to the Class A
Certificates by such Rating Agency and, for so long as the Class A
Certificates are outstanding, are acceptable to the Holders of
Certificates representing a majority of the Class A Principal Balance.
Permitted Transferee: As defined in Section 6.2(e).
Person: Any individual, corporation, partnership, joint venture, bank,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
Principal Balance: With respect to any Mortgage Loan on any date of
determination, the Cut-off Date Principal Balance thereof minus the sum of (a)
the principal portion of all Periodic Payments due during or prior to the
Collection Period (but after the Cut-off Date) immediately preceding such date
of determination, whether or not received during or prior to such Collection
Period, (b) all Principal Prepayments and all Insurance Proceeds and Net
Liquidation Proceeds (to the extent identified and applied by the Servicer as
recoveries of principal) received through the end of such Collection Period and
(c) any Realized Loss on such Mortgage Loan to the extent treated as a principal
loss and which is realized during or prior to such Collection Period.
Principal Prepayment: Any payment of principal on a Mortgage Loan
which is received in advance of its scheduled Installment Due Date and not
accompanied by interest.
Principal Prepayment in Full: Any prepayment of the entire principal
balance of the related Mortgage Loan.
<PAGE>
Purchase Price: With respect to any Defective Mortgage Loan repurchased
pursuant to Section 2.2 or Section 2.3, an amount equal to the sum of (i) 100%
of the outstanding principal balance thereof at the end of the Collection Period
prior to the Collection Period in which such Mortgage Loan is purchased (but in
no event to exceed the Cut-off Date Principal Balance of such Mortgage Loan),
(ii) unpaid accrued interest thereon at the applicable Mortgage Interest Rate
from the Installment Due Date to which interest was last paid (or from the
Cut-off Date if no Periodic Payment has been received) through the last
Installment Due Date in the Collection Period preceding the Remittance Date on
which the proceeds of the related purchase are to be distributed to
Certificateholders and (iii) any Liquidation Expenses incurred in connection
with the Defective Mortgage Loans to the extent not previously repaid to the
Servicer.
QIB: A "qualified institutional buyer" as such term is defined pursuant
to Rule 144A under the Securities Act.
Qualified Replacement Mortgage Loan: A Mortgage Loan substituted by
Bluegreen for a Defective Mortgage Loan which must, on the date of such
substitution, (i) have a Cut-off Date Principal Balance (or in the case of a
substitution of more than one Mortgage Loan for a Defective Mortgage Loan, an
aggregate Cut-off Date Principal Balance), not in excess of the principal
balance of the Defective Mortgage Loan; (ii) have a Mortgage Interest Rate not
less than the Mortgage Interest Rate of the Defective Mortgage Loan; (iii) have
a remaining term to maturity not more than 15 years after the second Remittance
Date and not more than two years less or one year more than the remaining term
of the Defective Mortgage Loan; (iv) comply with each represen tation and
warranty set forth in Section 2.3(a); (v) have an original Loan-to-Value Ratio
not greater than that of the Defective Mortgage Loan; (vi) have a Periodic Rate
Cap no lower than the Defective Mortgage Loan, if any; (vii) have a Lifetime
Rate Cap and an Interest Rate Floor no lower than that of the Defective Mortgage
Loan, if any; (viii) have a Gross Margin no smaller than that of the Defective
Mortgage Loan, if any; and (ix) have a Mortgage Interest Rate that is based on
the same Index as that of the Defective Mortgage Loan, if any.
Rate Adjustment Date: With respect to each adjustable-rate Mortgage
Loan, the date on which the Mortgage Interest Rate thereon may be adjusted as
set forth in each Mortgage Note.
Rating Agency: The Rating Organization that has rated the Class A
Certificate at the request of Bluegreen, or each of such organizations if more
than one, which shall initially be Duff & Phelps Credit Rating Co.
Rating Organization: A nationally recognized statistical rating
organization.
<PAGE>
Realized Loss: With respect to any Liquidated Mortgage Loan, the
principal balance of such Mortgage Loan as of the date it became a Liquidated
Mortgage Loan, and accrued interest at the applicable Mortgage Interest Rate on
the declining principal balance thereof from the date inter est was last paid on
such Mortgage Loan through the last Installment Due Date in the Collection
Period in which such Mortgage Loan became a Liquidated Mortgage Loan, in each
case remaining unpaid after application of the Net Liquidation Proceeds thereof
(first to interest and then to principal) following final liquidation of such
Mortgage Loan. With respect to any Mortgage Loan where the related Obligor is in
bankruptcy, the Debt Service Reduction or Deficient Valuation.
Record Date: With respect to any Remittance Date, the last day of the
Collection Period preceding the month of the related Remittance Date.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating to
real estate mortgage investment conduits, which appear at Section 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
regulations promulgated thereunder, as the foregoing may be in effect from time
to time and including any proposed legislation which, as proposed, would have an
effective date prior to enactment thereof and any proposed regulations.
Remittance Certificate: A certificate completed by and executed on
behalf of the Trustee in accordance with Section 5.2.
Remittance Date: The 1st day of any month, beginning in June, 1996 or,
if such 1st day is not a Business Day, the Business Day immediately following.
REO Property: Any Mortgaged Property which is acquired by the Trust
Fund by foreclosure or acceptance of a deed in lieu of foreclosure.
Reserve Account: The separate Eligible Account or Accounts created and
maintained with the Trustee pursuant to Section 3.2(d) for the benefit of the
Trust and collectively entitled "First Trust National Association, as trustee
for the benefit of the holders of Bluegreen Corporation REMIC Trust, Series
1996-1, Fixed Rate REMIC Mortgage Pass-through Certificates" or other
substantially similar title which begins "First Trust National Association, as
trustee". Such account will be opened at First Trust National Association,
initially funded from a portion of the proceeds of the sale of the Class A
Certificates, and will be a trust account.
<PAGE>
Responsible Officer: When used with respect to the Trustee, an officer
of the Trustee assigned to the Corporate Trust Office, including any Senior Vice
President, Vice President, Assistant Vice President, any Assistant Secretary,
any Assistant Treasurer, any trust officer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular matter, any other
officer to whom such matter is referred because of such officer's knowledge of
and familiarity with the particular subject.
Retention Event: For any Remittance Date, a Retention Event is deemed
to have occurred if: (a) an Event of Default shall have occurred and shall be
continuing under this Agreement, or (b) Bluegreen shall have been replaced as
the Servicer, or (c) the outstanding principal balance of Mortgage Loans over 90
days delinquent (exclusive of any REO Property) exceeds 5%, or total
Non-Performing Mortgage Loans exceed 7%, of the Cut-off Date Pool Principal
Balance, or (d) cumulative Realized Losses on the Mortgage Loans exceed 8% of
the Cut-off Date Pool Principal Balance, or (e) the balance in the Reserve
Account is less than 3% of the outstanding principal balance of the Class A
Certificates.
Securities Act: the Securities Act of 1933, as amended.
Servicer: Bluegreen, until a Successor Servicer shall have become such
pursuant to this Agreement, and thereafter "Servicer" shall mean such successor.
Servicer Errors and Omissions Insurance Policy: An errors and omissions
insurance policy maintained by the Servicer which names the Trustee as a loss
payee.
Servicer Fidelity Bond: A bond or insurance policy (acceptable, for so
long as the Class A Certificates are outstanding, to the Holders of Certificates
representing a majority of the Class A Principal Balance) issued by an insurance
company duly authorized and licensed to transact the applicable insurance
business and to write the insurance provided, and either (i) whose claims paying
ability is rated in one of the four highest rating categories by a Rating
Organization or (ii) whose selection as an insurer will not adversely affect the
rating of the Class A Certificates by the Rating Agency, under which such
insurer (a) agrees to indemnify the Servicer (subject to standard exclusions)
for all losses (less any deductible) sustained as a result of any theft,
embezzlement, fraud or other dishonest act on the part of the Servicer
directors, officers or employees, (b) provides for limits of liability under
such bond for each director, officer or employee of not less than an amount
required by the Rating Agency and (c) names the Trustee as a loss payee.
Servicer's Certificate: A certificate completed by and executed on
behalf of the Servicer in accordance with Section 4.1.
<PAGE>
Servicing Fee: The fee the Certificateholders shall pay to the
Servicer, equal to the Servic ing Fee Rate times the Principal Balance of each
Mortgage Loan as of each Installment Due Date for such Mortgage Loan. Such fee
shall be withdrawn from the Certificate Account monthly pursu ant to Section
3.4. Such fee shall be payable only at the time of and with respect to those
Mortgage Loans for which payment is in fact made of the entire amount of the
Periodic Payments or, with respect to Liquidated Mortgage Loans, shall be
recoverable as provided in Section 3.9.
Servicing Fee Rate: 0.50% per annum.
Servicing Officer: Any individual involved in, or responsible for, the
administration and servicing of the Mortgage Loans whose name appears on a list
of servicing officers furnished to the Trustee by the Servicer, as such list may
from time to time be amended.
Single Certificate: A Certificate of any Class that evidences the
smallest permissible denomination for such Class of Certificates, as specified
in Section 6.1.
Substitution Adjustment: As of any Remittance Date, any amount required
to be deposited by Bluegreen in the Collection Account on the Business Day next
preceding such Remittance Date pursuant to Section 2.3(e).
Successor Servicer: First Trust National Association or its successor
in interest, or such other party designated by the Trustee or the
Certificateholder, in accordance with Section 8.02(c) hereof.
Successor Servicer Fee: As defined in Section 8.2.
TIAA: Teachers Insurance and Annuity Association of America.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Certificate.
Trustee: First Trust National Association, a national banking
association, and its successors and any corporation resulting from or surviving
any consolidation or merger to which it or its successors may be a party and any
successor trustee at the time serving as successor trustee hereunder.
Trustee's Fee: The fee equal to the aggregate with respect to all of
the Mortgage Loans of the Trustee's Fee Rate times the Principal Balance of each
Mortgage Loan as of each Installment
<PAGE>
Due Date for such Mortgage Loan. Such fee shall be withdrawn from the
Certificate Account monthly pursuant to Section 3.4.
Trustee's Fee Rate: 0.10% per annum.
Trust Fund: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans, all payments on or collections in respect of
the Mortgage Loans due after the Cut-off Date, all Net Liquidation Proceeds,
Insurance Proceeds and Principal Prepayments received after the Cutoff Date, but
not including any amounts representing amounts due on or prior to the Cut-off
Date, such amounts as shall from time to time be held in the Collection Account
and the Certificate Account (to the extent provided for in this Agreement), the
insurance policies for which the Trustee is beneficiary or loss payee, if any,
relating to the Mortgaged Properties, any REO Property, and proceeds of all of
the foregoing.
Trust REMIC: The segregated pool of assets in the Trust Fund designated
as a REMIC pursuant to Section 11.1(a).
Uninsured Cause: Any cause of damage to Mortgaged Property such that
the complete restoration of such Mortgaged Property is not fully reimbursable
(less any applicable deductible) by the insurance policies required to be
maintained pursuant to Section 3.5.
Unscheduled Payments: With respect to any Remittance Date, the
aggregate of the Principal Prepayments (including Principal Prepayments in
Full), Insurance Proceeds and Net Liquidation Proceeds received during the
related Collection Period.
ARTICLE II CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1 Conveyance of Mortgage Loans. The Depositor, concurrently
with the execution and delivery of this Agreement, does hereby irrevocably sell,
transfer, assign, set over and otherwise convey to the Trustee without recourse,
representation or warranty (except as provided herein) all of the right, title
and interest of the Depositor in and to the Mortgage Loans and any other assets
constituting part of the Trust Fund, to have and to hold, in trust, and the
Trustee declares that, subject to the review provided for in Section 2.2, it has
received and shall hold the Trust Fund as Trustee, in trust, for the benefit and
use of the Holders of the Certificates and for the purposes and subject to the
terms and conditions set forth in this Agreement.
<PAGE>
In connection with such transfer and assignment, the Depositor does
hereby deliver to, and deposit with, the Trustee (with copies to the Servicer)
the Mortgage Documents.
Promptly following such transfer and assignment, the Trustee shall
release to the Servicer the unrecorded Assignments. The Servicer shall hold the
Assignments in trust for the benefit of the Certificateholders. The Servicer, at
the expense of the Depositor, shall, within 30 days of the Closing Date, or,
with respect to recently originated Mortgage Loans as to which the Servicer has
not received, as of the Closing Date, recording information for the related
Mortgage, within 30 days of receipt of such recording information, cause such
Assignments to be duly submitted for record ing in the name of the Trustee in
the appropriate records depository for the jurisdictions in which the Mortgaged
Properties are located and shall cause the receipt evidencing submission for
recording and the Assignments after recordation to be delivered to the Trustee
promptly upon the release thereof to the Servicer. To the extent it has not
previously done so, the Servicer will cause appropriate filings reflecting the
March 1996 change in Patten Corporation's name to Bluegreen Corporation to be
duly submitted for recording in the appropriate records depository for the
jurisdictions in which the Mortgaged Properties are located and shall cause the
receipt evidencing submission for recording and the filings after recordation to
be delivered to the Trustee promptly upon release thereof to the Servicer. The
Trustee shall hold legal title to the Mortgage Loans as trustee for the benefit
of the Certificateholders.
The ownership of the Mortgage Notes, the Mortgages and the other
Mortgage Documents is vested in the Trustee for the benefit of the
Certificateholders. The Depositor, Bluegreen and the Servicer agree to take no
action inconsistent with the Trustee's ownership of the Mortgage Loans and to
promptly indicate to all inquiring parties that the Mortgage Loans have been
sold and to claim no ownership interest in the Mortgage Loans, other than in
connection with a repurchase or substitution of a Defective Mortgage Loan by
Bluegreen.
The parties intend that the conveyance of the Depositor's right, title
and interest in and to the Trust Fund pursuant to this Agreement shall
constitute, and shall be construed as, a purchase and sale and not a pledge of
security for a loan. However, if such conveyance is deemed to be a pledge for a
loan, the parties intend that the rights and obligations of the parties to such
loan shall be established pursuant to the terms of this Agreement, the Depositor
shall be deemed to have granted and the Depositor hereby grants to the Trustee
for the benefit of the Certificateholders a first perfected priority security
interest in all of the Depositor's right, title and interest in, to and under
the Mortgage Loans and the balance of the Trust Fund, all payments of principal
of or interest on such Mortgage Loans, all other payments made in respect of
such Mortgage Loans and all accounts and funds established pursuant to this
Agreement, and all proceeds thereof, to secure the payment of the Certificates
and the obligations of the Depositor to the Trustee under this
<PAGE>
Agreement, and this Agreement shall constitute a security agreement under
applicable law. If such conveyance is deemed to be a loan and the trust created
by this Agreement terminates prior to the satisfaction of the claims of any
Person in any Certificates, 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, and all proceeds shall be distributed as
provided herein.
Within 10 Business Days after the Closing Date, Bluegreen will send, or
cause to be sent, written notice to each Obligor of the sale, transfer and
assignment of the related Mortgage Loan to the Trustee, on behalf of the
Certificateholders. Prior to the execution of this Agreement, the Servicer and
the Trustee will enter into a lock-box arrangement with Fleet Bank pursuant to
which (a) all Obligors under the Mortgage Loans who do not utilize Bluegreen's
"pre-authorized checking" payment program will be instructed to mail all
payments on the Mortgage Loans to a lock-box maintained by the Trustee with such
bank and (b) such bank will perform customary lock-box services and all funds
received from Obligors will be deposited into the Collection Account. Certain of
the Obligors utilize Bluegreen's "pre-authorized checking" program pursuant to
which Fleet Bank automatically charges the applicable Obligor's account for
payments owed under the Mortgage Loans. On the Closing Date, the Servicer shall
direct Fleet Bank to cause all funds received by such bank regarding the
Mortgage Loans under such "pre-authorized checking" program to be deposited into
the Collection Account. As contemplated in Article III below, from time to time
the Servicer will make Monthly Advances and deposit the amount thereof into the
Collection Account. On or prior to the Closing Date, the Servicer and the
Trustee will enter into a lock-box agreement and an automated wire transfer
agreement with Fleet Bank in the form attached hereto as collective Exhibit E.
Neither the Trustee nor the Servicer will amend such agreements without the
prior written consent of the Holders of Certificates representing a majority of
the principal balance of the Controlling Class. To the extent Fleet Bank elects
to terminate either of such agreements, the Servicer will use commercially
reasonable efforts to find a successor bank and cause the Obligors on the
Mortgage Loans to remit payments to such successor as soon as is reasonably
practicable.
Section 2.2. Acceptance by Trustee. The Trustee acknowledges receipt of
the Mortgage Documents delivered pursuant to Section 2.1, subject to the
Trustee's review thereof under this Section 2.2, and declares that the Trustee
holds and will hold such documents in trust, upon the terms herein set forth,
for the use and benefit of the Certificateholders. The Trustee does not have any
actual knowledge of any adverse claims, liens or encumbrances on any of the
assets so delivered, including without limitation, federal tax liens or liens
arising under ERISA. The Trustee shall execute and deliver to Bluegreen, the
Depositor and TIAA on the Closing Date the Initial Certification in the form
annexed hereto as Exhibit I-1 to the effect that it has received the documents
referred to in the definition of "Mortgage Documents" pertaining to each
Mortgage
<PAGE>
Loan listed on the Mortgage Loan Schedule, subject to its further review of the
Mortgage Docu ments pursuant to Section 2.2.
The Trustee agrees, for the benefit of Certificateholders, to review
the Mortgage Documents within 45 days after the Closing Date to ascertain that
(i) all the Mortgage Documents required to be delivered by Section 2.1 have been
executed and received, (ii) the Mortgages and Assignments have been sent to be
filed or recorded or, if certified copies of any Mortgages or Assignments are
delivered to the Trustee on the Closing Date in accordance with the definition
of "Mortgage Documents" or "Assignment," that such certified copies have been
received by the Trustee, (iii) such documents relate to the Mortgage Loans, and
(iv) based on its examination and only as to the documents that it has indicated
are in its possession, the information set forth in the Mortgage Loan Schedule
with respect to clauses (ii) (as to name only), (iii), (iv), (vi), (x), (xii),
(xiv) and (xv) of the definition of Mortgage Loan Schedule accurately reflects
the information set forth in the Mortgage Documents relating to the respective
Mortgage Loans, and the Trustee shall deliver to Bluegreen, the Depositor, TIAA
and the Servicer (if other than Bluegreen) an Interim Certification, in the form
annexed hereto as Exhibit I-2, to the foregoing effect. In so doing the Trustee
may rely on the purported due execution and genuineness of any such document and
on the purported genuineness of any signature thereon. The Trustee shall have no
responsibility for reviewing any Mortgage Document except as expressly set forth
in this Section 2.2. The Trustee shall be under no duty or obligation to
inspect, review or examine any such documents, instruments or certificates to
independently determine that they are genuine, enforceable or appropriate for
the represented purpose, whether the text of any assignment or endorsement is in
proper or recordable form (except, if applicable, to determine if the Trustee is
the assignee or endorsee or if the endorsement or assignment on the Mortgage
Note conforms to the requirements of the definition of "Mortgage Documents"),
whether any document has been recorded in accordance with the requirements of
any applicable jurisdiction, or to independently determine that any document has
actually been filed or recorded or that any document is other than what it
purports to be on its face.
Prior to the 9-month anniversary date of the Closing Date, the Trustee
shall deliver to Bluegreen, the Depositor, TIAA and the Servicer (if other than
Bluegreen) a Final Certification in the form annexed hereto as Exhibit I-3
evidencing the completeness of the Mortgage Documents required to be delivered
pursuant to Section 2.1 and certifying that the Mortgages and Assignments and
the name change filing referred to in Section 2.1 have all been filed or
recorded.
If the Trustee finds any document constituting a part of the Mortgage
Documents not to have been executed, recorded, delivered or received pursuant to
the terms hereof or to be unrelated to the Mortgage Loans or to be otherwise
missing or defective (that is, mutilated, damaged, de faced, incomplete,
improperly dated, clearly forged or otherwise physically altered) in any respect
which materially and adversely affects the interests of the Certificateholders,
the Trustee shall
<PAGE>
promptly (and in any event within five Business Days after such discovery)
notify Bluegreen there of. Within 60 days from the date it was notified of such
omission or defect, Bluegreen shall, at its option, (i) cure such omission or
defect in all material respects; (ii) repurchase the Mortgage Loan in accordance
with the provisions of Section 2.3; or (iii) substitute in place of the related
Mortgage Loan a Qualified Replacement Mortgage Loan or Loans in accordance with
the provisions of Section 2.3. It is understood and agreed that the obligation
of Bluegreen to cure (in the manner provided above) any material defect in or
omission of a constituent document with respect to a Mortgage Loan shall
constitute the sole remedy respecting such defect or omission available to the
Certificateholders or the Trustee on behalf of Certificateholders.
Section 2.3 Representations and Warranties of Bluegreen. Bluegreen
hereby represents and warrants to the Trustee that:
(a) With respect to each individual Mortgage Loan as of the Cut-off
Date, or as of the date such Mortgage Loan is deposited in the Trust Fund in the
case of a Qualified Replacement Mortgage Loan:
(1) The information set forth on the Mortgage Loan
Schedule is complete, true and correct as of the Cut-
off Date;
(2) Immediately prior to the transfer of such Mortgage
Loan to the Trustee, the Depositor had good and
marketable title to the Mortgage Note and the Mort
gage, and was the sole owner and holder of the
Mortgage Loan free and clear of any and all liens,
claims, encumbrances, participation interests, equi
ties, pledges, charges or security interests of any
nature and had full right and authority, subject to
no interest or participation of, or agreement with,
any other party, to sell and assign the same pursuant
to this Agreement. The Depositor has validly and
effectively transferred or caused to be transferred
the Mortgage Loan to the Trustee, free and clear of
any and all liens, claims, encumbrances,
participation interests, equities, pledges, charges
or security interests of any nature;
(3) The Mortgage securing such Mortgage Loan has been
duly recorded or sub mitted for recording in the
proper public office and is a valid and enforce able
first lien on the fee simple interest in the property
therein described, and the Mortgaged Property is free
and clear of all encumbrances and liens having
priority over the first lien of the Mortgage subject
only to taxes and assessments not yet due and payable
, and covenants, conditions and restrictions, rights
of way, easements and other matters of public record
as of the
<PAGE>
date of recording of such Mortgage, such exceptions
appearing of record being acceptable to mortgage
lending institutions generally;
(4) The terms of the Mortgage Note and the Mortgage have
not been impaired, altered or modified in any
respect, except by a written instrument which has
been recorded, if necessary to protect the interest
of Certificateholders and which has been delivered to
the Trustee, or except as is otherwise reflected in
the Mortgage Loan Schedule;
(5) No instrument of release or waiver has been executed
in connection with the Mortgage Loan, and no Obligor
has been released, in whole or in part, except in
connection with an assumption agreement which has
been deliv ered to the Trustee, except as is
otherwise reflected in the Mortgage Loan Schedule;
(6) All taxes, governmental assessments, insurance
premiums, water, sewer and municipal charges,
leasehold payments or ground rents which previously
became due and owing have been paid (it being
understood that Bluegreen does not escrow for such
matters);
(7) There is no proceeding pending or, to the best of
Bluegreen's knowledge, threatened for the total or
partial condemnation of the Mortgaged Property, nor
is such a proceeding currently occurring, and, to the
best of Bluegreen's knowledge, such property is
undamaged by waste, fire, earthquake or earth
movement, windstorm, flood or other casualty, so as
to affect adversely the value of the Mortgaged
Property as security for the Mortgage Loan;
(8) To the best of Bluegreen's knowledge, there are no
mechanics' or similar liens or claims which have been
filed for work, labor or material (and no rights are
outstanding that under law could give rise to such
lien) affecting the Mortgaged Property which are, or
may be, liens prior or equal to, or coordinate with,
the lien of the Mortgage;
(9) All of the improvements which were included for the
purpose of determining the Appraised Value of the
Mortgaged Property lie wholly within the boundaries
and building restriction lines of such property and
do not encroach upon easements burdening the
Mortgaged Property, and, to the best of Bluegreen's
knowledge, no improvements on adjoining properties en
croach upon the Mortgaged Property. The Mortgaged
Property fronts on and is contiguous to a public road
or easements or other legal rights benefit
<PAGE>
the Mortgaged Property which allow access thereto.
The Mortgaged Property either has all necessary
permits and approvals for ingress to and egress from
the Mortgaged Property over such public road or
easements or other legal rights benefit the Mortgaged
Property which allow access to such public road;
(10) To the best of Bluegreen's knowledge, no improvement
located on or being part of the Mortgaged Property is
in violation of any applicable zoning law or
regulation;
(11) To the extent required under applicable law,
Bluegreen and its Affiliates, and, to the best of
Bluegreen's knowledge, each other mortgagee under the
Mortgage was authorized to transact and do business
and was properly licensed in each jurisdiction in
which such authorization is necessary for Bluegreen,
such Affiliates or such mortgagee to transact and do
business at all times when it held the Mortgage Loan;
(12) The Mortgage Note and the related Mortgage are
genuine, and each is the legal, valid and binding
obligation of the maker thereof, enforceable in
accordance with its terms, subject to applicable
bankruptcy, insolvency and other similar laws
affecting the rights of creditors generally, and to
general principles of equity. All parties to the
Mortgage Note and the Mortgage had legal capacity to
execute the Mortgage Note and the Mortgage and each
Mortgage Note and Mortgage have been duly and
properly executed by such parties;
(13) Any and all requirements of any federal, state or
local law including, without limitation, usury,
truth-in-lending, real estate settlement procedures,
con sumer credit protection, equal credit opportunity
or disclosure laws applica ble to the Mortgage Loan
or the sale of the Mortgaged Property have been
complied with in all material respects, and Bluegreen
shall maintain in its possession evidence of
compliance with all such requirements;
(14) The proceeds, if any, of the Mortgage Loan have been
fully disbursed, there is no requirement for future
advances thereunder and any and all require ments as
to completion of any on-site or off-site improvements
and as to dis bursements of any escrow funds therefor
have been complied with. All costs, fees and expenses
incurred in making, or closing or recording the
Mortgage Loans were paid or will be paid;
<PAGE>
(15) No Mortgage Loan is more than 30 days delinquent, and
there is no other default, breach, violation or event
of acceleration existing under the Mortgage or the
related Mortgage Note and no event which, with the
passage of time or with notice and the expiration of
any grace or cure period, would constitute a default,
breach, violation or event of acceleration; and
neither Bluegreen nor any of its Affiliates have
waived any default, breach, violation or event of
acceleration, except any default, breach, violation
or event of acceleration as may have been previously
cured by the related Obligor;
(16) The Mortgage Loan is not subject to any right of
rescission, set-off, counter claim or defense,
including the defense of usury, nor will the
operation of any of the terms of the Mortgage Note or
the Mortgage, or the exercise of any right
thereunder, render either the Mortgage Note or the
Mortgage unenforceable, in whole or in part, or
subject to any right of rescission, set-off,
counterclaim or defense, including the defense of
usury, and no such right or rescission, set-off,
counterclaim or defense has been asserted with
respect thereto;
(17) The related Mortgage Note is payable in self-
amortizing monthly installments of principal and
interest, with interest payable in arrears, over an
original term of not more than 15 years. The current
Mortgage Interest Rate borne by the related Mortgage
Note is not less than 10.5%and not greaterthan 16.9%.
The weighted average Mortgage Interest Rate on the
fixed rate Mortgage Loans as of the Cut-off Date was
10.55%. Subject to any floors and usury limits, the
Mortgage Interest Rate on an adjustable-rate Mortgage
Note is subject to adjustment on each Rate Adjustment
Date to a new Mortgage Interest Rate equal to the sum
of the Current Index plus the Gross Margin, subject
to the limitations imposed by the Periodic Rate Cap
, Lifetime Rate Cap and Floor Interest Rate, if
any. The Gross Margin for each adjustable-rate Mort
gage Loan is not less than 2.0% or more than 8.2%.
The weighted average Mortgage Interest Rate on the
adjustable-rate Mortgage Loans as of the Cut-off Date
was 13.65%. As of the Cut-off Date, no
adjustable-rate Mortgage Loan had a Mortgage Interest
Rate below 10.75%. The weighted average Floor
Interest Rate on the adjustable-rate Mortgage Loans
as of the Cut-off Date was 11.62%. As of the Cut-off
Date, no adjustable-rate Mortgage Loan had a Floor
Interest Rate below 6.0%. With respect to each
adjustable rate Mortgage Loan, any previous interest
<PAGE>
rate adjustments have been made in compliance with
the applicable Mortgage Documents and law. With
respect to each adjustable rate Mort gage Loan, on
each Rate Adjustment Date, the Obligor's new Periodic
Payment with respect to each such Mortgage Loan will
be adjusted annually to an amount equal to the
payment which, when paid in substantially equal
installments during the then remaining term of such
Mortgage Loan, would amortize fully the unpaid
principal balance of such Mortgage Loan at the then
applicable Mortgage Interest Rate. No such Mortgage
Loan contains terms or provisions that could result
in negative amortization;
(18) The related Mortgage Note is not and has not been
secured by any collateral except the lien of the
corresponding Mortgage, other than any guarantee of
the Mortgage Loan;
(19) The related Mortgage contains customary and
enforceable provisions which render the rights and
remedies of the holder thereof adequate for the real
ization against the Mortgaged Property of the
benefits of the security, including, (i) in the case
of a Mortgage designated as a deed of trust, by
-
trustee's sale and (ii) in all other cases, by
judicial foreclosure. There is no homestead or other
exemption available to the Mortgagor which would
interfere with the right to sell the Mortgaged Pro
perty at a trustee's sale or the right to foreclose
the Mortgage;
(20) With respect to each Mortgage constituting a deed of
trust, a trustee, duly qualified under applicable law
to serve as such, has been properly designated and
currently so serves and is named in such Mortgage,
and no fees or expenses are or will become payable by
the Trustee or the Certificateholders to the trustee
under the deed of trust;
(21) The Mortgaged Property is located in the state identi
fied in the Mortgage Loan Schedule and consists of
either raw land or a one-family residence;
(22) The Mortgage Loan was underwritten substantially in
accordance with Bluegreen's then prevailing customary
and usual underwriting standards or with subsequently
approved credit guidelines acceptable to Holders of
Certificates representing a majority of the Class A
Principal Balance;
(23) There exist no deficiencies with respect to escrow
deposits and payments, if such are required, for
which customary arrangements for repayment thereof
<PAGE>
have not been made, and no escrow deposits or
payments of other charges or payments due Bluegreen
or any of its Affiliates have been capitalized under
the Mortgage or the related Mortgage Note;
(24) The origination, collection and other servicing
practices used by Bluegreen and its Affiliates with
respect to the Mortgage Loan have been in all
material respects legal, proper, prudent and
customary in the mortgage servicing business for
mortgage loans similar to the Mortgage Loans;
(25) The Mortgage Note, the Mortgage, the Assignment and
any other documents required to be delivered pursuant
to Section 2.1 with respect to the Mortgage Loan have
been delivered to the Trustee;
(26) Other than the Monthly Advance provided for in
Section 4.2, there is no obligation on the part of
Bluegreen or any other Person to make supple mental
payments in addition to those made by the Obligor or
co-obligor or any guarantor;
(27) There is no pledged account or other security other
than real estate securing the Obligor's obligations
other than any guarantee of the Mortgage Loan.
Neither Bluegreen nor any Affiliate thereof,
including the Depositor, has guaranteed the Mortgage
Loan;
(28) No adjustable-rate Mortgage Loan contains a provision
allowing the related Obligor to convert such Mortgage
Loan into a fixed-rate Mortgage Loan;
(29) The Mortgaged Property consists of an estate in fee
simple as evidenced by a recorded deed, in real
property and improvements located on the Mort gaged
Property with such appurtenant and indefeasible
rights and easements as are necessary for the legal
operation, occupancy and use thereof;
(30) All of the Mortgage Loans are (or will within 45 days
of the Closing Date be) secured by Mortgaged
Properties that are covered by a title insurance
policy. Each such title insurance policy will be in
full force and effect upon the consummation of
transactions contemplated by this Agreement or within
45 days thereafter; no claims have been made under
such title insurance policy; full premiums for the
policy, endorsements or all special endorse ments
have been paid; and no prior holder of the related
Mortgage, including Bluegreen or any Affiliate
thereof, has done anything, by act or omission, or
<PAGE>
possessed any knowledge of any matter, which would im
pair or diminish the coverage of such title insurance
policy;
(31) Other than with respect to a Mortgage Loan which is
delinquent less than 30 days, Bluegreen has no actual
knowledge of any circumstances with respect to the
Obligor, the Mortgage, the Mortgaged Property or any
guarantor of any Mortgage Loan that can reasonably be
expected to cause such Mortgage Loan to become
delinquent;
(32) There is no current obligation on the part of any
person to make payments on behalf of the Obligor in
respect of the Mortgage Loan except that there may be
a guarantor who is guaranteeing full and timely
payment of the Mortgage Loan until the maturity
thereof. No such guarantor has been released from
such guarantee and no such release is contemplated;
(33) The Mortgage Note has been or will prior to the
Closing Date be endorsed pursuant to the requirements
of the definition of "Mortgage Documents" and Section
2.1 and, together with the Mortgage, the Assignment
and any other
-----------
documents required to be delivered under this
Agreement, have been or will prior to the Closing
Date be delivered to the Trustee. The Servicer is in
possession of all documents relating to the Mortgage,
other than the Mortgage Documents and any other
documents held by the Trustee, or which have been
sent for recording and have not been returned by the
appli cable public recording office, and there are no
custodial agreements in effect adversely affecting
the right or ability of the Trustee to receive the
deliveries required under this Agreement;
(34) To the best of Bluegreen's knowledge, the Mortgaged
Property is not now and has never been used to
generate, manufacture, refine, transport, treat,
store, handle, dispose of, transfer, produce, process
or in any manner deal with gasoline, petroleum pro
ducts, explosives, radioactive materials, hazardous
materials, hazardous wastes, hazardous or toxic sub
stance, polychlorinated biphenyls or related or simi
lar materials, asbestos or any material containing
asbestos, or any other substance or material as may
be defined as a hazardous or toxic substance by any
Federal, state or local environmental law, ordinance,
rule, or regulation ("Hazardous Materials") in viola
tion of any such Federal, state or local environ men
tal law, ordinance, rule or regula tion. To the
best of Bluegreen's knowledge, no Hazardous Materials
have ever been installed, placed, or in any manner
dealt with on the Mortgaged
<PAGE>
Property in violation of any such Federal, state or
local environmental law, ordinance, rule or
regulation. To the best of Bluegreen's knowledge, no
owner, including Bluegreen or any Affiliate thereof,
operator or manager of the Mortgaged Property or any
tenant, subtenant, occupant, prior tenant, prior
subtenant, prior occupant or Person (collectively,
"Occupant") has re ceived any notice or advice from
any governmental agency or any Occupant with regard
to Hazardous Materials on, from or affecting the
Mortgaged Property; and
(35) Either, at the time of origination of the Mortgage
Loan, the fair market value of the related Mortgaged
Property was not less than 80% of the original
principal balance of the Mortgage Loan or, at the
Cut-off Date, the fair market value of the related
Mortgaged Property was not less than 80% of the
Cut-off Date Principal Balance or 80% of the adjusted
issue price (under the Code) of the Mortgage Loan.
(36) Except with respect to two (2) Mortgage Loans with
Cut-off Date Principal Balances of approximately
$22,680.93 at the origination of the Mortgage Loan,
the loan to Appraised Value ratio was not in excess
of 90%.
(b) With respect to the Mortgage Loans in the aggregate,
as of the Cut-off Date:
(1) No more than 45% of the Mortgage Loans (by Cut-off
Date Principal Balance) are secured by Mortgaged
Property located in Texas; and except for Texas, no
more than 20% of the Mortgage Loans (by Cut-off Date
Principal Balance) are secured by Mortgaged Property
located in any one state;
(2) Approximately 81.8% of the Mortgage Loans (by Cut-off
Date Principal Balance) bear a fixed rate of interest
and approximately 18.2% (by Cut-off Date Principal
Balance) bear an adjustable rate of interest;
(3) Approximately 97.25% of the Mortgage Loans (by
Cut-off Date Principal Balance) contain a provision
whereby Bluegreen or an Affiliate has the right to
draw the Obligor's Periodic Payment directly from the
Obligor's bank ac count (it being understood that
each Obligor who has elected to participate in such
pre-authorized payment program may elect to cease
such participation at any time and that, if the
Obligor fails to maintain sufficient
<PAGE>
collected funds to cover withdrawals the holder of
the Mortgage Loan may elect to terminate such partici
pation);
(4) No Mortgage Loan had a principal balance at
origination of less than $2,665.00 or more than
$124,800.00, and the average remaining Cut-off Date
Principal Balance of the Mortgage Loans was
approximately $25,586.63;
(5) [Intentionally Omitted];
(6) All of the adjustable-rate Mortgage Loans have an
Index based upon the prime rate (generally as
reported in The Wall Street Journal);
(7) None of the Mortgage Loans was secured by a Mortgaged
Property consisting of a condominium;
(8) The then remaining term to maturity of the Mortgage
Loans on a weighted average basis was 11 years or
less; and
(9) The loan to Appraised Value ratio of the Mortgaged
Properties was not in excess of 80% on a weighted
average basis.
(c) With respect to Bluegreen as of the Closing Date:
(1) Either Bluegreen or one of its Affiliates originated
each of the Mortgage Loans. Bluegreen and each Affili
ate of Bluegreen which originated one or more of the
Mortgage Loans (except for Affiliates which have been
merged into Bluegreen) are (or, with respect to each
such Affiliate, was at the time of origination of the
related Mortgage Loan) duly organized, validly exist
ing and in good standing under the laws of the states
of their respective incorporation or formation;
(2) Bluegreen and each Affiliate of Bluegreen which
originated one or more of the Mortgage Loans are (or,
with respect to each such Affiliate, was at the time
of origination of the related Mortgage Loan) duly
licensed to transact business under all applicable
laws and have obtained all governmental approvals
required to be obtained in order to conduct their
respective businesses as now being conducted and all
such governmental approvals are in full force and
effect, except where the failure to be so licensed or
obtain
<PAGE>
such approvals would not, in any one instance or in
the aggregate, have a material adverse effect on
Bluegreen and such Affiliates taken as a whole;
(3) The execution and delivery of this Agreement and the
full performance thereof by Bluegreen and any
Affiliate which is a party hereto, do not and will
not violate any provisions of the Articles of
Organization or By-laws of Bluegreen or such
Affiliate or any agreement to which Bluegreen or any
Affiliate is a party or by which Bluegreen or any
Affiliate is bound;
(4) This Agreement has been duly and validly authorized,
executed and delivered by Bluegreen and any Affiliate
which is a party hereto, and is a legal, valid and
binding agreement of Bluegreen and any such Affiliate
en forceable against them in accordance with its
terms, except as rights to indemnity hereunder may be
limited by applicable federal or state securities
laws;
(5) There is no action, suit, proceeding, governmental
investigation or arbitra tion (whether or not by its
terms purportedly on behalf of Bluegreen or any of
its Affiliates) at law or in equity or before or by
any federal, state, municipal or other governmental
department, commission, board, bureau, agency, or
instrumentality, domestic or foreign, pending, or to
the knowl edge of any of such Persons probable of
assertion, against Bluegreen or any of its
Affiliates, or any violation of any applicable law,
any of which indi vidually or in the aggregate could
reasonably be expected to (i) result in any material
adverse change in the business, operations, proper
ties, assets or condition (financial or otherwise) of
Bluegreen and its Affiliates taken as a whole, or
(ii) have a material adverse effect on the ability of
Bluegreen to perform its obligations under this Agree
ment, or (iii) have a material adverse affect on any
Mortgage Loan;
(6) Each assignment of the Mortgage Loans since
origination up through and including the Assignment
to the Trustee has been made for reasonably
equivalent value and fair consideration;
(7) Neither this Agreement nor any statement, report or
other document fur nished or to be furnished pursuant
to this Agreement or in connection with the
transactions contemplated hereby contains any untrue
statement of a material fact or omits to state a
material fact necessary to make the
<PAGE>
statements contained herein or therein in light of
the circumstances under which made not misleading;
(8) In selecting the Mortgage Loans, no selection proced
ures were employed which are adverse to the interests
of the Certificateholders;
(9) The transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages to the Trustee
pursuant to Section 2.1 are not subject to the bulk
transfer or any similar statutory provisions in
effect in any applicable juris diction;
(10) Bluegreen does not believe, nor does it have any
reason or cause to believe, that it or its applicable
Affiliate cannot perform each and every covenant
contained in this Agreement to be performed by them;
(11) The transfer of the Mortgage Loans in the manner
contemplated hereby is sufficient to transfer fully
to the Trustee for the benefit of the Certificate
holders the ownership of the Mortgage Loans;
(12) Bluegreen has no knowledge of any default, breach,
violation or event existing under this Agreement or
any event, which, with the passage of time or the
giving of notice, or both, would constitute such a
default, breach or violation and Bluegreen has not
waived any such default, breach or violation;
(13) The rights of the holder of the Mortgage Loans to
receive payments of principal and interest due
thereon after the Cut-off Date is not subordinate or
junior to the rights of any other Person to receive
such payments;
(14) No information, certificate of an officer, statement
furnished in writing or report delivered to the
Trustee by Bluegreen or any of its Affiliates will,
to the knowledge of Bluegreen, contain any untrue
statement of a material fact or omit a material fact
necessary to make the information, certificate,
statement or report in light of the circumstances
under which made or given not misleading;
(15) Bluegreen and its Affiliates, including the
Depositor, reflected (or will reflect) the sale of
the Mortgage Loans to the Trustee on their books and
re cords; Bluegreen and its Affiliates, including the
Depositor, will treat the
<PAGE>
transfer of the Mortgage Loans to the Trustee as a
sale for tax and ac counting purposes; and Bluegreen
and its Affiliates, including the Depositor, will
respond to all third party inquiries that the
Mortgage Loans have been sold to the Trustee;
(16) The transfer of the Mortgage Loans to the Depositor
and by the Depositor to the Trustee was not made with
the intent to hinder, delay or defraud creditors;
(17) The Depositor is solvent on the date hereof and will
be solvent after giving effect to the closing of the
transactions contemplated by this Agreement; and
(18) After giving effect to the simultaneous transactions
occurring on the Closing Date, none of Bluegreen's
Affiliates transferring any of the Mortgage Loans to
the Depositor will have any indebtedness or
liabilities of any kind, and each of such entities
and Bluegreen will be solvent.
With respect to the representations and warranties set forth in
Sections 2.3(a)(6), (7) (second clause only), (8), (9), (10), (11) and (34) or
elsewhere in Section 2.3 that are made to the best of Bluegreen's knowledge or
as to which Bluegreen has no knowledge, if it is discovered by Bluegreen, the
Servicer or the Trustee that the substance of such representation and warranty
is inaccurate and such inaccuracy materially and adversely affects the interests
of the Certificateholders in a Mortgage Loan then, notwithstanding Bluegreen's
lack of knowledge with respect to the substance of such representation and
warranty being inaccurate at the time the representation or warranty was made,
such inaccuracy shall be deemed a breach of the applicable representation or
warranty.
(d) It is understood and agreed that the representations and warranties
set forth in this Section 2.3 shall survive delivery of the Mortgage Loans to
the Trustee. Upon discovery by any of Bluegreen, the Servicer or the Trustee of
a breach of any of the foregoing representations and warranties which materially
and adversely affects the interests of the Certificateholders in a Mortgage
Loan, the party discovering such breach shall give prompt written notice to the
other. Within 60 days of its discovery or its receipt of notice of breach, or,
with the prior written consent of a Responsible Officer of the Trustee and, for
so long as the Class A Certificates are outstanding, the Holders of Certificates
representing a majority of the Class A Principal Balance, such longer period
specified in such consent (a copy of which shall be provided by the Trustee to
the Rating Agency), Bluegreen shall, at its option (i) cure such breach in all
material respects; (ii) repurchase the related Mortgage Loan; or (iii)
substitute in place of such Mortgage Loan a Qualified Replacement Mortgage Loan
or Loans provided such a substitution may only be effected prior to
<PAGE>
the second anniversary of the Closing Date and subject to Section 2.3(f). Any
repurchase shall be accomplished by Bluegreen depositing in the Collection
Account the Purchase Price for the appro priate Mortgage Loan within such 60 day
period (or such longer period as may be specified in the Trustee's consent) and,
with respect to the calculation of the Purchase Price and transfer of the
Mortgage Loan to Bluegreen, such repurchase shall be deemed to have occurred as
of the Business Day preceding the Remittance Date next following such deposit.
The Trustee shall not be charged with knowledge of any breach of the foregoing
representations unless a Responsible Officer of the Trustee at the Corporate
Trust Office has actual knowledge of such breach or receives written notice of
such breach from Bluegreen or the Holders of Certificates of any Class
evidencing, as to such Class, Percentage Interests aggregating not less than
25%. Notwithstanding anything to the contrary contained in this Agreement, in
the event that it is discovered that a Mortgage Loan is in breach of the
representations contained in Section 2.3(a)(3), or otherwise is not a "qualified
mort gage" within the meaning of the REMIC Provisions, Bluegreen shall, in all
events, cure such breach or repurchase or substitute such Mortgage Loan, as
described above, within 90 days of the date of discovery of such breach.
(e) In the event of a substitution of a Defective Mortgage Loan, as to
any Qualified Replacement Mortgage Loan or Loans, Bluegreen shall deliver to the
Trustee for such Qualified Replacement Mortgage Loan or Loans the Mortgage Note,
the Mortgage, the related Assignment, and such other documents and agreements as
are required by Section 2.1 within the 60-day period (or such longer period as
may be specified in the Trustee's consent) referred to in subsection (d) of this
Section 2.3 and such substitution shall be deemed to have occurred as of the
Business Day preceding the Remittance Date next following such delivery. For any
month during which Bluegreen substitutes one or more Qualified Replacement
Mortgage Loans, Bluegreen shall determine the amount, if any, by which (i) the
sum of the aggregate Cut-off Date Principal Balances of all such Qualified
Replacement Mortgage Loans is less than (ii) the aggregate Purchase Prices for
the related Defective Mortgage Loans had such Mortgage Loans been purchased on
the Business Day next preceding the Remittance Date next following such
substitution. The amount of such shortfall for any month computed by Bluegreen
shall be deposited by it in the Collection Account on the Business Day next
preceding the Remittance Date. All amounts received in respect of the Qualified
Replacement Mortgage Loan or Loans excluded from the Cut-off Date Principal
Balance shall not be deposited by Bluegreen in the Collection Account. All
amounts included in the Cut-off Date Principal Balance and received by the
Servicer shall be deposited by the Servicer in the Collection Account. Upon such
substitution, the Qualified Replacement Mortgage Loan or Loans shall be subject
to the terms of this Agreement in all respects, and Bluegreen shall be deemed to
have made with respect to such Qualified Replacement Mortgage Loan or Loans, as
of the date of substitution, the covenants, representations and warranties set
forth in this Section.
<PAGE>
(f) Notwithstanding any other provision of this Agreement, the right to
substitute Mortgage Loans pursuant to this Article II shall be subject to the
additional limitations that any substitution of a Qualified Replacement Mortgage
Loan for a Defective Mortgage Loan shall be made within 90 days of the Closing
Date, unless the Trustee has received an Opinion of Counsel (at the expense of
Bluegreen) that, under the current law, such substitution will not either (A)
affect adversely the status of the Trust REMIC as a REMIC, or of the Class A and
Class B Certificates as "regular interests" in the Trust REMIC or (B) cause the
Trust REMIC to be subject to a "prohibited transac tion tax" pursuant to Section
860F of the Code or "prohibited contribution tax" pursuant to Section 860G(d) of
the Code.
(g) In addition to the obligation of Bluegreen to cure, substitute for
(to the extent permitted herein) or repurchase any Mortgage Loan as to which a
breach under this Section 2.3 occurred and is continuing, Bluegreen shall
indemnify the Trustee and the Certificateholders and hold them harmless against
any losses, damages, penalties, fines, forfeitures, legal fees and related
costs, judg ments and other costs and expenses resulting from any claim, demand,
defense or assertion made by an Obligor to the extent resulting from a breach of
any representation or warranty contained in this Section 2.3. It is understood
and agreed that the above obligations of Bluegreen shall constitute the sole
remedies respecting such breach available to Certificateholders or the Trustee
on behalf of Certificateholders, and that the Certificates are not and shall not
be obligations of Bluegreen, the Depositor or any of their respective
Affiliates. Nothing contained herein shall limit the rights of the Trustee under
Section 9.5.
Section 2.4 Execution, Countersignature and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the Trust Fund
and, concurrently with such transfer and assignment, has caused to be executed,
countersigned and delivered to or upon the order of the Depositor, in exchange
for the Trust Fund, Certificates in authorized denominations evidencing the
entire ownership of the Trust Fund.
<PAGE>
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.1 Servicer. The Servicer shall service and administer the
Mortgage Loans on behalf of the Trustee and in the best interests of and for the
benefit of the Certificateholders (as determined by the Servicer in its
reasonable judgment) in accordance with the terms of this Agreement and the
Mortgage Loans and legal, proper, prudent and customary standards of practice in
the mortgage servicing business for mortgage loans similar to the Mortgage Loans
and with a view to the maximization of timely recovery of principal and interest
on the Mortgage Loans but without regard to (i) any relationship that the
Servicer or any Affiliate of the Servicer may have with any Mortgagor or any
Affiliate of any Mortgagor; (ii) the ownership of any Certificate by the
Servicer or any Affiliate of the Servicer; (iii) the Servicer's obligations to
make Monthly Advances or to incur servicing expenses with respect to the
Mortgage Loans; or (iv) the Servicer's right to receive compensation for its
services hereunder or with respect to any particular transaction. Subject to the
above-described servicing standards (herein referred to as "Accepted Servicing
Practices") and the terms of this Agreement (and in particular Section 11.3) and
of the Mortgage Loans, the Servicer shall have full power and authority to do
any and all things in connection with such servicing and administration which it
may deem necessary or desirable and consistent with the terms of this Agreement.
Without limiting the generality of the foregoing, the Servicer shall continue,
and is hereby authorized and empowered by the Trustee, to determine the amount,
and notify the related Obligor, of any changes to the Mortgage Interest Rate of
an adjustable-rate Mortgage Loan as fully as if the Servicer were the holder of
the related Mortgage Note, and to execute and deliver, on behalf of itself, the
Certificateholders, the Trustee or any of them, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge and all
other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Properties. The Trustee shall execute and deliver to
the Servicer any such documents as are provided to the Trustee which are
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
The relationship of the Servicer to the Trustee under this Agreement is
intended by the parties to be that of an independent contractor and not that of
a joint venturer, partner or agent.
All costs incurred by the Servicer in effecting the timely payment of
taxes and assessments on the Mortgaged Properties underlying the Mortgage Loans
shall not, for the purpose of calculating monthly distributions to
Certificateholders, be added to the amount owing under the related Mortgage
Loans, notwithstanding that the terms of such Mortgage Loan so permit, and such
costs shall be recoverable by the Servicer to the extent permitted by Section
3.4.
<PAGE>
The Servicer is hereby directed that with respect to any adjustable
rate Mortgage Loan, the Servicer shall not increase the Mortgage Interest Rate,
on a Rate Adjustment Date, to a rate that would violate applicable usury laws,
but will instead increase such Mortgage Interest Rate to the maximum rate
allowable under such usury laws.
Section 3.2 Collection of Certain Mortgage Loan Payments; Collection
Account; Certificate Account; Reserve Account. (a) The Servicer shall proceed
diligently to collect all payments called for under the terms and provisions of
the Mortgage Loans, and shall, to the extent such procedures shall be consistent
with this Agreement, follow such collection procedures as it follows with
respect to mortgage loans comparable to the Mortgage Loans in its servicing
portfolio. Subject to Section 11.3 and consistent with the foregoing, the
Servicer may in its discretion waive any late payment charge or any assumption
fees or other fees which may be collected in the ordinary course of servicing
such Mortgage Loan.
(b) On or before the Closing Date, the Servicer shall establish and
maintain one or more Collection Accounts, each of which shall be an Eligible
Account, into which the Servicer shall within two (2) Business Days of the
Closing Date deposit any amounts representing Periodic Payments due after the
Cut-off Date but received before the Closing Date and any Principal Prepay ments
received after the Cut-off Date but before the Closing Date. As provided in
Section 2.1, the Servicer shall direct all Obligors who do not utilize
Bluegreen's "pre-authorized checking" program to make their payments directly to
a lock-box maintained by the Trustee with Fleet Bank; all such payments shall be
deposited into the Collection Account. In addition, as provided in Section 2.1,
the Servicer shall direct Fleet Bank (which administers Bluegreen's
"pre-authorized checking" program) to cause all payments made by Obligors
regarding the Mortgage Loans who utilize Bluegreen's "pre-authorized checking"
program to be deposited into the Collection Account. To the extent it receives
funds, the Servicer shall deposit into the Collection Account within two
Business Days the following payments and collections received or made by it
(other than in respect of principal of and interest on the Mortgage Loans due on
or before the Cut-off Date):
(i) All payments on account of principal, including Principal
Prepayments, received from, or on behalf of, the related Obligor;
(ii) All payments on account of interest at the Mortgage
Interest Rate on each Mortgage Loan received from, or on behalf of, the
related Obligor (net of the Servicing Fee);
(iii) All Liquidation Proceeds received by the Servicer with
respect to each Mortgage Loan;
<PAGE>
(iv) All Insurance Proceeds which are not Liquidation Proceeds
(including, for this purpose, any amounts required to be deposited by the
Servicer pursuant to the last sentence of Section 3.5), other than proceeds to
be applied to the restoration or repair of the property subject to the related
Mortgage or released to the related Obligor in accordance with the normal
servicing procedures of the Servicer;
(v) The Purchase Price for any Defective Mortgage Loan
repurchased pursuant to Sections 2.2 and 2.3, or, if applicable, any
Substitution Adjustment, pursuant to said Sections;
(vi) All Monthly Advances made by the Servicer pursuant to
Section 4.2; and
(vii) The purchase price for the Mortgage Loans repurchased
pursuant to Section 10.1.
The foregoing requirements respecting deposits by the Servicer into the
Collection Account are exclusive, it being understood that, without limiting the
generality of the foregoing, the Servicer need not deposit into the Collection
Account amounts representing fees or late charge penalties payable by Obligors,
which the Servicer is entitled to retain as additional servicing compensation,
or any amounts received by the Servicer for the account of Obligors for
application towards the payment of taxes, insurance premiums, assessments and
similar items.
Within two Business Days of receipt, and no later than the Business Day
prior to each Remittance Date, all amounts on deposit in the Collection Account
shall be remitted to the Trustee for deposit into the Certificate Account by
wire transfer in immediately available funds.
Amounts held in the Collection Account and the Certificate Account may
be invested in one or more Permitted Investments in the name of the Trustee, as
trustee, in accordance with written instructions from Bluegreen. (It is
understood that it is anticipated that amounts held in the Collection Account
will not be invested.) Such Permitted Investments shall mature no later than the
Business Day immediately preceding the Remittance Date following such
investment. Any investment earnings on funds in the Collection Account and the
Certificate Account (net of losses) shall, subject to the terms of this
Agreement, remain in the Trust Fund. Realized losses, if any, on amounts
invested in the Collection Account and the Certificate Account shall be credited
against amounts in the Collection Account and the Certificate Account for
determining the Amount Available on the Remittance Date following such
investment. Permitted Investments of amounts held in the Collection Account and
the Certificate Account shall be held until maturity.
<PAGE>
(c) On or before the Closing Date, the Trustee shall establish the
Certificate Account. The Certificate Account shall at all times be an interest
bearing Eligible Account and shall relate solely to the Certificates and the
Trustee shall have the exclusive right to withdraw funds therefrom. The
Certificate Account shall be part of both BRT and the Trust Fund. The Trustee
shall deposit into the Certificate Account on the Business Day received all
moneys remitted by the Collection Account bank or the Servicer pursuant to
Section 3.2(b). The Trustee shall make withdrawals from the Certificate Account
only for the following purposes:
(i) to withdraw amounts deposited in the Certificate Account
in error;
(ii) to make distributions to the Certificateholders pursuant
to Section 5.1;
(iii) to clear and terminate the Certificate Account pursuant
to Section 10.1; and
(iv) to make distributions pursuant to Section 3.4.
(d) On or before the Closing Date, the Trustee shall establish the
Reserve Account. Amounts held in the Reserve Account shall be invested in one or
more Permitted Investments in the name of the Trustee, as trustee, in accordance
with written instructions from the Servicer, provided that the Reserve Account
shall not be invested in a manner that would result in more than thirty percent
of its gross income for any taxable year being derived from the sale or other
disposition of property held for less than three months, except as may otherwise
be permitted by Section 860G(a)(7)(C) of the Code. Such Permitted Investments
shall be held for investment purposes only, and shall mature no later than the
Business Day immediately preceding the Remittance Date following such
investment. All income and gain realized from any such investment shall be
additional servicing compensation for the Servicer and shall be subject to its
withdrawal or order from time to time. The amount of any losses incurred in
respect of any such investments shall be deposited in the Reserve Account by the
Servicer out of its own funds immediately as realized. The Trustee shall not be
liable for any losses on amounts invested in accordance with the provisions
hereof. In no event, however, shall any withdrawal from the Reserve Account be
made which would cause the Reserve Account to cease to be a Qualified Reserve
Fund, as that term is defined by Section 860G of the Code and the regulations
thereunder.
The Reserve Account shall be administered so that it meets all
applicable requirements of the Code, including without limitation the definition
of a "qualified reserve fund" under Section 860G(a)(7)(B) of the Code. The
Reserve Account shall at all times be an interest bearing Eligible Account and
shall relate solely to the Certificates and the Trustee shall have the exclusive
right to withdraw funds therefrom. On the Closing Date, the Depositor shall
deposit, or cause to be deposited, into the Reserve Account an amount equal to
two percent (2%) of the Outstanding Pool
<PAGE>
Principal Balance as of the Cut-off Date. Thereafter, the Trustee shall, as
applicable, make deposits or withdrawals from the Reserve Account only for the
following purposes:
(i) to deposit funds into the Reserve Account to the extent re
quired by Section 5.1(a)(v);
(ii) to withdraw funds from the Reserve Account to make dis
tributions to Certificateholders to the extent required by Section 5.1(a);
(iii) to withdraw amounts deposited in the Reserve Account by
error;
(iv) as to any Remittance Date and to the extent amounts in
the Reserve Account exceed five percent (5%) of the Outstanding Pool
Principal Balance, to withdraw amounts in the Reserve Account for
distribution to the Class R Certificateholders;
(v) to clear and terminate the Reserve Account pursuant to
Section 10.1; and
(vi) to pay to the Servicer as additional servicing
compensation any net investment income earned with respect to funds in the
Reserve Account invested in Permitted Investments.
Section 3.3 Collection of Taxes, Assessments and Other Items. The
Servicer shall pay or cause to be paid all hazard insurance premiums as required
under Section 3.5 or comparable items related to the Mortgage Loans when and as
the same shall become due and payable. The Servicer will also advance monies to
avoid the tax sale of the related Mortgaged Property. A withdrawal from the
Collection Account pursuant to Section 3.4 (viii) may be made only to reimburse
the Servicer out of collections on the related Mortgage Loan for any payments
made regarding taxes and assessments or for any payments made pursuant to
Section 3.5 regarding premiums on standard hazard insurance policies. It is
understood that Bluegreen does not escrow funds for such purposes.
Section 3.4 Permitted Withdrawals from the Certificate Account. The
Servicer may, on each Remittance Date, by Officers' Certificate instruct the
Trustee to make withdrawals from the Certificate Account for the following
purposes and in the following order of priority:
(i) To reimburse the Servicer for Liquidation Expenses
theretofore incurred in respect of any Mortgage Loan in an amount not
to exceed the amount of the related Liqui dation Proceeds deposited
into the Collection Account;
(ii) To pay to the Trustee any unpaid Trustee's Fee to which
it is entitled pursuant to Section 9.5 and to pay to the Servicer (x)
any unpaid Servicing Fees to which it is entitled
<PAGE>
pursuant to Section 3.9, (y) as additional servicing compensation the
amount, if any, by which Net Liquidation Proceeds in respect of a
Liquidated Mortgage Loan are in excess of the sum of (A) the unpaid
principal balance of such Liquidated Mortgage Loan and (B) accrued and
unpaid interest at the applicable Mortgage Interest Rate on the
declining Principal Balance thereof from the Installment Due Date to
which interest was last paid by the Obligor (or from the Cut-off Date,
if such date is prior to the Cut-off Date) to the Installment Due Date
next preceding the Remittance Date on which such Mortgage Loan became a
Liquidated Mortgage Loan;
(iii) To reimburse the Trustee for expenses pursuant to
Section 9.5 and Bluegreen or the Servicer to the extent permitted by
Section 7.3;
(iv) To pay to Bluegreen amounts received in respect of any
Defective Mortgage Loan repurchased by Bluegreen to the extent that the
distribution of any such amounts on the Remittance Date upon which the
proceeds of such purchase are distributed would make the total amount
distributed in respect of any such Mortgage Loan on such Remittance
Date greater than the Purchase Price therefor;
(v) To pay to Bluegreen amounts received in respect of
Defective Mortgage Loans which were not reflected in the calculation of
the related Purchase Price or any Substitution Adjustment;
(vi) To reimburse the Servicer for Monthly Advances
theretofore made in respect of any Mortgage Loan to the extent of late payments
and Liquidation Proceeds received, the Purchase Price paid or the termination
price paid pursuant to Section 10.1, in each case in respect of such Mortgage
Loan;
(vii) To reimburse the Servicer for any Nonrecoverable Advance;
(viii) To reimburse the Servicer out of collections on the
related Mortgage Loan for amounts paid by the Servicer for taxes,
assessments, hazard insurance premiums or comparable items pursuant to
Sections 3.3 and 3.5, to the extent not paid or reimbursed by the
related Obligor;
(ix) To withdraw from the Certificate Account any amounts
deposited therein by error;
(x) [INTENTIONALLY OMITTED];
<PAGE>
(xi) To pay any and all taxes imposed on the Trust REMIC by
federal or state governmental authorities to the extent such taxes have
not been paid pursuant to Section 11.1(c); and
(xii) To clear and terminate the Certificate Account pursuant
to Section 10.1.
The Servicer shall keep and maintain a separate accounting, on a
Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawals from the Certificate Account pursuant to clauses (i), (ii), (iv),
(v), (vi) and (viii) of this Section 3.4.
Section 3.5 Maintenance of Hazard Insurance. The Servicer shall cause
to be maintained on each Mortgaged Property on which a dwelling was located on
the date of origination of the related Mortgage Loan hazard insurance with
extended coverage in an amount which is at least equal to the maximum insurable
value of the improvements securing the related Mortgage Loan or the outstanding
principal balance owing on such Mortgage Loan from time to time, whichever is
less. To the extent provided in Section 3.2(b)(iv), amounts collected by the
Servicer under any such policies shall be deposited into the Collection Account.
Further, monies advanced by the Servicer to avoid the tax sale of the related
Mortgaged Property shall be recoverable by the Servicer pursuant to Section 3.3.
In cases in which a Mortgaged Property is located in a federally designated
flood area and such Mortgaged Property includes improvements thereon as of the
date of origina tion of the related Mortgage Loan, the hazard insurance to be
maintained for such Mortgaged Property shall include flood insurance. The
Servicer shall be under no obligation to require that any Obligor maintain
earthquake or other additional insurance and shall be under no obligation itself
to maintain any such additional insurance on a Mortgaged Property, other than
pursuant to such applicable laws and regulations as shall at any time be in
force and as shall require such additional insurance. If the Servicer shall
obtain and maintain a blanket policy insuring against hazard losses on all of
the Mortgaged Properties on which a dwelling is located, it shall conclusively
be deemed to have satisfied its obligations as set forth in the first sentence
of this Section 3.5, it being under stood and agreed that such policy shall
require prior notice of cancellation, shall name the Trustee as an additional
payee in accordance with its interest and may contain a deductible clause, in
which case the Servicer shall, in the event that there shall not have been
maintained on the related Mortgaged Property a policy complying with the first
sentence of this Section 3.5, and there shall have been a loss which would have
been covered by such policy, deposit into the Collection Account, the amount not
otherwise payable under the blanket policy because of such deductible clause.
Section 3.6 Assumption and Modification Agreements. In any case in
which a Mortgaged Property has been or is about to be conveyed by the Obligor,
the Servicer shall exercise its right to accelerate the maturity of such
Mortgage Loan under any "due-on-sale" clause applicable thereto. If a Mortgage
Loan contains no "due-on-sale" clause, such "due-on-sale" clause, by its terms,
is not
<PAGE>
operable or the Servicer is prevented, as provided in the last paragraph of this
Section 3.6, from enforcing any such clause, the Servicer is authorized to take
or enter into an assumption and modification agreement from or with the Person
to whom such Mortgaged Property has been or is about to be conveyed pursuant to
which such Person becomes liable under the Mortgage Note and the Obligor remains
liable thereon. The Servicer shall not take or enter into any such assumption
and modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation of the continued
effectiveness of any applicable hazard insurance policy. The Servicer shall
notify the Trustee that any assumption and modification agreement has been
completed and forward to the Trustee the original copy thereof, which copy shall
be added by the Trustee to the related Mortgage Documents and shall, for all
purposes, be considered a part of such Mortgage Documents to the same extent as
all other documents and instruments constituting a part thereof. In connection
with any such agreement, neither the Servicer nor the Trustee shall permit
modification of any term of the Mortgage Loan. Any fee collected by the Servicer
for enter ing into any such agreement will be retained by the Servicer as
additional servicing compensation.
Notwithstanding the foregoing paragraph of this Section 3.6 or any
other provision of this Agreement, the Servicer shall not be deemed to be in
default, breach or any other violation of its obligations hereunder by reason of
any assumption of a Mortgage Loan, or transfer of the property subject to a
Mortgage without the assumption thereof, by operation of law or any assumption
or transfer which the Servicer reasonably believes, after due inquiry, it is
restricted by law from preventing, for any reason whatsoever.
Section 3.7 Realization upon Defaulted Mortgage Loans; Title and
Management of REO Property. (a) The Servicer shall foreclose upon or otherwise
comparably convert to ownership Mortgaged Properties securing such of the
Mortgage Loans as come into and continue in Default (as defined below) and as to
which no satisfactory arrangements can be made for collection of delinquent
payments pursuant to Section 3.2. For purposes of this Section 3.7(a), "Default"
with respect to a Mortgage Loan shall mean a payment default (without giving
effect to any grace period) or any other material default under the terms of the
Mortgage Loan, which default continues unremedied for a period of more than 90
days. 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 normal and usual in its general mortgage servicing
activities and as shall be in accordance with Accepted Servicing Practices. The
Servicer shall be responsible for all other costs and expenses incurred by it in
any such proceedings; provided, however, that the Servicer shall be entitled to
reimbursement thereof from related Liquidation Proceeds to the extent provided
in Section 3.4. Notwithstanding the above, the Servicer shall not be entitled to
recover legal expenses incurred in connection with foreclosure proceedings where
the Mortgage Loan is reinstat ed and such foreclosure proceedings are terminated
prior to completion, other than sums received from the Obligor for such
expenses. The foregoing is subject to the provision that, in any case in
<PAGE>
which property subject to a Mortgage shall have suffered damage from an
Uninsured Cause, the Servicer shall not be required to expend its own funds in
connection with any foreclosure or towards the restoration of such property
unless it shall determine in its discretion (a) that such restoration and/or
foreclosure will increase the proceeds of liquidation of the related Mortgage
Loan to Certificateholders after reimbursement to itself for such expenses and
(b) that such expenses will be recoverable by the Servicer through Liquidation
Proceeds from the related property, as contemplated in Section 3.4.
Prior to foreclosing upon or otherwise comparably converting to
ownership any Mortgaged Property securing a Mortgage Loan, the Servicer will
review the mortgage file which includes the Mortgage Documents relating to such
Mortgage Loan and inspect the Mortgaged Property for purposes of determining
whether such foreclosure or comparable conversion is in the best economic
interests of the Certificateholders (assuming, for such purposes, that the
Mortgaged Property is in compliance with, and no liability or exposure would
exist upon foreclosure or conversion under, any applicable environmental law or
regulation). If, during the course of its activities specified in the preceding
sentence, the Servicer discovers that the Mortgaged Property is in material
violation of any applicable environmental law or regulation, the Servicer will
not (and shall, notwithstanding anything to the contrary contained in this
Agreement, not have any obligation to) foreclose or otherwise comparably convert
the Mortgaged Property without the prior written consent of the Holders of a
majority of the principal balance of the Controlling Class. It is expressly
understood that nothing in this paragraph shall require the Servicer to perform,
or request any other Person to perform, any environmental assessment or
inspection and it is contemplated that no such assessment or inspection shall
occur unless the same is requested by the Holders of the Controlling Class as a
condition to any consent.
(b) In the event that title to any Mortgaged Property is acquired by
the Servicer for the benefit of Certificateholders in foreclosure or by
deed-in-lieu of foreclosure or otherwise, the deed or certificate of sale shall
be taken in the name of the Trustee, or its nominee, on behalf of the
Certificateholders. The Servicer, on behalf of the Trust Fund, shall sell any
REO Property as expeditiously as possible, but in all events within the time
period, and subject to the conditions, set forth in Section 11.2. Subject to
Section 11.2, the Servicer shall manage, conserve, protect and operate each REO
Property for the Certificateholders solely for the purpose of its prompt disposi
tion and sale.
If the Trust Fund acquires any REO Property, the Servicer shall have
full power and authority, subject only to the specific requirements and
prohibitions of this Agreement, to do any and all things in connection therewith
as are consistent with Accepted Servicing Practices, all on terms and for such
period as the Servicer deems to be in the best interest of Certificateholders,
and, consistent therewith, shall advance from its own funds (i) all insurance
premiums due and payable
<PAGE>
in respect of such REO Property; (ii) all taxes and other impositions in respect
of such REO Property that could result or have resulted in the imposition of a
lien thereon; and (iii) all costs and expenses necessary to maintain such REO
Property; in each such case, if, but only if, the Servicer would make such an
advance if it owned such REO Property, and, in the Servicer's judgment, such
amounts will be recoverable by the Servicer from related Liquidation Proceeds.
Section 3.8 Trustee to Cooperate; Release of Mortgage Documents. Upon
the payment in full of any Mortgage Loan, the substitution or repurchase of a
Defective Mortgage Loan pursuant to Sections 2.2 or 2.3, or the modification of
a Mortgage pursuant to Section 11.3, the Servicer will immediately notify the
Trustee by a certification (which certification, in the case of a payment in
full or a substitution or repurchase pursuant to Section 2.2 or 2.3, shall
include a statement to the effect that all amounts received in connection with
such payment, repurchase or substitution which are required to be deposited in
the Collection Account pursuant to Section 3.2 have been so deposited) of a
Servicing Officer and shall request delivery to it of the related Mortgage
Documents. Upon receipt of such certification and request, the Trustee shall
promptly release the related Mortgage Documents to the Servicer. Upon any such
payment in full, repurchase, substitution or modification, the Servicer is
authorized to execute, pursuant to the authorization contained in Section 3.1,
an instrument of satisfaction regarding such Mortgage, which instrument of
satisfaction shall be recorded by the Servicer if required by applicable law and
be delivered to the Person entitled thereto, it being understood and agreed that
no expenses incurred in connection with such instrument of satisfaction shall be
reimbursed from amounts at the time deposited in the Collection Account. From
time to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan, the Trustee shall, upon request of the Servicer and delivery to the
Trustee of a receipt signed by a Servicing Officer, release the related Mortgage
Documents to the Servicer and shall execute such documents as shall be necessary
to the prosecution of any such proceedings. Such receipt shall obligate the
Servicer to return the Mortgage Documents to the Trustee when the need therefor
by the Servicer no longer exists unless the Mortgage Loan shall be liquidated,
in which case, upon receipt of a certificate of a Servicing Officer, the receipt
shall be released by the Trustee to the Servicer.
Section 3.9 Servicing Compensation; Payment of Certain Expenses by the
Servicer. The Servicer shall be entitled to instruct the Trustee to withdraw
from the Certificate Account or to withhold and pay to itself as servicing
compensation out of each payment received by it on account of interest on each
Mortgage Loan an amount equal to the Servicing Fee. Additional servicing
compensation in the form of assumption fees and late payment charges, pursuant
to Section 3.4 hereof or otherwise shall be retained by the Servicer to the
extent collected from the related Obligors and only to the extent in excess of
the full amount of the Periodic Payments on the related Mortgage Loans.
Additional servicing compensation in the form of investment income on amounts on
deposit in the Reserve Account and gain from the sale of REO Property as
calculated pursuant to
<PAGE>
Section 3.4(ii) shall be retained by the Servicer. The Servicer shall be
required to pay all expenses incurred by it in connection with its activities
hereunder (including payment of all other fees and expenses not expressly stated
hereunder to be for the account of the Certificateholders) and shall not be
entitled to reimbursement therefor except as provided in Sections 3.3, 3.4 and
3.7.
Section 3.10 Annual Statement as to Compliance. The Servicer shall
deliver to the Trustee, the Rating Agency and, for so long as the Class A
Certificates are outstanding, the Class A Certificateholders, on or before
September 30 of each year, beginning September 30, 1997, an Officers'
Certificate stating that (a) a review of the activities of the Servicer during
the 12 months ended March 31 (or from the Closing Date to March 31, 1997, with
respect to the first such Officers' Certificate) and of its performance under
this Agreement has been made under such officers' supervision and (b) to the
best of such officers' knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement throughout such period, or,
if there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officers and the nature and status
thereof.
Section 3.11 Annual Independent Public Accountant's Servicing Report.
On or before September 30 of each year, beginning September 30, 1997, the
Servicer, at its expense, shall direct a firm of independent public accountants
(which shall be one of the "big six" firms) to furnish a statement to the
Trustee, the Rating Agency and, for so long as the Class A Certificates are
outstanding, the Class A Certificateholders, stating that the firm has examined
certain documents and records relating to the servicing of the Mortgage Loans
during the Servicer's most recent fiscal year (or from the Closing Date to the
end of the Servicer's fiscal year, with respect to the first such statement) and
that, on the basis of the examination, nothing has come to the attention of such
firm that would cause it to believe that the servicing has not been conducted in
compliance with this Agreement except for (a) exceptions as the firm believes
are immaterial, and (b) other exceptions as shall be set forth in the statement.
Copies of the statement shall be provided to the Certificatehold ers by the
Servicer or by the Trustee at the Servicer's expense if the Servicer fails to
provide the requested copies.
Section 3.12 Access to Certain Documentation and Information Regarding
the Mortgage Loans. The Servicer shall provide to the Trustee and
Certificateholders and their respective supervisory agents and examiners access
to the documentation regarding the Mortgage Loans re quired by applicable laws
and regulations, such access being afforded without charge but only upon
reasonable request and during normal business hours at the offices of the
Servicer. Nothing in this Section 3.12 shall derogate from the obligation of the
Servicer to observe any applicable law prohibiting disclosure of information
regarding the Obligors and the failure of the Servicer to provide access as
provided in this Section 3.12 as a result of such obligation shall not
constitute a breach of this Section 3.12.
<PAGE>
Section 3.13 Maintenance of Certain Servicing Policies. (a) The
Servicer, at its expense, shall maintain in effect a Servicer Fidelity Bond and
a Servicer Errors and Omissions Insurance Policy, naming the Trustee as loss
payee, affording coverage for all directors, officers, employees and other
Persons acting on the Servicer's behalf. The Servicer Errors and Omissions
Insurance Policy and Servicer Fidelity Bond shall be in such form and amount
that would meet the requirements of the Rating Agency and, for so long as it
holds Class A Certificates, TIAA.
(b) The Servicer shall promptly report in writing to the Trustee and,
for so long as the Class A Certificates are outstanding, the Class A
Certificateholders, any material changes that may occur in any required Servicer
Fidelity Bond or Servicer Errors and Omissions Insurance Policy and shall
furnish to the Trustee copies of all binders and policies or certificates
evidencing that such bond and insurance policy are in full force and effect. The
Servicer shall promptly report in writing to the Trustee and, for so long as the
Class A Certificates are outstanding, the Class A Certificateholders, all cases
of embezzlement or fraud or irregularities of operation, suspected or otherwise,
if such events involve funds relating to the Mortgage Loans. The total losses,
regardless of whether claims are filed with the applicable insurer or surety,
shall be disclosed in such reports together with the amount of such losses
covered by insurance. If a bond or insurance claim report is filed with any of
the Servicer bonding companies or insurers, a copy of such report shall be
promptly furnished to the Trustee and, for so long as the Class A Certificates
are outstanding, the Class A Certificateholders.
Section 3.14 Preparation of Tax Returns and Other Reports.
(a) Subject to Section 11.1, the Trustee shall prepare or cause to be prepared
on behalf of the Trust Fund, in reliance upon the information, if any, furnished
by the Depositor and the Servicer in accordance with this Agreement and pursuant
to instructions given by the Holders of a majority in Percentage Interests of
the Class R Certificates, shall sign and shall file, Federal income tax and in
formation returns and appropriate state income tax and information returns or
such other returns as may be required by applicable law relating to the Trust
Fund. The Servicer and the Depositor shall provide to the Trustee any informa
tion within the control of each that shall be reasonably necessary to enable the
Trustee to comply with the provisions of this Section 3.14(a). The Trustee shall
forward to the Depositor and the Servicer copies thereof and of quarterly and
annual REMIC tax returns and Form 1099 information returns and such other infor
mation within the control of the Trustee as the Depositor and the Servicer may
reasonably request in writing. Moreover, the Trustee shall forward to each Cer
tificateholder such forms and furnish such information within the control of
the Trustee as are required by the Code to be furnished to them, will prepare
and file annual reports required by the state authorities, will file copies of
this Agreement with the appropriate state authorities as may be required by appl
icable law and will prepare and disseminate to Certificateholders Forms 1099
(or otherwise furnish information within the control of the Trustee) to the ex
tent required by
<PAGE>
applicable law. The Servicer, the Depositor and the Class R Certificateholders
(but not the Trust Fund) shall indemnify the Trustee for any liability of or
assessment against the Trustee and any expenses incurred in connection with such
liability or assessment (including attorney's fees) resulting from any error in
any of such tax or information returns resulting from errors in the information
or instructions, as applicable, provided by the Servicer, the Depositor or the
Class R Certificateholders. The Trustee shall indemnify the Servicer, the
Depositor and the Class R Certificateholders for any liability of or assessment
against the Servicer, the Depositor or the Class R Certificateholders and any
expense incurred in connection with such liability or assessment (including
attorney's fees) resulting from any error in any of such tax or information
returns resulting from errors in the preparation of such returns by the Trustee.
Any such indemnification shall survive the termination of this Agreement.
(b) The Trustee shall prepare, sign and file with the Internal Revenue
Service ("IRS"), on behalf of the Trust REMIC, an application for a taxpayer
identification number for the Trust REMIC on IRS Form SS-4. The Trustee, upon
receipt from the IRS of the Notice of Taxpayer Identification Number Assigned,
shall promptly forward a copy of such notice to the Servicer and the Depositor.
The Trustee shall prepare and file Form 8811 on behalf of the Trust REMIC and
shall designate an appropriate Person to respond to inquiries by or on behalf of
Certificateholders for original issue discount and related information in
accordance with applicable provisions of the Code.
Section 3.15 Trustee's Interest in the Trust Fund.
(a) Notwithstanding that the parties hereto intend that the conveyance
of the Depositor's right, title and interest on and to the Trust Fund pursuant
to this Agreement shall constitute a purchase and sale and not a pledge of
security for a loan, the Servicer shall, from time to time, cause to be taken
such actions as are necessary to continue the perfection of the Trustee's
security interest in the Trust Fund (other than any statutory lien arising by
operation of law after the Closing Date that is prior to such security
interest), including, without limitation, the filing of financing statements,
amendments thereto or continuation statements and the making of notations on the
records or documents of title relating to the Trust Fund. The Depositor will
cooperate in all such actions and will execute and deliver whatever is
reasonably necessary to accomplish the foregoing.
(b) The Servicer will deliver to the Trustee, the Rating Agency and,
for so long as the Class A Certificates are outstanding, the Class A
Certificateholders, within 180 days after the beginning of each calendar year
beginning with 1997, an Opinion of Counsel, dated as of a date during such
180-day period, either (i) stating that in the opinion of such counsel, all
financing statements and continuation statements have been executed and filed
that are necessary fully to continue the perfection of the Trustee's security
interest in the personal property in the Trust Fund in the event
<PAGE>
that the conveyance by Bluegreen to the Depositor and/or the Depositor to the
Trustee pursuant to this Agreement is deemed to be a pledge for a loan, and
reciting the details of such filings or referring to prior Opinions of Counsel
in which such details are given, or (ii) stating that, in the opinion of such
counsel, no such action during that calendar year is necessary to continue the
perfection of such security interest.
ARTICLE IV SERVICER'S CERTIFICATE; MONTHLY ADVANCES
Section 4.1 Servicer's Certificate. Each month, not later than the
third Business Day next preceding each Remittance Date, the Servicer shall
deliver to the Trustee, the Rating Agency and, for so long as the Class A
Certificates are outstanding, the Class A Certificateholders, a Servicer's
Certificate stating the date (month and year), the dates of the Collection
Period and the Remittance Date to which such Certificate relates, the Series
number of the Certificates, the date of this Agree ment, the Cut-off Date Pool
Principal Balance and the Class A Principal Balance and Class B Principal
Balance, in each case as of the Closing Date and, as of the close of business on
the Deter mination Date for such month:
(i) The amount on deposit in the Collection Account and the Certificate
Account as of the close of business on the preceding Determination Date (listing
separately each amount deposited therein pursuant to Section 3.2(b)), reduced by
the sum of (a) the Amount Held for Future Distribu tion and (b) amounts
permitted to be withdrawn from the Certificate Account pursuant to Section 3.2
and Section 3.4 (listing separately each such amount);
(ii) The aggregate Purchase Prices for, and principal balances of, any
Defective Mortgage Loans which Bluegreen will purchase on the Business Day
immediately preceding the following Remittance Date pursuant to Sections 2.2 and
2.3 together with any Substitution Adjustment to be deposited into the
Collection Account on the Business Day next preceding such Remittance Date
pursuant to Section 2.3(e) in connection with any substitution for a Defective
Mortgage Loan;
(iii) The principal balances of all Mortgage Loans which were the
subject of Principal Prepayments in Full during the preceding Collection Period;
(iv) The amount of all Principal Prepayments which were not Principal
Prepayments in Full and which were received during the preceding Collection
Period;
(v) The principal balances of all Mortgage Loans which became
Liquidated Mortgage Loans during the preceding Collection Period;
<PAGE>
(vi) The aggregate of Principal Balances of the Mortgage Loans for the
Remittance Date in the following month and the actual outstanding balances of
the Mortgage Loans as of the end of the most recent Collection Period;
(vii) The amount of the Monthly Advance to be made on the following Re
mittance Date;
(viii) The Amount Available and the Base Principal Distribution Amount
for the following Remittance Date;
(ix) The Class A and Class B Pass-Through Rates;
(x) The number and aggregate outstanding principal balances of Mortgage
Loans that (a) had a Periodic Payment which remained unpaid for 30, 60 and 90 or
more days, (b) were in foreclo sure and (c) were in inventory awaiting resale,
in each case as of the close of business on the last day of the immediately
preceding Collection Period;
(xi) The amount of Realized Losses on the Mortgage Loans as of the
last day of the immediately preceding Collection Period;
(xii) The statement of accounting required by Section 11.2(c);
(xiii) The Remittance Certificate required to be delivered by the
Trustee to Certificate holders pursuant to Section 5.2; and
(xiv) The amount on deposit in the Reserve Account as of the close of
business on the preceding Determination Date, reduced by any amount withdrawn
from the Reserve Account and transferred to the Certificate Account pursuant to
Section 5.1(a) or withdrawn and transferred to the holders of the Class R
Certificates pursuant to clause (iv) of Section 3.2(d).
Section 4.2 Monthly Advances. (a) If on any Determination Date, any
Periodic Payment due during the immediately preceding Collection Period has not
been received by the Servicer by such Determination Date, the Servicer shall
make a Monthly Advance unless, in the Servicer's good faith discretion, the
Servicer determines that such Monthly Advance will be a Nonrecoverable Advance.
If the Servicer determines that it will make a Monthly Advance it shall so
indicate on the related Servicer's Certificate, and on the Business Day prior to
the related Remittance Date either (i) deposit in the Collection Account an
amount equal to such Monthly Advance, (ii) cause to be made an appropriate entry
in the records relating to the Collection Account that all or a portion of the
Amount Held for Future Distribution, as permitted by this Section 4.2, has been
used by the Servicer to make such Monthly Advance, or (iii) make an advance in
the form of any combination
<PAGE>
of (i) and (ii) aggregating the amount of such Monthly Advance. Any such Monthly
Advance shall be included with the distribution to the Certificateholders on the
related Remittance Date. Any Amount Held for Future Distribution so used shall
be replaced by the Servicer by deposit from its own funds in the Collection
Account on or before any future Remittance Date to the extent that funds in the
Collection Account on such Remittance Date shall be less than payments to
Certifi cateholders required to be made on such date. The Servicer shall be
entitled to be reimbursed from the Collection Account for all Monthly Advances
and Nonrecoverable Advances as provided in Section 3.4.
Section 4.3 Reports of Foreclosures and Abandonment of Mortgaged
Property. Each year beginning in 1997, the Servicer shall prepare and execute
the reports of foreclosures and aban donments of any Mortgaged Property required
by Section 6050J of the Code. On or prior to February 28th of each year, the
Servicer shall provide to the Internal Revenue Service, reports relating to each
instance occurring during the previous calendar year in which the Servicer (i)
on behalf of the Trustee acquires an interest in a Mortgaged Property through
foreclosure or other comparable conversion in full or partial satisfaction of a
Mortgage Loan, or (ii) knows or has reason to know that a Mortgaged Property has
been abandoned. The reports from the Servicer shall be in form and substance
sufficient to meet the reporting requirements imposed by such Section 6050J of
the Code.
ARTICLE V PAYMENTS AND STATEMENTS TO CERTIFICATEHOLDERS
Section 5.1 Distributions; Accrual of Interest. (a) On each Remittance
Date, the Trustee shall make distributions to the Certificateholders, based on
information provided to the Trustee by the Servicer in the Servicer's
Certificate delivered pursuant to Section 4.1, in the following order of
priority, in each case to the extent of the Amount Available deposited in the
Certificate Account pursuant to Section 3.2(b):
(i) to the Holders of the Class A Certificates, interest
accrued on the outstand ing Class A Principal Balance immediately preceding such
Remittance Date during the Interest Accrual Period relating to such Remittance
Date, at a per annum rate equal to the Class A Pass- Through Rate;
(ii) to the Holders of the Class A Certificates, prin-cipal
equal to the lesser of (A) the outstanding Class A Principal Balance
and (B) the Class A Principal Distribution Amount for such Remittance
Date;
<PAGE>
(iii) if such Remittance Date is a Class A Cross-Over
Remittance Date, to the Holders of the Class B Certificates, interest accrued on
the outstanding Class B Principal Balance immediately preceding such Remittance
Date during the Interest Accrual Period relating to such Remittance Date, at a
per annum rate equal to the Class B Pass-Through Rate (if the Remittance Date is
not a Class A Crossover Remittance Date, the amount payable under this clause
(iii) shall be zero);
(iv) if such Remittance Date is a Class A Cross-Over
Remittance Date, to the Holders of the Class B Certificates, principal equal to
the lesser of (A) the outstanding Class B Principal Balance and (B) the Class B
Principal Distribution Amount for such Remittance Date;
(v) with respect to the first six Remittance Dates and, to the
extent a Retention Event shall have occurred (at any time and whether
or not cured), any Remittance Date subsequent to a Class A Cross-Over
Remittance Date, to the Reserve Account until the principal amount of
the Reserve Account equals 5% of the Outstanding Pool Principal Balance
(it being understood that on the seventh Remittance Date and each
Remittance Date thereafter until the occurrence of a Class A Cross-Over
Remittance Date and the occurrence of a Retention Event, no amount will
be deposited into the Reserve Account under this clause (v));
(vi) if not a Class A Cross-Over Remittance Date, the
remainder of the Amount Available, if any, to the Class A Certificates
as principal until the Class A Principal Balance has been reduced to
zero ($0), in which case the remainder of the Amount Available is
distributed to the Class B Certificates as principal; and
(vii) the remainder of the Amount Available to the Class R
Certificates.
If on any Remittance Date while the Class A Certificates are outstanding the
Amount Available is not sufficient to pay the amounts specified in clauses (i)
and (ii), the Servicer shall, on or before such Remittance Date, instruct the
Trustee to withdraw from the Reserve Account and cause to be deposited into the
Certificate Account the lesser of (i) the entire amount on deposit in the
Reserve Account and (ii) the amount necessary to pay Class A Certificateholders
the amounts specified in clauses (i) and (ii). If on any Remittance Date after
the Class A Principal Balance is reduced to zero the Amount Available is not
sufficient to pay Class B Certificateholders the amounts specified in clauses
(iii) and (iv), the Servicer shall, on or before such Remittance Date, instruct
the Trustee to withdraw from the Reserve Account and cause to be deposited into
the Certificate Account the lesser of (x) the entire amount on deposit in the
Reserve Account and (y) the amount necessary to pay Class B Certificateholders
the amounts specified in clauses (iii) and (iv). Amounts transferred
<PAGE>
to the Certificate Account from the Reserve Account in accordance herewith shall
be subject to distribution in the manner provided in this Section 5.1(a).
(b) Distributions to Certificateholders of each Class shall be made pro
rata within such Class, in proportion to the respective Percentage Interests of
the Certificateholders within such Class. Distributions on each Remittance Date
shall be made by the Trustee to each Certificateholder of record on the related
Record Date (other than as provided in Section 10.1 respecting the final
distribution), by check or money order mailed to such Certificateholder at the
address appearing in the Certificate Register, or upon written request by the
Certificateholder, by wire transfer of immediately available funds (in the event
such Certificateholder owns of record one or more Certificates of the same Class
(i) which have denominations aggregating at least $1,000,000 or (ii) the Class B
or the Class R Certificates), or by such other means of payment as such
Certificateholder and the Trustee shall agree; provided, however, that the final
distribution in retirement of any Class of Certificates shall be made only upon
presentation and surrender of the Certificate at the office or agency of the
Trustee specified in a notice from the Trustee to the Certifi cateholders.
(c) If on any Remittance Date, the amount of interest distributable on
any of the Class A or Class B Certificates in accordance with Section 5.1(a)
(after giving effect to the payment of any funds held in the Reserve Account) is
less than an amount equal to interest at the Pass-Through Rate for such Class
accrued during the related Interest Accrual Period on the Class Principal
Balance of such Class as of the immediately preceding Remittance Date, or, in
the case of the first Remittance Date, as of the Cut-off Date, the amount of
such interest shortfall shall accrue and be added to the Class Principal Balance
of such Class on such Remittance Date.
Section 5.2 Statements to Certificateholders. With each distribution
from the Certificate Account to the Certificateholders made on a Remittance
Date, the Trustee shall mail to each Certif icateholder a Remittance Certificate
prepared and delivered to the Trustee by the Servicer pursuant to Section
4.1(xiii) setting forth:
(i) the Class A Principal Balance as of the previous Remittance Date
and the portion thereof evidenced by a Single Certificate;
(ii) the amount of such distribution allocable to interest at the Class
A Pass-Through Rate for the related Remittance Date and the portion thereof
evidenced by a Single Certificate;
(iii) the amount of such distribution allocable to amortize the Class A
Principal Balance and the portion thereof evidenced by a Single Certificate;
<PAGE>
(iv) the Class A Principal Balance for such Remittance Date (stating to
the extent appli cable any amount consisting of interest accrued, unpaid and
added to principal on such Remittance Date) and the portion thereof evidenced by
a Single Certificate, and the Class A Percentage as of such previous Remittance
Date;
(v) the Class B Principal Balance as of the previous Remittance Date
and the portion thereof evidenced by a Single Certificate, and the Class B
Percentage as of such previous Remittance Date;
(vi) the amount of accrued interest on the Class B Principal Balance at
the Class B Pass- Through Rate for such Remittance Date and the portion thereof
evidenced by a Single Certificate;
(vii) the amount of such distribution allocable to amortize the Class B
Principal Balance and the portion thereof evidenced by a Single Certificate;
(viii) the Class B Principal Balance for such Remittance Date (stating
to the extent appli cable any amount consisting of interest accrued, unpaid and
added to principal on such Remittance Date) and the portion thereof evidenced by
a Single Certificate;
(ix) the amount allocable to fund the Reserve Account;
(x) the amount of any distribution to the Class R Certificateholders;
(xi) the aggregate Principal Balance and outstanding principal balance
of the Mortgage Loans as of such Remittance Date;
(xii) the number and aggregate outstanding principal balances of
Mortgage Loans (a) which had a Periodic Payment which remained unpaid for 30, 60
and 90 or more days, (b) that were in foreclosure and (c) foreclosed upon where
the Mortgaged Property has not yet been sold, in each case as of the close of
business on the last day of the immediately preceding Collection Period;
(xiii) the amount of Realized Losses on the Mortgage Loans as of the
last day of the immediately preceding Collection Period and total to date since
the Closing Date;
(xiv) the components of the Base Principal Distribution Amount with re
spect to such Remittance Date;
(xv) any amount covered by clauses (i) or (ii) of Section 5.1(a) which
was not paid on such Remittance Date;
<PAGE>
(xvi) to the extent a Retention Event shall exist with respect to such
Remittance Date, information concerning the applicable circumstances causing
such Retention Event;
(xvii) to the extent such Remittance Date is a Class A Cross-Over
Remittance Date, information as to compliance with each item in the definition
of Class A Cross-Over Remittance Date; and
(xviii) the amount on deposit in the Reserve Account as of the
applicable Determination Date, the percentage such amount represents of the
Outstanding Pool Principal Balance and whether any funds from the Reserve
Account were transferred to the Certificate Account and paid to
Certificateholders on such Remittance Date.
Within 60 days following the end of each calendar year, the Trustee
shall mail to each Person who at any time during the calendar year was a
Certificateholder on any Record Date during such calendar year (a) a statement
containing for such calendar year information as to the total amount of
distributions allocable to interest and the total amount allocable to amortize
principal on each Class of Certificates for which such distributions were made
as well as any amount of interest accrued and unpaid and added to principal on
each such Class of Certificate, and (b) such other customary information as the
Servicer deems necessary or desirable for Certificateholders to prepare their
tax returns. Such obligations of the Servicer and the Trustee shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Servicer pursuant to any requirements of the Code from
time to time in force.
ARTICLE VI THE CERTIFICATES
Section 6.1 The Certificates. The Class A, Class B and Class R
Certificates shall be sub stantially in the forms set forth in Exhibits A, B and
C, respectively, and shall, on original issue, be executed on behalf of the
Trust Fund, authenticated and delivered by the Trustee to or upon the order of
the Depositor upon receipt by the Trustee of the documents specified in Section
2.1. The Class A and Class B Certificates shall be issuable in the minimum
dollar denominations, integral dollar multiples in excess thereof and aggregate
dollar denominations per Class as set forth in the following table (except that
one Certificate of each Class may be issued in a different denomina tion):
<PAGE>
Aggregate Denom-
inations of all
Minimum Integral Multiples Certificates of
Class Denomination in Excess of Minimum Class
A $100,000 $1,000 $11,836,375.11
B $100,000 $1,000 $1,315,152.82
The Class R Certificates have no principal balance and do not bear
interest. The Class R Certificates are issuable in Percentage Interests.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trust Fund by the Trustee by an authorized officer under its seal
imprinted thereon. Certificates bearing the manual or facsimile signatures of
individuals who were, at the time when such signatures were affixed, authorized
to sign on behalf of the Trustee shall bind the Trustee, notwithstanding that
such individuals or any of them have ceased to be so authorized prior to the
execution and delivery of such Certificates or did not hold such offices at the
date of any such Certificate. No Certificate shall be entitled to any benefit
under this Agreement, or be valid for any purpose, unless such Certificate shall
have been manually authenticated by the Trustee substantially in the form
provided for herein, and such authentication upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been duly
executed and delivered hereunder. Each Certificate executed, authenticated and
delivered by the Trustee to or upon the order of the Depositor on the Closing
Date shall be dated as of the Closing Date. All other Certificates that are
authenticated after the Closing Date shall be dated the date of their
authentication.
Pending the preparation of definitive Certificates, the Trustee may
execute, authenticate and deliver temporary Certificates that are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Certificates in lieu
of which they may be so issued and with such variations as the officers
executing such Certificates may determine, as evidenced by their execution of
such Certificates.
If temporary Certificates are issued, the Depositor will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Trustee to be maintained as provided
in Section 6.2, without charge to the Certificateholder. Upon surrender or
cancellation of any one or more temporary Certificates, the Trustee shall
execute, authenticate and deliver and exchange therefor a like aggregate initial
principal amount of definitive Certificates of the same Class and of authorized
<PAGE>
denominations. Until so exchanged, the temporary Certificates shall in all
respects be entitled to the same benefits under this Agreement as definitive
Certificates of the same Class.
Section 6.2 Registration of Transfer and Exchange of Certificates. (a)
The Trustee shall cause to be kept at an office or agency in the city in which
the Corporate Trust Office of the Trustee is located or in the City of New York,
New York, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee shall provide for the registration
of Certif icates and of transfers and exchanges of Certificates as herein
provided. The Trustee shall initially serve as Certificate Registrar for the
purpose of registering Certificates and transfers and exchanges of Certificates
as herein provided.
Upon surrender for registration of transfer of any Certificate at any
office or agency of the Trustee maintained for such purpose pursuant to the
foregoing paragraph and upon satisfaction of the conditions set forth below, the
Trustee shall execute, authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Certificates of a like tenor, Class
and aggregate Percentage Interest.
At the option of the Certificateholders, Certificates may be exchanged
for any number of other Certificates of authorized denominations of a like Class
and aggregate Percentage Interest, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange the Trustee shall execute, authenticate and deliver the
Certificates of such Class which the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for transfer or
exchange shall (if so required by the Trustee or the Certificate Registrar) be
duly endorsed by, or 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 attorney duly authorized in writing.
(b) No transfer of a Certificate of any Class shall be made unless such
transfer is exempt from the registration requirements of the Securities Act and
any applicable state securities laws or is made in accordance with said Act and
laws. As a condition to any proposed transfer of a Certificate (other than the
initial transfer to TIAA), (i) the Trustee or Bluegreen shall require a written
Opinion of Counsel acceptable to and in form and substance satisfactory to the
Trustee and Bluegreen that such transfer may be made pursuant to an exemption,
describing the applicable exemption and the basis therefor, from said Act and
laws or is being made pursuant to said Act and laws, which Opinion of Counsel
shall not be an expense of the Trustee or Bluegreen, provided, however, that if
the transferee certifies in the applicable investment letter provided for in the
following clause (ii) that such transferee is a QIB and that such transfer is
being made pursuant to Rule 144A promulgated under the Securities Act, or that
such transferee is a sophisticated institutional investor (which is an
"accredited investor" within the meaning of Rule 501(a)(1),(2),(3) or (7) of
<PAGE>
Regulation D promulgated under the Securities Act, acquiring the Certificate for
investment purposes, then the Trustee and Bluegreen shall not require, and the
transferee shall have no obligation to provide, the Opinion of Counsel provided
for in this clause (i), and (ii) the Trustee shall require the transferee to
execute an investment letter, substantially in the form attached hereto as
Exhibit H-A, with respect to the Class A Certificates, and substantially in the
form attached hereto as Exhibit H-B, with respect to the Class B or Class R
Certificates, certifying to Bluegreen and the Trustee the facts surrounding such
transfer, which investment letter shall not be an expense of the Trustee or
Bluegreen. The Holder of a Certificate desiring to effect such transfer shall,
and by its acceptance of a Certificate agrees to, indemnify the Trustee and
Bluegreen 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 by reason of the
action or omission of such Holder and that the foregoing indemnification shall
survive any transfer of such Certificate by such Holder.
(c) No transfer of any Class A Certificate shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, substantially in the form attached hereto as
Exhibit H-A to the effect that such transferee is not an employee benefit plan
or other entity subject to Section 406 of ERISA or Section 4975 of the Code, nor
a Person acting on behalf of any such plan or other entity, which representation
letter shall not be an expense of the Trustee, Bluegreen or the Trust Fund, (ii)
if the purchaser is an insurance company, a representation from the purchaser of
such Certificate, substantially in the form reflected in Exhibit H-A to the
effect that the purchaser is an insurance company which is purchasing such
Certificate with funds contained in an "insurance company general account" (as
such term is defined in Section V(e) of Prohibited Transaction Class Exception
95-60 ("PTCE 95-60")) and that the purchase, holding and any sale of such
Certificates are covered under PTCE 95-60 (it being understood that no transfer
of a Class A Certificate pursuant to this clause (ii) shall be made if PTCE
95-60 is rescinded or otherwise amended in a manner which renders the prohibited
transactions exemptions contained therein unavailable to the purchase or holding
of the Class A Certificates), or (iii) in the case of any such Certificate
presented for registration in the name of an employee benefit plan or other
entity subject to Section 406 of ERISA or Section 4975 of the Code, or a trustee
of any such plan, one or more opinions of counsel satisfactory to the Trustee
and Bluegreen to the effect that the purchase or holding of such Subordinate
Certificate will not result in the assets of the Trust Fund being deemed to be
"plan assets" and subject to the prohibited transaction provisions of ERISA and
the Code and will not subject the Trustee or Bluegreen to any obligation in
addition to those undertaken in this Agreement and provided further, that such
opinions shall not be an expense of the Trustee, Bluegreen or the Trust Fund.
(d) No Subordinate Certificate may be owned, pledged or transferred to,
directly or indirectly, an employee benefit plan or other entity subject to
Section 406 of ERISA or Section 4975 of the Code, nor a Person acting on behalf
of any such plan or other entity. No transfer of any
<PAGE>
Subordinate Certificate shall be made unless the Trustee shall have received a
representation letter from the transferee of such Certificate, substantially in
the form attached hereto as Exhibit H-B, to the effect that such transferee is
not an employee benefit plan or other entity subject to Section 406 of ERISA or
Section 4975 of the Code, nor a person acting on behalf of any such plan or
other entity, which representation letter shall not be an expense of the
Trustee, Bluegreen or the Trust Fund.
Notwithstanding the registration in the Certificate Register of any
transfer, sale, or other disposition of a Class A or Class B Certificate or any
percentage therein to an employee benefit plan or other entity subject to
Section 406 of ERISA or section 4975 of the Code or an agent or nominee acting
on behalf of any such employee benefit plan or other entity, such registration
shall be deemed to be of no legal force or effect whatsoever and such employee
benefit plan or other entity (or such agent or nominee) shall not be deemed to
be a Certificateholder for any purpose hereunder, including, but not limited to,
the receipt of distributions on such Certificate.
(e) Notwithstanding anything to the contrary contained herein or in
this Agreement, no Class R Certificate or any Percentage Interest therein may be
owned, pledged or transferred, directly or indirectly, by or to a Disqualified
Organization. Prior to and as a condition of the registration of any transfer,
sale or other disposition of a Class R Certificate or any Percentage Interest
therein, the proposed transferee shall deliver to the Certificate Registrar an
affidavit in substantially the respective forms attached hereto as Exhibit
F-1(a) (for a U.S. Holder) or Exhibit F -1(b) (for a foreign Holder)
representing and warranting that such transferee is neither a Disqualified
Organization nor an agent or nominee acting on behalf of a Disqualified
Organization (any such transferee, a "Permitted Transferee"). In addition, the
Certificate Registrar may (but shall have no obligation to) require, prior to
and as a condition of any such transfer, the delivery by the proposed transferee
of an Opinion of Counsel, satisfactory in form and substance to the Certificate
Registrar, that such proposed transferee or, if the proposed transferee is an
agent or nominee, the proposed beneficial owner, is not a Disqualified
Organization. Notwithstanding the registration in the Certificate Register of
any transfer, sale, or other disposition of a Class R Certificate or any
percentage therein to a Disqualified Organization or an agent or nominee acting
on behalf of a Disqualified Organization, such registration shall be deemed to
be of no legal force or effect whatsoever and such Disqualified Organization (or
such agent or nominee) shall not be deemed to be a Certificateholder for any
purpose hereunder, including, but not limited to, the receipt of dis tributions
on such Class R Certificate. The Certificate Registrar shall not be under any
liability to any person for any registration or transfer of a Class R
Certificate to a Disqualified Organization or for the maturity of any payments
due on such Class R Certificate to the Holder thereof or for taking any other
action with respect to such Holder under the provisions of the Agreement, so
long as the transfer was effected in accordance with this Section 6.2(e), unless
the Certificate Registrar shall have actual knowledge at the time of such
transfer or the time of such payment or other action that
<PAGE>
the transferee is a Disqualified Organization (or an agent or nominee thereof).
The Certificate Registrar shall be entitled to recover from any Holder of a
Class R Certificate or any Percentage Interest therein that was a Disqualified
Organization (or an agent or nominee thereof) at the time it became a Holder or
any subsequent time it became a Disqualified Organization all payments made on
such Class R Certificate at and after either such times (and all costs and
expenses, including but not limited to attorneys' fees, incurred in connection
therewith). Any payment (not including any such costs and expenses) so recovered
by the Certificate Registrar shall be paid and delivered to the last preceding
Holder of such Class R Certificate or Percentage Interest therein. Any
Percentage Interest in a Class R Certificate shall be a pro rata individual
interest.
In addition to the foregoing restrictions on transfer of a Class R
Certificate or any Percentage Interest therein, the Certificate Registrar will
not register the transfer of a Class R Certificate unless (a) it has received a
transferee letter either in the form attached as Exhibit F-2(a) or Exhibit
F-2(b) hereto and (b) in the event that the transferee letter is in the form of
Exhibit F-2(b) (a "Foreign Holder Letter"), it has received written evidence
satisfactory to the Certificate Registrar that the transferor has paid or
provided for payment of all taxes (including all accrued taxes on excess
inclusion income) accrued on such Class R Certificate in accordance with the
provisions set forth in Section 11.1(i), which written evidence shall include a
copy of the applicable Forms 1066, Schedule Q (or other applicable form
prescribed by the Internal Revenue Service), to the extent that any such form
has been filed, evidencing the amount of excess inclusion income for the periods
during which the transferor held such Class R Certificate or any percentage
interest therein; (c) it has received the calculations and certifications
described in paragraph (4) of Exhibit F-2(b) or paragraph (14) of Exhibit
F-2(a), and in the event that the transferee letter is in the form of Exhibit
F-2(b), the requirements set forth in paragraph 3(xi) thereof have been complied
with to the satisfaction of the Certificate Registrar. Upon satisfaction of the
foregoing requirements, the Certificate Registrar shall register the Class R
Certificate in the name of the transferee on whose benefit the transferee letter
is made and delivered (and not in the name of any nominee thereof).
If any purported transferee shall become a registered Holder of a Class
R Certificate in violation of the provisions of this Section 6.2(e), then, upon
receipt of written notice to the Certificate Registrar that the registration of
transfer of such Class R Certificate was not in fact permitted by this Section
6.2(e), the last preceding Permitted Transferee shall be restored to all rights
as Holder thereof retroactive to the date of such registration of transfer of
such Class R Certificate. The Certificate Registrar shall be under no liability
to any Person for any registration of transfer of a Class R Certificate that is
in fact not permitted by this Section 6.2(e), for making any payment due on such
Certificate to the registered Holder thereof or for taking any other action with
respect to such Holder under the provisions of this Agreement so long as the
transfer was registered upon receipt of the affidavit described in the preceding
paragraph of this Section 6.2(e).
<PAGE>
Each Holder of a Class R Certificate or Percentage Interest
therein, by such Holder's acceptance thereof, shall be deemed for all purposes
to have consented to the provisions of this Section.
Each Class R Certificate shall bear a legend describing the
restrictions on transferability set forth in this Section 6.2(e).
(f) The Depositor, as initial holder of all the Class B and Class R
Certificates, agrees that it shall not transfer any of such Certificates or any
interest therein to Bluegreen or any Affiliate of Bluegreen unless it shall have
received the written consent of the Holders of a majority of the outstanding
Class A Principal Balance and a letter from the Rating Agency to the effect that
such Transfer will not result in a downgrading below A- of the rating assigned
to the Class A Certifi cates. Notwithstanding the foregoing or any other
provision of this Agreement to the contrary, nothing contained herein shall
limit the Depositor's ability to transfer any Certificates to the Trustee in
connection with the adoption of a plan of liquidation of BRT.
(g) Bluegreen and the Depositor agree that any Certificate owned by
them, or any Affiliate thereof, will be registered in the name of Bluegreen, the
Depositor or such Affiliate, as the case may be, and will not be registered in
the name of a broker or other nominee.
(h) [Intentionally Omitted].
(i) No service charge shall be made for any transfer or exchange of
Certificates of any Class, but the Trustee may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(j) All Certificates surrendered for transfer and exchange shall be de
stroyed by the Certificate Registrar.
(k) Any purported transfer of a Certificate in violation of this Sec
tion 6.2 shall be void and of no effect.
Section 6.3 Mutilated, Destroyed, Lost or Stolen Certificates. If (i)
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 (ii) there is delivered to the Trustee,
Bluegreen and the Certificate Registrar such security or indemnity (which shall
be the unsecured agreement of any Certificateholder which represents to the
Trustee and Bluegreen that it is an institutional investor and a QIB) as may be
required by them to save each of them harmless, then, in the absence of notice
to the Trustee or the Certificate Registrar that such Certificate has
<PAGE>
been acquired by a bona fide purchaser, the Trustee shall execute, authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new Certificate of like tenor, Class and Percentage
Interest. Upon the issuance of any new Certificate under this Section, 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 (including the fees and expenses of the Trustee and the Certificate
Registrar) connected therewith. Any duplicate Certificate issued pursuant to
this Section shall constitute complete and indefeasible evidence of ownership in
the Trust Fund, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
Section 6.4 Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, Bluegreen, the Trustee, the
Certificate Registrar and any agent of Bluegreen, the Trustee or the Certificate
Registrar may treat the Person in whose name any Certifi cate is registered as
the owner of such Certificate for the purpose of receiving distributions
pursuant to Section 5.1 and for all other purposes whatsoever, and neither
Bluegreen, the Trustee, the Certificate Registrar nor any agent of Bluegreen,
the Trustee or the Certificate Registrar shall be affected by notice to the
contrary. At Bluegreen's request, the Trustee shall advise Bluegreen as to the
registered owners of the Certificates or any thereof, the address for notices at
which each such owner may be contacted with respect to matters relating and
limited to this Agreement and, in the case of an institutional owner, the name
of a representative of such owner.
ARTICLE VII BLUEGREEN AND THE SERVICER
Section 7.1 Liability of Bluegreen and the Servicer. Bluegreen and the
Servicer shall be liable in accordance herewith only to the extent of the
obligations specifically imposed upon and undertaken by Bluegreen and the
Servicer herein. The Servicer agrees to notify the Trustee and the holders of
the Controlling Class if the Servicer shall fail duly to observe or perform in
any material respect any contract or agreement of the Servicer set forth in this
Agreement which is caused by clause (b) of Section 8.1 which is not cured or
remedied within five (5) Business Days.
Section 7.2 Merger or Consolidation of, or Assumption of the
Obligations of, Bluegreen and the Servicer. (a) Bluegreen and the Servicer each
will maintain its existence as a corporation and will obtain and preserve its
qualification to do business and any necessary licenses in each jurisdiction in
which such qualification or license is or shall be necessary to protect the
validity and enforceability of this Agreement or the Mortgage Loans, and to
perform its duties under this Agree ment.
<PAGE>
(b) Any Person into which Bluegreen or the Servicer may be merged or
consolidated, or any Person resulting from any merger, conversion or
consolidation to which Bluegreen or the Servicer shall be a party, or any
corporation succeeding to the business of Bluegreen or the Servicer, which
executes an agreement of assumption to perform every obligation hereunder of
Bluegreen or the Servicer, as the case may be, and, in the case of the Servicer,
which meets the requirements for a successor Servicer as provided in Section
8.2, shall be the successor hereunder of Bluegreen or the Servicer as the case
may be, 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.
Section 7.3 Limitation on Liability of Bluegreen, the Servicer and
Others. Neither Bluegreen, the Servicer nor any of the directors or officers or
employees or agents of Bluegreen or the Servicer shall be under any liability to
the Trust Fund or the Certificateholders for any action taken or for refraining
from the taking of any action by Bluegreen or the Servicer pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect Bluegreen or the Servicer or any such person against any
liability which would otherwise be imposed by reason of willful misfeasance, bad
faith or negligence in the performance of duties of Bluegreen or the Servicer,
as the case may be, hereunder or by reason of reckless disregard of obligations
and duties of Bluegreen or the Servicer, as the case may be, hereunder.
Bluegreen and the Servicer and any director or officer or employee or agent of
Bluegreen or the Servicer may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person respecting any matters
arising hereunder. Bluegreen and the Servicer and any director or officer or
employee or agent of Bluegreen or the Servicer shall be indemnified by the Trust
Fund and held harmless against any loss, liability or expense incurred in
connection with any legal action relating to this Agreement or the Certificates,
other than any loss, liability or expense related to any specific Mortgage Loan
or Mortgage Loans (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) and any loss, liability or
expense incurred by reason of willful misfeasance, bad faith or negligence in
the performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. The Servicer shall not be under any obligation
to appear in, prosecute or defend any legal action which is not incidental to
its duties to service the Mortgage Loans in accordance with this Agreement and
which in its reasonable opinion may involve it in any expense or liability;
provided, however, that the Servicer may in its good faith discretion undertake
any such action which it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder. In such event, the legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund and the Servicer shall be entitled to be
reimbursed therefor from amounts held in the Collection Account as provided by
Section 3.4.
<PAGE>
Section 7.4 Bluegreen and the Servicer Not to Resign. Subject to the
provisions of Section 7.2, neither Bluegreen nor the Servicer shall 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. Any such determination permitting the resignation of Bluegreen
or the Servicer shall be evidenced by an Opinion of Independent Counsel to such
effect delivered to the Trustee. No such resignation of the Servicer shall
become effective until the Trustee or a successor Servicer shall have assumed
the responsibilities and obligations of the Servicer in accordance with Section
8.2.
Section 7.5 Sale, Assignment or Delegation of Duties by Servicer.
Except as expressly provided herein, the Servicer shall not assign or transfer
any of its rights, benefits or privileges hereunder to any other Person, or
delegate to or subcontract with, or authorize or appoint any other Person to
perform any of the duties, covenants or obligations to be performed by the
Servicer hereunder; provided, however, that the Servicer shall have the right
without the prior written consent of the Trustee, the Depositor or the Rating
Agency to delegate or assign to or subcontract with or authorize or appoint an
Affiliate of the Servicer to perform and carry out any duties, cove nants or
obligations to be performed and carried out by the Servicer hereunder. In no
case, however, shall any such delegation, subcontracting or assignment to an
Affiliate of the Servicer relieve the Servicer of any liability hereunder.
Notice of such permitted assignment shall be given promptly by the Servicer to
the Depositor, the Rating Agency, the Trustee and, for so long as the Class A
Certificates are outstanding, the Holders of the Class A Certificates.
ARTICLE VIII DEFAULT
Section 8.1 Events of Default. If any one of the following events
("Events of Default")shall occur and be continuing:
(a) Any failure by the Servicer to deposit amounts in the Collection
Account or the Certificate Account in the amount and manner provided herein so
as to enable the Trustee to dis tribute to Holders of Certificates of any Class
any payment required to be made under the terms of such Certificates and this
Agreement which continues unremedied for a period of 2 Business Days; or
(b) Failure on the part of the Servicer duly to observe or perform in
any material respect any other covenants or agreements of the Servicer set forth
in the Certificates or in this Agreement, which failure (A) materially affects
the rights of Certificateholders and (B) continues unremedied for a period of 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
<PAGE>
by the Holders of Certificates of any Class evidencing, as to such Class, Percen
tage Interests aggregating not less than 25%; or
(c) The entry of a decree or order for relief by a court having
jurisdiction in respect of the Servicer in an involuntary case under the federal
bankruptcy laws, as now or hereafter in effect, or any other present or future
federal or state bankruptcy, insolvency or similar law, or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Servicer or of any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Servicer and the
continuance of any such decree or order unstayed and in effect for a period of
60 consecutive days; or
(d) The commencement by the Servicer of a voluntary case under the
federal bankruptcy laws, as now or hereafter in effect, or any other present or
future federal or state bankruptcy, insol vency or similar law, or the consent
by the Servicer to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Servicer or of any substantial part of its property or the making by the
Servicer of an assignment for the benefit of creditors or the failure by the
Servicer generally to pay its debts as such debts become due or the taking of
action by the Servicer in furtherance of any of the foregoing;
then, and in each and every such case, so long as an Event of Default shall not
have been remedied by the Servicer, either the Trustee, or the Holders of
Certificates of any Controlling Class evidencing, as to such Class, Percentage
Interests aggregating more than 50%, by notice then given in writing to the
Servicer (and to the Trustee if given by Certificateholders) may, in addition to
any other remedies at law or in equity available to the Trustee for the benefit
of Certificateholders, terminate all of the rights and obligations of the
Servicer under this Agreement, including, without limitation, the right to the
Servicing Fee. On or after the receipt by the Servicer of such written notice,
all authority and power of the Servicer under this Agreement, whether with
respect to the Certificates or the Mortgage Loans or otherwise, shall pass to
and be vested in the Trustee pursuant to and under this Section 8.1, and,
without limitation, the Trustee is hereby authorized and empowered to execute
and deliver, on behalf of the Servicer and at the Servicer's sole expense, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination. 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 the administration by it of all cash amounts that have been or
should have been deposited by the Servicer in the Collection Account and the
Certificate Account or thereafter received by the Servicer with respect to the
Mortgage Loans. In addition to any other amounts which are then, or,
notwithstanding the termination of its activities as Servicer, may become,
payable to the Servicer under this Agreement, the Servicer shall be entitled to
receive out of any delinquent payment on
<PAGE>
account of interest on a Mortgage Loan due during the period prior to the notice
pursuant to this Section 8.1 which terminates the obligations and rights of the
Servicer hereunder and received after such notice, that portion of such payment
which it would have been entitled to retain pursuant to Section 3.4(ii) if such
notice had not been given and out of any delinquent payment on a Mortgage Loan
due during such period, that portion of such payment which it would have been
entitled to retain pursuant to Sections 3.4(vi) and (vii) if such notice had not
been given. Upon the occurrence of any Event of Default hereunder, Bluegreen
shall give the Rating Agency and, for so long as the Class A Certificates are
outstanding, the Holders of the Class A Certificates written notice of the
occurrence thereof.
Section 8.2 Trustee to Act; Appointment of Successor. (a) On and after
the time the Servicer receives a notice of termination pursuant to Section 8.1,
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 except as otherwise provided by law; provided, however, that, with
respect to the obligation to make Monthly Advances pursuant to Section 4.2, the
Trustee shall not be required to make any Monthly Advance if the Trustee is
prohibited by law from making such Monthly Advance, as evidenced by an Opinion
of Counsel. As compensation therefor, the Trustee shall, except as provided in
Section 8.1, be entitled to such compensation as the Servicer would have been
entitled to hereunder if no such notice of termination had been given,
including, without limitation, the Servicing Fee.
(b) The Trustee, as Successor Servicer, shall during the term of its
service as Servicer maintain in force (i) a policy or policies of insurance
covering errors and omissions in the perfor mance of its obligations as Servicer
hereunder, and (ii) a fidelity bond in respect of its officers, employees and
agents to the same extent as the Servicer is so required pursuant to Section
3.13.
(c) Notwithstanding the above, the Trustee may, if it shall be
unwilling to so act, or shall, if it is unable to so act or if the Holders of
Certificates of the Controlling Class, voting as a Class, evi dencing, as to
each such Controlling Class, Percentage Interests aggregating more than 50% so
request in writing to the Trustee, appoint, or petition a court of competent
jurisdiction to appoint, any established mortgage loan servicing institution
that has a net worth of not less than $15,000,000 as the Successor Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder, provided, however, that the Trustee
receives written confirmation from each Rating Agency that such Successor
Servicer will not cause such Rating Agency to reduce the then current rating
assigned to any of the rated Certificates that were currently being rated by the
Rating Agency. In the event the Trustee elects to solicit bids, the Trustee
shall solicit, by public announcement, bids from housing and home finance
institutions, banks and mortgage servicing institutions meeting the
qualifications set forth above. Such public an
<PAGE>
nouncement shall specify that the Successor Servicer shall be entitled to
servicing compensation in an amount not to exceed 0.75% per annum times the
Principal Balance of each Mortgage Loan as of each Installment Due Date for such
Mortgage Loan (the "Successor Servicer Fee"), together with the other servicing
compensation in the form of assumption fees, late payment charges, gain from REO
sales or otherwise. Within thirty days after any such public announcement, the
Trustee shall negotiate and effect the sale, transfer and assignment of the
servicing rights and responsibilities hereunder to the qualified party
submitting the highest qualifying bid if acceptable to Holders of a majority of
the principal balance of the Controlling Class. The Trustee shall deduct from
any sum received by the Trustee from the Successor Servicer in respect of such
sale, transfer and assignment all costs and expenses of any public announcement
and of any sale, transfer and assignment of the servicing rights and
responsibilities hereunder and the amount of any unreimbursed Monthly Advances.
After such deductions, the remainder of such sum shall be paid by the Trustee to
the Servicer at the time of such sale, transfer and assignment to the Successor
Servicer. The Trustee and such Successor Servicer shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. The Servicer agrees to cooperate with the Trustee and any Successor
Servicer in effecting the termination of the Servicer servicing responsibilities
and rights hereunder and shall promptly provide the Trustee or such Successor
Servicer, as applicable, all documents and records reasonably requested by it to
enable it to assume the Servicer functions hereunder and shall promptly also
transfer to the Trustee or such Successor Servicer, as applicable, all amounts
which then have been or should have been deposited in the Collection Account or
the Certificate Account by the Servicer or which are thereafter received with
respect to the Mortgage Loans. Neither the Trustee nor any other Successor
Servicer shall be held liable by reason of any failure to make, or any delay in
making, any distribution hereunder or any portion thereof caused by (i) the
failure of the Servicer to deliver, or any delay in delivering, cash, documents
or records to it, or (ii) restrictions imposed by any regulatory authority
having jurisdiction over the Servicer hereunder. No appointment of a Successor
Servicer hereunder shall be effective until written notice of such proposed
appointment shall have been provided by the Trustee to each Certificateholder,
and the Trustee shall have consented thereto. The Trustee shall not resign as
Servicer until a Successor Servicer has been appointed.
Pending appointment of a Successor Servicer hereunder, 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 Servicer out of payments on Mortgage Loans as it
and such Successor Servicer shall agree; provided, however, that no such
compensation shall be in excess of the Successor Servicer Fee, together with
other servic ing compensation in the form of assumption fees, late payment
charges or otherwise as provided in this Agreement. The Servicer, the Trustee
and such Successor Servicer shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession.
<PAGE>
Section 8.3 Notification to Certificateholders and Rating Agency. Upon
any termination or appointment of a Successor Servicer pursuant to this Article
VIII, the Trustee shall give prompt written notice thereof to Certificateholders
at their respective addresses appearing in the Certificate Register and to the
Rating Agency. The Trustee also shall notify the Rating Agency and, for so long
as the Class A Certificates are outstanding, the Holders of the Class A
Certificates (a) if the Trustee has actual knowledge that an Event of Default
has occurred which was then either cured or waived and (b) on an annual basis,
within 60 days of each anniversary of the Closing Date during the term of this
Agreement, to the effect that the Trustee has no actual knowledge as to the
occurrence of any Event of Default such preceding year.
ARTICLE IX THE TRUSTEE
Section 9.1 Duties of Trustee. The Trustee, prior to the occurrence of
an Event of Default and after the curing of all Events of Default 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 Default 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 appear
to conform to the requirements of this Agreement.
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:
(i) Prior to the occurrence of an Event of Default, and after the
curing of all such Events of Default 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 which conform to the requirements of this Agreement and which are
reasonably believed to be genuine and duly authorized;
<PAGE>
(ii) Neither the Trustee nor its directors, officers, employees or
agents shall be personally 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
or such director, officer, employee or agent was negligent in performing its
duties in accordance with the terms of this Agreement;
(iii) Neither the Trustee nor its directors, officers, employees or
agents shall 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
Holders of Certificates of any Controlling Class evidencing, as to such Class,
Percentage Interests aggregating more than 50% 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
(iv) So long as the Trustee is not the Servicer, neither the Trustee
nor its directors, officers, employees or agents shall be charged with knowledge
of any failure by the Servicer to comply with its obligations referred to in
clauses (a) and (b) of Section 8.1 unless a Responsible Officer of the Trustee
at the Corporate Trust Office receives written notice of such failure from
Bluegreen or the Holders of Certificates of any Class evidencing, as to such
Class, Percentage Interests aggregating not less than 25%.
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, and
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 Bluegreen 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.
Section 9.2 Certain Matters Affecting the Trustee. Except as otherwise
provided in Section 9.1:
(i) The Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, Officers' Certificate, certificate of auditors
or any other certificate, statement, instru ment, 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;
<PAGE>
(ii) The Trustee may consult with counsel and any Opinion of Counsel
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;
(iii) 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 (which indemnity shall be the unsecured
obligation of TIAA or, with the consent of the Trustee, such consent not to be
unreasonably withheld, any Major Certificateholder) against the costs, expenses
and liabilities which may be incurred therein or thereby; nothing contained
herein shall, however, relieve the Trustee of the obligations, upon the
occurrence of an Event of Default (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;
(iv) The Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement;
(v) Prior to the occurrence of an Event of Default and after the curing
of all Events of De fault 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 to do so by Holders of Certificates of any Class
evidencing, as to such Class, Percentage Interests aggregating not less than
25%; 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 (which indemnity shall
be the unsecured obligation of TIAA or, with the consent of the Trustee, such
consent not to be unreasonably withheld, any Major Certificateholder) against
such cost, expense or liability as a condition to such proceeding. The
reasonable expense of every such examination shall be paid by Bluegreen or, if
paid by the Trustee, shall be reimbursed by Bluegreen upon demand. Nothing in
this clause (v) shall derogate from the obligation of Bluegreen to observe any
applicable law prohibiting disclosure of information regarding the Obligors; and
(vi) 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.
<PAGE>
Section 9.3 Trustee Not Liable for Certificates or Mortgage Loans. The
recitals contained herein and in the Certificates (other than the signature and
authentication of the Trustee on the Certificates) shall not be taken as the
statements of the Trustee, and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the validity
or sufficiency of this Agreement or of the Certificates (other than the
signature and authentication of the Trustee on the Certificates) or of the
Mortgage Loans or any related document. The Trustee shall not be accountable for
the use or application by the Depositor or Bluegreen of any of the Certificates
or of the proceeds of such Certificates, or for the use or application of any
funds paid to Bluegreen or any of its Affiliates in respect of the Mortgage
Loans or deposited in or with drawn from the Collection Account or deposited in
the Certificate Account by the Depositor, Bluegreen or the Servicer, except to
the extent the Trustee becomes the Successor Servicer (and in that event, then
only for withdrawals or deposits made by the Trustee in its capacity as
Servicer).
Section 9.4 Trustee May Own Certificates. The Trustee in its individual
or any other capacity may become the owner or pledgee of Certificates with the
same rights as it would have if it were not Trustee.
Section 9.5 Trustee's Fees and Expenses. The Trustee shall be entitled
to withdraw from the Certificate Account pursuant to Section 3.4(ii) the
Trustee's Fee as reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
for all services rendered by it in the execution of the trusts hereby created
and in the exercise and performance of any of the powers and duties hereunder of
the Trustee, and the Trustee shall be entitled to reimbursement from the
Certificate Account pursuant to Section 3.4(iii) for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any of the provisions of this Agreement (including the reasonable compensation
and the expenses and disbursements of its counsel and of all persons not
regularly in its employ) except any such expense, disbursement or advance as may
arise from its negligence or bad faith or which is the responsibility of
Certificateholders hereunder. In addition, except as otherwise set forth in
Section 3.14, Bluegreen covenants and agrees to indemnify the Trustee, its
directors, officers, employees and agents from, and hold them harmless against,
any and all losses, liabilities, damages, claims or expenses other than those
resulting from the negligence or bad faith of the Trustee, its directors,
officers, employees and agents.
Section 9.6 Eligibility Requirements for Trustee. The Trustee hereunder
shall not be an Affiliate of Bluegreen, the Servicer or any Obligor with respect
to more than 5% of the Cut-Off Date Principal Balance of the Mortgage Loans and
shall at all times be a corporation organized and doing business under the laws
of any State or the United States of America, authorized under such laws to
exercise corporate trust powers, having 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
<PAGE>
surplus of which is at least $50,000,000, and subject to supervision or
examination by federal or state authority and which will not adversely affect
the then current rating of the Class A Certifi cates. If such corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 9.6, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. The Trustee and any
successor trustee so long as such Person is Trustee hereunder shall be covered
by such insurance covering errors and omissions and the fidelity of its
officers, employees and agents as is standard for Persons performing similar
duties. In case at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 9.6, the Trustee shall resign immediately in
the manner and with the effect specified in Section 9.7.
Section 9.7 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 Bluegreen and the Holders of the Controlling Class. Upon
receiving such notice of resignation, Bluegreen shall promptly appoint a
successor Trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor Trustee; provided, however, that the Trustee receives (i) written
confirmation from each Rating Agency that such appointment will not cause such
Rating Agency to reduce the then current rating assigned to any of the rated
Certificates that were currently being rated by the Rating Agency and (ii) the
written consent of Holders of a majority of the Controlling Class. If no
successor Trustee shall have been so appointed and 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 appoint ment of
a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 9.6 and shall fail to resign after written
request therefor by Bluegreen, 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 Bluegreen, with the
written consent of Holders of a majority of the principal balance of the
Controlling Class, may remove the Trustee. If it removes the Trustee under the
authority of the immediately preceding sentence, Bluegreen, with the written
consent of Holders of a majority of the principal balance of the Controlling
Class, 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.
<PAGE>
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 9.7 shall
not become effective until acceptance of appointment by the successor Trustee as
provided in Section 9.8.
Section 9.8 Successor Trustee. Any successor Trustee appointed as
provided in Section 9.7 shall execute, acknowledge and deliver to Bluegreen 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 convey
ance, 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 to the successor Trustee
the Mortgage Loans and related documents and statements held by it hereunder;
and Bluegreen 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 9.8 unless at the time of such acceptance such successor Trustee shall
be eligible under the provisions of Section 9.6.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 9.8, the Servicer shall mail notice of the succession of such
Trustee hereunder to all holders of Certificates at their addresses as shown in
the Certificate Register and to the Rating Agency. If the Servicer fails to mail
such notice within 10 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 9.9 Merger or Consolidation of Trustee. Any corporation into
which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such corporation shall be eligible under the provisions of
Section 9.6, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, any thing herein to the contrary
notwithstanding.
Section 9.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing any Mortgage Note may at the time be
located, the Servicer and the Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the
benefit of
<PAGE>
the Certificateholders, such title to the Trust Fund, or any part thereof, and,
subject to the other provisions of this Section 9.10, such powers, duties,
obligations, rights and trusts as the Servicer and the Trustee may consider
necessary or desirable. If the Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
the case an Event of Default shall have occurred and be continuing, the Trustee
alone shall have the power to make such appointment. No co-trustee or separate
trustee hereunder shall be required to meet the terms of eligibility as a
successor trustee under Section 9.6 and no notice to Certificateholders of the
appointment of any co-trustee or separate trustee shall be required under
Section 9.8.
Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) All rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or performed
by the Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Trustee joining in such act), except to the extent that
under any law of any jurisdiction in which any particular act or acts are to be
performed (whether as Trustee hereun der or as successor to the Servicer
hereunder), the Trustee shall be incompetent or unqualified to perform such act
or acts, in which event such rights, powers, duties and obligations (including
the holding of title to the Trust Fund or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Trustee;
(ii) No trustee hereunder shall be held personally liable by reason of
any act or omission of any other trustee hereunder; and
(iii) The Servicer and the Trustee acting jointly may at any time
accept the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article IX. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Servicer.
<PAGE>
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
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.
ARTICLE X TERMINATION
Section 10.1 Termination Upon Repurchase by Bluegreen or Liquidation of
All Mortgage Loans. Subject to Section 10.2, the respective obligations and
responsibilities of BRT, Bluegreen, the Servicer, the Depositor and the Trustee
created hereby (other than the obligation to make payments to Certificateholders
as hereafter set forth in this Section 10.1) shall terminate upon (i) the later
of the final payment or other liquidation (or any Monthly Advance with respect
thereto) of the last Mortgage Loan in the Trust Fund and the disposition of all
property acquired in respect of any Mortgage Loan or (ii) the optional
repurchase by Bluegreen of the Mortgage Loans and any other assets remaining in
the Trust Fund on any Remittance Date after the date on which the Principal
Balance of all Mortgage Loans is less than 10% of the Cut-Off Date Principal
Balance, at a price equal to (A) the greater of (x) 100% of the Principal
Balance of each such Mortgage Loan as of the Installment Due Date preceding the
Remittance Date upon which the proceeds of such repurchase are to be
distributed, plus interest at the applicable Mortgage Interest Rate through the
last Installment Due Date in the Collection Period preceding the Remittance Date
on which the proceeds of such repurchase are to be distributed to
Certificateholders, and (y) the fair market value of the Mortgage Loans, plus
(B) the fair market value of any other property remaining in the Trust Fund or
(iii) provided that all of the Certificates not then paid in full are held by
Bluegreen, the Depositor or any of their respective Affiliates (and are not
subject to any pledge or repurchase agreement), by mutual consent of Bluegreen,
the Depositor and the Trustee (which consent, in the case of the Trustee, shall
not be unreasonably withheld); provided, however, 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 Joseph P. Kennedy, the late
ambassador of the United States to the Court of St. James, living on the date
hereof. The fair market value, in the case of the Mortgage Loans, REO Property
or other property in the Trust Fund, is to be determined by an independent
appraiser mutually agreed upon by the Servicer, the Trustee and Holders of a
majority of the principal balance of the Controlling Class (net of any
liquidation expenses to be incurred in connection with the disposition of such
REO Property, estimated in good faith by the Servicer).
<PAGE>
If Bluegreen exercises its right to purchase the Mortgage Loans
pursuant to clause (ii) above, Bluegreen shall provide to the Trustee the
certification required by Section 3.8 and the Trustee shall promptly release the
Mortgage Documents pertaining to the Mortgage Loans to Bluegreen.
Notice of any termination, specifying the Remittance Date upon which
the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
Bluegreen (if it is exercising its right to purchase the assets of the Trust
Fund) or by the Trustee (in any other case) by letter to Certificateholders
mailed not earlier than the 15th day and not later than the 25th day of the
month next preceding the month of such final distribution specifying (a) the
Remittance Date upon which final payment of the Certificates will be made upon
presentation and surrender of Certificates at the office or agency of the
Trustee therein designated, (b) the amount of any such final payment and (c)
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. If
Bluegreen is obligated to give notice to Certificateholders as aforesaid, it
shall give such notice to the Trustee and the Certificate Registrar at the time
such notice is given to Certificateholders. In the event such notice is given by
Bluegreen, Bluegreen shall deposit in the Collection Account on or before the
Remittance Date so specified in immediately available funds an amount equal to
the amount necessary to make the amount, if any, on deposit in the Collection
Account on such Remittance Date equal to the purchase price for the assets of
the Trust Fund computed as above provided. Any such notice, whether given by
Bluegreen or the Trustee, shall be given to the Rating Agency by Bluegreen at
the time such notice is given to Certificateholders.
In the event that Bluegreen has exercised its option to repurchase the
Mortgage Loans as above provided, the proceeds of such repurchase shall be
deposited into the Certificate Account and shall be distributed to
Certificateholders as part of the Amount Available pursuant to Section 5.1.
In the event that all of the Certificateholders shall not surrender
their Certificates for final payment and cancellation on or before the final
Remittance Date, the Trustee shall on such date cause all funds in the
Certificate Account not distributed in final distribution to Certificateholders
to be withdrawn from the Certificate Account and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for the
benefit of such Certificateholders and Bluegreen (if it exercises its right to
purchase the assets of the Trust Fund) or the Trustee (in any other case) 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 one year after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trustee may take
appropriate steps, or may appoint an agent to take appropriate steps, to contact
the
<PAGE>
remaining Certificateholders concerning surrender of their Certificates, and the
cost thereof shall be paid out of the funds on deposit in such escrow account.
Section 10.2 Additional Termination Requirements. (a) In connection
with any termination pursuant to clause (ii) of Section 10.1, the Trust Fund
shall be terminated in accordance with the following additional requirements,
unless the Trustee has received an Opinion of Counsel to the effect that the
failure of the Trust Fund to comply with the requirements of this Section 10.2
will not (i) result in the imposition of taxes on "prohibited transactions" of
the Trust Fund as defined in Section 860F of the Code or "prohibited
contributions" within the meaning of Section 860G(d) of the Code, or (ii) cause
the Trust Fund to fail to qualify as a REMIC at any time that any Class A or
Class B Certificates are outstanding:
(i) Within 89 days prior to the Remittance Date set forth in the notice
given by Bluegreen under Section 10.1, the Trustee shall adopt a plan of
complete liquidation of the Trust REMIC, meeting the requirements of a qualified
liquidation under the REMIC Provisions;
(ii) At or after the time of adoption of such a plan of complete
liquidation and at or prior to such Remittance Date, the Trustee shall sell any
remaining assets of the Trust Fund to the Depositor for cash;
(iii) At the time of the making of the final payment on the
Certificates other than the Class R Certificates, the Trustee shall distribute
or credit, or cause to be distributed or credited, to the Holders of the Class R
Certificates all cash on hand after such final payment (other than cash retained
to meet claims), and the Trust Fund shall terminate at that time; and
(iv) In no event may the final payment on the Certificates (except to
the extent permitted in Section 10.1 with respect to Certificateholders who fail
to surrender their Certificates) be made after the 89th day from the date on
which the plan of complete liquidation is adopted.
(b) By their acceptance of the Class R Certificates, the
Holders thereof hereby authorize the Trustee to adopt such a plan of complete
liquidation upon the written request of Bluegreen and to take such other action
in connection therewith as may be reasonably requested by Bluegreen, which
authorization shall be binding upon all successor Class R Certificateholders.
ARTICLE XI REMIC ADMINISTRATION
<PAGE>
Section 11.1 REMIC Administration. (a) An election will be made by the
Trustee on behalf of the Trust REMIC to treat the segregated pool of assets
constituting the Trust Fund as a REMIC under the Code (the "Trust REMIC"). Such
election will be made on Form 1066 or other appropriate federal tax or
information return for the taxable year ending on the last day of the calendar
year in which the Certificates are issued. For purposes of such election, the
Class A and Class B Certificates shall be designated as the "regular interests"
in the Trust REMIC and the Class R Certificates shall be designated as the
"residual interest" in the Trust REMIC. In accordance with the Code and
applicable regulations thereunder, including Treas. Reg. ss.1.860G-1(a)(4) and
(5), the latest possible maturity date for the Class A and Class B Certificates
is December 1, 2011;
(b) The Closing Date is hereby designated as the "Startup Day" of the
Trust REMIC within the meaning of Section 860G(a)(9) of the Code.
(c) Except as provided in Section 3.14 of this Agreement, the Trustee
shall pay (without reimbursement) any and all tax related expenses (not
including any taxes, however denominated, including any additions to tax,
penalties and interest) of the Trust REMIC, including but not limited to any
professional fees or expenses related to audits or any administrative or
judicial proceedings with respect to the Trust REMIC that involve the Internal
Revenue Service or state tax authorities.
(d) The Trustee shall prepare (or caused to be prepared), sign and file
all of the Trust REMIC's federal and state income or franchise tax and
information returns as the Trust REMIC's direct representative. Except as
provided in Section 3.14 of this Agreement, the expenses of preparing and filing
such returns shall be borne by the Trustee. The Servicer shall provide on a
timely basis to the Trustee or its designee such information with respect to the
Trust REMIC as is in its possession, which the Servicer has received or prepared
by virtue of its activities as Servicer hereunder and reasonably requested by
the Trustee to enable it to perform its obligations under this subsection, and
the Trustee shall be entitled to rely on such information in the performance of
its obligations hereunder.
(e) The Trustee shall perform on behalf of the Trust REMIC all
reporting and other tax compliance duties that are the responsibility of the
Trust REMIC under the Code, REMIC Provi sions, or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing authority.
Among its other duties, the Trustee shall provide (i) to the Internal Revenue
Service or other Persons (including, but not limited to, the transferor of a
Class R Certificate, to a Disqualified Organization or to an agent that has
acquired a Class R Certificate on behalf of a Disqualified Organization) such
information as is necessary for the application of any tax relating to the
transfer of a Class R Certificate to any Disqualified Organization and (ii) to
the Certificate holders such information or reports as are required by the Code
or REMIC Provisions. The Servicer shall provide on a timely basis to the Trustee
or its designee such information with respect
<PAGE>
to the Trust REMIC as is in its possession and reasonably requested in writing
by the Trustee to enable it to perform its obligations under this subsection.
(f) The Holder of the greatest percentage of Percentage Interests of
the Class R Certificates shall be the Trust REMIC's Tax Matters Person. The
duties of the Tax Matters Person for the Trust REMIC are hereby delegated to the
Trustee and each Class R Certificateholder, by acceptance of its Class R
Certificate, agrees, on behalf of itself and all successor holders of such Class
R Certificate, to such delegation to the Trustee as their agent and attorney in
fact. The Trustee shall take whatev er action is necessary for the signing of
such documents and designation of a Tax Matters Person, including the
designation of such Class R Certificateholder.
(g) The Trustee, the Holders of the Class R Certificates and the
Servicer shall act in accordance with this Agreement and the REMIC Provisions in
order to create and maintain the status of the Trust REMIC as a REMIC or, as
appropriate, adopt a plan of complete liquidation.
(h) The Trustee, the Holders of the Class R Certificates and the
Servicer shall not take any action or cause the Trust REMIC to take any action
that, under the REMIC Provisions, could (i) endanger the status of the Trust
REMIC as a REMIC or (ii) result in the imposition of a tax upon the Trust REMIC
(including but not limited to the tax on prohibited transactions as defined in
Code Section 860F(a)(2) and the tax on prohibited contributions as defined in
Code Section 860G(d)) unless (A) the Trustee has received a Nondisqualification
Opinion (at the expense of the party seeking to take such action) with respect
to such action or (B) the Trustee has received an opinion (at the expense of the
party seeking to take such action) to the effect that such action will not cause
the Trust REMIC to fail to qualify as a REMIC and the Trustee has calculated
that no tax will actually be imposed.
(i) The Holders of the Class R Certificates shall pay when due their
pro rata share of any and all federal, state and local taxes imposed on the
Trust REMIC or its assets or transactions, including, without limitation,
"prohibited transaction" taxes, as defined in Section 860F of the Code, any tax
on contributions imposed by Section 860G(d) of the Code, and any tax on "net
income from foreclosure property" as defined in Section 860G(c) of the Code. To
the extent that such Trust REMIC taxes are not paid by the Class R
Certificateholders, the Trustee shall pay any remaining Trust REMIC taxes out of
current or future amounts otherwise distributable to the Holders of the Class R
Certificates or, if no such amounts are available, out of other amounts held in
the Collection Account pursuant to Section 3.4(xi).
(j) The Trustee and, to the extent that records are maintained by the
Servicer in the normal course of its businesses, the Servicer shall, for federal
income tax purposes, maintain books and records with respect to the Trust REMIC
on a calendar year and on an accrual basis. The books and
<PAGE>
records must be sufficient concerning the nature and amount of the Trust REMIC's
investments to show that the Trust REMIC has complied with the REMIC Provisions.
(k) Neither the Trustee nor the Servicer shall enter into any
arrangement by which the Trust REMIC will receive a fee or other compensation
for services.
(l) In order to enable the Trustee to perform its duties as set forth
herein, the Depositor shall provide, or cause to be provided, to the Trustee
within twenty (20) days after the Closing Date all information or data that the
Trustee reasonably determines to be relevant for tax purposes on the valuations
and offering prices of the Certificates, including, without limitation, the
yield, prepayment assumption, issue prices and projected cash flows of the Class
A, Class B and Class R Certificates, as applicable, and the projected cash flows
on the Mortgage Loans. Thereafter, the Depositor shall provide to the Trustee,
promptly upon request therefor, any such additional information or data that the
Trustee may, from time to time, reasonably request in order to enable the
Trustee to perform its duties as set forth herein. The Trustee is hereby
directed to use any and all such information or data provided by the Depositor
in the preparation of all federal and state income or franchise tax and
information returns and reports for the Trust REMIC to Certifi cateholders as
required herein. The Depositor hereby indemnifies the Trustee for any losses,
liabilities, damages, claims or expenses of the Trustee arising from any errors
or miscalculations of the Trustee pursuant to this Section that result from any
failure of the Depositor to provide, or to cause to be provided, accurate
information or data to the Trustee (but not resulting from the methodology
employed by the Trustee) on a timely basis and such indemnifications shall
survive the termination of this Agreement.
The Trustee agrees that all such information or data so obtained by it
are to be regarded as confidential information and agrees that it shall use its
best reasonable efforts to retain in confidence, and shall ensure that its
officers, employees and representatives retain in confidence, and shall not
disclose, without the prior written consent of the Depositor, any or all of such
information or data, or make any use whatsoever (other than for the purposes
contemplated by this Agreement) of any such information or data without the
prior written consent of the Depositor, unless such information is generally
available to the public (other than as a result of a breach of this Section
11.1(l)) or is required by law or applicable regulations to be disclosed.
Section 11.2 REO Property. (a) Notwithstanding any other provision of
this Agreement, the Servicer, acting on behalf of the Trustee hereunder, shall
not rent, lease, or otherwise earn income on behalf of the Trust Fund with
respect to any REO Property which might cause such REO Property to fail to
qualify as "foreclosure property" within the meaning of section 860G(a)(8) of
the Code or result in the receipt by the Trust REMIC of any "income from
non-permitted assets" within the meaning of section 860F(a)(2)(B) of the Code or
any "net income from foreclosure
<PAGE>
property" within the meaning of Section 860G(c) which is subject to tax under
the REMIC Provisions unless the Trustee has received an Opinion of Counsel (at
the Trust Fund's expense) to the effect that, under the REMIC Provisions and any
relevant proposed legislation, any income generated for the Trust REMIC by the
REO Property would not result in the imposition of a tax upon the Trust REMIC.
(b) The Trustee, or the Servicer, acting on its behalf hereunder, shall
make reasonable efforts to sell any REO Property for its fair market value. In
any event, however, the Trustee, or the Servicer, acting on its behalf
hereunder, shall dispose of any REO Property within two years of its acquisition
by the Trust Fund unless the Trustee or the Servicer, on its behalf, has been
granted an extension of time (an "Extension") by the Internal Revenue Service to
sell such REO Property. If the Trustee or the Servicer, on its behalf, has
received such an Extension, then the Trustee, or the Servicer, acting on its
behalf hereunder, shall continue to attempt to sell the REO Property for its
fair market value for such period longer than two years as such Extension
permits (the "Extended Period"). If the Trustee or the Servicer, on its behalf,
has not received such an Extension and the Trustee, or the Servicer acting on
behalf of the Trustee hereunder, is unable to sell the REO Property within the
two year period or if the Trustee has received such an Extension, and the
Trustee, or the Servicer acting on behalf of the Trustee hereunder, is unable to
sell the REO Property within the Extended Period, the Servicer shall before the
end of the two-year period or Extended Period, as the case may be, auction the
REO Property to the highest bidder (which may be the Servicer) in accordance
with Accepted Servicing Practices.
(c) At the time of the delivery of the next subsequent Servicer
Certificate, the Servicer shall provide to the Trustee a statement of accounting
for such REO Property, including without limita tion, (i) the date such
Mortgaged Property was acquired in foreclosure or by deed in lieu of foreclo
sure, (ii) the date of disposition of such REO Property, (iii) the gross sales
price and related selling and other expenses, (iv) accrued and unpaid interest
on the declining principal balance at the applicable Mortgage Interest Rate
calculated from the Installment Due Date to which interest was last paid by the
Obligor (or from the Cut-off Date, if such date is prior to the Cut-off Date) to
the Installment Due Date in the Collection Period next preceding the Remittance
Date on which such Mortgage Loan became a Liquidated Mortgage Loan, and (v) such
other information as the Trustee may reasonably request.
Section 11.3 Modifications of Mortgage Loans. Notwithstanding anything
to the contrary in this Agreement, neither the Trustee nor the Servicer shall
permit any modification of any material term of a Mortgage Loan (including the
interest rate, the outstanding principal balance, the amortization schedule, the
security provisions, or any other term affecting the amount or timing of
payments on or security for such Mortgage Loan) unless (i) the Trustee and the
Servicer have received a Nondisqualification Opinion or a ruling from the
Internal Revenue Service (at the
<PAGE>
expense of the party making the request of the Servicer or the Trustee to modify
such Mortgage Loan) to the same effect as a Nondisqualification Opinion with
respect to such modification or (ii) a payment default with respect to such
Mortgage Loan is reasonably foreseeable or has occurred and the Servicer
determines that a modification, waiver or amendment of such Mortgage Loan is
reasonably likely to produce a greater recovery on a present value basis than
liquidation of the related Mortgaged Property; provided, however, that the
Servicer agrees not to permit any modification of a Mortgage Loan that would
change the Mortgage Interest Rate or the method of determining the Mortgage
Interest Rate, extend the maturity date of such Mortgage Loan beyond January 27,
2011 or forgive any principal and interest thereof, unless the Servicer has
notified the Trustee and the Certificateholders of such proposed modification
and such modification has been approved by 100% in Percentage Interests of the
Certificateholders; and provided, further, that no such modification shall
release the lien of the Mortgage on the related Mortgage Property unless the
Servicer has obtained a Nondisqualification Opinion with respect to such
modification.
Section 11.4 Prohibited Transactions and Activities. Except as
otherwise provided in Section 2.3, the Trustee shall not permit the sale,
disposition or substitution of the Mortgage Loans or the substitution of a
property for a Mortgaged Property (except in a disposition pursuant to (i) the
bankruptcy or insolvency of the Trust REMIC or (ii) the termination of the Trust
REMIC in a "qualified liquidation" as defined in Section 860F(a)(4) of the
Code), nor acquire any assets for the Trust REMIC (other than REO Property), nor
sell or dispose of any investments in the Collection Account or the Certificate
Account for gain, nor accept any contributions to the Trust REMIC (other than a
cash contribution during the 3-month period beginning on the Startup Day),
unless it has received an Opinion of Counsel (at the expense of the Person
requesting the Trustee to take such action) to the effect that such disposition,
acquisition, substitution, or acceptance will not (a) affect adversely the
status of the Trust REMIC as a REMIC or of the Certificates, other than the
Class R Certificates, as the regular interests therein, (b) affect the
distribution of interest or principal on the Certificates, (c) result in the
encumbrance of the assets transferred or assigned to the Trust REMIC (except
pursuant to the provisions of this Agreement) or (d) cause the Trust REMIC to be
subject to a tax on "prohibited transactions" or "prohibited contributions"
pursuant to the REMIC Provisions.
Section 11.5 Indemnification with Respect to Certain Taxes and Loss of
REMIC Status. (a) In the event that the Trust REMIC fails to qualify as a REMIC,
loses its status as a REMIC, or incurs state or local taxes, or tax as a result
of a prohibited transaction or contribution subject to taxation under the REMIC
Provisions due to the negligent performance by the Trustee of its duties and
obligations specifically set forth herein, the Trustee shall indemnify the
Holders of the Class R Certificates against any and all losses, claims, damages,
liabilities or expenses ("Losses") resulting from such negligence; provided,
however, that the Trustee shall not be liable for any such Losses attributable
to the action or inaction of the Servicer, the Depositor or the Holders of the
Class R
<PAGE>
Certificates nor for any such Losses resulting from misinformation provided by
the Servicer, the Depositor or such Holders of the Class R Certificates on which
the Trustee has relied. The fore going shall not be deemed to limit or restrict
the rights and remedies of the other Holders of the Class R Certificates now or
hereafter existing at law or in equity.
(b) In the event that the Trust REMIC fails to qualify as a REMIC,
loses its status as a REMIC, or incurs state or local taxes, or a tax as a
result of a prohibited transaction or contribution subject to taxation under the
REMIC Provisions due to the negligent performance of the Servicer of its duties
and obligations specifically set forth herein, the Servicer shall indemnify the
Holders of the Class R Certificates against any and all Losses resulting from
such negligence; provided, however, that the Servicer shall not be liable for
any such Losses attributable to the action or inaction of the Trustee, the
Depositor, or the Holders of such Class R Certificates nor for any such Losses
resulting from misinformation provided by the Trustee, the Depositor or such
Holders of the Class R Certificates on which the Servicer has relied. The
foregoing shall not be deemed to limit or restrict the rights and remedies of
the other Holders of the Class R Certificates now or hereafter existing at law
or in equity.
ARTICLE XII MISCELLANEOUS PROVISIONS
Section 12.1 Amendment of Agreement. This Agreement may be amended from
time to time by BRT, Bluegreen, the Servicer, the Depositor and the Trustee,
with the consent of Holders of a majority of the principal balance of the
Controlling Class, to (i) cure any ambiguity, (ii) amend any provision hereof to
the extent necessary or desirable to maintain the status of the Trust REMIC as a
REMIC or (iii) correct or supplement any provisions herein or therein which may
be inconsis tent with any other provisions herein or therein, as the case may
be, or to add any other provisions with respect to matters or questions arising
under this Agreement which shall not be inconsistent with the provisions of this
Agreement; provided, however, that such action pursuant to clause (iii) shall
not, as evidenced by an Opinion of Counsel delivered to the Trustee, (x)
adversely affect in any material respect the interests of any Certificateholder
not consenting thereto or (y) adversely affect the status of the Trust REMIC as
a REMIC. Any such amendment shall be deemed not to adversely affect in any
material respect any Holder if the Trustee receives written confirmation from
each Rating Agency that such amendment will not cause such Rating Agency to
reduce the then current rating assigned to any of the rated Certificates that
were currently being rated by the Rating Agency (and any Opinion of Counsel
requested by the Trustee in connection with any such amendment may rely
expressly on such confirmation as the basis therefor).
<PAGE>
This Agreement may also be amended from time to time by BRT, Bluegreen,
the Servicer, the Depositor and the Trustee, with the consent of the Holders of
Certificates of each Class affected thereby, voting as a Class, evidencing, as
to each such Class, Percentage Interests aggregating more than 50%, 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 Holders of Certificates; provided, however, that no such amendment shall (a)
reduce in any manner the amount of, or delay the timing of, collections of
payments on Mortgage Loans or distributions which are re quired to be made on
any Certificate without the consent of the Holder of each such Certificate or
(b) reduce the aforesaid percentage required to consent to any such amendment,
without the consent of the Holders of all Certificates then outstanding.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment of this Agreement, unless it shall have first
received an Opinion of Counsel to the effect that such amendment will not cause
the Trust REMIC to fail to qualify as a REMIC at any time that any Class A or
Class B Certificates are outstanding.
Prior to the execution of any such amendment or consent the Trustee
shall notify the Rating Agency thereof and promptly after the execution of any
such amendment or consent the Trustee, shall furnish written notification of the
substance of such amendment to each Certificateholder and to the Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 12.1 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.
Section 12.2 Recordation of Agreement. To the extent required by
applicable law in order to protect the Trustee's interest in the Trust Fund,
this Agreement is subject to recordation in all appropriate public offices for
real property records in all the counties or other comparable jurisdictions in
which any or all of the properties subject to the Mortgages are situated, and in
any other appropriate public recording office or elsewhere, such recordation to
be effected by Bluegreen and at its expense.
Section 12.3 Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust
Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
<PAGE>
No Certificateholder shall have any right to vote (except as provided
in Section 12.1) or in any manner otherwise control the operation and management
of the Trust Fund, or the obligations of the parties hereto, nor shall anything
herein set forth, or contained in the terms of the Certificates, be construed so
as to constitute the Certificateholders from time to time as partners or members
of an association; nor shall any Certificateholder be under any liability to any
third person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of default and of the continuance thereof, as hereinbefore provided, and unless
also the Holders of Certificates of any Class evidencing, as to such Class,
Percentage Interests aggregating not less than 25% shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity (which indemnity shall be the unsecured obligation of TIAA or, with
the consent of the Trustee, such consent not to be unreasonably withheld, any
Major Certificateholder) as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request an offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding; it being
understood and intend ed, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner and to
the extent whatever by virtue or by availing itself or themselves of any
provisions of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of the Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner and to the extent herein provided and
for the equal, ratable and common benefit of all Certificateholders. For the
protection and enforcement of the provisions of this Section 12.3, each and
every Certificateholder and the Trustee shall be entitled to such relief as can
be given either at law or in equity.
Section 12.4 Governing Law. Except as set forth in the next sentence,
this Agreement shall be construed in accordance with the internal laws of the
State of New York without giving effect to principles of conflicts of laws and
the obligations, rights and remedies of the parties hereunder shall be
determined in accordance with such laws.
Section 12.5 Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified mail, return receipt requested, to (a) in
the case of the Depositor, the Servicer or BRT, 5295 Town Center Road, Suite
400, Boca Raton, Florida 33486, Attention: President, with a copy
<PAGE>
to Bluegreen, (b) in the case of Bluegreen, to Bluegreen Corporation, 5295 Town
Center Road, Suite 400, Boca Raton, Florida 33486, Attention: President, (c) in
the case of the Trustee, to First Trust National Association,180 East 5th Street
, St. Paul, Minnesota 55101, Attention: Corporate Trust, and (d) in the case of
the Rating Agency, to Duff & Phelps Credit Rating Co., 55 East Monroe Street,
Chicago, Illinois 60603, Attention: Structured Finance Research and Monitor
ing Group or, as to each party, at such other address as shall be designated
by such party in a written notice to each other party, in each case, so long
as it holds 100% of the outstanding Class A Certificates, with a copy to TIAA,
730 Third Avenue, New York, New York 10017, Attention: Securities Accounting
Division, with copies to: TIAA, 730 Third Avenue, New York, New York 10017,
Attention: Securities Division, Private Placements, Mary Elizabeth Brennan and
(at the same address), Attention: Legal Department, Charles Mattison. Any notice
required or permitted to be mailed to a Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register or, if so requested, by facsimile transmission. Any notice
so mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
Section 12.6 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the Holders thereof.
Section 12.7 Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 7.2, 7.4 and 7.5, this
Agreement may not be assigned by Bluegreen or the Servicer without the prior
written consent of Holders of Certificates of each Class, voting as a Class,
evidencing, as to each such Class, Percentage Interests aggregating more than
50%.
Section 12.8 Certificates Nonassessable and Fully Paid. It is the
intention of the Trustee that Certificateholders shall not be personally liable
for obligations of the Trust Fund, that the beneficial ownership interests
represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust Fund or for any reason whatsoever, and that Certificates
upon execution, countersignature and delivery thereof by the Trustee pursuant to
Section 2.4 are and shall be deemed fully paid.
Section 12.9 Reports to Rating Agency. The Trustee or the Servicer, as
applicable, shall send the Rating Agency copies of all opinions, notices,
certificates, statements, schedules and reports sent to Certificateholders.
<PAGE>
Section 12.10 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, and all of
which together shall constitute one and the same instrument.
Section 12.11 Headings Not to Affect Interpretation. The headings
contained in this Agreement are for convenience of reference only, and they
shall not be used in the interpretation hereof.
* * * * * *
<PAGE>
IN WITNESS WHEREOF, BRT, the Depositor, Bluegreen and the Trustee have
caused this Agreement to be duly executed by their respective officers and their
respective seals, duly attested, to be hereunto affixed, all as of the day and
year first above written.
BLUEGREEN CORPORATION REMIC TRUST,
SERIES 1996-1
By: First Trust National
Association, as Trustee
By:
Name:
Title:
By:
Name:
Title:
BLUEGREEN RECEIVABLES FINANCE
CORPORATION I, as Depositor
By:
Name:
Title:
BLUEGREEN CORPORATION
By:
Name:
Title:
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
<PAGE>
By:
Name:
Title:
By:
Name:
Title:
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On the ____ day of , 1996 before me, a notary public in and
for the of , personally appeared Alan L. Murray, known to me who, being by me
duly sworn, did depose and say that he resides at Boca Raton, Florida, that he
is a Treasurer and Chief Financial Officer of Bluegreen Corporation, one of the
parties that executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by order of the Board of Directors of said corporation;
and that he signed his name thereto by like order.
Notary Public
[Notarial Seal]
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On the ____ day of , 1996 before me, a notary public in and
for the of , personally appeared Alan L. Murray, known to me who, being by me
duly sworn, did depose and say that he resides at Boca Raton, Florida, that he
is a Treasurer of Bluegreen Receivables Finance Corporation I, one of the
parties that executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by order of the Board of Directors of said corporation;
and that he signed his name thereto by like order.
Notary Public
[Notarial Seal]
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On the ____ day of , 1996 before me, a notary public in and
for the State of Minnesota, personally appeared , known to me who, being by me
duly sworn, did depose and say that he resides at , that he is a of First Trust
National Association, one of the parties that executed the foregoing instrument;
that he knows the seal of said corporation; that the seal affixed to said instru
ment is such corporate seal; that it was so affixed by order of the Board of
Directors of said corporation; and that he signed his name thereto by like
order.
Notary Public
[Notarial Seal]
<PAGE>
