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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 report): March 18, 1999
GREENPOINT CREDIT CORP.
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(exact name of registrant as specified in charter)
DELAWARE
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(state or other jurisdiction of incorporation)
333-59731
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(commission file number)
13-4002891
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(I.R.S. Employer Identification Number)
10089 Willow Creek Road
San Diego, California 92131
(619) 530-9394
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(address and telephone number of registrant's
principal executive offices)
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Item 1. CHANGES IN CONTROL OF REGISTRANT.
Not applicable.
Item 2. ACQUISITION OR DISPOSITION OF ASSETS.
Not applicable.
Item 3. BANKRUPTCY OR RECEIVERSHIP.
Not applicable.
Item 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
Not applicable.
Item 5. OTHER EVENTS
FILING OF POOLING AND SERVICING AGREEMENT*
On March 18, 1999, the Registrants sold approximately $189,637,432 of
GreenPoint Credit Manufactured Housing Contract Trust Pass-Through Certificates,
Series 1999-2, evidencing beneficial ownership interests in a trust consisting
of a pool of manufactured housing installment sales contracts and installment
loan agreements and certain related property conveyed to the trust by GreenPoint
Credit Corp. ("GreenPoint") pursuant to a Pooling and Servicing Agreement dated
March 1, 1999 between GreenPoint, as Contract Seller and as Servicer and The
First National Bank of Chicago as the Trustee (the "Pooling and Servicing
Agreement"). The Pooling and Servicing Agreement is attached hereto as Exhibit
4.
______________
* Capitalized terms used herein without definition shall have the meanings
assigned to them in the Prospectus Supplement, dated March 10, 1999, and related
Prospectus, dated November 17, 1998, of the Registrant relating to the Publicly
Offered Certificates,
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Item 6. RESIGNATIONS OF REGISTRANT'S DIRECTORS.
Not applicable.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Not applicable.
(b) Not applicable.
(c) Exhibit Numbers:
The following are filed herewith. The exhibit numbers correspond with
Item 601(b) of Regulation S-K.
4. Pooling and Servicing Agreement, dated as of March 1, 1999, between
GreenPoint Credit Corp., as Contract Seller and as Servicer and The
First National Bank of Chicago as Trustee.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
GREENPOINT CREDIT CORP.
By: /s/ Charles O. Ryan
-------------------
Name: Charles O. Ryan
Title: Senior Vice President
Dated: March 18, 1999
San Diego, California
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EXHIBIT INDEX
Exhibit Numbers
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4. Pooling and Servicing Agreement, dated as of March 1, 1999,
between GreenPoint Credit Corp., as Contract Seller and as
Servicer and The First National Bank of Chicago as Trustee.
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EXHIBIT 4
EXECUTION COPY
GREENPOINT CREDIT CORP.,
CONTRACT SELLER AND SERVICER,
and
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 1999
GreenPoint Manufactured Housing Contract Trust
Pass-Through Certificates
Series 1999-2
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS................................................ 1
Section 1.01 Terms.............................................. 1
Section 1.02 Construction....................................... 20
ARTICLE II CONVEYANCE OF CONTRACTS, REPRESENTATIONS AND WARRANTIES.... 21
Section 2.01 Conveyance of Contracts............................ 21
Section 2.02 Filing and Assignment, Name Change or Relocation... 22
Section 2.03 Acceptance by Trustee.............................. 22
Section 2.04 Trustee Receipt of Documents....................... 23
Section 2.05 Representations and Warranties Regarding the
Servicer.......................................... 23
Section 2.06 Covenants of the Contract Seller, Trustee and
Servicer.......................................... 24
Section 2.07 Authentication and Delivery of Certificates........ 25
Section 2.08 Covenants of the Servicer.......................... 25
ARTICLE III REPRESENTATIONS AND WARRANTIES BY THE CONTRACT SELLER..... 25
Section 3.01 Representations and Warranties of the Contract
Seller............................................ 25
Section 3.02 Representations and Warranties Regarding Each
Contract.......................................... 26
Section 3.03 Representations and Warranties Regarding the
Contracts in the Aggregate........................ 30
Section 3.04 Representations and Warranties Regarding the
Contracts......................................... 31
Section 3.05 Repurchases of Contracts or Substitution of
Contracts for Breach of Representations and
Warranties........................................ 31
Section 3.06 General............................................ 34
ARTICLE IV ADMINISTRATION AND SERVICING OF CONTRACTS.................. 35
Section 4.01 Responsibility for Contract Administration and
Servicing......................................... 35
Section 4.02 Standard of Care................................... 35
Section 4.03 Records............................................ 35
Section 4.04 Inspection......................................... 36
Section 4.05 Establishment of and Deposits in Certificate
Account........................................... 36
Section 4.06 Payment of Taxes................................... 37
Section 4.07 Enforcement........................................ 37
Section 4.08 Transfer of Certificate Account.................... 38
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Section 4.09 Maintenance of Hazard Insurance Policies........... 39
Section 4.10 Fidelity Bond and Errors and Omissions Insurance... 40
Section 4.11 Collections under Hazard Insurance Policies,
Consent to Transfers of Manufactured Homes,
Assumption Agreements............................. 40
Section 4.12 Realization upon Defaulted Contracts............... 41
Section 4.13 Costs and Expenses................................. 41
Section 4.14 Trustee to Cooperate............................... 42
Section 4.15 Servicing and Other Compensation................... 42
Section 4.16 Custody of Contracts............................... 43
Section 4.17 REMIC Compliance................................... 45
Section 4.18 Management of REO Property......................... 50
Section 4.19 Reports to the Securities and Exchange Commission.. 51
Section 4.20 Annual Statement as to Compliance.................. 52
Section 4.21 Annual Independent Public Accountants' Servicing
Report............................................ 52
Section 4.22 Retitling of Land Home Contracts................... 52
Section 4.23 Notice of Rating Change............................ 53
ARTICLE V PAYMENTS, MONTHLY ADVANCES AND MONTHLY REPORTS.............. 53
Section 5.01 Monthly Advances by the Servicer................... 53
Section 5.02 Payments........................................... 54
Section 5.03 Permitted Withdrawals from the Certificate Account. 56
Section 5.04 Monthly Reports.................................... 57
Section 5.05 Certificate of Servicing Officer................... 59
Section 5.06 Other Data......................................... 59
Section 5.07 Statements to Certificateholders................... 59
Section 5.08 Certificate Insurance Policy; Enhancement Payments. 60
ARTICLE VI THE CERTIFICATES........................................... 61
Section 6.01 The Certificates................................... 61
Section 6.02 Certificate Register; Registration of Transfer and
Exchange of Certificates.......................... 62
Section 6.03 Mutilated, Destroyed, Lost or Stolen Certificates.. 65
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Section 6.04 Persons Deemed Owners.............................. 66
Section 6.05 Access to List of Certificateholders' Names and
Addresses......................................... 66
Section 6.06 Global Certificates................................ 66
Section 6.07 Notices to Depository.............................. 67
Section 6.08 Definitive Certificates............................ 67
ARTICLE VII THE CONTRACT SELLER AND THE SERVICER...................... 68
Section 7.01 Liabilities to Obligors............................ 68
Section 7.02 Servicer's Indemnities............................. 68
Section 7.03 Operation of Indemnities........................... 68
Section 7.04 Merger or Consolidation of the Contract Seller or
the Servicer...................................... 68
Section 7.05 Limitation on Liability of the Contract Seller,
the Servicer and Others........................... 69
Section 7.06 Assignment by Servicer............................. 69
Section 7.07 Successor to the Servicer.......................... 70
ARTICLE VIII EVENTS OF DEFAULT........................................ 71
Section 8.01 Events of Default.................................. 71
Section 8.02 Waiver of Defaults................................. 72
Section 8.03 Trustee to Act, Appointment of Successor........... 73
Section 8.04 Notification to Certificateholders................. 73
Section 8.05 Effect of Transfer................................. 73
Section 8.06 Transfer of the Account............................ 74
ARTICLE IX CONCERNING THE TRUSTEE..................................... 74
Section 9.01 Duties of Trustee.................................. 74
Section 9.02 Certain Matters Affecting the Trustee.............. 75
Section 9.03 Trustee not Liable for Certificates or Contracts... 76
Section 9.04 Trustee May Own Certificates....................... 76
Section 9.05 Servicer to Pay Fees and Expenses of Trustee,
Paying Agent and Certificate of Administrator..... 76
Section 9.06 Eligibility Requirements for Trustee............... 77
Section 9.07 Resignation and Removal of the Trustee............. 78
Section 9.08 Successor Trustee.................................. 78
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Section 9.09 Merger or Consolidation of Trustee................. 79
Section 9.10 Appointment of Co-Trustee or Separate Trustee...... 79
Section 9.11 Appointment of Office or Agency.................... 80
Section 9.12 Certificate Administrator.......................... 81
Section 9.13 Appointment of Paying Agent........................ 81
Section 9.14 Determination of LIBOR; Auction Procedures......... 81
ARTICLE X TERMINATION................................................. 82
Section 10.01 Termination....................................... 82
ARTICLE XI MISCELLANEOUS PROVISIONS................................... 86
Section 11.01 Amendment......................................... 86
Section 11.02 Recordation of Agreement; Counterparts............ 88
Section 11.03 Governing Law..................................... 88
Section 11.04 Calculations...................................... 88
Section 11.05 Notices........................................... 88
Section 11.06 Severability of Provisions........................ 89
Section 11.07 Assignment........................................ 89
Section 11.08 Limitations on Rights of Certificateholders....... 90
Section 11.09 Inspection and Audit Rights....................... 90
Section 11.10 Certificates Nonassessable and Fully Paid......... 91
Section 11.11 Third Party Beneficiary........................... 91
Section 11.12 Purchases Upon Conversion......................... 91
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<PAGE>
This POOLING AND SERVICING AGREEMENT, dated as of March 1, 1999 (the
"Agreement"), is executed by and between GreenPoint Credit Corp., as the
contract seller (in such capacity, the "Contract Seller") and the servicer (in
such capacity together with its permitted successors, the "Servicer"), and The
First National Bank of Chicago, as trustee (together with its permitted
successors in trust, the "Trustee").
The Contract Seller and Servicer, have duly authorized the execution
and delivery of this Agreement to provide for the issuance of GreenPoint
Manufactured Housing Contract Trust, Pass-Through Certificates, Series 1999-2
(the "Certificates"). The Certificates issued hereunder shall be limited to the
amount herein described. All covenants and agreements made by the Contract
Seller herein are for the benefit and security of the Certificateholders. The
Contract Seller is entering into this Agreement, and the Trustee is accepting
the trusts created hereby for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged.
In consideration of the premises and the mutual agreements hereinafter
set forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Terms.
-----
Whenever used in this Agreement, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
Adverse REMIC Event: As defined in Section 4.17(f) hereof.
-------------------
Advisor: As defined in Section 10.01(b)(3) hereof.
-------
Affiliate: As to any specified Person, any other Person controlling or
---------
controlled by or under common control with such specified 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 or otherwise; and the terms "controlling" or "controlled" have meanings
correlative to the foregoing.
Agreement: This Pooling and Servicing Agreement and any and all amendments
---------
or supplements hereto.
Annual Servicing Rate: 1.00% per annum (or, in the case of a successor
---------------------
Servicer engaged at any time after GCC is no longer the Servicer, the percentage
agreed upon pursuant to Section 7.07).
Assignment: An individual assignment of a Mortgage, notice or transfer or
----------
equivalent instrument in recordable form, sufficient under the laws of the
jurisdiction wherein the related
1
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Mortgaged Property is located to reflect of record the sale or transfer of the
related Land Home Contract.
Auction Agent: The meaning assigned in the Auction Procedures.
-------------
Auction Agent Agreement: The meaning assigned in the Auction Procedures.
-----------------------
Auction Agent Fee: The meaning assigned in the Auction Agent Agreement.
-----------------
Auction Procedures: The procedures set forth in Schedule I hereof by which
------------------
the Auction Rate is determined.
Auction Rate: The rate of interest per annum that results from
------------
implementation of the Auction Procedures and which is determined as described in
Section 2.1.1(c)(ii) of the Auction Procedures.
Auction Termination Date: As defined in Section 10.01(b) hereof.
------------------------
Available Distribution Amount: As to any Distribution Date, the sum of (a)
-----------------------------
the amount on deposit or otherwise credited to the Certificate Account as of the
end of the Collection Period ending immediately prior to such Distribution Date,
less the portion of such amount (i) permitted to be withdrawn by the Servicer
pursuant to Section 5.03 or (ii) constituting Excess Contract Payments, (b) the
Monthly Advance for such Distribution Date actually made in respect of such
Distribution Date , and (c) constituting the Class A-2 Holdover Amount as of the
immediately preceding Distribution Date.
Available Funds Shortfall: With respect to any Distribution Date, the
-------------------------
amount, if any, by which the Available Distribution Amount, prior to giving
effect to any related Enhancement Payment, for such Distribution Date is less
than the amount required to be distributed to the Class A Certificates on such
Distribution Date pursuant to Section 5.02(a)(i) and (ii).
Bank Agent: The meaning assigned in the Insurance Agreement.
----------
Broker Dealer Agreement: The meaning assigned in the Auction Procedures.
-----------------------
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii) a day
------------
on which the New York Stock Exchange or banking institutions in the City of New
York, New York, or the State of California or the city in which the Corporate
Trust Office of the Trustee is located are authorized or obligated by law or
executive order to be closed.
Certificate: Any of the GreenPoint Manufactured Housing Contract Trust
-----------
Pass-Through Certificates, Series 1999-2.
Certificate Account: The separate Eligible Account created and initially
-------------------
maintained by the Trustee pursuant to Section 4.05 in the name of the Trustee
for the benefit of the Holders of the Certificates. Funds in the Certificate
Account shall be held in trust for the aforementioned Certificateholders for the
uses and purposes set forth in this Agreement.
2
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Certificate Administrator: The Person appointed by the Trustee from time
-------------------------
to time pursuant to Section 9.12.
Certificate Balance: When used with respect to a single Class, the Class
-------------------
A-1 Certificate Balance or Class A-2 Certificate Balance, as applicable; and
when used with respect to more than one Class of Certificates, the sum of the
Class A-1 Certificate Balance and Class A-2 Certificate, as applicable.
Certificate Insurance Policy: An unconditional and irrevocable certificate
----------------------------
insurance policy, in the form attached hereto as Exhibit H, to the Trustee for
-------
the benefit of the Class A Certificateholders.
Certificate Owner: With respect to a Global Certificate, the person that
-----------------
is the beneficial owner of an interest in such Global Certificate.
Certificate Register: The register maintained pursuant to Section 6.02
--------------------
hereof.
Certificateholder or Holder: The person in whose name a Certificate is
----------------- ------
registered in the Certificate Register (initially, Cede & Co., as nominee for
the Depository, in the case of any Global Certificates), except that solely for
the purpose of giving any consent pursuant to this Agreement, any Certificate
registered in the name of the Contract Seller, the Servicer or any Affiliate of
the Contract Seller or the Servicer 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
effect such consent has been obtained; provided, however, that if any such
-------- -------
Person (including the Contract Seller) 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 hereof that requires the consent of
the Holders of Certificates of a particular Class as a condition to the taking
of any action hereunder. The Trustee is entitled to rely conclusively on a
certification of the Contract Seller, the Servicer or any Affiliate of the
Contract Seller or the Servicer in determining which Certificates are registered
in the name of an Affiliate of the Contract Seller or the Servicer.
Class : Any of the Class A-1, Class A-2 or Class R Certificates, as the
------
case may be.
Class A Certificate Balance: With respect to any date of determination,
----------------------------
the sum of the Class A-1 Certificate Balance and the Class A-2 Certificate
Balance.
Class A Certificates: The Class A-1 Certificates and the Class A-2
---------------------
Certificates.
Class A-1 Certificate: Any one of the Certificates, executed and
---------------------
authenticated as provided herein, substantially in the form set forth in Exhibit
-------
B-1 and Exhibit C hereto.
- --- ---------
Class A-1 Certificate Balance: At any time, the Initial Class A-1
-----------------------------
Certificate Balance minus the sum of all principal distributions previously made
to the Class A-1 Certificateholders.
Class A-1 Distribution Amount: As to any Distribution Date, the total
-----------------------------
amount distributed to the Class A-1 Certificateholders pursuant to Section 5.02.
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Class A-1 Formula Rate: A per annum rate equal to the sum of (a) LIBOR and
----------------------
(b) .22%.
Class A-1 Interest Distribution Amount: As to any Distribution Date, an
--------------------------------------
amount equal to the sum of (a) one month's interest at the Class A-1 Pass-
Through Rate on the Class A-1 Certificate Balance as of such Distribution Date
(before giving effect to the principal distributions on such Distribution Date)
and (b) any Class A-1 Unpaid Interest Shortfall.
Class A-1 Interest Shortfall: As to any Distribution Date, any amount by
----------------------------
which the amount distributed to Holders of Class A-1 Certificates on such
Distribution Date is less than the amount computed pursuant to clause (a) of the
definition of "Class A-1 Interest Distribution Amount."
Class A-1 Net Funds Cap Carryover Amount: As of the First Distribution
----------------------------------------
Date, zero. On each subsequent Distribution Date, the sum of (A) if on such
Distribution Date, the Class A-1 Pass-Through Rate is based upon the Net
Weighted Average Contract Rate, the excess of (i) the lesser of (a) the product
of (i) the Weighted Average Maximum Cap and (ii) the Class A-1 Certificate
Balance and (b) the amount of interest the Class A-1 Certificates would
otherwise be entitled to receive on such Distribution Date had such rate been
calculated at the Class A-1 Formula Rate for such Distribution Date over (ii)
the amount of interest payable on the Class A-1 Certificates at the Net Weighted
Average Contract Rate for such Distribution Date and (B) the Class A-1 Net Funds
Cap Carryover Amount, together with accrued interest thereon at the Class A-1
Pass-Through Rate in effect on such Distribution Date, for all previous
Distribution Dates not previously distributed pursuant to clause 5.02(a)(iv).
Class A-1 Pass-Through Rate: The lesser of (a) the Class A-1 Formula Rate
---------------------------
and (b) the Net Weighted Average Contract Rate.
Class A-1 Unpaid Interest Shortfall: As to any Distribution Date, the
-----------------------------------
amount, if any, by which the aggregate of the Class A-1 Interest Shortfalls for
prior Distribution Dates exceeds all prior distributions made pursuant to
Section 5.02 in respect of prior Class A-1 Interest Shortfalls, plus accrued
interest thereon (to the extent payment thereof is legally permissible) at the
Class A-1 Pass-Through Rate on such amount with respect to such prior
Distribution Dates.
Class A-2 Certificate: Any one of the Certificates, executed and
---------------------
authenticated as provided herein, substantially in the form set forth in Exhibit
-------
B-2 and Exhibit C hereto.
- --- ---------
Class A-2 Certificate Balance: At any time, the Initial Class A-2
-----------------------------
Certificate Balance minus the sum of all principal distributions previously made
to the Class A-2 Certificateholders.
Class A-2 Distribution Amount: As to any Distribution Date, the total
-----------------------------
amount distributed to the Class A-2 Certificateholders pursuant to Section 5.02.
Class A-2 Formula Rate: With respect to the First Distribution Date, 4.97%
----------------------
per annum. With respect to all subsequent Distribution Dates, the Auction Rate
established for such Distribution Date as determined pursuant to the Auction
Procedures.
Class A-2 Holdover Amount: On (i) the first Distribution Date on which the
-------------------------
Class A-2 Certificateholders receive distribution of principal pursuant to
Section 5.02(a)(ii) hereof, zero,
4
<PAGE>
(ii) on each subsequent Distribution Date on which the Class A-2
Certificateholders receive distribution of principal pursuant to Section
5.02(a)(ii) hereof but prior to the Class A-2 Pro Rata Date, an amount equal to
the lesser of (i) $24,999.99 and (ii) the portion of the Formula Principal
Distribution Amount required to be applied as a principal payment on the Class
A-2 Certificates that exceeds $25,000 or an integral multiple of $25,000 and
(iii) on each Distribution Date on and after the Class A-2 Pro Rata Date, zero.
Class A-2 Interest Distribution Amount: As to any Distribution Date, an
--------------------------------------
amount equal to the sum of (a) one month's interest at the Class A-2 Pass-
Through Rate on the Class A-2 Certificate Balance as of such Distribution Date
(before giving effect to the principal distributions on such previous
Distribution Date) and (b) any Class A-2 Unpaid Interest Shortfall.
Class A-2 Interest Shortfall: As to any Distribution Date, any amount by
----------------------------
which the amount distributed to Holders of Class A-2 Certificates on such
Distribution Date is less than the amount computed pursuant to clause (a) of the
definition of "Class A-2 Interest Distribution Amount."
Class A-2 Net Funds Cap Carryover Amount: As of the First Distribution
----------------------------------------
Date, zero. On each subsequent Distribution Date, the sum of (A) if on such
Distribution Date, the Class A-2 Pass-Through Rate is based upon the Net
Weighted Average Contract Rate, the excess of (i) the lesser of (a) the product
of (i) the Weighted Average Maximum Cap and (ii) the Class A-2 Certificate
Balance and (b) the amount of interest the Class A-2 Certificates would
otherwise be entitled to receive on such Distribution Date had such rate been
calculated at the Class A-2 Formula Rate for such Distribution Date over (ii)
the amount of interest payable on the Class A-2 Certificates at the Net Weighted
Average Contract Rate for such Distribution Date and (B) the Class A-2 Net Funds
Cap Carryover Amount, together with accrued interest thereon at Class A-2 Pass-
Through Rate in effect on such Distribution Date, for all previous Distribution
Dates not previously distributed pursuant to clause 5.02(a)(iv).
Class A-2 Pass-Through Rate: The lesser of (a) the Class A-2 Formula Rate
---------------------------
and (b) the Net Weighted Average Contract Rate.
Class A-2 Pro Rata Date: The date, if any, upon which the Class A-2
-----------------------
Certificates are no longer held in book-entry form or the Certificate Balance of
each outstanding Class A-2 Certificate is less than $25,000.
Class A-2 Unpaid Interest Shortfall: As to any Distribution Date, the
-----------------------------------
amount, if any, by which the aggregate of the Class A-2 Interest Shortfalls for
prior Distribution Dates exceeds all prior distributions made pursuant to
Section 5.02 in respect of prior Class A-2 Interest Shortfalls, plus accrued
interest thereon (to the extent payment thereof is legally permissible) at Class
A-2 Pass-Through Rate on such amount with respect to such prior Distribution
Dates.
Class R Certificate: Any one of the Certificates, executed and
-------------------
authenticated as provided herein, substantially in the form set forth in Exhibit
-------
D hereto.
- -
Closing Date: March 18, 1999.
------------
5
<PAGE>
Code: The Internal Revenue Code of 1986, including any successor or
----
amendatory provisions.
Collected Scheduled Payments: As to any Distribution Date, (a) the amount
----------------------------
on deposit in the Certificate Account as of the end of the related Collection
Period, less (b) the sum of (i) the aggregate of all Partial Prepayments
collected during such Collection Period, (ii) the aggregate of all payments
collected during such Collection Period on Contracts that were prepaid in full
during such Collection Period (less the aggregate of the scheduled payments due
on such Contracts that were delinquent as of the beginning of such Collection
Period and recovered out of such collections), (iii) the aggregate of the Net
Liquidation Proceeds collected in respect of all Contracts that became
Liquidated Contracts during such Collection Period (less the aggregate of
scheduled payments due on such Contracts that were delinquent at the beginning
of such Collection Period and recovered out of such collections and less any
Repossession Profits collected during such Collection Period), (iv) the
aggregate of the Repurchase Prices of all Contracts that were repurchased by the
Contract Seller pursuant to Section 3.05 (less the aggregate of scheduled
payments due on such Contracts that were delinquent at the beginning of such
Collection Period and recovered out of such collections), (v) the amounts
permitted to be withdrawn by the Servicer from the Certificate Account pursuant
to clauses (i), (ii), (iii), (iv), (v) and (vii) of Section 5.03, and (vi)
amounts representing Excess Contract Payments.
Collection Period: With respect to any Distribution Date, the calendar
-----------------
month preceding the month of the Distribution Date.
Computer Tape: The computer tape generated by the Servicer on behalf of
-------------
the Contract Seller which provides information relating to the Contracts sold by
the Contract Seller, and includes the master file and the history file.
Contract: Any one of the manufactured housing installment sale contracts
--------
or installment loan agreements, including any Land Home Contracts, described in
the Contract Schedule and constituting part of the corpus of the Trust Fund,
which Contracts are to be sold and assigned by the Contract Seller to the
Trustee and which are the subject of this Agreement. The Contracts include all
related security interests and any and all rights to receive payments which are
due pursuant thereto from and after the Cut-Off Date, but exclude any rights to
receive payments which were due pursuant thereto prior to the Cut-Off Date.
Contract File: As to each Contract other than a Land Home Contract, (a)
-------------
the original copy of the Contract, (b) the original title document issued to the
Seller or BankAmerica Housing Services as secured lender or agent therefor for
the related Manufactured Home, unless the laws of the jurisdiction in which the
related Manufactured Home is located do not provide for the issuance of any
title documents for manufactured housing to secured lenders, (c) evidence of one
or more of the following types of perfection of the security interest in favor
of the Seller or BankAmerica Housing Services as secured lender or agent
therefor in the related Manufactured Home granted by such Contract, as
appropriate: (1) notation of such security interest on the title document, (2)
a financing statement meeting the requirements of the UCC, with evidence of
recording in the appropriate offices indicated thereon, or (3) such other
evidence of perfection of a security interest in a manufactured housing unit as
is customary in such jurisdiction, (d) the assignment of the Contract from the
manufactured housing dealer to the Seller or BankAmerica
6
<PAGE>
Housing Services, if any, including any intervening assignments, and (e) any
extension, modification or waiver agreement(s).
Contract Pool: The pool of Contracts held in the Trust Fund.
-------------
Contract Rate: With respect to each Contract, the per annum rate of
-------------
interest borne by such Contract, as set forth or described in such Contract.
Contract Schedule: The list identifying each Contract, as amended from time
-----------------
to time, constituting part of the corpus of the Trust Fund, which list is
attached hereto as Exhibit A and which (a) identifies each Contract by contract
---------
number and name and address of the Obligor, and (b) sets forth as to each
Contract (i) the Scheduled Principal Balance as of the Cut-Off Date, (ii) the
amount of each monthly payment due from the Obligor, (iii) the Contract Rate,
(iv) the maturity date, (v) the maximum cap and (vi) the minimum cap.
Contract Seller: GCC.
---------------
Corporate Trust Office: The principal corporate trust office of the
----------------------
Trustee at which, at any particular time, its corporate trust business shall be
administered, which office at the date of execution of this Agreement is located
at One First National Plaza, Chicago, Illinois 60670-0126, Attention: Corporate
Trust Services Division, except that for purposes of Section 9.11, such term
shall mean the office or agency of the Trustee in the Borough of Manhattan, the
City of New York, which office at the date hereof is located at 14 Wall Street,
Eighth Floor, New York, New York 10005.
Cut-Off Date: The close of business on February 28, 1999.
------------
Cut-Off Date Pool Principal Balance: $189,637,432.62.
-----------------------------------
Deficiency: With respect to any Contract that is a Liquidated Contract,
----------
the amount by which (i) the outstanding principal balance of such Contract, plus
accrued and unpaid interest thereon at the related Contract Rate to the Due Date
for such Contract in the Collection Period in which such Contract became a
Liquidated Contract exceeds (ii) the Net Liquidation Proceeds for such Contract.
Deficiency Amount: With respect to any Contract, the amount, if any, that
-----------------
the Servicer collects directly from the Obligor with respect to any Deficiency.
Deficiency Event: On any Distribution Date as to which, after the
----------------
application of funds pursuant to Section 5.02(a), the sum of the Pool Scheduled
Principal Balance and the amount of the Class A-2 Holdover Amount on deposit in
the Certificate Account is equal to or less than the aggregate of the
Certificate Balances of the Class A-1 and Class A-2 Certificates.
Deficiency Percentage: 35%.
---------------------
Definitive Certificates: As defined in Section 6.08.
-----------------------
7
<PAGE>
Denomination: With respect to each Regular Certificate, the amount set
------------
forth on the face thereof as the "Initial Principal Balance of this
Certificate." With respect to each Class R Certificate, the Percentage Interest
appearing on the face thereof.
Depository: The initial Depository shall be the Depository Trust Company,
----------
the nominee of which is Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be the registered Holder of
the Global Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(3) of the Uniform Commercial Code of
the State of New York.
Depository Agreement: The agreement among the Contract Seller, the Trustee
--------------------
and the initial Depository, dated as of the Closing Date, substantially in the
form of Exhibit I.
---------
Depository Participant: A broker, dealer, bank or other financial
----------------------
institution or other person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: With respect to any Distribution Date, the third
------------------
Business Day prior to such Distribution Date.
Disqualified Organization: Any organization defined as a "disqualified
-------------------------
organization" under Section 860E(e)(5) of the Code and any of the following:
(i) the United States, any State or political subdivision thereof, any
possession of the United States, or any agency or instrumentality of any of the
foregoing (other than an instrumentality which is a corporation if all of its
activities are subject to tax and, except for the FHLMC, a majority of its board
of directors is not selected by such governmental unit), (ii) a foreign
government, any international organization, or any agency or instrumentality of
any of the foregoing, (iii) any organization (other than certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code (including the tax imposed by Section 511 of
the Code on unrelated business taxable income), (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code, (v) any
Person "electing large partnership" within the meaning of Section 775 of the
Code and (vi) any other Person so designated by the Trustee based upon an
Opinion of Counsel that the holding of an Ownership Interest in a Class R
Certificate by such Person may cause the Trust Fund, or any Person having an
Ownership Interest in any Class of Certificates (other than such Person) to
incur a liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the Transfer of an Ownership Interest in a
Certificate to such Person. The terms "United States", "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
Distribution Date: (A) With respect to (i) payment distributions to be
-----------------
made to the Class A-1 Certificateholders pursuant to Section 5.02(a) hereof, the
deposit of amounts to the Special Account pursuant to Section 5.02(a)(iii)
hereof, the statement to be delivered to the Class A-1 Certificateholders
pursuant to Section 5.07 hereof and the determination of the Interest Accrual
Period for the Class A-1 Certificates, the 15th day of each calendar month after
the initial issuance of the Class A-1 Certificates, or if such 15th day is not a
Business Day, the next
8
<PAGE>
succeeding Business Day, and (ii) payment distributions to be made to the Class
A-2 or Class R Certificateholders pursuant to Section 5.02(a) hereof, payments
to be made to the Auction Agent pursuant to Section 5.02(a)(v) hereof, the
statement to be delivered to the Class A-2 Certificateholders pursuant to
Section 5.07 hereof and the determination of the Interest Accrual Period for the
Class A-2 Certificates, the 18th day of each calendar month after the initial
issuance of the Class A-2 Certificates or if such 18th day is not a Business
Day, the next succeeding Business Day, commencing, in each case, in April, 1999
and (B) for all other purposes hereunder, the 15th day of each calendar month
commencing in April 1999, or if such day is not a Business Day, the next
succeeding Business Day, and ending on the last day of the month in which the
Class A-1 Certificate Balance has been reduced to zero, and the 18th day of each
calendar month thereafter, or if such 18th day is not a Business Day, the next
succeeding Business Day.
Due Date: The day of the month on which each scheduled payment of
--------
principal and interest is due on a Contract, exclusive of any days of grace.
Eligible Account: An account that is one of the following (i) an account
----------------
maintained with a FDIC-insured depository institution which is subject to
examination by federal or state authorities and the commercial paper of which
has a rating of P-1 from Moody's (if rated by Moody's) and A-1 from S&P or the
long-term deposits or long-term unsecured senior debt obligations of which are
in one of the two highest rating categories of Moody's and S&P, or maintained
with a depository institution that is otherwise acceptable to each Rating Agency
(as evidenced by a letter from each Rating Agency to such effect), (ii) a trust
account maintained with the Trustee or, if the Certificate Administrator is not
the Trustee, with the Certificate Administrator, in which the funds are either
held uninvested or invested solely in Eligible Investments, or (iii) an account
that is otherwise acceptable to the Rating Agencies, as evidenced by a letter
from each Rating Agency, without a reduction or withdrawal of the rating of the
Certificates.
Eligible Investments: One or more of the following in the order of
--------------------
priority specified herein:
(a) any common trust fund, collective investment trust or money market
fund rated Aaa by Moody's and AAAg or AAAm by S&P; and
(b) other obligations or securities that are acceptable to each Rating
Agency as an Eligible Investment hereunder and will not result in a reduction in
or withdrawal of the then current rating or ratings of the Certificates, as
evidenced by a letter to such effect from each Rating Agency;
provided, however, that no investments in "interest only" stripped obligations
shall qualify as an Eligible Investment pursuant to this definition.
Eligible Substitute Contract: As to any Replaced Contract for which such
----------------------------
Eligible Substitute Contract is being substituted pursuant to Section 3.05(b), a
Contract that (a) as of the date of its substitution, satisfies all of the
representations and warranties (which, except when expressly stated to be as of
origination, shall be deemed to be determined as of the date of its
9
<PAGE>
substitution rather than as of the Cut-Off Date or the Closing Date) in Section
3.02 and does not cause any of the representations and warranties in Section
3.03, after giving effect to such substitution, to be incorrect, (b) after
giving effect to the scheduled payment due in the month of such substitution,
has a Scheduled Principal Balance that is not greater than the Scheduled
Principal Balance of such Replaced Contract, (c) has a Contract Rate that is at
least equal to the Contract Rate of such Replaced Contract, (d) has a remaining
term to scheduled maturity that is not greater than the remaining term to
scheduled maturity of the Replaced Contract, and (e) has not been delinquent for
more than 31 days as to any scheduled payment due within twelve months of the
date of its substitution. In addition, a Substitute Contract which is a Land
Home Contract may only be used to replace a Replaced Contract which was a Land
Home Contract.
Enhancement Payment: As to any Distribution Date and the immediately
-------------------
preceding Collection Period, the amount by which the aggregate amount
distributable to the Class A Certificateholders pursuant to Sections 5.02(a)(i)
and(ii) exceeds the aggregate Available Distribution Amount.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
-----
ERISA Restricted Certificate: Any Class R Certificate.
----------------------------
Event Of Default: Any one of the Events of Default described in Section
----------------
8.01 hereof.
Excess Contract Payment: With respect to any Contract, any portion of a
-----------------------
payment of principal and interest on such Contract, that (a) is in excess of the
scheduled payment (or is an integral multiple thereof and has not been
identified by the Obligor as a Principal Prepayment), (b) is not a Principal
Prepayment and (c) is not part of the Liquidation Proceeds of such Contract or
the Repurchase Price of such Contract paid pursuant to Section 3.05.
Extension Fee: Any extension fee paid by the Obligor on a Contract.
-------------
FDIC: The Federal Deposit Insurance Corporation, or any successor thereto.
----
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
-----
instrumentality of the United States created and existing under Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Fidelity Bond: A fidelity bond to be maintained by the Servicer pursuant
-------------
to Section 4.10.
First Distribution Date: With respect to the Class A-1 Certificates, April
-----------------------
15, 1999, and with respect to the Class A-2 Certificates, April 19, 1999.
FNMA: The Federal National Mortgage Association, a federally chartered and
----
privately owned corporation organized and existing under the Federal National
Mortgage Association Charter Act, or any successor thereto.
Formula Principal Distribution Amount: As to any Distribution Date, an
-------------------------------------
amount equal to the sum of (a) the Total Regular Principal Amount for such
Distribution Date, (b) any previously undistributed shortfalls in the
distribution of the Total Regular Principal Amount in respect of
10
<PAGE>
prior Distribution Dates and (c) with respect to the Class A-2 Certificates, the
Class A-2 Holdover Amount as of the immediately preceding Distribution Date.
Fractional Interest: As to any Certificate, the product of (a) the
-------------------
Percentage Interest evidenced by such Certificate multiplied by (b) the amount
derived from dividing the Certificate Balance of the Class represented by such
Certificate by the aggregate Certificate Balances of each Class.
GCC: GreenPoint Credit Corp., a Delaware corporation, its successors or
---
assigns.
Global Certificate: Any Certificate registered in the name of the
------------------
Depository or its nominee, ownership of which is reflected on the books of the
Depository or on the books of a Person maintaining an account with such
Depository (directly or as an indirect participant in accordance with the rules
of such Depository and as described in Section 6.06). On the Closing Date, only
the Class A Certificates will be Global Certificates.
Gross Margin: With respect to each Contract that has a variable Contract
------------
Rate, the percentage set forth as such on the Contract Schedule.
Hazard Insurance Policy: With respect to each Contract, the policy of fire
-----------------------
and extended coverage insurance (and federal flood insurance, if applicable)
required to be maintained for the related Manufactured Home, as provided in
Section 4.09 (which may be a blanket insurance policy maintained by the Servicer
in accordance with the terms and conditions of Section 4.09).
Independent Contractor: Either (i) any Person (other than the Servicer or
----------------------
the Trustee) that would be an "independent contractor" with respect to the Trust
Fund within the meaning of Section 856(d)(3) of the Code if the Trust Fund were
a real estate investment trust (except that the ownership test set forth in that
Section shall be considered to be met by any Person that owns, directly or
indirectly, 35 percent or more of any Class of Certificates, or such other
interest in any Class of Certificates as is set forth in an Opinion of Counsel,
which shall be at no expense to the Trustee or the Trust Fund, delivered to the
Trustee), so long as the Trust Fund does not receive or derive any income from
such person and provided that the relationship between such Person and the Trust
Fund is at arm's length, all within the meaning of Treasury Regulation Section
1.856-4(b)(5), or (ii) any other Person (including the Servicer and the Trustee)
upon receipt by the Trustee of an Opinion of Counsel, which shall be at no
expense to the Trustee or the Trust Fund, to the effect that the taking of any
action in respect of any REO Property by such Person, subject to any conditions
therein specified, that is otherwise herein contemplated to be taken by an
Independent Contractor will not cause such REO Property to cease to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code
(determined without regard to the exception applicable for purposes of Section
860D(a) of the Code).
Index: With respect to each Contract that has not converted its Contract
-----
Rate from a variable rate to a fixed rate, the per annum rate equal to the
monthly average yield on U.S. Treasury securities adjusted to a constant
maturity of one year (as compiled by the U.S. Treasury Department), in
accordance with the terms of the related Contract.
Initial Class A-1 Certificate Balance: As set forth in Section 6.01.
-------------------------------------
11
<PAGE>
Initial Class A-2 Certificate Balance: As set forth in Section 6.01.
--------------------------------------
Insurance Agreement: The Master Insurance and Reimbursement Agreement,
-------------------
dated as of the February 25, 1999, including Schedule I, page 1 thereto dated as
of March 18, 1999, among GCC, GreenPoint Bank, the Trustee and the Insurer, as
amended, modified and supplemented from time to time in accordance with its
terms.
Insurer: MBIA Insurance Corporation and its successors and assigns.
-------
Insurer Default: The failure by the Insurer to make a payment under the
---------------
Certificate Insurance Policy in accordance with its terms.
Interest Accrual Period: With respect to any Distribution Date for any
-----------------------
Class, other than the First Distribution Date, the one month period beginning on
the Distribution Date occurring during the month of the month preceding the
month in which such Distribution Date occurs and ending on the day preceding
such Distribution Date, and with respect to the First Distribution Date, the
period commencing on the Closing Date and ending on the First Distribution Date.
Land Home Contract: A Contract that is secured by a mortgage or deed of
------------------
trust on real estate on which the related Manufactured Home is situated (as well
as by such related Manufactured Home).
Land Home Contract File: As to each Land Home Contract, (a) the original
-----------------------
copy of the Land Home Contract, (b) the original related Mortgage with evidence
of recording thereon (or, if the original Mortgage has not yet been returned by
the applicable recording office, a copy thereof, certified by such recording
office, which will be replaced by the original Mortgage when it is so returned)
and any title document for the related Manufactured Home, (c) the assignment of
the Land Home Contract from the originator (if other than the Contract Seller)
to the Contract Seller, (d) if such Land Home Contract was originated by the
Contract Seller, an endorsement of such Land Home Contract by the Contract
Seller, and (e) any extension, modification or waiver agreement(s).
Late Payment Fees: Any late payment fees (including any not sufficient
-----------------
funds fees) paid by Obligors on Contracts after all sums received have been
allocated first to regular installments due or overdue and all such installments
are then paid in full.
Latest Due Date: The latest date on which any Contract matures.
---------------
LIBOR: As of any LIBOR Determination Date and the Class A-1 Certificates,
-----
the rate for deposits in United States dollars for a period equal to the
relevant Interest Accrual Period (commencing on the first day of such Interest
Accrual Period) which appears in the Telerate Page 3750 as of 11:00 a.m. London
time, on such date. If such rate does not appear on Telerate Page 3750, the
rate for that day will be determined on the basis of the rates at which deposits
in United States dollars are offered by the Reference Banks at approximately
11:00 a.m., London time, on that day to prime banks in the London interbank
market for a period equal to the relevant Interest Accrual Period (commencing on
the first day of such Interest Accrual Period) and as quoted to the Trustee by
such Reference Banks. If at least two such quotations are provided, the rate
for that day will be the arithmetic mean of the quotations. If fewer than two
quotations are provided
12
<PAGE>
as requested, the rate for that day will be the arithmetic mean of the rates
quoted to major banks in New York City, selected by the Servicer, at
approximately 11:00 a.m., New York City time, on that day for loans in United
States dollars to leading European banks for a period equal to the relevant
Interest Accrual Period (commencing on the first day of such Interest Accrual
Period).
LIBOR Determination Date: With respect to any Interest Accrual Period, the
------------------------
second London business day preceding the commencement of such Interest Accrual
Period. For purposes of determining LIBOR, a "London business day" is any day
on which dealings in deposits of United States dollars are transacted in the
London interbank market.
Liquidated Contract: Any defaulted Contract as to which the Servicer has
-------------------
determined that all amounts (other than amounts in respect of any Deficiency)
which it expects to recover from or on account of such Contract have been
recovered; provided that any defaulted Contract in respect of which the related
--------
Manufactured Home and, in the case of Land Home Contracts, Mortgaged Property,
has been realized upon and liquidated and the proceeds of such disposition have
been received shall be deemed to be a Liquidated Contract.
Liquidation Expenses: All reasonable out-of-pocket expenses (exclusive of
--------------------
overhead expenses) which are incurred by the Servicer in connection with the
liquidation of any defaulted Contract, on or prior to the date on which the
related Manufactured Home, and, in the case of Land Home Contracts, Mortgaged
Property, is liquidated, including legal fees and expenses, any unreimbursed
amount expended by the Servicer pursuant to Sections 4.06, 4.07, 4.09 or 4.13
(to the extent such amount is reimbursable under the terms of Sections 4.06,
4.07, 4.09 or 4.13, as the case may be) with respect to such Contract, and any
unreimbursed expenditures for property taxes or other taxes or charges or for
property restoration or preservation that are related to such liquidation.
Liquidation Proceeds: Cash (including insurance proceeds other than those
--------------------
applied to the restoration of the related Manufactured Home or Mortgaged
Property or released to the related Obligor in accordance with the normal
servicing procedures of the Servicer, but excluding deficiency amounts) received
in connection with the liquidation of defaulted Contracts, whether through
repossession or otherwise.
Loan-To-Value Ratio: The fraction, expressed as a percentage, the
-------------------
numerator of which is the original principal balance of the related Contract and
the denominator of which is the Original Value of the related Manufactured Home.
Majority In Interest: As to any Class of Regular Certificates, the Holders
--------------------
of Certificates of such Class evidencing, in the aggregate, at least 51% of the
Percentage Interests evidenced by all Certificates of such Class.
Manufactured Home: A unit of manufactured housing which meets the
-----------------
requirements of Section 25(e)(10) of the Code, securing the indebtedness of the
Obligor under the related Contract.
Market Agent: The meaning assigned in the Auction Procedures.
------------
13
<PAGE>
Maximum Cap: With respect to each Contract, the amount set forth on the
-----------
Contract Schedule pursuant to clause (v) of the definition thereof.
Minimum Termination Amount: As of any time after the Pool Scheduled
--------------------------
Principal Balance is less than 10% of the Cut-Off Date Pool Principal Balance,
whether in the case of a Termination Auction or a purchase of Contracts by the
Servicer or the Residual Interest Holder pursuant to Section 10.01(a)(ii)
hereof, an amount equal to the sum of (a) the aggregate Class A Certificate
Balance, (b) any shortfall in interest due to the Class A Certificateholders in
respect of prior Distribution Dates, (c) one month's interest on the Class A-1
Certificate Balance at the Class A-1 Pass-Through Rate and (d) one month's
interest on the Class A-2 Certificate Balance at the Class A-2 Pass-Through
Rate.
Monthly Advance: As to any Distribution Date, the lesser of (1) (a) the
---------------
amount, if any, by which (i) the Scheduled Amount exceeds (ii) the Collected
Scheduled Payments, less (b) the amount of any scheduled payment on a Contract
due during the related Collection Period which the Servicer has determined would
be a Nonrecoverable Advance if an advance in respect of such scheduled payment
were made and (2) the amount by which the Available Distribution Amount
(exclusive of the Monthly Advance component thereof) for such Distribution Date
is less than the sum of (a) the Total Regular Principal Amount and (b) the sum
of the Class A-1 Interest Distribution Amount and the Class A-2 Interest
Distribution Amount.
Monthly Advance Reimbursement Amount: Any amount received or deemed to be
------------------------------------
received by the Servicer pursuant to Section 5.01(b) or (c) in reimbursement of
a Monthly Advance made out of its own funds.
Monthly Report: The monthly report described in Section 5.04.
--------------
Monthly Servicing Fee: As of any Distribution Date, an amount equal to
---------------------
one-twelfth of 1.00% per annum (or, in the case of a successor Servicer engaged
at any time after GCC is no longer the Servicer, the percentage agreed upon
pursuant to Section 7.07) of the Scheduled Principal Balance for such
Distribution Date.
Moody's: Moody's Investors Service, Inc. or any successor thereto.
-------
Mortgage: The mortgage, deed of trust, security deed or similar evidence
--------
of lien, creating a first lien on an estate in fee simple in the real property
securing a Land Home Contract.
Mortgaged Property: The property subject to the lien of a Mortgage.
------------------
Net Contract Rate: With respect to the fist seven Distribution Dates, the
-----------------
rate of interest per annum borne by a Contract on the first day of the related
Collection Period minus the Annual Servicing Rate. For each Distribution Date
thereafter, the rate of interest per annum borne by a Contract on the first day
of the related Collection Period minus the Annual Servicing Rate minus .50%.
Net Funds Cap Carryover Amount: The Class A-1 Net Funds Cap Carryover
------------------------------
Amount and/or the Class A-2 Net Funds Cap Carryover Amount, as applicable.
14
<PAGE>
Net Liquidation Proceeds: As to any Liquidated Contract, Liquidation
------------------------
Proceeds net of the sum of (i) Liquidation Expenses, (ii) all accrued and unpaid
interest thereon through the date the related Contract becomes a Liquidated
Contract and (iii) any amount required to be paid to the Obligor or any other
Person with an interest in the Manufactured Home or Mortgaged Property that is
senior to the interest of the Trust Fund.
Net Weighted Average Contract Rate: As to any Distribution Date, the
----------------------------------
weighted average of the Net Contract Rates of all of the Contracts as of the
first day of the related Collection Period, weighted on the basis of the
Scheduled Principal Balances of the Contracts on the first day of the related
Collection Period.
Non-United States Person: Any Person other than a United States Person.
------------------------
Nonrecoverable Advance: Any advance made or proposed to be made pursuant
----------------------
to Section 5.01 which the Servicer believes, in its good faith judgment, is not,
or if made would not be, ultimately recoverable from late payments, Liquidation
Proceeds or otherwise. In determining whether an advance is or will be
nonrecoverable, the Servicer need not take into account that it might receive
any amounts in a deficiency judgment. The determination by the Servicer that
any advance is, or if made would constitute, a Nonrecoverable Advance, shall be
evidenced by an Officer's Certificate of the Servicer delivered to the Trustee
and stating the reasons for such determination.
Notice of Rating: A notice by the Servicer substantially in the form of
----------------
Exhibit K hereto.
- ---------
Obligor: Each Person who is indebted under a Contract or who has acquired
-------
a Manufactured Home subject to a Contract.
Officer's Certificate: A certificate (i) signed by the Chairman of the
---------------------
Board, the Vice Chairman of the Board, the President, a Vice President (however
denominated), an Assistant Vice President, the Treasurer, the Secretary, or one
of the assistant treasurers or assistant secretaries of the Contract Seller or
the Servicer (or any other officer customarily performing functions similar to
those performed by any of the above designated officers and also to whom, with
respect to a particular matter, such matter is referred because of such
officer's knowledge of and familiarity with a particular subject) or (ii) if
provided for in this Agreement, signed by a Servicing Officer and delivered to
the Contract Seller and the Trustee, as the case may be, as required by this
Agreement.
Opinion Of Counsel: A written opinion of counsel, who may be the in-house
------------------
counsel for the Contract Seller or the Servicer, reasonably acceptable to the
Trustee and the Contract Seller, as the case may be.
Optional Termination Date: The date upon which the Pool Scheduled
-------------------------
Principal Balance is less than 10% of the Cut-Off Date Pool Principal Balance.
Original Value: With respect to any Manufactured Home that was new at the
--------------
time the related Contract was originated, the retail stated cash sale price of
such Manufactured Home, plus taxes and, to the extent financed under such
Contract, closing fees paid to third parties, insurance and prepaid finance
charges. With respect to any Manufactured Home that was used at
15
<PAGE>
the time the related Contract was originated, the total delivered sales price of
such Manufactured Home, plus taxes and, to the extent financed under such
Contract, closing fees paid to third parties, insurance and prepaid finance
charges.
Outstanding: With respect to any Contract as to the time of reference
-----------
thereto, a Contract that has not been fully prepaid, has not become a Liquidated
Contract, and has not been repurchased pursuant to Section 3.05 prior to such
time of reference.
Outstanding Amount Advanced: As to any Distribution Date, the aggregate of
---------------------------
all Monthly Advances made by the Servicer out of its own funds pursuant to
Section 5.01 less the aggregate of all Monthly Advance Reimbursement Amounts
actually received by the Servicer prior to such Distribution Date.
Ownership Interest: Any legal or beneficial, direct or indirect, ownership
------------------
or other interest.
Partial Prepayment: Any Principal Prepayment other than a Principal
------------------
Prepayment in Full.
Paying Agent: Any paying agent appointed pursuant to Section 9.13.
------------
Percentage Interest: As to any Certificate (other than a Class R
-------------------
Certificate) of any Class, the percentage interest evidenced thereby in
distributions required to be made on the Certificates of such Class, such
percentage interest being equal to the percentage obtained by dividing the
original denomination of such Certificate by the aggregate of the original
denominations of all of the Certificates of such Class; and as to a Class R
Certificate, the percentage set forth on the face thereof.
Permitted Transferee: Any Person other than (i) a Disqualified
--------------------
Organization or (ii) a Non-United States Person.
Person: Any individual, corporation, partnership, joint venture,
------
association, joint-stock company, trust, unincorporated organization or
government, or any agency or political subdivision thereof.
Pool Scheduled Principal Balance: As to any Distribution Date, the sum of
--------------------------------
the Scheduled Principal Balances of all Contracts at the end of the related
Collection Period.
Principal Prepayment: (i) Subject to clause (ii) of this definition, with
--------------------
respect to any Contract, any payment or any portion thereof or other recovery on
such Contract (other than a Liquidated Contract or a Contract repurchased
pursuant to Section 3.05) that exceeds the amount necessary to bring such
Contract current as of any Due Date unless (A) the related Obligor has notified
or confirmed with the Servicer that such payment is to be applied as Scheduled
Payments for future Due Dates or (B) the amount of such excess payment is
approximately equal (subject to a variance of plus or minus 10%) to the amount
of the Scheduled Payment on the next Due Date; (ii) notwithstanding the
provisions of the preceding clause (i), if any payment or any portion thereof or
other recovery on a Contract (other than a Liquidated Contract or a Contract
repurchased pursuant to Section 3.05) is sufficient to pay the outstanding
principal balance of such Contract, all accrued and unpaid interest at the
Contract Rate to the payment date and, at the
16
<PAGE>
option of the Servicer, all other outstanding amounts owing on such Contract,
the portion of the payments or recoveries on such Contract during such
Collection Period that is equal to the Scheduled Principal Balance of such
Contract after giving effect to the scheduled payment on such Contract due in
such Collection Period; and (iii) any cash deposit made with respect to a
Contract pursuant to Section 3.05.
Principal Prepayment In Full: Any Principal Prepayment specified in clause
----------------------------
(ii) of the definition of the term "Principal Prepayment."
Private Certificate: Any Class R Certificate.
-------------------
Rating Agency: Either Moody's or S&P.
-------------
Record Date: With respect to any Distribution Date, the close of business
-----------
on the day preceding such Distribution Date.
Reference Banks: The leading banks selected by the Trustee with respect to
---------------
the Class A-1 Certificates and the Auction Agent with respect to the Class A-2
Certificates, which are engaged in transactions in Eurodollar deposits in the
London interbank market.
Regular Certificates: Any one of the Class A Certificates.
--------------------
REMIC: A "real estate mortgage investment conduit" within the meaning of
-----
Section 860D of the Code.
REMIC Administrator: The Holder of the Class R Certificate on the Closing
-------------------
Date, or any successor thereto meeting the requirements set forth in Section
4.17 (c).
REMIC Provisions: Provisions of the federal income tax law relating to
----------------
real estate mortgage investment conduits, which appear at sections 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
proposed, temporary and final regulations and published rulings, notices and
announcements promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
REO Account: As defined in Section 4.17.
-----------
REO Property: As defined in Section 4.17.
------------
Replaced Contract: A Contract as to which the Contract Seller has a
-----------------
Repurchase Obligation and which, at the Contract Seller's option, is replaced in
the Trust Fund by an Eligible Substitute Contract pursuant to Section 3.05.
Repossession Profits: As to any Distribution Date, the excess, if any, of
--------------------
Net Liquidation Proceeds in respect of each Contract that became a Liquidated
Contract during the related Collection Period over the sum of the remaining
principal balance of such Contract prior to any write down thereof plus accrued
and unpaid interest at the related Contract Rate on the remaining principal
balance thereof from the Due Date to which interest was last paid by the Obligor
to the Due Date in the month in which such Contract became a Liquidated
Contract.
17
<PAGE>
Repurchase Obligation: The obligation of the Contract Seller, set forth in
---------------------
Section 3.05, to repurchase the related Contracts as to which there exists an
uncured breach of a representation or warranty contained in Sections 3.02 or
3.03.
Repurchase Price: With respect to any Contract required to be repurchased
----------------
hereunder, an amount equal to the remaining principal amount outstanding on such
Contract as of the beginning of the month of repurchase plus accrued interest
from the Due Date with respect to which the Obligor last made a payment to the
Due Date in the Collection Period in which such Contract is repurchased.
Responsible Officer: When used with respect to the Trustee, the Paying
-------------------
Agent or the Certificate Administrator, the chairman or vice chairman of the
board of directors, the chairman or vice chairman of any executive committee of
the board of directors, the president, any vice president, any assistant vice
president, the secretary, any assistant secretary, the treasurer, any assistant
treasurer, the cashier, any assistant cashier, any trust officer or assistant
trust officer, the controller or any assistant controller, or any other officer
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.
S&P: Standard & Poor's Ratings Services, a division of The McGraw-Hill
---
Companies, Inc., or any successor thereto.
Scheduled Amount: As to any Distribution Date, the amount equal to the
----------------
aggregate of the scheduled payments that were due during the Collection Period
ending immediately prior to such Distribution Date in respect of Contracts that
were Outstanding immediately following such Collection Period or whose last
scheduled payment was due during such Collection Period.
Scheduled Payment: As to any Distribution Date and each Contract, the
-----------------
amount equal to the scheduled payment that was due during the Collection Period
ending immediately prior to such Distribution Date in respect of each such
Contract that was Outstanding immediately following such Collection Period or
whose last scheduled payment was due during such Collection Period.
Scheduled Principal Balance: As to any Contract and any Distribution Date,
---------------------------
the principal balance of such Contract as of the Due Date in the Collection
Period next preceding such Distribution Date (or, with respect to the First
Distribution Date, as of the Cut-Off Date) as specified in the amortization
schedule for such Contract at the time relating thereto, after giving effect to
all previous Partial Prepayments, all previous scheduled principal payments
(whether or not paid), to the scheduled payment of principal due on such Due
Date and to all non-cash reductions to the related Contract during such
preceding Collection Period whether by bankruptcy or other similar proceeding or
other adjustment by the Servicer in the normal course of business of its
servicing activities.
Securities Act: The Securities Act of 1933, as amended.
--------------
Servicer: GCC, or its successors in interest or any successor Servicer
--------
under this Agreement as provided by Section 7.06 or 7.07.
18
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Servicer Deficiency Amount: With respect to any Distribution Date, the
--------------------------
product of the Deficiency Percentage and the aggregate of the Deficiency Amounts
received during the immediately preceding Collection Period.
Servicing File: All documents, records, and other items maintained by the
--------------
Servicer with respect to a Contract and not included in the corresponding
Contract File or the Land Home Contract, as applicable, including the credit
application, credit reports and verifications, appraisals, tax and insurance
records, payment records, insurance claim records, correspondence, and all
historical computerized data files.
Servicing Officer: Any officer of the Servicer involved in, or responsible
-----------------
for, the administration and servicing of the Contracts 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.
Special Account: The account established and maintained pursuant to the
---------------
Insurance Agreement, which will not be an asset of the Trust Fund or the REMIC.
Special Account Deposit Amount: As defined in the Insurance Agreement.
------------------------------
Startup Day: As defined in Section 4.17(b) hereof.
-----------
Tax: As defined in Section 4.17(g) hereof.
---
Tax Matters Person: The person designated as "tax matters person" in the
------------------
manner provided under Treasury regulation Section 1.860F-4(d) and Section 6231
of the Code. Initially, this person shall be the Servicer.
Telerate Page 3750: The display page currently so designated on the Dow
------------------
Jones Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices).
Termination Auction: As defined in Section 10.01(b) hereof.
-------------------
Total Regular Principal Amount: As to any Distribution Date, an amount
------------------------------
equal to the sum of (a) all scheduled payments of principal due on each
outstanding Contract during the immediately preceding Collection Period, (b) all
Partial Prepayments on the Contracts received during the immediately preceding
Collection Period, (c) the Scheduled Principal Balance of each Contract for
which a Principal Prepayment in Full was received during the immediately
preceding Collection Period, (d) the Scheduled Principal Balance of each
Contract that became a Liquidated Contract during the immediately preceding
Collection Period, (e) the Scheduled Principal Balance of each Contract that was
repurchased during the immediately preceding Collection Period pursuant to
Section 3.05, and (f) all non-cash reductions to the Scheduled Principal
Balance of each Contract during the immediately preceding Collection Period
whether by bankruptcy or other similar proceeding or other adjustment by the
Servicer in the normal course of business of its servicing activities.
Transfer: Any direct or indirect transfer or sale of any Ownership
--------
Interest in a Class R Certificate.
19
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Transferee: Any Person who is acquiring by Transfer any Ownership Interest
----------
in a Class R Certificate.
Trustee: The First National Bank of Chicago, or its successors or assigns
-------
or any successor under this Agreement.
Trust Fund: The corpus of the trust created by this Agreement, to the
----------
extent described herein, consisting of the Contracts (including the security
interest created thereby), including all rights to receive payments on the
Contracts due on or after the Cut-Off Date, such assets as shall from time to
time be identified as deposited in the Certificate Account, each Manufactured
Home and Mortgaged Property which secured a Contract (which has not been
repurchased pursuant to Section 3.05) and which has been acquired in realizing
upon such Contract, the Repurchase Obligation, the Certificate Insurance Policy
and the proceeds of the Hazard Insurance Policies.
UCC: The Uniform Commercial Code, as in effect in the relevant
---
jurisdiction.
United States Person: A citizen or resident of the United States, a
--------------------
corporation, partnership or other entity created or organized in, or under the
laws of, the United States, any state thereof or the District of Columbia (other
than a partnership not treated as a United States person under any applicable
Treasury Regulations), or an estate or trust whose income is subject to United
States federal income tax regardless of the source of income.
Voting Rights: The portion of the voting rights of all of the Certificates
-------------
that is allocated to any Certificate. As of any date of determination, 99% of
the Voting Rights shall be allocated among Holders of the Regular Certificates
in proportion to the Certificate Balances of their respective Certificates on
such date and 1% of the Voting Rights shall be allocated among Holders of the
Class R Certificates, in each case allocated among the Certificates of each such
Class in accordance with their respective Percentage Interests.
Weighted Average Maximum Cap: With respect to any Distribution Date, an
----------------------------
amount equal to the weighted average of the Maximum Caps on such Distribution
Date (or with respect to any Contract that had its Contract Rate convert from a
variable rate to a fixed rate, the appropriate fixed rate) multiplied by a
fraction the numerator of which is the actual number of days elapsed in the
related Interest Accrual Period and the denominator of which is 360.
Section 1.02 Construction.
------------
Unless the context of this Agreement otherwise clearly requires, references
to the plural include the singular, the singular the plural and the part the
whole and "or" has the inclusive meaning sometimes represented by the phrase
"and/or." The words "include" or "including" shall be deemed followed by the
phrase "without limitation." The words "hereof," "herein," "hereunder" and
similar terms in this Agreement refer to the Agreement as a whole and not to any
particular provision of this Agreement. The Section and other headings
contained in this Agreement are for reference purposes only and shall not
control or affect the construction of this Agreement or the interpretation
thereof in any respect. Section, subsection, Schedule, Appendix and Exhibit
references are to this Agreement unless otherwise specified. The date as of
which this Agreement is dated has been assigned solely for purposes of
identification, and does not signify the date as of which assets are
transferred, securities are issued, or any other actions are
20
<PAGE>
taken hereunder, and the parties specifically acknowledge and agree that the
conveyance of the Contracts pursuant to Section 2.01 and the delivery of the
Certificates pursuant to Section 2.07 have occurred on and are effective as of
the Closing Date.
ARTICLE II
CONVEYANCE OF CONTRACTS, REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Contracts.
-----------------------
(a) GCC, as Contract Seller, concurrently with the execution and
delivery hereof, does hereby transfer, sell, assign, set over and otherwise
convey to the Trustee without recourse (i) all of its right, title and interest
in and to the Contracts listed on the Contract Schedule, as amended from time to
time, (including the security interests created thereby), including all
principal of and interest due on or with respect to such Contracts on or after
the Cut-Off Date (other than payments of principal and interest due on such
Contracts before the Cut-Off Date), (ii) all of the rights under all Hazard
Insurance Policies relating to the Manufactured Homes securing such Contracts
for the benefit of the creditors under such Contracts, (iii) all documents
contained in the Contract Files and in the Land Home Contract Files with respect
to the related Contracts, and (iv) all proceeds of any of the foregoing.
The ownership of each Contract and the contents of the related Contract
File or Land Home Contract File, as applicable, and Servicing File are vested in
the Trustee. The Servicer hereby disclaims any and all right, title and other
ownership interest in and to the Contracts (including the security interests
created thereby). The contents of each Contract File and, except as provided in
Section 4.16(e), the contents of each Land Home Contract File, as applicable,
and Servicing File are and shall be held by the Servicer for the benefit of the
Trustee as the owner thereof (it being understood that the Servicer's possession
of the contents of each Contract File or Land Home Contract File, as applicable,
and Servicing File so retained is for the sole purpose of servicing the related
Contract, and such retention and possession by the Servicer is in a custodial
capacity only). Neither the Contract Seller nor the Servicer shall take any
action inconsistent with the Trustee's ownership of the Contracts, and the
Contract Seller and the Servicer shall promptly indicate to all inquiring
parties that the Contracts have been sold, transferred, assigned, set over and
conveyed to the Trustee and shall not claim any ownership interest in the
Contracts.
(b) Although the parties intend that the conveyance of the Contract
Seller's right, title and interest in and to the Contracts pursuant to this
Agreement shall constitute a purchase and sale and not a loan, if such
conveyances are deemed to be 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 parties also intend and agree that GCC shall be
deemed to have granted to the Trustee, and GCC does hereby grant to the Trustee,
a perfected first-priority security interest in (i) all of its right, title and
interest, whether now owned or hereafter acquired, in and to the Contracts
listed on the Contract Schedule, as amended from time to time (including the
security interests created thereby), including all principal of and interest due
on or with respect to such Contracts on or after the Cut-Off Date (other than
payments of principal and interest due on such Contracts before the Cut-Off
Date), (ii) all of the rights under all Hazard Insurance Policies
21
<PAGE>
relating to the Manufactured Homes securing such Contracts for the benefit of
the creditors under such Contracts, (iii) all documents contained in the
Contract Files and in the Land Home Contract Files with respect to the related
Contracts, and (iv) all proceeds of any of the foregoing. The parties intend and
agree that this Agreement shall constitute a security agreement under applicable
law. If the trust created by this Agreement terminates prior to the satisfaction
of the claims of any Person under any Certificates, the security interests
created hereby shall continue in full force and effect and the Trustee shall be
deemed to be the collateral agent for the benefit of such Person.
Section 2.02 Filing and Assignment, Name Change or Relocation.
------------------------------------------------
(a) On or prior to the Closing Date, the Servicer shall cause to be
filed in the office of the Secretary of State of California a UCC-1 financing
statement signed by GCC describing the related Contracts as collateral and
naming GCC as debtor and the Trustee as secured party.
From time to time, the Servicer shall take and cause to be taken such
actions and execute such documents as are necessary to perfect and protect the
Certificateholders' interests in the Contracts and their proceeds and the
Manufactured Homes and the Mortgaged Properties against all other Persons,
including the filing of financing statements, amendments thereto and
continuation statements, the execution of transfer instruments and the making of
notations on or taking possession of all records or documents of title;
provided, however, that GCC, so long as it is the Servicer, shall not be
- -------- -------
required to cause notations to be made on any document of title relating to any
Manufactured Home or to execute any transfer instrument relating to any
Manufactured Home (other than a notation or a transfer instrument necessary to
show the Contract Seller as the lienholder or legal title holder) or, except as
provided in Section 4.22, to file documents in real property records with
respect to a Manufactured Home or related Contract, absent notice from the
Trustee or the Contract Seller or actual knowledge that such Manufactured Home
that does not secure a Land Home Contract has become real property under
applicable state law; and further provided, that the Servicer shall have no
------- --------
obligation pursuant to this sentence with respect to any failure to maintain a
first-priority perfected security interest which results from a breach of any
representation or warranty in Section 3.02(j) or (u) as to the Trustee's
security interest in a Manufactured Home, except to enforce the Contract
Seller's obligations in respect thereof in Section 3.05. The Trustee and the
Contract Seller agree to take whatever action is necessary to enable the
Servicer to fulfill its obligations as set forth in this Section 2.02(a).
(b) The Servicer agrees to pay all reasonable costs and
disbursements in connection with its duties specified in this Section 2.02.
Section 2.03 Acceptance by Trustee.
---------------------
(a) The Trustee hereby acknowledges conveyance of the Contracts to
the Trustee and declares that the Trustee, directly or through a custodian
(which shall be the Servicer pursuant to Section 4.16, except as provided under
Section 4.16(e)), holds and will hold such Contract Files in trust for the use
and benefit of all present and future Certificateholders. The Trustee hereby
certifies (without any independent investigation) that it has no notice or
knowledge of (i) any adverse claim, lien or encumbrance with respect to any
Contract, (ii) any Contract being overdue
22
<PAGE>
or dishonored, (iii) any evidence on the face of any Contract of any security
interest therein adverse to the Trustee's interest, or (iv) any defense against
or claim against any Contract by the Obligor or by any other party. The Trustee
also hereby certifies that its books and records will reflect it as the legal
owner of the Contracts. Nothing in this Agreement shall be construed to
constitute acceptance by the Trustee or the Trust Fund of any liability or
obligation of the Contract Seller, whether on any Contract, to any Obligor, or
otherwise.
(b) The Trustee hereby acknowledges delivery of the Certificate
Insurance Policy to the Trustee and declares that the Trustee holds and will
hold the Certificate Insurance Policy in trust for the use and benefit of all
present and future Class A Certificateholders.
Section 2.04 Trustee Receipt of Documents.
----------------------------
On the Closing Date, the Trustee shall authenticate and deliver the
Certificates upon instructions from the Contract Seller pursuant to Section 2.07
and the receipt of the following documents:
(a) A letter from each Rating Agency confirming that the
Certificates (other than the Class R Certificates) have been assigned the rating
of "Aaa" (in the case of Moody's) and "AAA" (in the case of S&P);
(b) An Officer's Certificate from the Servicer to the effect that
the Servicer has deposited $1,011,789.12 in the Certificate Account, which is an
estimate of all amounts received on the Contracts from and including the Cut-Off
Date up to and including March 16, 1999;
(c) An executed Auction Agent Agreement and Broker Dealer Agreement;
and
(d) The Certificate Insurance Policy.
Notwithstanding anything in this Agreement to the contrary, the Servicer
shall deposit into the Certificate Account all amounts in respect of the
Contracts received on or after March 1, 1999 or otherwise required to be
deposited in the Certificate Account by other provisions of this Agreement
pursuant to Section 4.05.
Section 2.05 Representations and Warranties Regarding the Servicer.
-----------------------------------------------------
The Servicer makes the following representations and warranties to the
Trustee and the Certificateholders:
(a) Organization and Good Standing. The Servicer is a corporation, duly
------------------------------
organized, validly existing and in good standing under the laws of the State of
Delaware, and the Servicer has the corporate power to own its assets and to
transact the respective business in which it is currently engaged. The Servicer
is duly qualified to do business as a foreign corporation and is in good
standing in each jurisdiction in which its type of organization and the
character of the business transacted by it or properties owned or leased by it
requires such qualification and in which the failure so to qualify would have a
material adverse effect on its business, properties, assets, or condition
(financial or other).
23
<PAGE>
(b) Authorization; Binding Obligations. The Servicer has the power and
----------------------------------
authority to make, execute, deliver and perform this Agreement and all of the
transactions contemplated under the Agreement, and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement. When executed and delivered, this Agreement will constitute the
legal, valid and binding obligation of the Servicer enforceable in accordance
with its terms, except as enforcement of such terms may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally and by the availability of equitable remedies.
(c) No Consent Required. The Servicer is not required to obtain the
-------------------
consent of any other party or any consent, license, approval or authorization
from, or registration or declaration with, any governmental authority, bureau or
agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement or in connection with the transaction of its
business, except such as have been obtained or where the failure to obtain any
such consent, license, approval or authorization, or to make any registration or
declaration does not materially adversely affect the interests of the Trust Fund
or the interests of the Certificateholders therein.
(d) No Violations. The execution, delivery and performance of this
-------------
Agreement by the Servicer will not violate any provision of any existing law or
regulation or any order or decree of any court applicable to the Servicer or the
charter or bylaws of the Servicer, or constitute a material breach of any
mortgage, indenture, contract or other agreement to which the Servicer is a
party or by which the Servicer may be bound except where such violation or
breach does not materially adversely affect the interests of the Trust Fund or
the interests of the Certificateholders therein.
(e) Litigation. No litigation or administrative proceeding of or before
----------
any court, tribunal or governmental body is currently pending, or, to the
knowledge of the Servicer, threatened, against the Servicer or any of its
properties or with respect to this Agreement or the Certificates which, if
adversely determined, would in the opinion of the Servicer have a material
adverse effect on the transactions contemplated by this Agreement.
Within 60 days of the earlier of discovery by the Servicer or receipt of
notice by the Servicer of the breach of any representation, warranty or covenant
of the Servicer set forth in this Section 2.05 which materially and adversely
affects the interests of the Certificateholders in any Contract, the Servicer
shall cure such breach in all material respects.
Section 2.06 Covenants of the Contract Seller, Trustee and Servicer.
------------------------------------------------------
Upon discovery by any of the Contract Seller, the Servicer or the Trustee
of a breach of any of the representations, warranties and covenants set forth in
Article III hereof which materially and adversely affects the value of the
Contracts or the interests of the Certificateholders in the Contracts (or which
materially and adversely affects the value of or the interest of the
Certificateholders in the related Contract in the case of a representation,
warranty or covenant set forth in Article III hereof and relating to a
particular Contract), the party discovering such breach shall give prompt
written notice to the other parties. The cure of such breach or the repurchase
or substitution for any affected Contract shall be done in accordance with
Section 3.05.
24
<PAGE>
Section 2.07 Authentication 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 executed,
authenticated and delivered to or upon the order of the Contract Seller, the
Certificates in authorized denominations evidencing the entire ownership of the
Trust Fund. The Trustee agrees to hold the Trust Fund and exercise the rights
referred to above for the benefit of all present and future Holders of the
Certificates.
Section 2.08 Covenants of the Servicer.
-------------------------
The Servicer hereby covenants to the Contract Seller and the Trustee that
no written information, certificate of an officer, statement furnished in
writing or written report delivered to the Contract Seller, any Affiliate of the
Contract Seller or the Trustee and prepared by the Servicer pursuant to this
Agreement will contain any untrue statement of a material fact or omit to state
a material fact necessary to make the information, certificate, statement or
report not misleading.
ARTICLE III
REPRESENTATIONS AND WARRANTIES BY THE CONTRACT SELLER
Section 3.01 Representations and Warranties of the Contract Seller.
-----------------------------------------------------
The Contract Seller makes the following representations and warranties to
the Trustee:
(a) Organization and Good Standing; Licensing. It is a corporation, duly
-----------------------------------------
organized, validly existing and in good standing under the laws of the State of
Delaware, and it has the corporate power to own its assets and to transact the
business in which it is currently engaged. It is duly qualified to do business
as a foreign corporation and is in good standing in each jurisdiction in which
its type of organization and the character of the business transacted by it or
properties owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on its business,
properties, assets, or condition (financial or other). It was properly licensed
in each jurisdiction at the time of purchase or origination of each Contract
originated or purchased on an individual basis by it in such jurisdiction to the
extent required by the laws of such jurisdiction as applied to the purchase or
origination and servicing of such Contract, except where the failure to be so
licensed does not materially adversely affect the interests of the Trust Fund or
the Certificateholders in and to such Contract.
(b) Authorization; Binding Obligations. It has the power and authority to
----------------------------------
make, execute, deliver and perform this Agreement and all of the transactions
contemplated under this Agreement, and has taken all necessary corporate action
to authorize the execution, delivery and performance of this Agreement. When
executed and delivered, this Agreement will constitute the legal, valid and
binding obligation of the Contract Seller enforceable in accordance with its
terms, except as enforcement of such terms may be limited by bankruptcy,
insolvency or similar laws affecting the enforcement of creditors' rights
generally and by the availability of equitable remedies.
25
<PAGE>
(c) No Consent Required. It is not required to obtain the consent of any
-------------------
other party or any consent, license, approval or authorization from, or
registration or declaration with, any governmental authority, bureau or agency
in connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except such as have been obtained or where the
failure to obtain any such consent, license, approval or authorization, or to
make any registration or declaration does not materially adversely affect the
interests of the Trust Fund or the interests of the Certificateholders therein.
(d) No Violations. The execution, delivery and performance of this
-------------
Agreement by the Contract Seller will not violate any provision of any existing
law or regulation or any order or decree of any court applicable to the Contract
Seller or the charter or bylaws of the Contract Seller, or constitute a material
breach of any mortgage, indenture, contract or other agreement to which the
Contract Seller is a party or by which the Contract Seller may be bound except
where such violation or breach does not materially adversely affect the
interests of the Trust Fund or the interests of the Certificateholders therein.
(e) Litigation. No litigation or administrative proceeding of or before
----------
any court, tribunal or governmental body is currently pending or, to its
knowledge, threatened, against it or any of its properties or with respect to
this Agreement or the Certificates which, if adversely determined, would in the
opinion of the Contract Seller have a material adverse effect on the
transactions contemplated by this Agreement.
(f) Chief Executive Office. As of the Closing Date, its chief executive
----------------------
office is in California.
(g) Name Change or Relocation. During the term of this Agreement, it will
-------------------------
not change its name, identity or structure or relocate its chief executive
office without first giving written notice to the Trustee. If any change in the
Contract Seller's name, identity or structure or the relocation of its chief
executive office would make any financing or continuation statement or notice of
lien filed under this Agreement seriously misleading within the meaning of
applicable provisions of the UCC or any title statute, the Contract Seller, no
later than five days after the effective date of such change, shall file such
amendments as may be required to preserve and protect the Certificateholders'
interests in the Contracts and proceeds thereof and in the Manufactured Homes
and the Mortgaged Properties.
Section 3.02 Representations and Warranties Regarding Each Contract.
------------------------------------------------------
The Contracts listed on the Contract Schedule have been sold by GCC in its
capacity as Contract Seller to the Trust Fund on the date of execution and
delivery hereof. As a condition of the purchase by the Trust Fund, the Contract
Seller represents and warrants to the Trustee as of the Closing Date (except as
otherwise expressly stated):
(a) Payments. As of the Cut-Off Date, no Contract was more than 59 days
--------
delinquent.
(b) No Waivers. The terms of the Contract have not been waived, altered
----------
or modified in any respect, except by instruments or documents identified in the
Contract File or the Land Home Contract File, as applicable.
26
<PAGE>
(c) Binding Obligation. The Contract is the legal, valid and binding
------------------
obligation of the Obligor thereunder and is enforceable in accordance with its
terms, except as such enforceability may be limited by laws affecting the
enforcement of creditors' rights generally and by general principles of equity.
(d) No Defenses. The Contract is not subject to any right of rescission,
-----------
setoff, counterclaim or defense, including the defense of usury, and the
operation of any of the terms of the Contract or the exercise of any right
thereunder will not render the Contract unenforceable in whole or in part or
subject to any right of rescission, setoff, counterclaim or defense, including
the defense of usury, and no such right of rescission, setoff, counterclaim or
defense has been asserted with respect thereto.
(e) Insurance. The Manufactured Home securing the Contract is covered by
---------
a Hazard Insurance Policy in the amount required by Section 4.09. All premiums
due as of the Closing Date on such insurance have been paid in full to the
applicable providers of such insurance.
(f) Origination. To the knowledge of the Contract Seller, the Contract
-----------
was either (i) originated by a manufactured housing dealer acting in the regular
course of its business, and purchased on an individual basis by the Contract
Seller in the ordinary course of business, (ii) originated by the Contract
Seller in the ordinary course of business, or (iii) purchased from Bank of
America, FSB, which had originated such Contracts in the ordinary course of its
business.
(g) Lawful Assignment. The Contract was not originated in and is not
-----------------
subject to the laws of any jurisdiction whose laws would make the transfer of
such Contract from the Contract Seller to the Trust Fund under this Agreement
unlawful.
(h) Compliance with Law. All requirements of any federal, state or local
-------------------
law, including usury, truth-in-lending and equal credit opportunity laws and
lender licensing laws, applicable to the Contract have been complied with.
(i) Contract in Force. The Contract has not been satisfied or
-----------------
subordinated in whole or in part or rescinded, the Manufactured Home securing
the Contract has not been released from the lien of the Contract in whole or in
part and, in the case of a Land Home Contract, the related Mortgaged Property
has not been released from the related Mortgage.
(j) Valid Security Interest. The Contract, other than any Land Home
Contract, creates a valid, subsisting and enforceable (except as may be limited
by laws affecting creditors' rights generally) first-priority security interest
in favor of GCC as secured lender, or agent thereof, in the Manufactured Home
covered thereby; such security interest has been assigned by the Contract Seller
as secured lender to the Trustee in accordance with the terms herein and; the
Trustee has a valid and perfected first-priority security interest in such
Manufactured Home. Each Mortgage is a valid first lien in favor GCC on real
property securing the amount owed by the Obligor under the related Land Home
Contract subject only to (a) the lien of current real property taxes and
assessments, (b) covenants, conditions and restrictions, rights of way,
easements and other matters of public record as of the date of recording of such
Mortgage, such exceptions appearing of record being acceptable to mortgage
lending institutions generally in the area wherein the property subject to the
Mortgage is located or specifically reflected in the
27
<PAGE>
appraisal obtained in connection with the origination of the related Land Home
and (c) other matters to which like properties are commonly subject which do not
materially interfere with the benefits of the security intended to be provided
by such Mortgage. The Contract Seller has assigned all of its right, title and
interest in such Land Home Contract and related Mortgage, including the security
interest in the Manufactured Home covered thereby, to the Trustee. The Trustee
has and will have a valid and perfected and enforceable first priority security
interest in such Land Home Contract.
(k) Capacity of Parties. All parties to the Contract had capacity to
-------------------
execute the Contract.
(l) Good Title. It purchased the Contract for value and took possession
----------
thereof, without knowledge that the Contract was subject to any security
interest. It has not sold, assigned or pledged the Contract to any Person other
than the Trust Fund, and prior to the transfer of the Contract by the Contract
Seller to the Trust Fund, it had good and marketable title thereto free and
clear of any encumbrance, equity, loan, pledge, charge, claim or security
interest and was the sole owner thereof with full right to transfer the Contract
to the Trust Fund.
(m) No Defaults. As of the Cut-Off Date, there was no default, breach,
-----------
violation or event permitting acceleration existing under the Contract and to
its knowledge, no event which, with notice and the expiration of any grace or
cure period, would constitute such a default, breach, violation or event
permitting acceleration under such Contract (except payment delinquencies
permitted by clause (a) above). The Contract Seller has not waived any such
default, breach, violation or event permitting acceleration.
(n) No Liens. As of the Closing Date, there are, to its knowledge, no
--------
liens or claims which have been filed for work, labor or materials affecting the
Manufactured Home or any related Mortgaged Property securing the Contract which
are or may be liens prior to, or equal or coordinate with, the lien of the
Contract.
(o) Installments. Such Contract provides for monthly payments of
------------
principal and interest which fully amortize the loan over its term, each
Contract that has converted to a fixed rate of interest has a fixed Contract
Rate and each Contract that has not converted to a fixed rate of interest has a
Contract Rate that after an initial period is calculated based upon the Index
plus the Gross Margin. The scheduled monthly payment allocable to interest on
each Contract is calculated on the basis that each scheduled monthly payment is
applied on its Due Date, regardless of when it is actually made.
(p) Enforceability. The Contract contains customary and enforceable
--------------
provisions such as to render the rights and remedies of the holder thereof
adequate for the realization against the collateral of the benefits of the
security.
(q) Contract Schedule. The information set forth in the Contract Schedule
-----------------
is true and correct.
(r) One Original. There is only one original executed Contract. Such
------------
original Contract is in the custody of the Servicer on the Closing Date.
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(s) Loan-to-Value Ratio. At the time of its origination, such Contract
-------------------
had a Loan-to-Value Ratio (rounded to the nearest 1%) not greater than 95%.
(t) Not Real Estate. With respect to each Contract other than a Land Home
---------------
Contract, the related Manufactured Home is personal property and is not
considered or classified as part of the real estate on which it is located under
the laws of the jurisdiction in which it is located and was personal property
and was not considered or classified as part of the real estate on which it was
located under the laws of the jurisdiction in which it was located at the time
the related Contract was executed by the parties thereto, and with respect to
each Contract including Land Home Contracts the related Manufactured Home is, to
the Contract Seller's knowledge, free of damage (including earthquake or
hurricane damage) and in good repair.
(u) Notation of Security Interest. With respect to each Contract other
-----------------------------
than a Land Home Contract, if the related Manufactured Home is located in a
state in which notation of a security interest on the title document is required
or permitted to perfect such security interest, the title document shows, or, if
a new or replacement title document with respect to such Manufactured Home is
being applied for, such title document will be issued within 180 days and will
show, GCC or BankAmerica Housing Services as the holder of a first-priority
security interest in such Manufactured Home. If the related Manufactured Home is
located in a state in which the filing of a financing statement or the making of
a fixture filing under the UCC is required to perfect a security interest in
manufactured housing, such filings have been duly made and show GCC or
BankAmerica Housing Services as the secured party. If the related Manufactured
Home secures a Land Home Contract, such Manufactured Home is subject to a
Mortgage properly filed in the appropriate public recording office or such
Mortgage will be properly filed in the appropriate public recording office
within 180 days, naming GCC as mortgagee. In either case, the Trustee has the
same rights as the secured party of record would have (if such secured party
were still the owner of the Contract) against all Persons (including the
Contract Seller and any trustee in bankruptcy of GCC or BankAmerica Housing
Services) claiming an interest in such Manufactured Home. Assuming consummation
of the transactions contemplated herein the Trustee has the same rights as the
secured party of record would have (if such secured party were still the owner
of the Contract) against all Persons claiming an interest in such Manufactured
Home and, if applicable, such Mortgaged Property.
(v) Secondary Mortgage Market Enhancement Act. The related Manufactured
-----------------------------------------
Home is a "manufactured home" within the meaning of 42 United States Code,
Section 5402(6). With respect to the Contracts originated by Bank of America,
FSB, Bank of America, FSB meets the requirements of Section 3(a)(41)(A)(ii) of
the Securities Exchange Act of 1934, as amended. As of the Cut-Off Date, the
Contract Seller was approved for insurance by the Secretary of Housing and Urban
Development pursuant to Section 2 of the National Housing Act.
(w) Qualified Mortgage for REMIC. Each Contract is secured by a "single
----------------------------
family residence" within the meaning of Section 25(e)(10) of the Code. The fair
market value of the Manufactured Home securing each Contract was at least equal
to 80% of the adjusted issue price of the Contract at either (i) the time the
Contract was originated (determined pursuant to the REMIC Provisions) or (ii)
the time the Contract is transferred to the Trust Fund. Each Contract is a
"qualified mortgage" under Section 860G(a)(3) of the Code.
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<PAGE>
(x) Stamping of Contracts. Within 60 days of the Closing Date, each
---------------------
original Contract will have been stamped with the following legend: "This
Contract has been assigned to The First National Bank of Chicago, as Trustee
under the Pooling and Servicing Agreement dated as of March 1, 1999 (between
such Trustee and GreenPoint Credit Corp.) or to any successor Trustee
thereunder."
(y) Actuarial/Simple Interest Contracts. Except for $1,791,816.60 by
-----------------------------------
aggregate principal amount of the Contracts on the Cut-Off Date which are simple
interest Contracts, each Contract is an actuarial manufactured housing
installment loan agreement or manufactured housing installment sales contract.
(z) Land Home Contracts. No Contract other than a Land Home Contract is
-------------------
secured, or intended to be secured, in whole or in part by the lien of a
mortgage or deed of trust creating a first lien or an estate in fee simple in
the real property.
(aa) Financing of Real Property. No Contract other than a Land Home
--------------------------
Contract has financed any amount in respect of real property.
(bb) Minimum and Maximum Contract Rate. As of the Cut-Off Date, the
---------------------------------
Contract with the lowest Contract Rate has a Contract Rate of 5.75% and the
Contract with the highest Contract Rate has a Contract Rate of 13.50%.
Section 3.03 Representations and Warranties Regarding the Contracts in the
-------------------------------------------------------------
Aggregate.
- ---------
The Contract Seller represents and warrants that:
(a) Amounts. The aggregate principal amounts payable by Obligors under
-------
the Contracts as of the Cut-Off Date (including scheduled principal payments due
on or after the Cut-Off Date but paid prior to the Cut-Off Date) equal or exceed
the Cut-Off Date Pool Principal Balance. As of the Cut-Off Date, $3,309,392.29
of the aggregate principal amount of the Contracts were originated and funded by
Bank of America, FSB and $22,939,689.22 of the aggregate principal amount of the
Contracts were originated and partially funded by Bank of America, FSB prior to
September 30, 1998 and were fully funded by the Contract Seller subsequent to
such date.
(b) Characteristics. The Contracts have the following characteristics as
---------------
of the Cut-Off Date: (i) Contracts representing approximately 84.50% of the
Contracts by remaining principal balance are attributable to loans for purchases
of new Manufactured Homes, and approximately 15.5% thereof is attributable to
loans for purchases of used Manufactured Homes; (ii) not more than approximately
8.76% of the Contracts by remaining principal balance as of the Cut-Off Date are
secured by Manufactured Homes located in any one state, not more than 1.00% of
the Contracts by remaining principal balance are secured by Manufactured Homes
located in an area with the same zip code, not more than 1.00% of the Contracts
by remaining principal balance are secured by Manufactured Homes located in the
same manufactured housing park; (iii) no Contract has a remaining maturity of
more than 360 months; (iv) no Contract was originated before May, 1998; and (v)
the final scheduled payment date on the Contract with the latest maturity is in
February 2029.
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(c) Computer Tape. The Computer Tape made available by the Servicer as of
-------------
the close of business on February 28, 1999 was accurate as of its date and
includes a description of the same Contracts that are described in the Contract
Schedule.
(d) Marking Records. Within 7 days following the Closing Date, the
---------------
Contract Seller will have caused the portions of the electronic master record of
its manufactured housing installment sales contracts and installment loan
agreements relating to the Contracts sold by it as of the Closing Date to be
clearly and unambiguously marked to indicate that such Contracts constitute part
of the Trust Fund and are owned by the Trust Fund in accordance with the terms
of the trust created hereunder.
(e) No Adverse Selection. Except to ensure compliance with the
--------------------
representations and warranties made in Sections 3.02 and 3.03, no selection
procedures have been intentionally employed to achieve an adverse effect on the
interests of the Certificateholders or the Insurer in selecting the Contracts.
Section 3.04 Representations and Warranties Regarding the Contracts.
------------------------------------------------------
The Contract Seller represents and warrants that:
(a) Possession. Immediately prior to the Closing Date, the Servicer will
----------
have possession of each original Contract and the related Contract File or Land
Home Contract File, as applicable (except for any certificate of title that has
not yet been returned from the appropriate public recording office). There are
and there will be no custodial agreements in effect materially and adversely
affecting the right of the Contract Seller to make, or to cause to be made, any
delivery required hereunder.
(b) Bulk Transfer Laws. The transfer, assignment and conveyance of the
------------------
Contracts, the Contract Files and the Land Home Contract Files by related
Contract Seller to the Trust Fund as contemplated by this Agreement are not
subject to the bulk transfer or any similar statutory provisions in effect in
any applicable jurisdiction.
Section 3.05 Repurchases of Contracts or Substitution of Contracts for Breach
----------------------------------------------------------------
of Representations and Warranties.
- ---------------------------------
(a) The Contract Seller shall either (i) repurchase a Contract sold by it
to the Trust Fund at such Contract's Repurchase Price, or (ii) if the Contract
Seller is able to satisfy the conditions of Section 3.05(b), remove such
Contract from the Trust Fund and substitute therefor an Eligible Substitute
Contract in accordance with and subject to the limitations of Section 3.05(b),
in each case within 90 days after the Contract Seller becomes aware, or receives
written notice from the Servicer or the Trustee, of a breach of a representation
or warranty of the Contract Seller set forth in Section 3.02 or 3.03 of this
Agreement that materially adversely affects the Trust Fund's interest in such
Contract, unless such breach has been cured; provided, however, that with
-------- -------
respect to any Contract incorrectly described on the Contract Schedule with
respect to remaining principal balance, which the Contract Seller would
otherwise be required to repurchase pursuant to this Section 3.05, the Contract
Seller may, in lieu of repurchasing such Contract, deposit in the Certificate
Account not later than one Business Day after such Determination Date cash in an
amount sufficient to cure such deficiency or discrepancy; and
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<PAGE>
further provided, that with respect to a breach of a representation or warranty
- ------- --------
relating to the Contracts in the aggregate and not to any particular Contract,
the Contract Seller may select Contracts to repurchase or substitute for such
that, had such Contracts not been included as part of the Contract Pool and
after giving effect to such substitution, if any, there would have been no
breach of such representation or warranty; and further provided, that in
------- --------
connection with any Contract that the Contract Seller is required to repurchase,
the Contract Seller shall at its own expense deliver to the Trustee an opinion
of counsel to the effect that the repurchase of such Contract will not cause the
Trust Fund to fail to qualify as a REMIC at any time any Certificate is
outstanding under then applicable REMIC Provisions, be deemed a contribution to
the Trust Fund after the Startup Day or cause any "prohibited transaction," in
each case, that will result in the imposition of a tax under the applicable
REMIC Provisions. It is understood and agreed that the obligation of the
Contract Seller to repurchase or substitute for any Contract sold by it as to
which a breach of a representation or warranty set forth in Section 3.02 or 3.03
of this Agreement has occurred and is continuing shall constitute the sole
remedy respecting such breach available to the Certificateholders, the Trust
Fund or the Trustee; provided, however, that the Contract Seller shall defend
-------- -------
and indemnify the Trustee, the Certificate Administrator, the Trust Fund and the
Certificateholders against all costs, expenses, losses, damages, claims and
liabilities, including reasonable fees and expenses of counsel, which may be
asserted against or suffered by any of them as a result of third-party claims
arising out of any breach of a representation or warranty set forth in Section
3.02(c), (d), (g), (h) or (w) of this Agreement. Notwithstanding any other
provision of this Agreement, the obligation of the Contract Seller under this
Section 3.05 shall not terminate upon an Event of Default.
Notwithstanding any other provision of this Agreement to the contrary,
any amount received on or recovered with respect to repurchased Contracts or
Replaced Contracts during or after the month of repurchase shall be the property
of the Contract Seller and need not be deposited in the Certificate Account.
Notwithstanding the foregoing, the Contract Seller shall not deposit
cash into either Certificate Account pursuant to this Section 3.05 after the
three-month period beginning on the Closing Date unless it shall first have
obtained an Opinion of Counsel to the effect that such deposit will not give
rise to any tax under Section 86OF(a) (1) of the Code or Section 86OG(d) of the
Code. Any such deposit shall not be invested.
The Trustee shall have no obligation to pay any taxes pursuant to this
Section 3.05, other than from moneys provided to it by the Contract Seller or
from moneys held therefor pursuant to Section 4.17. The Trustee shall be deemed
conclusively to have complied with this Section 3.05 if it follows the
directions of the Servicer required to be provided in the preceding paragraph.
Upon the repurchase of any Contract by the Contract Seller, the Trustee shall
delete such Contract from the Contract Schedule.
For reasons of administrative convenience in servicing of the
Contracts, notwithstanding the above provisions of this Section 3.05(a), the
Contract Seller shall not be required to repurchase or substitute for any
Contract relating to a Manufactured Home located in any jurisdiction on account
of a breach of the representation or warranty contained in Section 3.02(j) or
(u) of this Agreement solely on the basis of failure by the Contract Seller to
cause notations to be made on any document of title relating to any such
Manufactured Home or to
32
<PAGE>
execute any transfer instrument (including any UCC-3 assignments) relating to
any such Manufactured Home (other than a notation or a transfer instrument
necessary to show the Contract Seller as lienholder or legal title holder)
unless (i) a court of competent jurisdiction has adjudged that, because of such
failure, the Trustee does not have a perfected first-priority security interest
in such related Manufactured Home, or (ii) (A) the Servicer has received written
advice of counsel to the effect that a court of competent jurisdiction has held
that, solely because of a substantially similar failure on the part of a pledgor
or assignor of manufactured housing contracts (who has perfected the assignment
or pledge of such contracts), a perfected first-priority security interest was
not created in favor of the pledgee or assignee (as the case may be) in a
related manufactured home which is located in such jurisdiction and which is
subject to the same laws regarding the perfection of security interests therein
as apply to Manufactured Homes located in such jurisdiction, and (B) the
Servicer shall not have completed all appropriate remedial action with respect
to such Manufactured Home within 90 days after receipt of such written advice.
Any such advice shall be from counsel selected by the Servicer on a
nondiscriminatory basis from among the counsel used by the Servicer in its
general business in the jurisdiction in question. The Servicer shall have no
obligation on an ongoing basis to seek any advice with respect to the matters
described in clause (ii) above. However, the Servicer shall seek advice with
respect to such matters whenever information comes to the attention of its
general counsel which causes such general counsel to determine that a holding of
the type described in clause (ii)(A) might exist. If any counsel selected by the
Servicer informs the Servicer that no holding of the type described in clause
(ii)(A) exists, such advice shall be conclusive and binding on the parties with
respect to the applicable date and jurisdiction.
(b) On or prior to the date that is the second anniversary of the Closing
Date, the Contract Seller, at its election, may substitute a Contract for any
Contract that it is otherwise obligated to repurchase pursuant to Section
3.05(a) (such Contract being referred to as the "Replaced Contract") upon
satisfaction of the following conditions:
(i) the Contract to be substituted for the Replaced Contract is an
Eligible Substitute Contract and the Contract Seller delivers an Officer's
Certificate, substantially in the form of Exhibit E, to the Trustee
---------
certifying that such Contract is an Eligible Substitute Contract,
describing in reasonable detail how such Contract satisfies the definition
of the term "Eligible Substitute Contract" (as to satisfaction of
representations and warranties, such description shall be that such
Contract satisfies such representations and warranties) and certifying that
the Contract File or the Land Home Contract File, as applicable, for such
Contract is in the possession of the Servicer;
(ii) the Contract Seller shall have delivered to the Trustee evidence
of filing with the appropriate office in California of a UCC-1 financing
statement executed by the Contract Seller as debtor and naming the Trustee
as secured party and listing such Contract as collateral;
(iii) the Contract Seller shall have delivered to the Trustee an
Opinion of Counsel (a) to the effect that the substitution of such Contract
for such Replaced Contract will not cause the Trust Fund to fail to qualify
as a REMIC at any time any Certificate is outstanding under then applicable
REMIC Provisions, be deemed a contribution to the Trust Fund after the
Startup Day or cause any "prohibited transaction," in each case, that
33
<PAGE>
will result in the imposition of a tax under the applicable REMIC
Provisions, and (b) to the effect that, except as to Contracts that are
Land Home Contracts, no filing or other action other than the filing of
financing statements on Form UCC-1 with the Secretary of State of the State
of California, naming the Contract Seller as debtor and the Trustee as
secured party as required by Section 3.05(a) of this Agreement and the
filing of continuation statements as required by Section 2.02(a) is
necessary to perfect as against third parties the conveyance of the
substitute Contract by the Contract Seller to the Trustee; and
(iv) if the Scheduled Principal Balance of such Replaced Contract is
greater than the Scheduled Principal Balance of such Contract, the Contract
Seller shall have deposited in the Certificate Account the amount of such
excess (which amount shall be deemed a Principal Prepayment on such
Contract) and shall have included in the Officer's Certificate required by
clause (i) above a certification that such deposit has been made.
Upon satisfaction of such conditions, the Trustee shall add such
Contract to, and delete such Replaced Contract from, the Contract Schedule (or
cause such addition and deletion to be accomplished). Such substitution shall
be effected prior to the first Determination Date that occurs more than 90 days
after the Contract Seller becomes aware or receives written notice from the
Servicer or the Trustee, of the breach referred to in Section 3.05(a).
(c) Promptly after the repurchase referred to in Section 3.05(a) or
the substitution referred to in Section 3.05(b), the Trustee shall execute such
documents as are presented to it by the Contract Seller and are reasonably
necessary to reconvey the repurchased Contract or Replaced Contract, as the case
may be, to the Contract Seller.
(d) Notwithstanding anything in this Section 3.05 to the contrary, in
the event any Opinion of Counsel referred to in this Section 3.05 indicates that
a repurchase or substitution, as the case may be, of a Contract will result in
the imposition of a tax under the applicable REMIC Provisions with respect to
"prohibited transactions," or deemed a contribution to the REMIC after the
"start-up day," the Contract Seller shall not be required to repurchase or
substitute the Contract to which such Opinion of Counsel relates unless and
until the Servicer has determined there is an actual or imminent default with
respect thereto or that the defect or breach giving rise to the repurchase or
substitution obligation adversely affects the enforceability of such Contract.
Section 3.06 General.
-------
(a) It is understood and agreed that the representations and warranties in
this Article III hereof shall remain operative and in full force and effect,
shall survive the transfer and conveyance of the Contracts by the Contract
Seller to the Trustee and shall inure to the benefit of the Trustee.
(b) Any cause of action against the Contract Seller relating to or arising
out of the breach of any of its representations and warranties made in this
Article III shall accrue as to any Contract upon (i) discovery of such breach by
the Contract Seller or notice thereof by the Trustee or Servicer to the Contract
Seller, (ii) failure by the Contract Seller to cure such breach, and
34
<PAGE>
(iii) demand upon the Contract Seller by the Trustee for all amounts payable in
respect of such Contract under this Agreement.
ARTICLE IV
ADMINISTRATION AND SERVICING OF CONTRACTS
Section 4.01 Responsibility for Contract Administration and Servicing.
--------------------------------------------------------
GCC hereby agrees to act as Servicer under this Agreement. The
Certificateholders by their acceptance of the Certificates consent to GCC acting
as Servicer. The Servicer shall service and administer the Contracts and,
subject to the terms of this Agreement, shall have full power and authority to
do any and all things which it may deem necessary or desirable in connection
with such servicing and administration. Subject to Section 4.02, without
limiting the generality of the foregoing, the Servicer hereby is authorized and
empowered, when the Servicer believes it appropriate in its best judgment, to
execute and deliver, on behalf of the Certificateholders and the Trust Fund 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 Contracts, with respect to the Manufactured Homes and with
respect to the Mortgaged Property. The Trustee shall furnish the Servicer with
any powers of attorney and other documents necessary or appropriate to enable
the Servicer to service and administer the Contracts. The relationship of the
Servicer (and of any successor to the Servicer as Servicer under this Agreement)
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 of the
Trustee.
Section 4.02 Standard of Care.
----------------
In managing, administering, servicing and making collections on the
Contracts pursuant to this Agreement, the Servicer will, consistent with the
terms of this Agreement and applicable law, act with reasonable care, using that
degree of skill and care that it exercises with respect to similar manufactured
housing contracts owned and/or serviced by it, but in no event using a degree of
skill and care that is lower than that used generally in the servicing industry
for such manufactured housing contracts; provided, however, that notwithstanding
-------- -------
the foregoing, the Servicer shall not release or waive the right to collect the
unpaid balance on any Contract except if default or foreclosure on such Contract
has occurred or in the reasonable judgment of the Servicer is imminent and such
waiver or release is in the best interest of the Trust, in the reasonable
judgement of the Servicer. Notwithstanding anything to the contrary contained
in this Agreement, no provision of this Agreement shall be construed so as to
require the Servicer to take any action or fail to take any action in respect of
a Contract which action or failure violates applicable law.
Section 4.03 Records.
-------
The Servicer, during the period it is Servicer hereunder, shall maintain
such books of account and other records as will enable the Trustee (if the
Trustee so elects in its discretion) to determine the status of each Contract.
Without limiting the generality of the preceding sentence, the Servicer shall
keep such records in respect of Liquidation Expenses as will enable the Trustee
35
<PAGE>
(if the Trustee so elects in its discretion) to determine that the correct
amount of Net Liquidation Proceeds in respect of a Liquidated Contract has been
deposited in the Certificate Account.
Section 4.04 Inspection.
----------
(a) At all times during the term hereof, the Servicer shall afford the
Trustee and its authorized agents reasonable access during normal business hours
to the Servicer's records relating to the Contracts and will cause its personnel
to assist in any examination of such records by the Trustee or any of its
authorized agents. The examination referred to in this Section 4.04 will be
conducted in a manner which does not interfere unreasonably with the Servicer's
normal operations or customer or employee relations. Without otherwise limiting
the scope of the examination which the Trustee may make, the Trustee or its
authorized agents, using generally accepted audit procedures, may in their
discretion verify the status of each Contract and review the records relating
thereto for conformity to Monthly Reports prepared pursuant to Article V and
compliance with the standards represented to exist as to each Contract in this
Agreement.
(b) At all times during the term hereof, the Servicer shall keep available
a copy of the Contract Schedule at its principal executive office for inspection
by Certificate Owners.
Section 4.05 Establishment of and Deposits in Certificate Account.
----------------------------------------------------
On or before the Closing Date, the Trustee shall have established, and
thereafter shall maintain, a Certificate Account, which is an Eligible Account,
in the form of a segregated trust account titled "GreenPoint Manufactured
Housing Contract Trust, Pass-Through Certificates, Series 1999-1, Certificate
Account in trust for the Trustee as trustee for the benefit of the Class A
Certificateholders." As of the Closing Date, the Certificate Account shall be a
segregated trust account established at The First National Bank of Chicago and
shall be invested in the Trustee's Corporate Trust Short-Term Investment Fund
(as long as such fund is an Eligible Investment) or other similar Eligible
Investment selected by the Trustee. Eligible Investments shall mature or, in
the case of a money market fund, be redeemed not later than the Business Day
immediately preceding the Distribution Date next following the date of such
investment (except that, if such Eligible Investment is an obligation of the
institution that maintains the Certificate Account, then such Eligible
Investments shall mature or, in the case of a money market fund, be redeemed not
later than such Distribution Date), and shall not be sold or disposed of prior
to its maturity. All such Eligible Investments shall be made in the name of the
Trustee, as trustee for the benefit of the Certificateholders. Without limiting
the generality of the foregoing, the Trustee shall select obligations for the
investment of the Certificate Account from among the investments specified in
clauses (a) and (b) of the definition of "Eligible Investments." The Trustee
shall select such Eligible Investments, which shall mature as provided above, in
such manner as to achieve the following objectives in the order stated: (1)
preservation of principal values; and (2) maximization of income.
All net income and gain realized from any such investments, to the extent
provided by this Agreement, shall be added to the Certificate Account.
The Servicer shall deposit in the Certificate Account as promptly as
practicable (but not later than the close of business of the second Business
Day) following receipt thereof:
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(1) All amounts received from Obligors with respect to principal of
and interest on the Contracts (including Excess Contract Payments);
(2) All Net Liquidation Proceeds;
(3) All amounts required to be deposited by the Contract Seller
pursuant to Sections 3.05(a) and (b) and;
(4) All Monthly Advances pursuant to Section 5.01;
(5) Any proceeds of Hazard Insurance Policies pursuant to Section
4.11 and any amounts in respect of indemnification pursuant to Section
7.03;
(6) All amounts required to be withdrawn from an REO Account and
deposited in the Certificate Account in accordance with Section 4.17; and
(7) All Deficiency Amounts.
The Trustee shall cause the Insurer to deposit in the Certificate
Account all Enhancement Payments pursuant to Section 5.08.
Section 4.06 Payment of Taxes.
----------------
If the Servicer becomes aware of the nonpayment by an Obligor of a real or
personal property tax or other tax or charge which may result in a lien upon a
Manufactured Home or Mortgaged Property prior to, or equal to or coordinate
with, the lien of the related Contract, the Servicer, consistent with Section
4.02, shall take action, including the payment of such taxes or charges to avoid
the attachment of any such lien. If the Servicer shall have paid any such real
or personal property tax or other tax or charge directly on behalf of an
Obligor, the Servicer shall seek reimbursement therefor only from the related
Obligor (except as provided in the last sentence of this Section 4.06) and may
separately add such amount to the Obligor's obligation as provided by the
Contract, but, for the purposes of this Agreement, may not add such amount to
the remaining principal balance of the Contract. If the Servicer shall have
repossessed a Manufactured Home or Mortgaged Property on behalf of the
Certificateholders and the Trustee, the Servicer shall pay the amount of any
such tax or charge arising during the time such Manufactured Home is in the
Servicer's possession or title to the Mortgaged Property is in the name of the
Servicer (or any Person acting on behalf of the Servicer), unless the Servicer
is contesting in good faith such tax or charge or the validity of the claimed
lien on such Manufactured Home or Mortgaged Property. If the Obligor does not
reimburse the Servicer for payment of such taxes or charges pursuant to this
Section 4.06 and the related Contract is liquidated after a default, the
Servicer shall be reimbursed for its payment of such taxes or charges out of the
related Liquidation Proceeds.
Section 4.07 Enforcement.
-----------
(a) The Servicer, consistent with Section 4.02, shall act with respect to
the Contracts in such manner as will maximize the receipt of principal and
interest on such Contracts.
37
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(b) The Servicer shall sue to enforce or collect upon Contracts and, where
permitted by applicable law, any Deficiency at its own expense, in its own name,
if possible, or as agent for the Trustee in its own name, if possible, or as
agent for the Trust Fund. If the Servicer elects to commence a legal proceeding
to enforce a Contract, the act of commencement shall be deemed to be an
automatic assignment of the Contract to the Servicer for purposes of collection
only. If, however, in any enforcement suit or legal proceeding it is held that
the Servicer may not enforce a Contract on the ground that it is not a real
party in interest or a holder entitled to enforce the Contract, the Trustee on
behalf of the Certificateholders shall, at the Servicer's expense, take such
steps as the Servicer deems necessary to enforce the Contract, including
bringing suit in its name or the names of the Certificateholders. If there has
been a recovery of attorneys' fees in favor of the Servicer or the Trust Fund in
an action involving the enforcement of a Contract, the Servicer shall be
reimbursed out of such recovery for its out-of-pocket attorney's fees and
expenses incurred in such enforcement action.
(c) The Servicer shall exercise any rights of recourse against third
persons that exist with respect to any Contract in accordance with Section 4.02.
In exercising recourse rights, the Servicer is authorized on the Trustee's
behalf to reassign the Contract or to resell the related Manufactured Home and,
if applicable, the Mortgaged Property, to the Person against whom recourse
exists at the price set forth in the document creating the recourse.
(d) The Servicer may grant to the Obligor on any Contract any rebate,
refund or adjustment out of the Certificate Account that is required because of
an overpayment in connection with the partial prepayment or prepayment in full
of the Contract or otherwise. The Servicer may rescind, cancel or make material
modifications of the terms of any Contract (including modifying the amounts and
due dates of scheduled monthly payments); provided that, unless required by
--------
applicable law or to bring Contracts into conformity with the representations
and warranties contained in Article III, the Servicer will not permit any
rescission or cancellation of any Contract or any material modification of a
Contract other than in connection with a default or an imminent default on such
Contract unless the Servicer obtains an Opinion of Counsel to the effect that
such modification will not cause the Trust Fund to fail to qualify as a REMIC or
result in the imposition of taxes on the Trust Fund under the REMIC Provisions.
Notwithstanding the foregoing, the Servicer may, without an Opinion of Counsel,
make a one-time modification to the Contract Rate with respect to any Contract
by an amount equal to the lesser of (i) 5% of such Contract Rate and (ii) 0.50%
provided, however, that the aggregate Scheduled Principal Balance of the
Contracts so modified shall in no event exceed 10% of the Cut-Off Date Pool
Principal Balance.
Section 4.08 Transfer of Certificate Account.
-------------------------------
The Trustee may transfer the Certificate Account to a different depository
institution from time to time, so long as each of the Certificate Account
remains an Eligible Account. The Trustee shall give notice of any transfer of
the Certificate Account to each Rating Agency prior to such transfer.
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Section 4.09 Maintenance of Hazard Insurance Policies.
----------------------------------------
(a) Except as otherwise provided in subsection (b) of this Section 4.09,
the Servicer shall cause to be maintained with respect to each Contract one or
more Hazard Insurance Policies which provide, at a minimum, the same coverage as
a standard form fire and extended coverage insurance policy that is customary
for manufactured housing, issued by a company authorized to issue such policies
in the state in which the Manufactured Home is located, and in an amount which
is not less than the maximum insurable value of such Manufactured Home or the
principal balance of the related Contract, whichever is less; provided that such
--------
Hazard Insurance Policies may provide for customary deductible amounts, and
further provided that the amount of coverage provided by each Hazard Insurance
- ------- --------
Policy shall be sufficient to avoid the application of any co-insurance clause
contained therein. If a Manufactured Home is located within a federally
designated special flood hazard area, the Servicer shall, to the extent required
by applicable law or regulation, also cause flood insurance to be maintained,
which coverage shall be at least equal to the minimum amount specified in the
preceding sentence or such lesser amount as may be available under the federal
flood insurance program. Each Hazard Insurance Policy caused to be maintained by
the Servicer shall contain a standard loss payee clause in favor of the Servicer
and its successors and assigns. If any Obligor is in default in the payment of
premiums on its Hazard Insurance Policy or Policies, the Servicer shall pay such
premiums out of its own funds, and may add separately such premium to the
Obligor's obligation as provided by the Contract, but may not add such premium
to the remaining principal balance of the Contract for purposes of this
Agreement. If the Obligor does not reimburse the Servicer for payment of such
premiums and the related Contract is liquidated after a default, the Servicer
shall be reimbursed for its payment of such premiums out of the related
Liquidation Proceeds.
(b) The Servicer may, in lieu of causing individual Hazard Insurance
Policies to be maintained with respect to each Manufactured Home pursuant to
subsection (a) of this Section 4.09, and shall, to the extent that the related
Contract does not require the Obligor to maintain a Hazard Insurance Policy with
respect to the related Manufactured Home, maintain one or more blanket insurance
policies covering losses as provided in subsection (a) of this Section 4.09
resulting from the absence or insufficiency of individual Hazard Insurance
Policies. Any such blanket policy shall be substantially in the form that is the
industry standard for blanket insurance policies issued to cover Manufactured
Homes and in the amount sufficient to cover all losses on the Contracts. The
Servicer shall pay, out of its own funds, the premium for such policy on the
basis described therein and shall deposit in the Certificate Account, on the
Business Day next preceding the Determination Date following the Collection
Period in which the insurance proceeds from claims in respect of any Contracts
under such blanket policy are or should have been received, the deductible
amount with respect to such claims. The Servicer shall not, however, be required
to deposit any deductible amount with respect to claims under individual Hazard
Insurance Policies maintained pursuant to subsection (a) of this Section 4.09.
(c) If the Servicer shall have repossessed a Manufactured Home on behalf
of the Trustee, the Servicer shall either (i) maintain at its expense a Hazard
Insurance Policy with respect to such Manufactured Home, except that the
Servicer shall be responsible for depositing any deductible amount with respect
to all claims under individual Hazard Insurance Policies, or (ii) indemnify the
Trust Fund against any damage to such Manufactured Home prior to resale or other
disposition that would have been covered by such Hazard Insurance Policy.
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(d) Any cost incurred by the Servicer in maintaining any of the foregoing
insurance, for the purpose of calculating monthly distributions to
Certificateholders, shall not be added to the amount owing under the Contract,
notwithstanding that the terms of the Contract so permit. The Servicer shall not
be entitled to reimbursement from the Contract Seller, the Trustee or the
Certificateholders for such costs. Such costs (other than the cost of the
blanket policy) shall only be recovered out of later payments by the Obligor for
such premiums or, if the related Contract is liquidated after a default, out of
the related Liquidation Proceeds.
Section 4.10 Fidelity Bond and Errors and Omissions Insurance.
------------------------------------------------
The Servicer shall maintain, at its own expense, a blanket fidelity bond
and an errors and omissions insurance policy, with broad coverage with
responsible companies acceptable to FNMA and FHLMC, on all officers, employees
or other persons acting in any capacity with regard to the Contracts to handle
funds, money, documents and papers relating to the Contracts. Any such fidelity
bond and errors and omissions insurance shall protect and insure the Servicer
against losses, including forgery, theft, embezzlement, fraud, errors and
omissions and negligent acts of such persons. No provision of this Section 4.10
requiring such fidelity bond and errors and omissions insurance shall diminish
or relieve the Servicer from its duties and obligations as set forth in this
Agreement. The minimum coverage under any such bond and insurance policy shall
be in an amount as is customary for servicers that service a portfolio of
manufactured housing installment sales contracts of $100 million or more and
that are generally acceptable as servicers to institutional investors. On or
before April 1 of every year, the Servicer shall cause to be delivered to the
Trustee a certified true copy of such fidelity bond and insurance policy and a
statement from the surety and the insurer that such fidelity bond or insurance
policy shall in no event be terminated or materially modified without 30 days'
prior written notice to the Trustee.
Section 4.11 Collections under Hazard Insurance Policies, Consent to
-------------------------------------------------------
Transfers of Manufactured Homes, Assumption Agreements.
- ------------------------------------------------------
(a) In connection with its activities as administrator and Servicer of the
Contracts, the Servicer agrees to present, on behalf of itself, the Trustee and
the Certificateholders, claims to the insurer under any Hazard Insurance
Policies and, in this regard, to take such reasonable action as shall be
necessary to permit recovery under any Hazard Insurance Policies or any blanket
policies obtained pursuant to Section 4.09(b). Any amounts collected by the
Servicer under any such Hazard Insurance Policies shall be deposited in the
Certificate Account pursuant to Section 4.05, except to the extent they are
applied to the restoration of the related Manufactured Home or released to the
related Obligor in accordance with the normal servicing procedures of the
Servicer.
(b) In connection with any transfer of ownership of a Manufactured Home by
an Obligor to a Person, the Servicer shall consent to any such transfer and
permit the assumption by such Person of the Contract related to such
Manufactured Home, provided that (i) such Person, in the judgment of the
--------
Servicer, meets the Servicer's underwriting standards then in effect, (ii) such
Person enters into an assumption agreement, (iii) the Servicer determines that
permitting such assumption by such Person will not materially increase the risk
of nonpayment of such Contract and (iv) such action will not adversely affect or
jeopardize any coverage under any insurance policy required by this Agreement.
In the event the Servicer determines that the conditions of the
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proviso of the preceding sentence have not been fulfilled, then the Servicer
shall withhold its consent to any such transfer, but only to the extent
permitted under the Contract and applicable law and governmental regulations
and only to the extent that such action will not adversely affect or jeopardize
any coverage under any insurance policy required by this Agreement. In
connection with any such assumption, the rate of interest borne by, and all
other material terms of, the related Contract shall not be changed.
(c) In any case in which a Manufactured Home or Mortgaged Property is to
be conveyed to a Person by an Obligor, and such Person is to enter into an
assumption agreement or modification agreement or supplement to the Contract in
accordance with Section 4.11(b) or Section 4.07(d), upon the closing of such
conveyance, the Servicer shall cause the originals of the assumption agreement,
the release (if any), or the modification or supplement to the Contract to be
deposited with the Contract File or the Land Home Contract File, as applicable,
for such Contract. Any fee collected by the Servicer for entering into an
assumption or substitution of liability agreement with respect to such Contract
will be retained by the Servicer as additional servicing compensation.
Section 4.12 Realization upon Defaulted Contracts.
------------------------------------
Subject to applicable law, the Servicer shall repossess, foreclose upon or
otherwise comparably convert the ownership of Manufactured Homes and Mortgaged
Property securing all Contracts that come into default and which the Servicer
believes in its good faith business judgment will not be brought current.
Subject to Section 4.17, the Servicer shall manage, conserve and protect such
Manufactured Homes and Mortgaged Property for the purposes of their prompt
disposition and sale, and shall dispose of such Manufactured Homes and Mortgaged
Property on such terms and conditions as it deems in the best interests of the
Certificateholders. If the Servicer has actual knowledge that a Mortgaged
Property is affected by hazardous waste, then the Servicer shall not cause the
Contract Seller to acquire title to such Mortgaged Property in a foreclosure or
similar proceeding. For purposes of the proviso in the preceding sentence, the
Servicer shall not be deemed to have actual knowledge that a Mortgaged Property
is affected by hazardous waste unless it shall have received written notice that
hazardous waste is present on such property and such written notice has been
made a part of the Land Home Contract File with respect to the related Contract.
In connection with such activities, the Servicer shall follow such practices and
procedures as are consistent with Section 4.02.
Section 4.13 Costs and Expenses.
------------------
Except as otherwise expressly provided herein, all costs and expenses
incurred by the Servicer in carrying out its duties under this Agreement,
including all fees and expenses incurred in connection with the enforcement of
Contracts (including enforcement of defaulted Contracts and repossessions of
Manufactured Homes and Mortgaged Property securing such Contracts), shall be
paid by the Servicer, and the Servicer shall not be entitled to reimbursement
hereunder, except to the extent such reimbursement is specifically provided for
in this Agreement. Notwithstanding the foregoing, the Servicer shall be
reimbursed out of the Liquidation Proceeds of a defaulted Contract for
Liquidation Expenses incurred by it in realizing upon the related Manufactured
Home and Mortgaged Property, including, but not limited to: (i) costs of
refurbishing and securing such Manufactured Home; (ii) transportation expenses
incurred in
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moving the Manufactured Home; (iii) reasonable legal fees and expenses of
outside counsel; and (iv) sales commissions paid to Persons that are not
Affiliates of the Servicer. The Servicer shall not incur any Liquidation
Expenses unless it determines in its good faith business judgment that incurring
such expenses will increase the Net Liquidation Proceeds from such Manufactured
Home and Mortgaged Property.
Section 4.14 Trustee to Cooperate.
--------------------
(a) Upon payment in full of any Contract, the Servicer will notify the
Trustee on the next Distribution Date by a certificate of a Servicing Officer
(which certification shall include a statement to the effect that all amounts
received or to be received in connection with such payment which are required to
be deposited in the Certificate Account pursuant to Section 4.05 have been
deposited). The Servicer is authorized to execute an instrument in satisfaction
of such Contract and to do such other acts and execute such other documents as
the Servicer deems necessary to discharge the Obligor thereunder and eliminate
the security interest in the Manufactured Home. The Servicer shall determine
when a Contract has been paid in full. To the extent insufficient payments are
received on a Contract mistakenly determined by the Servicer to be prepaid or
paid in full and satisfied, the shortfall shall be paid by the Servicer out of
its own funds by deposit into the Certificate Account.
(b) From time to time as appropriate for servicing and foreclosure in
connection with any Land Home Contract, the Trustee shall, upon written request
of a Servicing Officer and delivery to the Trustee of a receipt signed by such
Servicing Officer, cause the original Land Home Contract and the related Land
Home Contract File to be released to the Servicer and shall execute such
documents as the Servicer shall deem necessary to the prosecution of any such
proceedings. The Trustee shall stamp the face of each such Land Home Contract to
be released to the Servicer with a notation that the Land Home Contract has been
assigned to the Trustee.
(c) The Servicer's receipt of a Land Home Contract and/or Land Home
Contract File shall obligate the Servicer to return the original Land Home
Contract and the related Land Home Contract File to the Trustee, or any person
acting on behalf of the Trustee, when its need by the Servicer has ceased unless
the Contract shall be liquidated, repurchased or replaced as described in
Section 3.05.
(d) Upon request of a Servicing Officer, the Trustee shall, at the expense
of the Servicer, perform such acts as are reasonably requested by the Servicer
(including the execution of documents) and otherwise cooperate with the Servicer
in the enforcement of rights and remedies with respect to Contracts.
Section 4.15 Servicing and Other Compensation.
--------------------------------
The Servicer, as compensation for its activities hereunder including the
payment of fees and expenses of the Trustee, the Certificate Administrator and
the Paying Agent pursuant to Section 9.05, shall be entitled to receive on each
Distribution Date the Monthly Servicing Fee and Repossession Profits pursuant to
Section 5.03.
Additional servicing compensation in the form of Late Payment Fees or
Extension Fees and any transfer of equity or assumption fees shall be retained
by the Servicer. The Servicer
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shall not be reimbursed for its costs and expenses in servicing the Contracts
except as otherwise expressly provided herein.
No transfer, sale pledge or other disposition of the Servicer's right to
receive all or any portion of the Monthly Servicing Fee shall be made, and any
such attempted transfer, sale, pledge or other disposition shall be void, unless
such transfer is made to a successor Servicer in connection with the assumption
by such successor Servicer of the duties hereunder pursuant to Section 7.07 and
all (and not a portion) of the Monthly Servicing Fee is transferred to such
successor Servicer.
Section 4.16 Custody of Contracts.
--------------------
(a) Subject to the terms and conditions of this Section 4.16, the Servicer
agrees to act as custodian of the Contract Files (other than the Land Home
Contract Files) for the benefit of the Certificateholders and the Trust Fund.
The Certificateholders by their acceptance of the Certificates, consent to the
Servicer acting as custodian, and the Servicer agrees to maintain the Contract
Files (other than the Land Home Contract Files) as custodian therefor.
(b) The Servicer agrees to maintain the related Contract Files (other than
the Land Home Contract Files) at its offices where they are presently
maintained, or at such other offices of the Servicer in the State of California
as shall from time to time be identified to the Trustee by ten days' prior
written notice. The Servicer may temporarily move individual Contract Files,
Land Home Contract Files or, in each case, any portion thereof without notice as
necessary to conduct collection and other servicing activities in accordance
with its customary practices and procedures.
(c) As custodian, the Servicer shall have and perform the following powers
and duties:
(i) hold the Contract Files (other than the Land Home Contract
Files) on behalf of the Certificateholders and the Trustee, maintain
accurate records pertaining to each Contract to enable it to comply with
the terms and conditions of this Agreement, maintain a current inventory
thereof and conduct annual physical inspections of Contract Files held by
it under this Agreement;
(ii) implement policies and procedures in writing and signed by a
Servicing Officer, with respect to persons authorized to have access to the
Contract Files on the Servicer's premises and the receipting for Contract
Files taken from their storage area by an employee of the Servicer for
purposes of servicing or any other purposes; and
(iii) attend to all details in connection with maintaining custody of
the Contract Files on behalf of the Certificateholders and the Trustee.
(d) In performing its duties under this Section 4.16, the Servicer agrees
to act in accordance with the standard of care set forth in Section 4.02. The
Servicer shall promptly report to the Trustee any failure by it to hold the
Contract Files as herein provided, and shall promptly take appropriate action to
remedy any such failure. In acting as custodian of the Contract Files, the
Servicer further agrees not to assert any beneficial ownership interests in the
Contracts, or the
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Contract Files. The Servicer agrees to indemnify the Certificateholders and the
Trustee for any and all liabilities, obligations, losses, damages, payments,
costs or expenses of any kind whatsoever which may be imposed on, incurred or
asserted against the Certificateholders and the Trustee as the result of any act
or omission by the Servicer relating to the maintenance and custody of the
Contract Files; provided, however, that the Servicer will not be liable for any
-------- -------
portion of any such amount resulting from the negligence or willful misconduct
of any other Person.
(e) Not later than 60 days from the Closing Date, the Contract Seller
shall deliver, or cause to be delivered, to the Trustee the following:
(i) the Land Home Contract Files;
(ii) the original Land Home Contract endorsed as provided in Section
3.02(x) (which endorsement may be manual or facsimile signature) on behalf
of the Contract Seller; and
(iii) an Assignment from GCC (on behalf of the Contract Seller) to the
Trustee, which Assignment shall be in form and substance for recording, but
shall not be recorded except as required by Section 4.22 below;
Notwithstanding anything to the contrary contained in this Section 4.16(e), in
those instances where the public recording office retains the original Mortgage,
the Assignment of the Mortgage or the intervening Assignments of the Mortgage
after it has been recorded, the Contract Seller shall be deemed to have
satisfied its obligations hereunder upon delivery to the Trustee of a copy of
such Mortgage, such Assignment or Assignments of Mortgage certified by the
public recording office to be a true copy of the recorded original thereof.
Within 90 days following the Closing Date, the Trustee shall review each
Land Home Contract File to determine that all required documents set forth in
each item of the first paragraph of this Section 4.16(e) have been executed and
received and that such documents relate to the Land Home Contracts identified on
the Contract Schedule. For purposes of this determination, the Trustee may rely
on the purported due execution and genuineness of any signature thereon. If
within such 90 day period the Trustee finds that any document constituting a
part of a Land Home Contract File was not executed, defective or received or is
unrelated to the Land Home Contracts identified in the Contract Schedule (in
this Section 4.16(e), a "defect"), the Trustee shall promptly upon the
conclusion of its review notify the Servicer and the Servicer shall notify the
Contract Seller. The Contract Seller shall have a period of 90 days from
receipt of such notice within which to correct or cure any such defect after the
Contract Seller has been notified of such. If the Contract Seller cannot
correct or cure any such defect with respect to a Land Home Contract within such
90 day period, it shall comply with the provisions of Section 3.05 hereof.
If recordation of any Assignment is required hereunder, the original of
each such recorded Assignment shall be delivered to the Trustee within 10 days
following the date on which it is returned to the Contract Seller by the office
with which such Assignment was filed for
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recordation. Upon receipt by the Trustee of the recorded Assignment, such
recorded Assignment shall become part of the Land Home Contract File.
(f) Custodial Arrangements. The Trustee may appoint a custodian who is
----------------------
acceptable to the Servicer and the Contract Seller and who, upon execution of a
custodial agreement, shall maintain possession of the Land Home Contract Files,
together with assignments in recordable form, to the Trustee or another
custodian designated by the Trustee, and the Trustee agrees that upon such
delivery it shall maintain, or cause such custodian to maintain, or such part of
them as the Trustee shall direct, as agent of the Trustee pursuant to the terms
of such custodial agreement. The appointment of such custodian shall not relieve
the Trustee of its obligations hereunder. The Trustee will notify the Rating
Agencies upon the appointment of any custodian.
The Trustee shall keep the Servicer apprised at all times after the Closing
Date of the location of the Land Home Contract Files. The Trustee shall take
all steps that are reasonably necessary or appropriate in order to facilitate
the Servicer's access to the Land Home Contract Files during normal business
hours of the Trustee or any custodian and shall cooperate fully with the
Servicer in securing such access.
Section 4.17 REMIC Compliance.
----------------
(a) The REMIC Administrator shall make an election to treat the Trust Fund
as a REMIC under the Code and, if necessary, under applicable state law. Such
election will be made on Form 1066 or other appropriate federal tax or
information return (including Form 8811) or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the
Certificates are issued. For the purposes of the REMIC election in respect of
the Trust Fund, each of the Class A Certificates shall be designated as the
"regular interests" and the Class R Certificates shall be designated as the sole
class of "residual interests" in the REMIC. The REMIC Administrator and the
Trustee shall not permit the creation of any "interests" (within the meaning of
Section 860G of the Code) in the REMIC other than the Certificates.
(b) The Closing Date is hereby designated as the "startup day" (the
"Startup Date") of the Trust Fund within the meaning of Section 860G(a)(9) of
the Code.
(c) The REMIC Administrator shall at all times hold a Class R Certificate
representing a 0.01% Percentage Interest of all Class R Certificates and shall
be designated as "the tax matters person" with respect to the REMIC in the
manner provided under Treasury regulations section 1.860F-4(d) and temporary
Treasury regulations section 301.6231(a)(7)-1T. The REMIC Administrator, as tax
matters person, shall (i) act on behalf of the REMIC in relation to any tax
matter or controversy involving the Trust Fund and (ii) represent the Trust Fund
in any administrative or judicial proceeding relating to an examination or audit
by any governmental taxing authority with respect thereto. The legal expenses,
including without limitation attorneys' or accountants' fees, and costs of any
such proceeding and any liability resulting therefrom shall be expenses of the
Trust Fund and the REMIC Administrator shall be entitled to reimbursement
therefor out of amounts attributable to the Contracts on deposit in the
Certificate Account provided by Section 5.03 unless such legal expenses and
costs are incurred by reason of the Servicer's willful misfeasance, bad faith or
gross negligence. If the REMIC Administrator is no longer the Servicer
hereunder, at its option the REMIC Administrator may
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continue its duties as tax matters person and shall be paid reasonable
compensation not to exceed $3,000 per year by any successor Servicer hereunder
for so acting as the REMIC Administrator.
(d) The REMIC Administrator shall prepare or cause to be prepared all of
the tax returns that it determines are required with respect to the REMIC
created hereunder and deliver such tax returns in a timely manner to the Trustee
and the Trustee shall sign and file such tax returns in a timely manner. The
expenses of preparing such returns shall be borne by the REMIC Administrator
without any right of reimbursement therefor. The REMIC Administrator agrees to
indemnify and hold harmless the Trustee with respect to any tax liability
arising from the Trustee's signing of tax returns that contain errors or
omissions. The Trustee and Servicer shall promptly provide the REMIC
Administrator with such information as the REMIC Administrator may from time to
time request for the purpose of enabling the REMIC Administrator to prepare tax
returns.
(e) The REMIC Administrator shall provide (i) to any transferor of a Class
R Certificate such information as is necessary for the application of any tax
relating to the transfer of a Class R Certificate to any Person who is not a
Permitted Transferee, (ii) to the Trustee and the Trustee shall forward to the
Certificateholders such information or reports as are required by the Code or
the REMIC Provisions including reports relating to interest, original issue
discount and market discount or premium (using the Prepayment Assumption) and
(iii) to the Internal Revenue Service the name, title, address and telephone
number of the person who will serve as the representative of the REMIC.
(f) The REMIC Administrator and the Servicer shall take such actions and
shall cause the REMIC created hereunder to take such actions as are reasonably
within the REMIC Administrator's or the Servicer's control and the scope of its
duties more specifically set forth herein as shall be necessary or desirable to
maintain the status thereof as a REMIC under the REMIC Provisions (and the
Trustee shall assist the Servicer and the REMIC Administrator, to the extent
reasonably requested by the Servicer and the REMIC Administrator to do so). The
REMIC Administrator and the Servicer shall not knowingly or intentionally take
any action, cause the Trust Fund to take any action or fail to take (or fail to
cause to be taken) any action reasonably within their respective control that,
under the REMIC Provisions, if taken or not taken, as the case may be, could (i)
endanger the status of the REMIC as a REMIC or (ii) result in the imposition of
a tax upon the REMIC (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC set forth in Section 860(G)(d) of the Code) (either
such event, in the absence of an Opinion of Counsel or the indemnification
referred to in this sentence, an "Adverse REMIC Event") unless the REMIC
Administrator or the Servicer, as applicable, has received an Opinion of Counsel
(at the expense of the party seeking to take such action or, if such party fails
to pay such expense, and the REMIC Administrator or the Servicer, as applicable,
determines that taking such action is in the best interest of the Trust Fund and
the Certificateholders, at the expense of the Trust Fund, but in no event at the
expense of the REMIC Administrator, the Contract Seller, the Servicer or the
Trustee) to the effect that the contemplated action will not, with respect to
the REMIC created hereunder, endanger such status or, unless the REMIC
Administrator, the Servicer or both, as applicable, determine in its or their
sole discretion to indemnify the Trust Fund against the imposition of such a
tax, result in the imposition of such a tax. Wherever in this Agreement a
contemplated action may not be taken because the timing of
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such action might result in the imposition of a tax on the Trust Fund, or may
only be taken pursuant to an Opinion of Counsel that such action would not
impose a tax on the Trust Fund, such action may nonetheless be taken provided
that the indemnity given in the preceding sentence with respect to any taxes
that might be imposed on the Trust Fund has been given and that all other
preconditions to the taking of such action have been satisfied. The Trustee
shall not take or fail to take any action (whether or not authorized hereunder)
as to which the REMIC Administrator or the Servicer, as applicable, has advised
it in writing that it has received an Opinion of Counsel to the effect that an
Adverse REMIC Event could occur with respect to such action. In addition, prior
to taking any action with respect to the REMIC or its assets, or causing the
REMIC to take any action, which is not expressly permitted under the terms of
this Agreement, the Trustee will consult with the REMIC Administrator or the
Servicer, as applicable, or its designee, in writing, with respect to whether
such action could cause an Adverse REMIC Event to occur with respect to the
REMIC, and the Trustee shall not take any such action or cause the REMIC to take
any such action as to which the REMIC Administrator or the Servicer, as
applicable, has advised it in writing that an Adverse REMIC Event could occur.
The REMIC Administrator or the Servicer, as applicable, may consult with counsel
to make such written advice, and the cost of same shall be borne by the party
seeking to take the action not expressly permitted by this Agreement, but in no
event at the expense of the REMIC Administrator or the Servicer. At all times as
may be required by the Code, the Servicer will to the extent within its control
and the scope of its duties more specifically set forth herein, maintain
substantially all of the assets of the REMIC as "qualified mortgages" as defined
in Section 860G(a)(3) of the Code and "permitted investments" as defined in
Section 860G(a)(5) of the Code.
(g) In the event that any tax, including interest, penalties, additional
amounts or additions to tax (a "Tax"), is imposed on the Trust Fund, such Tax
shall be charged against amounts otherwise required to be distributed to the
Holders of the Class R Certificates. The Trustee is hereby authorized to retain,
or cause the Paying Agent to retain, from amounts otherwise required to be
distributed to the Holders of the Class R Certificates sufficient funds to pay
or provide for the payment of, and to actually pay, or cause the Paying Agent to
pay, such Tax as is legally owed by the Trust Fund (but such authorization shall
not prevent the Servicer from contesting any such Tax in appropriate
proceedings, and withholding payment of such Tax, if permitted by law, pending
the outcome of such proceedings). To the extent that sufficient amounts cannot
be so retained to pay or provide for the payment of any tax imposed on gain
realized from any prohibited transaction (as defined in the REMIC Provisions),
the Trustee is hereby authorized to and shall segregate, into a separate non-
interest-bearing account, the net income from such prohibited transactions and
pay, or cause the Paying Agent to pay, such Tax. In the event any (i) amounts
initially retained from amounts required to be distributed to the Holders of the
Class R Certificates and (ii) income so segregated and applied towards the
payment of such Tax shall not be sufficient to pay such Tax in its entirety, the
amount of the shortfall shall be paid from funds in the Certificate Account
notwithstanding anything to the contrary contained herein. To the extent any
such segregated income or funds from the Certificate Account are paid to the
Internal Revenue Service, the Trustee shall retain, or cause to be retained, an
amount equal to the amount of such income or funds so paid from future amounts
otherwise required to be distributed to the Holders of the Class R Certificates
and shall deposit
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such retained amounts in the Certificate Account for distribution to the Holders
of the Regular Certificates.
(h) The Trustee and the Servicer shall, for federal income tax purposes,
maintain books and records with respect to the REMIC on a calendar year and on
an accrual basis or as otherwise may be required by the REMIC Provisions.
(i) Following the Startup Day, neither the Servicer nor the Trustee shall
accept any contributions of assets to the REMIC unless (subject to Section
4.17(f)) the Servicer and the Trustee shall have received an Opinion of Counsel
(at the expense of the party seeking to make such contributions) to the effect
that the inclusion of such assets in the REMIC will not cause the REMIC to fail
to qualify as a REMIC at any time that any Certificates are outstanding or
subject the REMIC to any tax under the REMIC Provisions or other applicable
provisions of federal, state and local law or ordinances.
(j) Neither the Servicer nor the Trustee shall (subject to Section
4.17(f)) enter into any arrangement by which the REMIC will receive a fee or
other compensation for services nor permit the REMIC to receive any income from
assets other than "qualified mortgages" as defined in Section 860G(a)(3) of the
Code or "permitted investments" as defined in Section 860G(a)(5) of the Code.
(k) Solely for the purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
Regulations, the "latest possible maturity date" by which the Certificate
Balance of each Class of Certificates representing a regular interest in the
REMIC would be reduced to zero is March 2029, which is the Distribution Date
immediately following the latest scheduled maturity of any Contract.
(l) Within 30 days after the Closing Date, the REMIC Administrator shall
prepare and file with the Internal Revenue Service Form 8811, "Information
Return for Real Estate Mortgage Investment Conduits (REMIC) and Issuers of
Collateralized Debt Obligations" for the REMIC.
(m) Neither the Trustee nor the Servicer shall sell, dispose of or
substitute for any of the Contracts (except in connection with (i) the default,
imminent default or foreclosure of a Contract, including but not limited to, the
acquisition or sale of a Manufactured Home or a Mortgaged Property acquired by
deed in lieu of foreclosure, (ii) the bankruptcy of the REMIC, (iii) the
termination of the REMIC pursuant to Article X of this Agreement or (iv) a
purchase of Contracts pursuant to Article III of this Agreement) nor acquire any
assets for the REMIC, nor sell or dispose of any investments in the Certificate
Account for gain nor accept any contributions to the REMIC after the Closing
Date unless it has received an Opinion of Counsel that such sale, disposition,
substitution or acquisition will not (a) affect adversely the status of the
REMIC as a REMIC or (b) unless the Servicer has determined in its sole
discretion to indemnify the Trust Fund against such tax, cause the REMIC to be
subject to a tax on "prohibited transactions" or "contributions" pursuant to the
REMIC Provisions.
(n) Each Holder of a Class R Certificate, by purchasing such Class R
Certificate, agrees to give the Servicer written notice that it is a "pass-
through interest holder" within the meaning of Temporary Treasury Regulations
Section 1.67-3T(a)(2)(i)(A) immediately upon
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becoming the Holder of such Class R Certificate, if it is, or is holding such
Class R Certificate on behalf of, a "pass-through interest holder." The Special
Account and amounts distributed thereto pursuant to Section 5.02(a) hereof shall
not be an asset of the REMIC or the Trust Fund. The Class R Certificateholder
shall be the owner of the Special Account for federal income tax purposes and
shall be responsible for all taxes payable with respect to distributions
thereto.
(o) In the event that any Manufactured Home or Mortgaged Property is
acquired in a repossession (an "REO Property"), the Servicer shall sell any REO
Property within three years of its acquisition by the Trust Fund, unless (i) at
least 60 days before such three-year period would otherwise expire, the Servicer
applies for an extension of such three-year period pursuant to Sections
856(e)(3) and 860G(a)(8)(A) of the Code, in which case the Servicer shall sell
such REO Property within the applicable extension period or (ii) at the request
of the Servicer, the Trustee seeks, and subsequently receives, an Opinion of
Counsel, addressed to the Trustee and the Servicer, to the effect that the
holding by the Trust Fund of such REO Property subsequent to three years after
its acquisition will not result in the imposition of taxes on "prohibited
transactions" of the Trust Fund as defined in Section 860F of the Code or cause
the Trust Fund to fail to qualify as a REMIC at any time that any Certificates
are outstanding. The Servicer shall manage, conserve, protect and operate each
REO Property solely for the purpose of its prompt disposition and sale in a
manner that does not cause any 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 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 property" which is subject to taxation under the REMIC Provisions.
In connection with its efforts to sell such REO Property, the Servicer shall
either itself or through an agent selected by the Servicer protect and conserve
such REO Property in the same manner and to such extent as is customary in the
locality where such REO Property is located and may, incident to its
conservation and protection of the interests of the Certificateholders, rent the
same, or any part thereof, as the Servicer deems to be in the best interest of
the Servicer and the Certificateholders for the period prior to the sale of such
REO Property.
(p) The Servicer shall segregate and hold all funds collected and received
in connection with the operation of any REO Property separate and apart from its
own funds and general assets and shall establish and maintain with respect to
each REO Property an account held in trust for the Trustee for the benefit of
the Certificateholders (each, an "REO Account"), which shall be an Eligible
Account and the funds therein shall be invested in Eligible Investments that
will mature not later than the Business Day preceding the applicable
Determination Date. The Servicer shall be entitled to retain or withdraw any
interest income paid on funds deposited in each REO Account by the depository.
(q) The Servicer shall deposit, or cause to be deposited, on a daily basis
in each REO Account all revenues received with respect to operation of the
related REO Property and shall withdraw therefrom funds necessary for the proper
operation, management and maintenance of the REO Property. On or before each
Determination Date, the Servicer shall withdraw from each REO Account and
deliver to the Trustee for deposit into the Certificate Account the income from
the REO Property on deposit in the REO Account, net of its reasonable fees and
expenses.
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(r) The disposition of REO Property shall be carried out by the Servicer
at such price and upon such terms and conditions as the Servicer shall deem
necessary or advisable, as shall be normal and usual in its general servicing
activities.
(s) The proceeds from the disposition of any REO Property, net of any
reimbursement to the Servicer as provided above, shall be deposited in the REO
Account and shall be deposited in the Certificate Account when the related
Contract becomes a Liquidated Contract.
Section 4.18 Management of REO Property.
--------------------------
(a) If the Trustee acquires any REO Property pursuant to Section 4.17, 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 the manner in which the Servicer
manages and operates similar property owned by the Servicer or any of its
Affiliates, all on such terms and for such period as the Servicer deems to be in
the best interests of Certificateholders, and, consistent therewith, shall
withdraw from the REO Account, to the extent of amounts on deposit therein with
respect to such REO Property, funds necessary for the proper operation,
management and maintenance of such REO Property, including:
(i) all insurance premiums due and payable in respect to such REO
Property;
(ii) all real estate taxes and assessments in respect to such REO
Property that may result in the imposition of a lien thereon; and
(iii) all costs and expenses necessary to maintain such REO Property.
To the extent that amounts on deposit in the REO Account in respect of any
REO Property are insufficient for the purposes set forth in (i)-(iii) above with
respect to such REO Property, the Servicer shall advance from its own funds such
amount as is necessary for such purposes if, but only if, the Servicer would
make such advances if the Servicer owned such REO Property and if in the
Servicer's judgment, the payment of such amounts will be recoverable from the
operation or sale of such REO Property.
(b) Notwithstanding the foregoing, the Servicer shall not:
(i) authorize or permit any construction on any REO Property, other
than the completion of a building or other improvement thereon, and then
only if more than ten percent of the construction of such building or other
improvement was completed before default on the related Contract became
imminent, all within the meaning of Section 856(e)(4)(B) of the Code; or
(ii) directly operate, or allow any other Person to directly
operate, any REO Property on any date more than 90 days after its date of
acquisition;
unless, in any such case, the Servicer has requested and received an Opinion of
Counsel to the effect that such action will not cause such REO Property to fail
to qualify as "foreclosure property" within the meaning of Section 860G(a)(8) of
the Code at any time that it is held by the
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Trust Fund, in which case the Servicer may take such actions as are specified in
such Opinion of Counsel.
(c) The Servicer may contract with any Independent Contractor for the
operation and management of any REO Property, provided that:
(i) the terms and conditions of any such contract may not be
inconsistent herewith;
(ii) any such contract shall require, or shall be administered to
require, that (A) the Independent Contractor pay all costs and expenses
incurred in connection with the operation and management of such REO
Property, including those listed in subsection (a) hereof, (B) hold all
related revenues in a segregated account, which shall be an Eligible
Account, and (C) remit all related revenues collected (net of such costs
and expenses and any fees retained by such Independent Contractor) to the
Servicer on a monthly or more frequent basis;
(iii) none of the provisions of this Section 4.18(c) relating to any
such contract or to actions taken through any such Independent Contractor
shall be deemed to relieve the Servicer of any of its duties and
obligations to the Trustee on behalf of Certificateholders with respect to
the operation and management of any such REO Property; and
(iv) the Servicer shall be obligated with respect thereto to the same
extent as if it alone were performing all duties and obligations in
connection with the operation and management of such REO Property.
The Servicer shall be entitled to enter into any agreement with any
Independent Contractor performing services for it related to its duties and
obligations hereunder for indemnification of the Servicer by such Independent
Contractor, and nothing in this Agreement shall be deemed to limit or modify
such indemnification. The Servicer shall be entitled to pay all fees owed to
any such Independent Contractor out of the REO Account pursuant to Section 4.17.
(d) Subject to Section 4.18(b), the Servicer shall itself be entitled to
operate and manage any foreclosure property and, in such event, shall be
entitled to pay itself a monthly management fee in accordance with Section 4.17;
provided that the amount of such management fee shall not exceed the amount
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customarily charged for the operation and management of similar property in the
locality of such REO Property by property managers other than the Servicer or
its Affiliates.
Section 4.19 Reports to the Securities and Exchange Commission.
-------------------------------------------------
The Servicer shall use reasonable efforts to assist the Contract Seller in
obtaining any information maintained by it in the ordinary course of performing
its duties hereunder that is necessary for the Contract Seller, on behalf of the
Trust Fund, to cause to be filed with the Securities and Exchange Commission any
periodic reports required to be filed under the provisions of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission thereunder.
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Section 4.20 Annual Statement as to Compliance.
---------------------------------
The Servicer will deliver to the Contract Seller, the Trustee and each
Rating Agency on or before April 1 of each year, commencing in 2000, an
Officer's Certificate (i) stating that a review of the activities of the
Servicer during the preceding calendar year and of performance under this
Agreement has been made under such officer's supervision, and (ii) stating that
to the best of such officer's knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement throughout such year, or, if
there has been a default in the fulfillment of any such obligation, specifying
each such default known to such officer and the nature and status thereof.
Section 4.21 Annual Independent Public Accountants' Servicing Report.
-------------------------------------------------------
On or before April 1 of each year, commencing in 2000, the Servicer, at its
expense, shall cause a firm of independent public accountants which is a member
of the American Institute of Certified Public Accountants to furnish a statement
to the Contract Seller, the Trustee and each Rating Agency to the effect that
such firm has examined certain documents and records relating to the servicing
of the Contracts under this Agreement and, at the option of the Servicer,
manufactured housing installment sale contracts and installment loan agreements
under pooling and servicing agreements substantially similar to this Agreement
with regard to servicing procedures (such statement to have attached thereto a
schedule setting forth the pooling and servicing agreements covered thereby,
including this Agreement) and that, on the basis of such examination conducted
substantially in compliance with this Agreement or such agreements, as the case
may be, and generally accepted auditing standards, such servicing has been
conducted substantially in compliance with this Agreement or such pooling and
servicing agreements, as the case may be, except for such exceptions as such
firm believes to be immaterial and such other exceptions or errors in records
that may be set forth in such statement. For purposes of such statement, such
firm may assume conclusively that all pooling and servicing agreements among the
Contract Seller, the Servicer and the Trustee relating to certificates
evidencing an interest in actuarial and/or simple interest manufactured housing
contracts are substantially similar to one another, except for any such pooling
and servicing agreement which by its terms specifically states otherwise.
Section 4.22 Retitling of Land Home Contracts.
--------------------------------
If the Contract Seller or the Servicer receives actual notice or knowledge
that GreenPoint Bank, the parent of the Contract Seller, is no longer assigned a
long-term senior debt rating from Moody's of Baa3 or higher, of BBB- or higher
from S&P, the Servicer shall promptly provide notice to the Trustee that
GreenPoint Bank no longer has such rating. If at any time during the term of
this Agreement the Trustee receives written notice from the Servicer or the
Contract Seller that GreenPoint Bank does not have a long-term senior debt
rating from Moody's of Baa3 or higher, of BBB- or higher from S&P, or if the
Trustee otherwise becomes aware that the Contract Seller is no longer assigned
such rating, the Trustee, at the Contract Seller's expense, shall file promptly
in the appropriate recording offices the assignments to the Trustee on behalf of
the Trust Fund of each Mortgage securing a Land Home Contract sold by the
Contract Seller to the Trust Fund.
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Section 4.23 Notice of Rating Change.
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In the event that the Class A-2 Certificates are not rated "AAA" by
S&P and "Aaa" by Moody's, respectively, on the Closing Date, the Servicer shall
give written notice to the Auction Agent of the initial ratings on the Class A-2
Certificates by S&P and Moody's substantially in the form of the Notice of
Ratings. If there is a change in any of the ratings of the Certificates at any
time, the Servicer shall give written notice to the Auction Agent or if the
Class A-2 Certificates are no longer maintained in Book-Entry Form by the
Depository, to the Trustee, substantially in the form of the Notice of Ratings
within three (3) Business Days of its receipt of notice of such change, but not
later than the close of business on the Business Day immediately preceding an
Auction Date if the Servicer has received written notice of such change in a
rating or ratings prior to 12:00 noon on such Business Day, and the Auction
Agent or the Trustee, as applicable, shall take into account such change in
rating or ratings for purposes hereof and any Auction, so long as such Notice of
Ratings is received by the Auction Agent or Trustee no later than the close of
business on such Business Day.
ARTICLE V
PAYMENTS, MONTHLY ADVANCES AND MONTHLY REPORTS
Section 5.01 Monthly Advances by the Servicer.
--------------------------------
(a) By the close of business on the day prior to each Distribution Date,
the Servicer shall (i) cause to be deposited, out of its own funds, in the
Certificate Account the Monthly Advance for the related Distribution Date, (ii)
direct the Trustee to apply all or a portion of the Excess Contract Payments in
the Certificate Account to make such Monthly Advance, or (iii) do any
combination of clauses (i) and (ii) to make such Monthly Advance. To the extent
that an Excess Contract Payment (or any portion thereof) that has been applied
pursuant to clause (ii) or (iii) is required for application as to all or a
portion of a scheduled payment due on the related Contract, the Servicer shall
deposit, out of its own funds, the amount of such Excess Contract Payment (or
the portion thereof required for such scheduled payment) into the Certificate
Account on the immediately succeeding Due Date, and the amount so deposited will
become part of the Outstanding Amount Advanced.
(b) The Servicer shall reimburse itself for the Outstanding Amount
Advanced out of (i) collections of delinquent payments of principal and interest
on Contracts as to which the Servicer previously made a Monthly Advance, (ii)
available funds in the Certificate Account attributable to Excess Contract
Payments or (iii) any combination of clauses (i) and (ii) above.
(c) If the Servicer determines that any advance made pursuant to Section
5.01(a) has become a Nonrecoverable Advance and at the time of such
determination there exists an Outstanding Amount Advanced, then the Servicer
shall reimburse itself out of funds in the Certificate Account for the amount of
such Nonrecoverable Advance for the next succeeding Distribution Date) by
withdrawing such amount pursuant to Section 5.03(v), but not in excess of such
Outstanding Amount Advanced. If a Contract becomes a Liquidated Contract and at
such time there exists an Outstanding Amount Advanced, then the Servicer shall
reimburse itself out of funds in the Certificate Account for the portion of
Monthly Advances equal to the aggregate of
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delinquent scheduled payments on such Contract to the Due Date in the Collection
Period in which such Contract became a Liquidated Contract, but not in excess of
such Outstanding Amount Advanced.
Section 5.02 Payments.
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(a) On each Distribution Date, the Trustee shall withdraw from the
Certificate Account an amount equal to the sum of the Available Distribution
Amount and the Enhancement Payment, if any, and apply such amount, in the
following order of priority, to the distribution of:
(i) to the Class A-1 Certificateholders and the Class A-2
Certificateholders, the Class A-1 Interest Distribution Amount and the
Class A-2 Interest Distribution Amount, respectively; provided that if the
--------
Available Distribution Amount, together with any Enhancement Payment, is
insufficient to make the full distributions of interest referred to in this
clause (i), the Available Distribution Amount, together with the
Enhancement Payment, shall be distributed on such Classes of Certificates
pro rata based on such full amounts allocable to such Classes;
(ii) to the Class A Certificateholders, the Formula Principal
Distribution Amount (less, with respect to the Class A-2
Certificateholders, the Class A-2 Holdover Amount for such Distribution
Date) in the following order of priority:
(a) to the Class A-1 Certificateholders until the Class A-1
Certificate Balance is reduced to zero; and
(b) to the Class A-2 Certificateholders until the Class A-2
Certificate Balance is reduced to zero;
(iii) to the Special Account, the Special Account Deposit Amount
required to be deposited therein pursuant to the Insurance Agreement;
(iv) to the Class A-1 Certificateholders and the Class A-2
Certificateholders, the Class A-1 Net Funds Cap Carryover Amount and Class
A-2 Net Funds Cap Carryover Account, respectively, provided that if the
--------
Available Distribution Amount is insufficient to make the full
distributions of the Net Funds Cap Carryover Amounts referred to in this
clause (iv), the Available Distribution Amount shall be distributed on such
Classes of Certificates pro rata based on such full amounts allocable to
such Classes;
(v) to the Auction Agent, certain amounts that may be required to be
paid pursuant to the Auction Agent Agreement; and
(vi) to the Class R Certificateholders, any remaining Available
Distribution Amount.
In addition, notwithstanding the prioritization of the distribution of
the Formula Principal Distribution Amount to the Holders of the Class A
Certificates pursuant to clause (ii) above, on a Distribution Date, if any, in
respect of which a Deficiency Event is in effect, the portion of the Formula
Principal Distribution Amount for such Distribution Date that would
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otherwise be distributed sequentially to the Class A-1 and Class A-2
Certificateholders pursuant to clause (ii) above will instead be distributed to
the Class A-1 and Class A-2 Certificateholders pro rata based upon the
Certificate Balance of each such Class immediately prior to such Distribution
Date until the Certificate Balances of the Class A-1 and Class A-2 Certificates
have been reduced to zero (but distributions among the Class A-2 Certificates
shall be made in accordance with the terms of Section 5.02(e) hereof).
Such distributions to the Class A-1 Certificateholders and Class A-2
Certificateholders shall be made such that the Trustee shall distribute (a) to
each Class A-1 Certificateholder as of the preceding Record Date an amount equal
to the product of the aggregate Percentage Interest evidenced by such
Certificateholder's Class A-1 Certificates and the Class A-1 Distribution Amount
for such Distribution Date, and (b) subject to 5.02(e) hereof with respect to
payments of principal, to each Class A-2 Certificateholder as of the preceding
Record Date an amount equal to the product of the aggregate Percentage Interest
evidenced by such Certificateholder's Class A-2 Certificates and the Class A-2
Distribution Amount for such Distribution Date. The Trustee shall pay each
Certificateholder of record by check mailed to such Certificateholder at the
address for such Certificateholder appearing on the Certificate Register;
provided that if such Certificateholder holds Certificates evidencing a
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Percentage Interest aggregating 10% or more with respect to such Class and has
given the Trustee appropriate written instructions at least 10 days prior to the
related Distribution Date (which instructions, until revised, shall remain
operative for all Distribution Dates thereafter), the Trustee shall pay such
Certificateholder by wire transfer of funds. If on any Determination Date the
Servicer determines that there are no Contracts outstanding and no other funds
or assets in the Trust Fund other than the funds in the Certificate Account, the
Servicer promptly shall notify the Insurer and the Trustee and instruct the
Trustee to send the final distribution notice to each Certificateholder and make
provision for the final distribution in accordance with Section 10.01(c). Final
payment of any Certificate shall be made only upon presentation of such
Certificate at the office or agency of the Certificate Registrar.
(b) On each Distribution Date, the Trustee shall withdraw from the
Certificate Account (solely out of the Available Distribution Amount for such
Distribution Date after giving effect to the distributions made to the
Certificateholders pursuant to Section 5.02(a)(i)-(ii) and (iv), to the Special
Account pursuant to Section 5.02(a)(iii), and to the Auction Agent pursuant to
Section 5.02(a)(v)) and distribute the amount specified in Section 5.02(a)(vi)
for such Distribution Date to the Class R Certificateholders by wire transfer of
immediately available funds. Such distribution shall be made by a means that is
mutually acceptable to the Trustee and the Class R Certificateholders.
(c) Each distribution with respect to a Global Certificate shall be paid
to the Depository, which shall credit the amount of such distribution to the
accounts of its Depository Participants in accordance with its normal
procedures. Each Depository Participant shall be responsible for disbursing such
distribution to the Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating
firm") for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the Certificate Owners that it represents. All such credits
and disbursements with respect to a Global Certificate are to be made by the
Depository and the Depository Participants in accordance with the provisions of
the Certificates. Neither the Trustee, the Certificate Registrar, the Contract
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Seller nor the Servicer shall have any responsibility therefor. To the extent
applicable and not contrary to the rules of the Depository, the Trustee shall
comply with the provisions of the forms of the Certificates as set forth in
Exhibit B-1, Exhibit B-2, and Exhibit C (reverse of Certificates) hereto.
- ---------- ----------- ---------
(d) None of the Servicer, Seller, Trustee, Holders of the Regular
Certificates or, except and only to the extent set forth in the Insurance
Agreement, the Class R Certificateholders shall have any right to any amounts on
deposit in the Special Account.
(e) On each Distribution Date prior to the Class A-2 Pro Rata Date,
principal payments will be made to the Class A-2 Certificates only in amounts
equal to $25,000 and integral multiples in excess thereof. On each Distribution
Date, the Class A-2 Holdover Amount, if any, for such Distribution Date will be
retained in the Certificate Account. The amount being distributed to Holders of
the Class A-2 Certificates as principal will be allocated to the specific
Certificates of such Class which are selected prior to the related Distribution
Date by lot or such other manner as may be determined by the Depository, a
Depository Participant or the Trustee , which distributions, prior to the Class
A-2 Pro Rata Date, will be made only in allocations equal to $25,000 and
integral multiples of $25,000 in excess thereof. On each Distribution Date on
and after the Class A-2 Pro Rata Date, distributions will be made pro rata to
the Holders of the Class A-2 Certificates pursuant to Section 5.02(a) based on
their respective Percentage Interests. Any amounts on deposit in the Certificate
Account representing the Class A-2 Holdover Amount, shall only be applied to
payments of principal on the Class A-2 Certificates until the Certificate
Balance of the Class A-2 Certificates has been reduced to zero.
Section 5.03 Permitted Withdrawals from the Certificate Account.
--------------------------------------------------
The Servicer may, from time to time as provided herein, make withdrawals
from the Certificate Account of amounts deposited therein pursuant to Section
4.05 that are attributable to the Contracts for the following purposes:
(i) to pay to the Contract Seller with respect to each Contract sold
by it or property acquired in respect thereof that has been repurchased or
replaced pursuant to Section 3.05, all amounts received thereon that are
specified in such Section to be property of the Contract Seller;
(ii) to reimburse itself for the payment of taxes or charges out of
Liquidation Proceeds (to the extent not previously retained from such
Liquidation Proceeds prior to their deposit) or out of payments expressly
made by the related Obligor to reimburse the Servicer for such taxes or
charges, as permitted by Section 4.06;
(iii) to pay to itself the Monthly Servicing Fee and Servicer
Deficiency Amounts and Repossession Profits, if any;
(iv) to reimburse itself or a previous Servicer out of Liquidation
Proceeds (to the extent not previously retained from Liquidation Proceeds
prior to their deposit in the Certificate Account) in respect of a
Manufactured Home and out of payments by the related Obligor (to the extent
of payments expressly made by the Obligor to reimburse the
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Servicer for insurance premiums) for expenses incurred by it in respect of
such Manufactured Home that are specified as being reimbursable to it
pursuant to Section 4.07, 4.09, 4.13 or 4.18 or to a previous Servicer
under Section 7.07;
(v) to reimburse itself for any Nonrecoverable Advances and for
Monthly Advances in respect of Liquidated Contracts, in each case, in
accordance with Section 5.01(c);
(vi) after the Class A-1 Certificate Balance and Class A-2 Certificate
Balance, have been reduced to zero and all amounts owing to the Special
Account have been deposited therein, to reimburse the Servicer and the
REMIC Administrator, pro rata, for expenses incurred and reimbursable to
the Servicer pursuant to Section 7.05 and to the REMIC Administrator
pursuant to Section 4.17(c); and
(vii) to withdraw any amount deposited in the Certificate Account
that was not required to be deposited therein (including any collections on
the Contracts that, pursuant to Section 2.01(a), are not part of the Trust
Fund and amounts permitted to be withdrawn pursuant to Section 11.12(ii)
hereof)).
Since, in connection with withdrawals pursuant to clauses (i), (ii)
and (iv) of this Section 5.03, the Servicer's entitlement thereto is limited to
collections or other recoveries on the related Contract, the Servicer shall keep
and maintain separate accounting, on a Contract by Contract basis, for the
purpose of justifying any withdrawal from the Certificate Account pursuant to
such clauses.
Section 5.04 Monthly Reports.
---------------
At least two Business Days prior to each Distribution Date, the Servicer
shall cause the Trustee, the Insurer, the Rating Agencies, the Contract Seller
and the Certificate Administrator to receive a Monthly Report, which report
shall include the following information with respect to the immediately
following Distribution Date:
(a) the Class A-1 Distribution Amount for such Distribution Date;
(b) the amount of principal to be distributed to the Class A-1
Certificateholders, separately stating the contribution thereto from each
of the amounts specified in clauses (a) through (f), inclusive, of the
definition of Total Regular Principal Amount and from the amount of clause
(b) of the definition of Formula Principal Distribution Amount;
(c) the amount of interest to be distributed to Class A-1 Certificateholders on
such Distribution Date (separately identifying any Class A-1 Unpaid
Interest Shortfall included in such distribution);
(d) the remaining Class A-1 Certificate Balance after giving effect to the
payment of principal to be made on such Distribution Date (on which
interest will be calculated on the next succeeding Distribution Date);
(e) the Class A-2 Distribution Amount for such Distribution Date;
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(f) the amount of principal to be distributed to the Class A-2
Certificateholders, separately stating the contribution thereto from each
of the amounts specified in clauses (a) through (f), inclusive, of the
definition of Total Regular Principal Amount and from the amount of clause
(b) of the definition of Formula Principal Distribution Amount;
(g) the amount of interest to be distributed to Class A-2 Certificateholders on
such Distribution Date (separately identifying any Class A-2 Unpaid
Interest Shortfall included in such distribution);
(h) the remaining Class A-2 Certificate Balance after giving effect to the
payment of principal to be made on such Distribution Date (on which
interest will be calculated on the next succeeding Distribution Date);
(i) the Class A-1 Pass-Through Rate , the Class A-2 Pass-Through Rate and the
Class A-2 Holdover Amount;
(j) the total amount of Monthly Servicing Fee payable on such Distribution
Date, the amount of any reimbursement to the Servicer pursuant to Section
7.05, and any Late Payment Fees, Extension Fees and assumption fees paid
during the prior Collection Period, and the amount of any other fees
payable out of the Trust Fund;
(k) the number of and aggregate remaining principal balance of Contracts with
payments delinquent 31 to 59, 60 to 89, and 90 or more days, respectively;
(l) the number of Contracts that were repurchased or replaced by the Contract
Seller in accordance with Section 3.05 during the prior Collection Period,
identifying such Contracts and (i) the Repurchase Price of such Contracts
and (ii) the amount, if any, paid by the Contract Seller due to the
differences, if any, between the remaining principal balances of the
replaced Contracts and the Eligible Substitute Contracts;
(m) the aggregate principal balances of all Contracts that are not Liquidated
Contracts and in respect of which the related Manufactured Homes have been
repossessed or foreclosed upon;
(n) the Enhancement Payment, if any, on such Distribution Date;
(o) the amount of any Monthly Advance and the Outstanding Amount Advanced with
respect to such Distribution Date;
(p) the amounts, if any, deposited into the Special Account for such
Distribution Date;
(q) the amount, if any, to be distributed to the Class R Certificateholders;
(r) (i) the Net Weighted Average Contract Rate for the Collection Period
immediately preceding the month of such Distribution Date and (ii) the Net
Weighted Average Contract Rate for the Collection Period occurring in the
month in which such Distribution Date occurs;
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(s) the number of Manufactured Homes currently held by the Servicer due to
repossessions and the aggregate principal balance of the related defaulted
Contracts;
(t) the Pool Principal Balance, expressed as a percentage of the Cut-Off Date
Pool Principal Balance;
(u) the aggregate of the Deficiency Amounts and Servicer Deficiency Amounts
received for the preceding Collection Period;
(v) any additional items required to be set forth in the Monthly Report
pursuant to the Insurance Agreement; and
(w) amounts paid to the Class A-1 Certificateholders on such Distribution Date
in respect of the Class A-1 Net Funds Cap Carryover Amount and amounts paid
to the Class A-2 Certificateholders on such Distribution Date in respect of
the Class A-2 Net Funds Cap Carryover Amount.
Copies of all Monthly Reports shall be provided by the Servicer to each
Rating Agency. Neither the Trustee nor the Certificate Administrator shall be
under any duty to recalculate or verify the information provided to it by the
Servicer. The Servicer shall deliver a written notice to the Trustee not later
than three Business Days next preceding a Distribution Date if it cannot provide
the Trustee and the Certificate Administrator with a Monthly Report for such
Distribution Date.
Section 5.05 Certificate of Servicing Officer.
--------------------------------
Each Monthly Report pursuant to Section 5.04 shall be accompanied by a
certificate of a Servicing Officer substantially in the form of Exhibit F,
---------
certifying the accuracy of the Monthly Report and that such officer is not aware
of the occurrence of an Event of Default or of an event that, with notice or
lapse of time or both, would become an Event of Default, or if such officer is
aware that such an event has occurred and is continuing, specifying the event
and its status.
Section 5.06 Other Data.
----------
In addition, the Servicer, on request of the Trustee or the Certificate
Administrator, shall furnish the Trustee or the Certificate Administrator (as
the case may be) such underlying data as may reasonably be requested.
Section 5.07 Statements to Certificateholders.
--------------------------------
Concurrently with each distribution to Certificateholders pursuant to this
Article V, the Trustee shall mail, or cause the Paying Agent to mail, to each
Certificateholder at the address appearing on the Certificate Register a
statement as of the related Distribution Date prepared by the Servicer setting
forth in the Monthly Report together with the following information:
(1) the amount of fees and expenses payable out of the Trust Fund for such
Collection Period;
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(2) the percentage obtained by dividing the aggregate Certificate Balances with
respect to each Class (after giving effect to the distributions on the
Certificates made on such Distribution Date) by the aggregate Initial
Certificate Balances with respect to each Class;
(3) such other customary factual information as is available to the Servicer as
the Servicer deems necessary and can obtain reasonably from its existing
data base to enable Certificateholders to prepare their tax returns.
In the case of information furnished with respect to a dollar amount, the
amounts shall be expressed as a dollar amount per Certificate with a $1,000
denomination.
Within a reasonable period of time after the end of each calendar year,
subject to the next sentence, but in no event later than 90 days after the end
of such year, the Servicer shall prepare and furnish to the Trustee, the Paying
Agent and the Certificate Administrator, and the Trustee, promptly upon receipt,
shall furnish or cause the Paying Agent to furnish to each Person who at any
time during the calendar year was the Holder of a Certificate, a statement
containing the information set forth in clauses (b) and (c) of Section 5.04, in
the case of Class A-1 Certificateholders and (f) and (g) of Section 5.04, in the
case of Class A-2 Certificateholders, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such obligation of the Servicer 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 as from time to time in force.
On each Distribution Date, the Servicer shall forward or cause to be forwarded
by mail to each Holder of a Class R Certificate, a copy of the Monthly Report
for such Distribution Date. The Servicer shall also forward or cause to be
forwarded by mail to each Holder of a Class R Certificate, a statement setting
forth such information as the Servicer deems necessary or appropriate.
Within a reasonable period of time after the end of each calendar year, the
Servicer shall furnish or cause to be furnished to each Person who at any time
during the calendar year was a Holder of a Class R Certificate a statement
containing the applicable distribution information provided pursuant to this
Section 5.07 aggregated for such calendar year or applicable portion thereof
during which such Person was a Holder of a Class R Certificate. Such obligation
of the Servicer 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. A Certificate Owner holding Certificates of a
Class representing in the aggregate at least 5% of the Percentage Interests of
such Class shall, upon written request to the Trustee certifying its beneficial
ownership of such Certificates, be entitled to receive copies of all reports
provided by the Trustee. Copies of all reports provided by the Trustee to the
Certificateholders shall also be provided to each Rating Agency.
Section 5.08 Certificate Insurance Policy; Enhancement Payments.
--------------------------------------------------
(a) The parties hereto acknowledge that the Insurer has provided the
Certificate Insurance Policy in order to provide the Class A
Certificateholders with a source of
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funds to enhance the likelihood of the receipt by such Certificateholders
on each Distribution Date of the aggregate amount distributable pursuant to
Section 5.02(a)(i)-(ii) with respect to such Distribution Date.
(b) Upon receipt of a Monthly Report from the Servicer that shows an
Enhancement Payment and in all events two Business Days prior to the
Distribution Date, the Trustee shall make a claim to the Insurer on the
Certificate Insurance Policy pursuant to a Notice of Payment (and deliver a
copy of such Notice of Payment to the Bank Agent pursuant to the
Certificate Insurance Policy) directing the Insurer to make payment by wire
transfer to the Certificate Account.
(c) If, in respect of any Distribution Date, the Trustee is holding in the
Certificate Account all or part of any Enhancement Payment for such
Distribution Date, then the Trustee shall distribute to the
Certificateholders such Enhancement Payment together with the Available
Distribution Amount pursuant to Section 5.01(a).
ARTICLE VI
THE CERTIFICATES
Section 6.01 The Certificates.
----------------
The Certificates shall be substantially in the forms attached hereto as
Exhibit B-1, Exhibit B-2, Exhibit C and Exhibit D. The Class A Certificates
- ----------- ------------ --------- ---------
shall be issuable in registered form, in the minimum dollar denominations,
integral dollar multiples in excess thereof (except that one Certificate in each
Class may be issued in a different amount which must be in excess of the
applicable minimum dollar denomination) and aggregate dollar denominations per
Class as set forth in the following table:
<TABLE>
<CAPTION>
Integral
Multiples in
Minimum Excess of Latest Scheduled Initial Certificate
Class Denomination Minimum Distribution Date Balance
- ----------- ------------ ------------ ------------------- ----------------------
<S> <C> <C> <C> <C>
A-1 $50,000 $ 1 February 15, 2019 $ 89,637,432
A-2 $25,000 $25,000 March 19, 2029 $100,000,000
</TABLE>
The Class R Certificate shall initially be issued with no principal
balance.
The Certificates shall be executed by manual or facsimile signature on
behalf of the Trustee by an authorized officer. 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 authentication and delivery of such Certificates
or did not hold such offices at the date of such authentication and delivery. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form set forth as attached
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hereto executed by the Trustee by manual signature, and such certificate of
authentication upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication. On
the Closing Date, the Trustee shall authenticate the Certificates to be issued
at the written direction of the Contract Seller or any Affiliate thereof.
The Contract Seller shall provide, or cause to be provided, to the Trustee
on a continuous basis, an adequate inventory of Certificates to facilitate
transfers.
Section 6.02 Certificate Register; Registration of Transfer and Exchange of
--------------------------------------------------------------
Certificates.
- ------------
(a) The Trustee shall maintain, or cause to be maintained, a Certificate
Register for the Trust Fund in which, subject to the provisions of
subsections (b) and (c) below and to such reasonable regulations as it may
prescribe, the Trustee shall provide for the registration of Certificates
and of transfers and exchanges of Certificates as herein provided. Upon
surrender for registration of transfer of any Certificate, the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of the same Class and of like
aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged for
other Certificates of the same Class in authorized denominations and evidencing
the same aggregate Percentage Interest upon surrender of the Certificates to be
exchanged at the office or agency of the Trustee. Whenever any Certificates are
so surrendered for exchange, the Trustee shall execute, authenticate, and
deliver the Certificates that the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Trustee duly executed by the
holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but 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 may be required.
All Certificates surrendered for registration of transfer or exchange shall
be canceled and subsequently destroyed by the Trustee in accordance with the
Trustee's customary procedures.
(b) No transfer of an ERISA Restricted Certificate will be made unless the
Trustee has received either (i) an Opinion of Counsel, at no expense to the
Trustee, the Contract Seller, the Insurer or the Servicer, acceptable to
and in form and substance satisfactory to the Trustee, the Contract Seller
and the Servicer with respect to the permissibility of such transfer under
ERISA and Section 4975 of the Code and stating, among other things, that
the transferee's acquisition of such ERISA Restricted Certificate will not
constitute or result in a non-exempt prohibited transaction under Section
406 of ERISA or Section 4975 of the Code and will not subject the Servicer,
the Contract Seller or the Trustee to any obligation or liability in
addition to those undertaken in this Agreement or (ii) a representation
letter from the transferee, substantially in the form of paragraph 5 of
Exhibit G. No transfer of an ERISA Restricted
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Certificate will be made without the consent of the Insurer and without
notification to the Rating Agencies.
(c) (i) Each Person who has or who acquires any Ownership Interest in a Class R
Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions
and to have irrevocably authorized the Trustee or its designee under clause
(iii)(A) below to deliver payments to a Person other than such Person and
to negotiate the terms of any mandatory sale under clause (iii)(B) below
and to execute all instruments of transfer and to do all other things
necessary in connection with any such sale. The rights of each Person
acquiring any Ownership Interest in a Class R Certificate are expressly
subject to the following provisions:
(A) Each Person holding or acquiring any Ownership Interest in a Class R
Certificate shall be a Permitted Transferee and shall promptly notify the
Trustee of any change or impending change in its status as a Permitted
Transferee.
(B) In connection with any proposed Transfer of any Ownership Interest in a
Class R Certificate, the Trustee shall require delivery to it, and shall
not register the Transfer of any Class R Certificate until its receipt of,
(I) an affidavit and (a "Transfer Affidavit," in the form attached hereto
as Exhibit G-1) from the proposed Transferee, representing and warranting,
among other things, that it is a Permitted Transferee, that it is not
acquiring its Ownership Interest in the Class R Certificate that is the
subject of the proposed Transfer as a nominee, trustee or agent for any
Person who is not a Permitted Transferee, that for so long as it retains
its Ownership Interest in a Class R Certificate, it will endeavor to remain
a Permitted Transferee, and that it has reviewed the provisions of this
Section 6.02(c) and agrees to be bound by them, and (II) a certificate, in
the form attached hereto as Exhibit G-2, from the Holder wishing to
transfer the Class R Certificate, representing and warranting, among other
things, that no purpose of the proposed Transfer is to impede the
assessment or collection of tax.
(C) Notwithstanding the delivery of a Transfer Affidavit by a proposed
Transferee under clause (B) above, if a Responsible Officer of the Trustee
who is assigned to this Agreement has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership
Interest in a Class R Certificate to such proposed Transferee shall be
effected.
(D) Each Person holding or acquiring any Ownership Interest in a Class R
Certificate shall agree (x) to require a Transfer Affidavit from any other
Person to whom such Person attempts to transfer its Ownership Interest in a
Class R Certificate and (y) not to transfer its Ownership Interest unless
it provides a certificate to the Trustee in the form attached hereto as
Exhibit G-2.
(E) Each Person holding or acquiring an Ownership Interest in a Class R
Certificate, by purchasing an Ownership Interest in such Certificate,
agrees to give the Trustee written notice that it is a "pass-through
interest holder" within the meaning of Temporary Treasury Regulations
Section 1.67-3T(a)(2)(i)(A) immediately upon
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acquiring an Ownership Interest in a Class R Certificate, if it is, or is
holding an Ownership Interest in a Class R Certificate on behalf of, a
"pass-through interest holder."
(ii) The Trustee will register the Transfer of any Class R Certificate
only if it shall have received the Transfer Affidavit, a certificate of the
Holder requesting such transfer in the form attached hereto as Exhibit G-2.
Transfers of the Class R Certificates to Non-United States Persons and
Disqualified Organizations (as defined in Section 860E(e)(5) of the Code) are
prohibited.
(iii) (A) If any Disqualified Organization shall become a holder of a
Class R Certificate, then the last preceding Permitted Transferee shall be
restored, to the extent permitted by law, to all rights and obligations as
Holder thereof retroactive to the date of registration of such Transfer of such
Class R Certificate. If a Non-United States Person shall become a holder of a
Class R Certificate, then the last preceding United States Person shall be
restored, to the extent permitted by law, to all rights and obligations as
Holder thereof retroactive to the date of registration of such transfer of such
Class R Certificate. If a transfer of a Class R Certificate is disregarded
pursuant to the provisions of Treasury Regulations Section 1.860E-1 or Section
1.860G-3, then the last preceding Permitted Transferee shall be restored, to the
extent permitted by law, to all rights and obligations as Holder thereof
retroactive to the date of registration of such Transfer of such Class R
Certificate. The Trustee 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 6.02(c) or for making any payments due on such Certificate to
the holder thereof or for taking any other action with respect to such holder
under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder of a Class
R Certificate in violation of the restrictions in this Section 6.02(c) and
to the extent that the retroactive restoration of the rights of the Holder
of such Class R Certificate as described in clause (iii)(A) above shall be
invalid, illegal or unenforceable, then either the Servicer shall have the
right, without notice to the holder or any prior holder of such Class R
Certificate, to sell such Class R Certificate to a purchaser selected by
the Servicer on such terms as the Servicer may choose. Such purported
Transferee shall promptly endorse and deliver each Class R Certificate in
accordance with the instructions of the Servicer. Such purchaser may be
the Servicer itself or any Affiliate of the Servicer. The proceeds of such
sale, net of the commissions (which may include commissions payable to the
Servicer or its Affiliates), expenses and taxes due, if any, will be
remitted by the Servicer to such purported Transferee. The terms and
conditions of any sale under this clause (iii)(B) shall be determined in
the sole discretion of the Servicer, and the Servicer shall not be liable
to any Person having an Ownership Interest in a Class R Certificate as a
result of its exercise of such discretion.
(iv) The Servicer, on behalf of the Trustee, shall use its reasonable
efforts to make available, upon written request from the Trustee, all
information necessary to compute any tax imposed (A) as a result of the Transfer
of an Ownership Interest in a Class R Certificate to any Person who is a
Disqualified Organization, including the information regarding "excess
inclusions" of such Class R Certificates required to be provided to the Internal
Revenue Service and certain Persons as described in Treasury Regulations
Sections 1.860D-1(b)(5) and 1.860E-2(a)(5), and (B) as a result of any regulated
investment company, real estate investment
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trust, common trust fund, partnership, trust, estate or organization described
in Section 1381 of the Code that holds an Ownership Interest in a Class R
Certificate having as among its record holders at any time any Person who is a
Disqualified Organization. Reasonable compensation for providing such
information may be required by the Servicer from such Person.
(v) The provisions of this Section 6.02(c) set forth prior to this
clause (v) may be modified, added to or eliminated pursuant to Section 11.01,
provided that there shall have also been delivered to the Trustee the following:
(A) written notification from each Rating Agency to the effect
that the modification, addition to or elimination of such provisions will
not cause such Rating Agency to downgrade its then-current ratings, if any,
of any Class of the Regular Certificates below the lower of the then-
current rating or the rating assigned to such Certificates as of the
Closing Date by such Rating Agency; and
(B) a certificate of the Servicer stating that the Servicer has
received an Opinion of Counsel, in form and substance satisfactory to the
Servicer, to the effect that such modification, addition to or absence of
such provisions will not cause Trust Fund to cease to qualify as a REMIC
and will not cause (x) the Trust Fund to be subject to an entity-level tax
caused by the Transfer of any Class R Certificate to a Person that is a
Disqualified Organization or (y) a Certificateholder or another Person to
be subject to a REMIC-related tax caused by the Transfer of a Class R
Certificate to a Person that is not a Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions referred to
above in this Section 6.02 shall not be an expense of the Trust Fund, the
Trustee, the Contract Seller or the Servicer.
Section 6.03 Mutilated, Destroyed, Lost or Stolen Certificates.
-------------------------------------------------
If (a) any mutilated Certificate is surrendered to the Trustee, or the
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Certificate and of the ownership thereof and (b) there is delivered to
the Trustee and the Certificate Administrator, if any, such security or
indemnity as may be required by them to save each of them harmless, then, in the
absence of notice to the Trustee that such Certificate has 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 Class, tenor and Percentage Interest. In
connection with the issuance of any new Certificate under this Section 6.03, 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) connected therewith.
Any replacement Certificate issued pursuant to this Section 6.03 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. All Certificates surrendered to the Trustee under
the terms of this Section 6.03 shall be canceled and destroyed by the Trustee in
accordance with its standard procedures without liability on its part.
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Section 6.04 Persons Deemed Owners.
---------------------
The Servicer, the Trustee and any agent of the Servicer or the Trustee may
treat the person in whose name any Certificate is registered as the owner of
such Certificate for the purpose of receiving distributions as provided in this
Agreement and for all other purposes whatsoever, and neither the Servicer, the
Trustee nor any agent of the Servicer or the Trustee shall be affected by any
notice to the contrary.
Section 6.05 Access to List of Certificateholders' Names and Addresses.
---------------------------------------------------------
If three or more Certificateholders (a) request such information in writing
from the Trustee, (b) state that such Certificateholders desire to communicate
with other Certificateholders with respect to their rights under this Agreement
or under the Certificates, and (c) provide a copy of the communication that such
Certificateholders propose to transmit or if the Contract Seller or Servicer
shall request such information in writing from the Trustee, then the Trustee
shall, within ten Business Days after the receipt of such request, provide the
Contract Seller, the Servicer or such Certificateholders at such recipients'
expense the most recent list of the Certificateholders of the Trust Fund held by
the Trustee, if any. The Contract Seller and every Certificateholder, by
receiving and holding a Certificate, agree that the Trustee shall not be held
accountable by reason of the disclosure of any such information as to the list
of the Certificateholders hereunder, regardless of the source from which such
information was derived.
Section 6.06 Global Certificates.
-------------------
The Regular Certificates, upon original issuance, shall be issued in the
form of one or more typewritten Certificates representing the Global
Certificates, to be delivered to the Depository by or on behalf of the Contract
Seller. Such Global Certificates shall initially be registered on the
Certificate Register in the name of the Depository or its nominee, and no
Certificate Owner will receive a definitive certificate representing such
Certificate Owner's interest in such Certificates, except as provided in Section
6.08. Unless and until definitive, fully registered Certificates ("Definitive
Certificates") have been issued to the Certificate Owners of such Certificates
pursuant to Section 6.08:
(a) the provisions of this Section shall be in full force and effect;
(b) the Contract Seller, the Servicer and the Trustee may treat the Depository
and the Depository Participants for all purposes as the authorized
representative of the respective Certificate Owners of such Certificates
and, in the case of distributions, with the Depository as the authorized
representative of the Depository Participants and the Certificate Owners;
(c) registration of the Global Certificates may not be transferred by the
Trustee except to another Depository;
(d) the rights of the respective Certificate Owners of such Certificates shall
be exercised only through the Depository and the Depository Participants
and shall be limited to those established by law and agreements between the
Owners of such Certificates and the Depository and/or the Depository
Participants. Pursuant to the Depository Agreement, unless and until
Definitive Certificates are issued with respect to the Class A Certificates
pursuant to
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Section 6.08, the Depository will make book-entry transfers among the
Depository Participants and receive and transmit distributions of principal
and interest on the related Certificates to such Depository Participants;
(e) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants;
(f) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants; and
(g) to the extent that the provisions of this Section conflict with any other
provisions of this Agreement, the provisions of this Section shall control.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Certificateholders
evidencing a specified percentage of the Certificate Balance of a Class of
Certificates, such direction or consent may be given by Certificate Owners
(acting through the Depository and the Depository Participants) owning Global
Certificates evidencing the requisite percentage of the Certificate Balance or
the requisite Percentage Interests.
Section 6.07 Notices to Depository.
---------------------
Whenever any notice or other communication is required to be given to
Certificateholders of any Class with respect to which Global Certificates have
been issued, unless and until Definitive Certificates shall have been issued to
the related Certificate Owners, the Trustee shall give all such notices and
communications to the Depository.
Section 6.08 Definitive Certificates.
-----------------------
If, after Global Certificates have been issued with respect to the Class A
Certificates, (a) the Servicer advises the Trustee that the Depository is no
longer willing or able to discharge properly its responsibilities under the
Depository Agreement with respect to such Certificates and the Trustee or GCC is
unable to locate a qualified successor, (b) GCC, at its sole option, advises the
Trustee that it elects to terminate the book-entry system with respect to such
Certificates through the Depository or (c) after the occurrence and continuation
of an Event of Default, Certificate Owners of such Global Certificates having
not less than 51% of the Voting Rights evidenced by the related Class advise the
Trustee and the Depository in writing through the Depository Participants that
the continuation of a book-entry system with respect to such Certificates
through the Depository (or its successor) is no longer in the best interests of
the Certificate Owners with respect to such Certificates, then the Trustee shall
notify all Certificate Owners of such Class of Certificates, through the
Depository, of the occurrence of any such event and of the availability of
Definitive Certificates for such Class to Certificate Owners requesting the
same. The Contract Seller shall provide the Trustee with an adequate inventory
of certificates to facilitate the issuance and transfer of Definitive
Certificates. Upon surrender to the Trustee of any such Certificates by the
Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall authenticate and deliver such Definitive
Certificates. Neither the Contract Seller, the Servicer nor the Trustee shall be
liable for any delay in delivery of such instructions and each may conclusively
rely on, and shall be protected in
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relying on, such instructions. Upon the issuance of such Definitive
Certificates, all references herein to obligations imposed upon or to be
performed by the Depository shall be deemed to be imposed upon and performed by
the Trustee, to the extent applicable with respect to such Definitive
Certificates and the Trustee shall recognize the Holders of such Definitive
Certificates as Certificateholders hereunder.
ARTICLE VII
THE CONTRACT SELLER AND THE SERVICER
Section 7.01 Liabilities to Obligors.
-----------------------
No liability to any Obligor under any of the Contracts arising out of any
act or omission to act of the Servicer in servicing the Contracts prior to the
Closing Date is intended to be assumed by the Contract Seller, the Trustee, the
Certificate Administrator or the Certificateholders under or as a result of this
Agreement and the transactions contemplated hereby and, to the maximum extent
permitted and valid under mandatory provisions of law, the Contract Seller, the
Trustee, the Certificate Administrator and the Certificateholders expressly
disclaim such assumption.
Section 7.02 Servicer's Indemnities.
----------------------
The Servicer shall defend and indemnify the Trust Fund, the Trustee, the
Certificate Administrator, the Certificate Registrar, the Paying Agent, the
Contract Seller and the Certificateholders against any and all costs, expenses,
losses, damages, claims or liabilities, including reasonable fees and expenses
of counsel and expenses of litigation, arising from third party claims or
actions (including penalties or fees imposed by any governmental or regulatory
body or agency) in respect of any action taken by the Servicer with respect to
any Contract or Manufactured Home constituting a failure by the Servicer to
perform its obligations under this Agreement. This indemnity shall survive any
Event of Default (but a Servicer's obligations under this Section 7.02 shall not
relate to any actions of any subsequent Servicer after an Event of Default) and
any payment of the amount owing under, or any repurchase by the Contract Seller
of, any such Contract.
Section 7.03 Operation of Indemnities.
------------------------
Indemnification under this Article VII shall include reasonable fees and
expenses of counsel and expenses of litigation. Any amounts received by the
Trustee from the Servicer pursuant to this Article VII shall be deposited in the
Certificate Account pursuant to Section 4.05. If the Servicer has made any
indemnity payments to the Trustee pursuant to this Article VII and the Trustee
thereafter collects any of such amounts from others, the Trustee will repay such
amounts collected to the Servicer, together with any interest collected thereon.
Section 7.04 Merger or Consolidation of the Contract Seller or the Servicer.
--------------------------------------------------------------
The Contract Seller and the Servicer will each keep in full effect their
existence, rights and franchises as a Delaware corporation, and will obtain and
preserve its qualification to do business as a foreign corporation in each
jurisdiction in which such qualification is or shall be
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necessary to protect the validity and enforceability of this Agreement, the
Certificates or any of the Contracts and to perform its duties under this
Agreement.
Any Person into which the Contract Seller or the Servicer may be merged or
consolidated, or any corporation or association resulting from any merger,
conversion or consolidation to which the Contract Seller or the Servicer shall
be a party, or any Person succeeding to the business of the Contract Seller or
the Servicer, shall be the successor of the Contract Seller or the Servicer
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor or surviving Person to
-------- -------
the Servicer shall satisfy the requirements of Section 7.07 with respect to the
qualifications of a successor to the Servicer. The Contract Seller and the
Servicer shall promptly notify each Rating Agency of any such merger to which it
is a party.
Section 7.05 Limitation on Liability of the Contract Seller, the Servicer and
----------------------------------------------------------------
Others.
- ------
Neither the Contract Seller, the Servicer nor any of their directors,
officers, employees or agents shall be under any liability to the Trustee or the
Certificateholders for any errors in judgment or any action taken or for
refraining from the taking of any action, pursuant to this Agreement; provided,
--------
however, that this provision shall not protect the Contract Seller or any such
- -------
Person against any liability that would otherwise be imposed by reason of its
willful misconduct, or gross negligence; provided, further that this provision
-------- -------
shall not protect the Servicer or any such Person against any liability that
would otherwise be imposed by reason of its willful misconduct or gross
negligence. The Contract Seller, the Servicer and any of their directors,
officers, employees or agents may rely on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. Neither the Contract Seller nor the Servicer shall be under any
obligation to appear in, prosecute or defend any legal action which arises under
this Agreement (other than in connection with the enforcement of any Contract in
accordance with this Agreement) and which in its opinion may involve it in any
expenses or liability; provided, however, that the Servicer may in its
-------- -------
discretion undertake any such other legal action which it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the parties
hereto. In such event, the legal expenses and costs of such other legal action
and any liability resulting therefrom shall be expenses, costs and liabilities
payable from the Certificate Account, and the Servicer shall be entitled to be
reimbursed therefor out of the Certificate Account as provided by Section 5.03.
Section 7.06 Assignment by Servicer.
----------------------
Notwithstanding any provision to the contrary in this Agreement without
the consent of the Trustee or any Certificateholder, the Servicer may, with the
consent of the Insurer (provided that if an Insurer Default has occurred and is
continuing, no consent of the Insurer needs to be obtained), which consent shall
not be unreasonably withheld, assign its rights and delegate its duties and
obligations under this Agreement; provided that the Person shall execute and
--------
deliver to the Trustee an agreement, in form and substance reasonably
satisfactory to the Trustee, which contains an assumption by such Person of the
due and punctual performance and observance of each covenant and condition to be
performed or observed by the Servicer under this Agreement; and further provided
------- --------
that each Rating Agency's rating of any Class of the Certificates in effect
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immediately prior to such assignment and delegation will not be withdrawn or
reduced as a result of such assignment and delegation, as evidenced by a letter
from each Rating Agency. In the case of any such assignment and delegation, the
Servicer shall be released from its obligations under this Agreement, except
that the Servicer shall remain liable for all liabilities and obligations
incurred by it as Servicer hereunder prior to the satisfaction of the conditions
to such assignment and in delegation.
Section 7.07 Successor to the Servicer.
-------------------------
In connection with the termination of the Servicer's responsibilities and
duties under this Agreement pursuant to Section 8.01, the Trustee shall (i)
succeed to and assume all of the Servicer's responsibilities, rights, duties and
obligations under this Agreement (except the duty to pay and indemnify the
Trustee pursuant to Section 9.05 hereof), or (ii) with the consent of the
Contract Seller and the Insurer (provided that if an Insurer Default has
occurred and is continuing, no consent of the Insurer needs to be obtained),
which consent shall not be unreasonably withheld, appoint a successor which
shall have a net worth of not less than $50,000,000 and shall have serviced for
at least one year prior to such appointment a portfolio of not less than
$100,000,000 principal balance of manufactured housing installment sale
contracts or installment loans and which shall succeed to all rights and assume
all of the responsibilities, duties and liabilities of the Servicer under this
Agreement prior to the termination of the Servicer's responsibilities, duties
and liabilities under this Agreement (except that the duty to pay and indemnify
the Trustee pursuant to Section 9.05 hereof shall be subject to negotiation at
the time of such appointment). If the Trustee has become the successor to the
Servicer in accordance with this Section 7.07, the Trustee may, if it shall be
unwilling to continue to so act, or shall, if it is unable to so act, appoint,
or petition a court of competent jurisdiction to appoint, a successor satisfying
the requirements set out in clause (ii) above. In connection with any
appointment of a successor Servicer, the Trustee may make such arrangements for
the compensation of such successor out of payments on Contracts as it and such
successor shall agree or such court shall determine; provided, however, that the
-------- -------
Monthly Servicing Fee shall not be in excess of a monthly amount equal to 1/12th
of the product of 1% and the Pool Principal Balance for the Distribution Date in
respect of which such compensation is being paid without the consent of all of
the Certificateholders and notice to each Rating Agency. If the Servicer's
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to Section 7.06 or 8.01, the Servicer shall discharge such
duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the same
degree of diligence and prudence which it is obligated to exercise under this
Agreement, shall cooperate with the Trustee and any successor Servicer in
effecting the termination of the Servicer's responsibilities and rights
hereunder, and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor. The assignment by a Servicer
pursuant to Section 7.06 or removal of Servicer pursuant to Section 8.01 shall
not become effective until a successor shall be appointed pursuant to this
Section 7.07 and shall in no event relieve the Contract Seller of liability
pursuant to Section 3.05 for breach of the representations and warranties made
pursuant to Section 3.02 or 3.03. The Servicer being terminated pursuant to
Section 8.01 or Section 7.06 shall bear all costs of a transfer of servicing
therefrom, including but not limited to those of the Trustee reasonably
allocable to specific employees and overhead, legal fees and expenses, and costs
of amending the Agreement, if necessary.
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Any successor appointed as provided herein shall execute, acknowledge and
deliver to the Servicer and to the Trustee an instrument accepting such
appointment, whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and liabilities of the
Servicer, with like effect as if originally named as a party to this Agreement
and the Certificates. Any assignment by or termination of the Servicer pursuant
to Section 7.06 or 8.01 or the termination of this Agreement pursuant to Section
10.01 shall not affect any claims that the Trustee may have against the Servicer
arising prior to any such termination or resignation.
The Servicer shall timely deliver to the successor the funds in the
Certificate Account and REO Account and all Contract Files, Land Home Contract
Files and related documents and statements held by it hereunder and the Servicer
shall account for all funds and shall execute and deliver such instruments and
do such other things as reasonably may be required to more fully and definitely
vest and confirm in the successor all such rights, powers, duties,
responsibilities, obligations and liabilities of the Servicer. Without
limitation, the Trustee is authorized and empowered to execute and deliver on
behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents
and other instruments (including transfer instruments in respect of certificates
of title and financing statements relating to the Manufactured Homes), and to do
any and all acts or things necessary or appropriate to effect the purposes of
such notice of termination.
Upon a successor's acceptance of appointment as such, the Trustee shall
notify in writing the Certificateholders and each Rating Agency of such
appointment.
ARTICLE VIII
EVENTS OF DEFAULT
Section 8.01 Events of Default.
-----------------
In case one or more of the following Events of Default shall occur and be
continuing, that is to say:
(a) any failure by the Servicer to make any deposit or payment, or to remit to
the Trustee any payment, required to be made under the terms of this
Agreement which continues unremedied for a period of five days after the
date upon 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, the Trustee by the Holders of Certificates evidencing Fractional
Interests aggregating not less than 25%; or
(b) failure on the part of the Servicer duly to observe or perform in any
material respect any other of the covenants or agreements on the part of
the Servicer set forth in this Agreement, including the failure to deliver
a Monthly Report, which 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, the Trustee and the Contract Seller by the Holders of
Certificates evidencing Fractional Interests aggregating not less than 25%;
or
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(c) a decree or order of a court or agency or supervisory authority having
jurisdiction in the premises in an involuntary case under any present or
future federal or state bankruptcy, insolvency or similar law or appointing
a conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshaling of assets and liabilities or similar proceedings, or for
the winding-up or liquidation of its affairs, shall have been entered
against the Servicer, and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(d) the Servicer shall consent to the appointment of a conservator or receiver
or liquidator in any insolvency, readjustment of debt, marshaling of assets
and liabilities or similar proceedings of or relating to the Servicer or of
or relating to all or substantially all of the Servicer's property; or
(e) the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations
or take any corporate action in furtherance of the foregoing;
then, and in each and every such case, so long as such Event of Default shall
not have been cured or waived, the Trustee may with the consent of the Insurer
(which consent shall not be unreasonably withheld (provided that if an Insurer
Default has occurred and is continuing, no such consent needs to be obtained),
and, the Trustee shall at the written direction of (i) the Insurer so long as no
Insurer Default has occurred or is continuing or (ii) if an Insurer Default has
occurred and is continuing, the Holders of Certificates evidencing Fractional
Interests aggregating not less than 51% by notice in writing to the Servicer,
terminate all the rights and obligations of the Servicer under this Agreement
and in and to the Contracts and the proceeds thereof, except any responsibility
for its acts or omissions during its tenure as Servicer hereunder. The Trustee
shall send a copy of a notice of any Event of Default to each Rating Agency, the
Insurer and the Contract Seller. 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 Contracts or otherwise, shall pass to and
be vested in the successor appointed pursuant to Section 7.07. Upon the
occurrence of an Event of Default which shall not have been remedied, the
Trustee may also pursue whatever rights it may have at law or in equity to
damages, including injunctive relief and specific performance. The Trustee will
have no obligation to take any action or institute, conduct or defend any
litigation under this Agreement at the request, order or direction of any of the
Certificateholders or the Insurer unless such Certificateholders or the Insurer
have offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which the Trustee may incur.
Section 8.02 Waiver of Defaults.
------------------
The Insurer or the Holders of Certificates evidencing Fractional Interests
aggregating not less than 25% may waive any default by the Servicer in the
performance of its obligations hereunder and its consequences, except that a
default in the making of any required remittance to the Trustee for distribution
on any of the Certificates may be waived only by the affected
Certificateholders. Upon any such waiver of a past default, such default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been remedied for every purpose
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of this Agreement. No such waiver shall extend to any subsequent or other
default or impair any right consequent thereon except to the extent expressly so
waived.
Section 8.03 Trustee to Act, Appointment of Successor.
----------------------------------------
On and after the time the Servicer receives a notice of termination
pursuant to Section 8.01, the Trustee or its appointed agent shall be the
successor in all respects to the Servicer as provided in Section 7.07 hereof.
Notwithstanding the above, or anything in Section 7.07 to the contrary, the
Trustee, if it becomes Servicer pursuant to this Section, shall have no
responsibility or obligation (i) to repurchase or substitute any Contract, (ii)
for any representation or warranty of the Servicer hereunder, and (iii) for any
act or omission of either a predecessor or successor Servicer other than the
Trustee. The Trustee may conduct any activity required of it as Servicer
hereunder through an Affiliate or through an agent. Neither the Trustee nor any
other successor Servicer shall be deemed to be in default hereunder due to any
act or omission of a predecessor Servicer, including but not limited to failure
to timely deliver to the Trustee any Monthly Report, any funds required to be
deposited to the Trust Fund, or any breach of its duty to cooperate with a
transfer of servicing as required by Section 7.07.
Section 8.04 Notification to Certificateholders.
----------------------------------
(a) Upon any such termination pursuant to Section 8.01, the Trustee shall give
prompt written notice thereof to the Contract Seller, the
Certificateholders at their respective addresses appearing in the
Certificate Register and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default, the Trustee
shall transmit by mail to all Holders of Certificates notice of each such
Event of Default hereunder known to the Trustee, unless such Event of
Default shall have been cured or waived.
Section 8.05 Effect of Transfer.
------------------
(a) After a transfer of servicing duties to a successor Servicer pursuant to
Section 7.04, 7.06, 7.07 or 8.01, the Trustee or the successor Servicer may
notify Obligors to make payments that are due under the Contracts after the
effective date of the transfer of servicing duties directly to the
successor Servicer.
(b) After the transfer of servicing duties to a successor Servicer pursuant to
Section 7.04, 7.06, 7.07 or 8.01, the replaced Servicer shall have no
further obligations with respect to the management, administration,
servicing or collection of the Contracts, but in the case of a transfer
pursuant to Section 7.07 or 8.01 shall remain liable for any liability
arising from the replaced Servicer's actions hereunder and shall remain
entitled to any compensation due the replaced Servicer that had already
accrued prior to such transfer.
(c) A transfer of servicing duties to a successor Servicer shall not affect the
rights and duties of the parties hereunder (including but not limited to
the indemnities of the Servicer pursuant to Article VII), other than those
relating to the management, administration, servicing or collection of the
Contracts.
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Section 8.06 Transfer of the Account.
-----------------------
Notwithstanding the provisions of Section 8.01, if the Certificate Account
shall be maintained with the Servicer or an Affiliate of the Servicer and an
Event of Default shall occur and be continuing, the Servicer, after five days'
written notice from the Trustee, or in any event within ten days after the
occurrence of the Event of Default, shall establish a new account, which shall
be an Eligible Account, conforming with the requirements of this Agreement, at
the trust department of the Trustee or with a depository institution other than
the Servicer or an Affiliate of the Servicer, and shall promptly transfer all
funds in the Certificate Account to such new Certificate Account, which shall
thereafter be deemed the Certificate Account for the purposes hereof.
ARTICLE IX
CONCERNING THE TRUSTEE
Section 9.01 Duties of Trustee.
-----------------
The Trustee, prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred, undertakes
to perform such duties and only such duties as are set forth specifically in
this Agreement. In case an Event of Default has occurred of which a Responsible
Officer has knowledge (which has not been cured or waived), 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,
unless it is acting as Servicer pursuant to Section 8.03 in which case it will
use the same degree of care and skill as the Servicer.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are required specifically to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
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 or
waiver 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 rely conclusively, as to the truth
of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee and conforming
to the requirements of this Agreement;
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(ii) The Trustee shall not be liable personally for an error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(iii) The Trustee shall not be liable personally with respect to any action
taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Insurer or Holders of Certificates evidencing
Fractional Interests aggregating not less than 25% as 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.
None of the provisions contained in this Agreement shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties as Trustee hereunder or in the
exercise of any of its rights or powers if there is reasonable ground for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
The Trustee shall have no liability for any loss on any Eligible Investment
except and only to the extent that it is an Obligor thereon.
Section 9.02 Certain Matters Affecting the Trustee.
-------------------------------------
Except as otherwise provided in Section 9.01:
(a) The Trustee may rely upon and shall be protected in acting or refraining
from acting upon any resolution, Officers' Certificate, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) The Trustee may consult with counsel, and any written advice of its counsel
or 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 advice or Opinion of
Counsel;
(c) The Trustee shall be under no obligation to exercise any of the trusts 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 or the Insurer pursuant to the
provisions of this Agreement, unless such Certificateholders or the Insurer
shall have offered to the Trustee reasonable security or indemnity against
the costs, expenses and liabilities which may be incurred therein or
thereby;
(d) The Trustee shall not be liable personally 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;
(e) Prior to the occurrence of an Event of Default hereunder and after the
curing or waiving of all Events of Default which may have occurred, the
Trustee shall not be bound to
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make any investigation into the computations, facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report, any
Monthly Report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing so to do by the Holders of
Certificates evidencing Fractional 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
against such expense or liability as a condition to such proceeding. The
reasonable expense of every such examination shall be paid by the Servicer,
if an Event of Default shall have occurred and is continuing, and otherwise
by the Certificateholders requesting the investigation;
(f) 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;
provided, however, that any Affiliate of the Contract Seller may only
-------- -------
perform ministerial or custodial duties hereunder as agent for the Trustee;
and
(g) The Trustee shall examine any directions, notices or other communications
received from the Servicer, the Contract Seller, the Insurer or any
Certificateholder (or agent thereof) to determine if such directions,
notices or other communications appear on their face to have been made and
to otherwise be in accordance with the requirements of this Agreement. As
long as the Trustee has acted in good faith and has not been negligent in
making determinations required by this Section 9.02(g), the Trustee may
conclusively rely on such directions, notices or other communications and
shall incur no liability hereunder for complying with, or assuming the
truth of the statements contained in, any such direction, notice or other
communication.
Section 9.03 Trustee not Liable for Certificates or Contracts.
------------------------------------------------
The recitals contained herein and in the Certificates (other than the
authentication of the Certificates) shall be taken as the statements of the
Contract Seller or the Servicer, as the case may be, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations or
warranties as to the validity or sufficiency of this Agreement, of the
Certificates (except that the Certificates shall be duly and validly
authenticated by it) or of any Contract or related document. The Trustee shall
not be accountable for the use or application by the Contract Seller or the
Servicer of any of the Certificates or of the proceeds of such Certificates, or
for the use or application of any funds paid to the Contract Seller or the
Servicer in respect of the Contracts or deposited in or withdrawn from the
Certificate Account by the Servicer.
Section 9.04 Trustee May Own Certificates.
----------------------------
The Trustee in its individual or any other capacity may become the owner or
pledgee of Certificates and may transact business with the other parties hereto
with the same rights it would have if it were not Trustee.
Section 9.05 Servicer to Pay Fees and Expenses of Trustee, Paying Agent and
--------------------------------------------------------------
Certificate of Administrator.
- ----------------------------
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The Servicer covenants and agrees to pay, from its own funds, to the
Trustee, the Paying Agent and the Certificate Administrator from time to time,
and the Trustee, the Paying Agent and the Certificate Administrator shall each
be entitled to, 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 trust hereby created and
in the exercise and performance of any of the powers and duties hereunder of the
Trustee, and the Servicer will pay (out of its own funds) or reimburse the
Trustee, the Paying Agent and the Certificate Administrator, to the extent
requested by the Trustee, the Paying Agent or the Certificate Administrator, as
the case may be, for all reasonable expenses, disbursements and advances
incurred or made by the Trustee, the Paying Agent or the Certificate
Administrator, as the case may be, in accordance with any of the provisions of
this Agreement, and the reasonable compensation and the expenses and
disbursements of its counsel and of all persons not regularly in its employ, and
the expenses incurred by the Trustee in connection with the appointment of an
office or agency pursuant to Section 9.11, except any such expense, disbursement
or advance as may arise from its negligence or bad faith. The Servicer also
covenants and agrees to indemnify (out of its own funds) the Trustee, the Paying
Agent and the Certificate Administrator for, and to hold each of them harmless
against, any loss, liability or expense incurred without negligence or bad faith
on the part of the Trustee, the Paying Agent or the Certificate Administrator,
as the case may be, arising out of or in connection with the acceptance or
administration of this trust and its duties hereunder, including the costs and
expenses of defending itself against any claim or liability in connection with
the exercise or performance of any of its powers or duties hereunder. The
covenants in this Section 9.05 shall be for the benefit of the Trustee, the
Paying Agent and the Certificate Administrator in their respective capacities as
Trustee, Certificate Administrator, Paying Agent and Certificate Registrar
hereunder, and shall survive the termination of this Agreement.
Section 9.06 Eligibility Requirements for Trustee.
------------------------------------
There shall at all times be a Trustee hereunder which shall be qualified to
maintain an Eligible Account and shall be either (a) The First National Bank of
Chicago ("First National") or any other Person into which First National is
merged or consolidated or to which substantially all of the properties and
assets of First National are transferred as an entirety, provided that such
--------
other Person has accepted appointment as Trustee under this Agreement in
accordance with this Article IX, and further provided that such entity is not an
------- --------
Affiliate of the Contract Seller, is authorized to exercise corporate trust
powers under the laws of the United States of America, any State thereof or the
District of Columbia and has all necessary trust powers to perform its
obligations hereunder, or (b) a corporation or banking association organized and
doing business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000, and
subject to supervision or examination by Federal or State authority, and which
is not an Affiliate of the Contract Seller; further provided that either (i)
------- --------
such entity has long-term debt rated at least A3 by Moody's, BBB by S&P or the
equivalent by any nationally recognized statistical rating organization, or (ii)
each Rating Agency provides a letter to the effect that such appointment will
not affect the then current ratings of the Certificates. If the corporation or
banking association referred to in clause (b) of the previous sentence publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section 9.06, the combined capital and
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surplus of such corporation or banking association shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. In addition, the Trustee shall maintain an office in New York. If
at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 9.06, it shall resign immediately in the manner and
with the effect hereinafter specified in this Article IX.
Section 9.07 Resignation and Removal of the Trustee.
--------------------------------------
The Trustee at any time may resign and be discharged from the trusts hereby
created by giving written notice thereof to the Contract Seller, the Servicer,
the Insurer and each Rating Agency. Upon receiving such notice of resignation,
the Contract Seller, with the consent of the Insurer which consent shall not be
unreasonably withheld (provided that if an Insurer Default has occurred and is
continuing, no such consent needs to be obtained) 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. 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 appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance with
the provisions of Section 9.06 and shall fail to resign after written request
therefor by the Contract Seller, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or a receiver
of the Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then the Contract
Seller may remove the Trustee and 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 and the
Certificateholders.
The Holders of Certificates evidencing Fractional Interests aggregating not
less than 50% may remove the Trustee at any time and appoint a successor trustee
reasonably satisfactory to the Insurer (provided that if an Insurer Default has
occurred and is continuing, no consent of the Insurer needs to be obtained) by
written instrument or instruments, in triplicate, signed by such
Certificateholders or their attorneys-in-fact duly authorized, one complete set
of which instruments shall be delivered to the Contract Seller, one complete set
to the Trustee so removed and one complete set to the successor so appointed.
Any resignation or removal of the Trustee and appointment of a successor
trustee pursuant to any of the provisions of this Section 9.07 shall become
effective upon acceptance of appointment by the successor trustee as provided in
Section 9.08.
Section 9.08 Successor Trustee.
-----------------
Any successor trustee appointed as provided in Section 9.07 shall execute,
acknowledge and deliver to the Contract Seller and to its predecessor trustee,
with a copy to the Servicer, an instrument accepting such appointment hereunder,
and thereupon the resignation or removal of the predecessor trustee and the
appointment of such successor trustee shall become effective, and
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such successor trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as trustee
herein. The predecessor trustee shall execute and deliver such instruments and
do such other things as reasonably may be required to more fully and certainly
vest and confirm in the successor trustee all such rights, powers, duties and
obligations.
No successor trustee shall accept appointment as provided in this Section
9.08 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 9.06.
Upon acceptance of appointment by a successor trustee as provided in
this Section 9.08, the Servicer shall mail notice of the succession of such
trustee hereunder to all Certificateholders at their addresses as shown in the
Certificate Register, to the Contract Seller and each 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 Contract Seller.
Section 9.09 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 9.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. Upon succession of a successor trustee as provided in
this Section 9.09, the successor Trustee shall mail notice of the succession of
such trustee hereunder to all Certificateholders at their addresses as shown in
the Certificate Register, to the Servicer, the Contract Seller and each Rating
Agency.
Section 9.10 Appointment of Co-Trustee or Separate Trustee.
---------------------------------------------
Notwithstanding any other provisions hereof, at any time, for the purpose
of (i) meeting any legal requirements of any jurisdiction in which any part of
the Trust Fund or property securing the same may be located at the time, or (ii)
meeting any legal requirements with respect to the holding of the Contracts, the
Contract Seller 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, 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 Contract Seller
and the Trustee may consider necessary or desirable. If the Contract Seller
shall not have joined in such appointment within 15 days after the receipt by it
of a request so to do, or in case an Event of Default shall have occurred and be
continuing, the Trustee alone (or with one consenting Seller) 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
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Section 9.06 hereunder, and no notice to Certificateholders of the appointment
of co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.
In the case of any appointment of a co-trustee or separate trustee pursuant
to this Section 9.10, 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, except
to the extent that, under any law of any jurisdiction in which any particular
act or acts are to be performed or under any regulation applicable to any of the
Contracts (whether as Trustee hereunder 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 by such separate trustee or co-
trustee at the direction of the 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.
Any separate trustee or co-trustee may, at any time, appoint 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. Nothing in this Section 9.10 shall relieve the Trustee of
its duties, obligations or liabilities under this Agreement.
Section 9.11 Appointment of Office or Agency.
-------------------------------
The Trustee will appoint an office or agency in the City of New York where
Certificates may be surrendered for registration of transfer or exchange. The
Trustee initially designates Chicago Trust Company of New York, located at 14
Wall Street, New York, New York, for such purpose. The Certificate Register
will be kept in Chicago, Illinois at the offices of the Certificate Registrar
located at the Corporate Trust Office and may be kept in an electronic form
capable of printing out a hard copy of the Certificate Register. The Trustee
will maintain an office at the address stated in Section 11.05 hereof where
notices and demands to or upon the Trustee in respect of the Certificates may be
served. The Trustee will give prompt written notice to Certificateholders of
any change in the location of the Certificate Register or any such office or
agency.
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Section 9.12 Certificate Administrator.
-------------------------
The Trustee may, from time to time, appoint a Certificate Administrator for
the purpose of performing, as the Trustee's agent, those duties hereunder that
are specifically designated herein as performable by the Certificate
Administrator; provided, however, that the Certificate Administrator shall at
-------- -------
all times satisfy the eligibility requirements of a Trustee set forth in Section
9.06. As of the Closing Date, the Trustee shall be the Certificate
Administrator unless and until the Trustee appoints a successor Certificate
Administrator. In performing its duties hereunder, the Certificate
Administrator (if not the Trustee) shall have the benefit of the provisions of
this Agreement to the same extent that the Trustee would have the benefit of
such provisions if the Trustee were itself performing such duties. The
Certificate Administrator (including the Trustee solely in its capacity as
Certificate Administrator) shall not have any fiduciary responsibility to the
Contract Seller, the Servicer or the Certificateholders except when acting as
Paying Agent. Additionally, the Certificate Administrator shall be entitled to
rely upon all directions, calculations and other information received by the
Contract Seller, the Trustee or the Servicer without any duty to independently
verify such directions, calculations or other information.
Section 9.13 Appointment of Paying Agent.
---------------------------
The Trustee may appoint a Paying Agent for the purpose of making
distributions to Certificateholders pursuant to Section 5.02 and payments
pursuant to 3.17 and 9.01(c). Any Paying Agent or its parent company so
appointed either shall be a bank or trust company and shall have a rating
acceptable to each Rating Agency. In the event of any such appointment, on or
prior to each Distribution Date, the Trustee shall deposit or cause to be
deposited with the Paying Agent, from amounts in the Certificate Account, a sum
sufficient to make the payments to Certificateholders in the amounts and in the
manner provided for in Section 5.02, such sum to be held in trust for the
benefit of the Certificateholders. The Trustee is hereby initially appointed as
Paying Agent.
In performing its duties hereunder, the Paying Agent shall have the benefit
of the provisions of this Agreement to the same extent that the Trustee would
have the benefit of such provisions if the Trustee were itself performing such
duties. Additionally, the Paying Agent shall be entitled to rely upon all
information received from the Servicer without any duty to independently verify
or recalculate any such information.
The Trustee shall cause the Paying Agent to execute and deliver to the
Trustee an instrument in which such Paying Agent shall agree with the Trustee
that such Paying Agent is at all times acting as agent for the Trustee and such
Paying Agent will hold all sums held by it for the payment to Certificateholders
entitled thereto until such sums shall be paid to such Certificateholders.
Section 9.14 Determination of LIBOR; Auction Procedures
------------------------------------------
On each LIBOR Determination Date (or if such date is not a Business Day, on
the next succeeding Business Day), the Trustee shall determine LIBOR for the
following Interest Accrual Period in effect on such LIBOR Determination Date and
shall inform the Servicer of such rate.
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The Trustee agrees to comply with the terms of the Auction Procedures as such
terms relate to the Trustee.
ARTICLE X
TERMINATION
Section 10.01 Termination.
-----------
(a) The respective obligations and responsibilities of the Contract Seller, the
Servicer (except as to Section 9.05) and the Trustee shall terminate upon
the earlier of: (i) the final payment or other liquidation (or any advance
with respect thereto) of the last Contract or the disposition of all
property acquired upon repossession of any Contract and the remittance of
all funds due hereunder; (ii) at the option of the Servicer, on any
Distribution Date after the Optional Termination Date and subject to the
prior consummation of the Termination Auction as contemplated pursuant to
Section 10.01(b) below, upon the purchase by the Servicer of the
Outstanding Contracts at a price equal to the greater of (a) the sum of (x)
100% of the Scheduled Principal Balance of each Contract (other than any
Contract as to which the related Manufactured Home has been acquired and
not yet disposed of and whose fair market value is included pursuant to
Clause (y) below) as of the final Distribution Date, and (y) the fair
market value of such acquired property (as determined by the Servicer as of
the close of business on the third Business Day next preceding the date
upon which notice of any such termination is furnished to
Certificateholders pursuant to Section 10.01(c)(i)), and (b) the aggregate
fair market value (as determined by the Servicer as of the close of
business on such third Business Day) of all the assets in the Trust Fund,
plus, in the case of both clause (a) and clause (b), an amount sufficient
to pay any Class A-1 Unpaid Interest Shortfall and Class A-2 Unpaid
Interest Shortfall and the remittance of all funds due hereunder; provided,
--------
however, that if any Enhancement Payment has been made and not yet
-------
reimbursed, the Servicer (or the Holders of the Class R Certificates) may
only exercise this option with the consent of the Insurer, provided,
--------
further, that the purchase price of such Contracts shall in no event be
-------
less than the Minimum Termination Amount as of the Distribution Date on
which the Servicer purchases such Contracts; (iv) the purchase of the
Contracts by the Holders of the Class R Certificates as described below or
(v) the sale of all Contracts that remain outstanding, pursuant to a
Termination Auction as contemplated by Section 10.01(b) below and the
remittance of all funds due hereunder. If the Servicer does not exercise
its option, the Holders of the Class R Certificates, on any Distribution
Date after the Optional Termination Date and subject to the prior
consummation of the Termination Auction as contemplated pursuant to Section
10.01(b) below, upon the purchase by the Holders of the Class R
Certificates of the Outstanding Contracts at a price equal to the greater
of (a) the sum of (x) 100% of the Scheduled Principal Balance of each
Contract (other than any Contract as to which the related Manufactured Home
has been acquired and not yet disposed of and whose fair market value is
included pursuant to clause (y) below) as of the final Distribution Date,
and (y) the fair market value of such acquired property (as determined by
the Servicer as of the close of business on the third Business Day next
preceding the date upon which notice of any such termination is furnished
to Certificateholders pursuant to Section 10.01(c)(i)), and (b) the
aggregate fair market value (as determined by the Servicer as of the close
of business on such third Business Day) of all the assets in the Trust
Fund, plus, in the case of both clause (a) and clause (b), an amount
sufficient to pay any Class A-1 Unpaid Interest Shortfall and Class A-2
Unpaid Interest Shortfall,
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and any Enhancement Payments made by the Insurer but not yet reimbursed and
the remittance of all funds due hereunder, provided, that the purchase
--------
price of such Contracts shall in no event be less than the Minimum
Termination Amount as of the Distribution Date on which the Servicer
purchases such Contracts. Notwithstanding anything herein to the contrary,
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; and provided further that if the
-------- -------
Trust Fund is dissolved prior to the termination of the Certificate
Insurance Policy, the Trustee shall retain possession of Certificate
Insurance Policy as collateral agent for the benefit of the
Certificateholders, and if any amount previously distributed in accordance
with Section 5.02(a) is thereafter required to be paid under the
Certificate Insurance Policy, the Trustee as collateral agent shall make a
claim under the Certificate Insurance Policy for such amount in accordance
with Section 5.08 and distribute such amount as required under the
Certificate Insurance Policy.
(b) Termination Auction. The Servicer shall provide written notice to the
-------------------
Trustee of the occurrence of the Distribution Date as of which the Pool
Scheduled Principal Balance is less than 10% of the Cut-Off Date Pool
Principal Balance within three Business Days following such Distribution
Date. If neither the Servicer or the Class R Certificateholders exercises
their option to purchase the Contracts pursuant to Section 10.01(a), the
Trustee shall in accordance with the procedures and schedule set forth in
Exhibit J hereto (the "Auction Termination Procedures"), make a
---------
commercially reasonable effort to sell at fair market value in a
commercially reasonable manner and upon commercially reasonable terms but
subject to the earlier purchase by the Servicer of the Outstanding
Contracts as provided in Section 10.01(a) above, by conducting an auction
(the "Termination Auction") of the Contracts remaining in the Trust Fund in
order to effect a termination of the Trust Fund on a date selected by the
Trustee (the "Auction Termination Date"), but in any case within ninety
days following the Distribution Date as of which the Pool Scheduled
Principal Balance is less than 10% of the Cut-Off Date Pool Principal
Balance. The Contract Seller (if GCC is not the Servicer) may, but shall
not be required to, bid at the Termination Auction. The Trustee shall be
entitled to retain counsel of its choice to represent it in the Termination
Auction, and the fees and expenses of such counsel shall be paid by the
Contract Seller. The Trustee shall sell and transfer the Contracts to the
highest bidder therefor at the Termination Auction provided that:
(1) the Termination Auction has been conducted in accordance with the Auction
Termination Procedures;
(2) the Trustee has received good faith bids for the Contracts from at least
two prospective purchasers that are considered by the Trustee, in its sole
discretion, to be competitive participants in the market for manufactured
housing installment sale contracts; provided, that at least one of such
--------
prospective purchasers shall not be an Affiliate of the Contract Seller;
(3) a financial advisor selected by the Trustee, the fees of whom shall be an
expense of the Contract Seller, as advisor to the Trustee (in such
capacity, the "Advisor"), shall have advised the Trustee in writing that at
least two of such bidders are participants in the market for manufactured
housing retail installment sale contracts and are willing
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and able to purchase the Contracts (the Trustee may in its discretion
select itself or an affiliate thereof as Advisor);
(4) the highest bid in respect of the Contracts is not less than the aggregate
fair market value of the Contracts (as determined by the Trustee in its
sole discretion);
(5) any bid submitted by the Contract Seller or any Affiliate of the Contract
Seller shall be independently verified and represented in writing by a
qualified independent third party evaluator (which may include the Advisor
or an investment banking firm) selected by the Trustee and may only be
considered if such evaluator determines that the bid reasonably represents
the fair market value of the Contracts;
(6) the highest bid would result in proceeds from the sale of the Contracts
which will be at least equal to the Minimum Termination Amount plus any
unreimbursed Enhancement Payment;
(7) such sale and consequent termination of the Trust Fund must constitute a
"qualified liquidation" of the Trust Fund under Section 860F of the Code,
including the requirement that the proceeds of such qualified liquidation
are credited or distributed to the holders of regular residual interests
within 90 days from the date upon which the Trust Fund adopts a plan of
complete liquidation (the Trustee may, in its discretion, require that the
purchaser of such Contracts provide an Opinion of Counsel to that effect);
and
(8) the terms of the Termination Auction must be made available to all bidders
and must stipulate that the Servicer be retained to service the Contracts
on terms substantially similar to those in this Agreement.
Provided that all of the conditions set forth in clauses (1) through (8)
have been met, the Trustee shall sell and transfer the Contracts, without
representation, warranty or recourse of any kind whatsoever, to such highest
bidder in accordance with and upon completion of the Auction Procedures. The
Trustee shall deposit the purchase price for the Contracts in the Certificate
Account at least one Business Day prior to the fourth Distribution Date
following the Optional Termination Date. The provisions of subsections (c) and
(d) of this Section 10.01 also shall apply with respect to any Termination
Auction. In the event that any of such conditions are not met or such highest
bidder fails or refuses to comply with any of the Auction Procedures, the
Trustee shall decline to consummate such sale and transfer. In such case the
Termination Auction shall be concluded and the Trustee shall be under no further
duty to solicit bids for or otherwise to attempt to sell the Contracts.
(c) (i) Notice of any termination, specifying the Distribution Date upon which
all Certificateholders may surrender their Certificates to the Trustee for
payment and cancellation, shall be given promptly by the Servicer by letter
to the Certificateholders, the Insurer, the Trustee, the Contract Seller
and each Rating Agency mailed no later than the 10th day of the month next
preceding the month of such final distribution, specifying (i) the
Distribution Date upon which final payment on the Certificates will be made
upon presentation and surrender of Certificates at the office or agency of
the Trustee therein designated, (ii) the amount of any such
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final payment, and (iii) that the Record Date otherwise applicable to such
Distribution 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. After giving such notice, the Trustee shall
not register the transfer or exchange of any Certificates. If such notice
is given in connection with the Servicer's election to purchase, the
Servicer shall deposit in the Certificate Account on the Business Day prior
to the applicable Distribution Date the amount described in Section
10.01(a)(ii). The amount so deposited shall not be invested.
(ii) Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed, from funds in the Certificate Account, to
Certificateholders, in proportion to their respective Percentage Interests,
an amount equal to (a) as to the Class A-1 Certificates, the Class A-1
Certificate Balance together with the Class A-1 Unpaid Interest Shortfall
and one month's interest at the Class A-1 Pass-Through Rate on the Class A-
1 Certificate Balance, and (b) as to the Class A-2 Certificates, the Class
A-2 Certificate Balance together with the Class A-2 Unpaid Interest
Shortfall and one month's interest at the Class A-2 Pass-Through Rate on
the Class A-2 Certificate Balance.
(iii) Upon such termination, any amounts remaining in the Certificate
Account (other than amounts retained to meet claims) shall be paid to the
Class R Certificateholders. Following such final deposit, the Servicer
shall prepare and the Trustee shall execute all assignments, endorsements
and other instruments necessary to effectuate such transfer. The
distribution on the final Distribution Date shall be in lieu of the
distribution otherwise required to be made on such Distribution Date in
respect of the Certificates and the Class R Certificate.
(d) If any Certificateholder does not surrender its Certificate for
cancellation by the final Distribution Date specified in the written notice
required in Section 10.01(c)(i), any amounts retained in the Certificate
Account that are owed to such Certificateholder shall be withdrawn from the
Certificate Account and held in an escrow account with the Trustee pending
distribution pursuant to this Section 10.01(d). Any amounts so held shall
not be invested. The Trustee 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 two years after the second notice all the Certificates shall not
have been surrendered for cancellation, the Trustee shall so notify the
Contract Seller and the Contract Seller may take appropriate steps, or may
appoint an agent to take appropriate and reasonable steps, to contact the
remaining Certificateholders concerning surrender of their Certificates,
and the cost thereof shall be paid out of, and only to the extent of, the
funds and other assets which remain in trust hereunder.
Upon any termination pursuant to the exercise of the purchase option
contained in Section 10.01(a)(ii), the consummation of a sale pursuant to a
Termination Auction or otherwise, 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 10.01 will not (i) result in the
imposition of taxes on "prohibited transactions" of the Trust Fund as described
in Section 860F of the Code, (ii) cause the Trust Fund to fail to qualify as a
REMIC at any time that any Certificates are outstanding, or (iii) result in the
imposition of taxes on contributions of additional assets to the Trust Fund
under Section 860G(d) of the Code:
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(i) Within 90 days prior to the final Distribution Date set forth in the notice
given by the Servicer or the Trustee under this Section 10.01, the Holders
of the Class R Certificates shall adopt a plan of complete liquidation of
the Trust Fund;
(ii) At or after the time of adoption of such a plan of complete liquidation and
at or prior to the final Distribution Date, the Servicer as agent of the
Trustee shall sell all of the assets of the Trust Fund to the purchaser
thereof (which may be the Servicer) for cash (other than assets that will
be converted to cash prior to the final Distribution Date); and
(iii) At or after the time of adoption of such a plan of complete liquidation
and at or prior to the final Distribution Date, the Trustee shall credit or
distribute all proceeds of the liquidation (plus the cash), less assets
retained to meet claims, to the Certificateholders.
By its acceptance of a Class R Certificate, each Holder thereof hereby agrees to
adopt such a plan of complete liquidation upon the written request of the
Servicer and to take such other action in connection therewith as may be
reasonably requested by the Contract Seller.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.
---------
This Agreement may be amended from time to time by the Contract Seller, the
Servicer and the Trustee , with the consent of the Insurer, which consent shall
not be unreasonably withheld (provided that if an Insurer Default has occurred
and is continuing, no such consent needs to be obtained) without the consent of
any of the Certificateholders, (i) to cure any ambiguity, (ii) to correct or
supplement any provisions herein, (iii) to add to the duties or obligations of
the Servicer, (iv) to obtain a rating from a nationally recognized rating agency
or to maintain or improve the ratings of any Class of Certificates by each
Rating Agency (it being understood that after obtaining ratings for the
Certificates from Moody's and S&P, none of the Trustee, the Contract Seller or
the Servicer is obligated to obtain, maintain or improve any rating assigned to
the Certificates) or (v) to make such other provisions with respect to matters
or questions arising under this Agreement, as shall not be inconsistent with any
other provisions herein; provided that such action shall not, as evidenced by an
--------
Opinion of Counsel, adversely affect in any material respect the interests of
any Certificateholder. Notwithstanding the foregoing, without the consent of the
Certificateholders, the Trustee, the Contract Seller, the Insurer, which consent
shall not be unreasonably withheld (provided that if an Insurer Default has
occurred and is continuing, no such Insurer consent needs to be obtained) and
the Servicer may at any time and from time to time amend this Agreement to
modify, eliminate or add to any of its provisions to such extent as shall be
necessary or appropriate to maintain the qualification of the Trust Fund as a
REMIC under the Code or to avoid or minimize the risk of the imposition of any
tax on the Trust Fund pursuant to the Code that would be a claim against the
Trust Fund at any time prior to the final redemption of the Certificates,
provided that the Trustee has been provided an Opinion of Counsel, which opinion
shall be an expense of the party requesting such
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opinion but in any case shall not be an expense of the Trustee, to the effect
that such action is necessary or appropriate to maintain such qualification or
to avoid or minimize the risk of the imposition of such a tax.
This Agreement may also be amended from time to time by the Contract
Seller, the Servicer and the Trustee with the consent of the Insurer, which
consent shall not be unreasonably withheld (provided that if an Insurer Default
has occurred and is continuing, no such consent needs to be obtained) and with
the consent of the Holders of a Majority In Interest of each Class of Regular
Certificates affected thereby 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 (i) reduce in any manner the amount of, or
- -------
delay the timing of, payments required to be distributed on any Certificate
without the consent of the Holder of such Certificate, (ii) adversely affect in
any material respect the interests of the Holders of any Class of Certificates
in a manner other than as described in (i), without the consent of the Holders
of Certificates of such Class evidencing, as to such Class, Percentage Interests
aggregating 66% or (iii) reduce the aforesaid percentages of Certificates the
Holders of which are required to consent to any such amendment, without the
consent of the Holders of all such Certificates then outstanding.
Notwithstanding any contrary provision of this Agreement, the Trustee shall
not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel, which opinion shall be an expense of the party
requesting such amendment but in any case shall not be an expense of the
Trustee, to the effect that such amendment will not cause the imposition of any
tax on the Trust Fund or the Certificateholders or cause the Trust Fund to fail
to qualify as a REMIC at any time that any Certificates are outstanding.
Promptly after the execution of any amendment to this Agreement requiring
the consent of Certificateholders, the Trustee shall furnish written
notification of the substance of such amendment to each Certificateholder, the
Insurer and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under this
Section 11.01 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
regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel, satisfactory to the Trustee
that (i) such amendment is permitted and is not prohibited by this Agreement and
that all requirements for amending this Agreement have been complied with; and
(ii) either (A) the amendment does not adversely affect in any material respect
the interests of any Certificateholder or (B) the conclusion set forth in the
immediately preceding clause (A) is not required to be reached pursuant to this
Section 11.01.
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Section 11.02 Recordation of Agreement; Counterparts.
--------------------------------------
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 Contracts are situated, and
in any other appropriate public recording office or elsewhere, such recordation
to be effected by the Servicer at its expense.
For the purpose of facilitating the recordation of this Agreement as herein
provided and for other purposes, this Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and such counterparts shall constitute but one and the same
instrument.
Section 11.03 Governing Law.
-------------
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
SUBSTANTIVE LAWS OF THE STATE OF CALIFORNIA APPLICABLE TO AGREEMENTS MADE AND TO
BE PERFORMED IN THE STATE OF CALIFORNIA AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Section 11.04 Calculations.
------------
Except as otherwise provided in this Agreement, all Pass-Through Rate,
interest rate and basis point calculations under this Agreement will be made
with respect to the Class A Certificates on the basis of the actual number of
days elapsed during the related Interest Accrual Period and a 360-day year and
will be carried out to at least three decimal places. Interest on the Regular
Certificates with respect to a Distribution Date will accrue during the related
Interest Accrual Period.
Section 11.05 Notices.
-------
(a) The Trustee shall use its best efforts to promptly provide notice to each
Rating Agency with respect to each of the following of which it has actual
knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Servicer or the Trustee and the
appointment of any successor or any assignment of this Agreement pursuant to
Section 7.06;
4. The repurchase or substitution of Contracts pursuant to Section 3.05;
5. The final payment to Certificateholders;
6. A sale of any Class R Certificate; and
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7. Any shortfalls arising from the failure of the Servicer to advance as
required pursuant to Section 5.01 hereof.
In addition, the Servicer shall promptly furnish to each Rating Agency
copies of the following:
1. Each report to Certificateholders described in Section 5.07;
2. Each annual statement as to compliance described in Section 4.20; and
3. Each annual independent public accountants' servicing report described in
Section 4.21.
All directions, demands and notices hereunder shall be in writing and
shall be deemed to have been duly given when delivered to (a) in the case of the
Contract Seller and the Servicer: GreenPoint Credit Corp., 10089 Willow Creek
Road, San Diego, California 92131, Attention: Manager, Investor Servicing (or
such other address as may be hereafter furnished to the Contract Seller, the
Insurer and the Trustee by the Servicer in writing), with copies to Howard
Bluver, Esq., GreenPoint Bank, 90 Park Avenue, New York, New York 10016, (b) in
the case of the Trustee, The First National Bank of Chicago, One First National
Plaza, Suite 0126, Chicago, Illinois 60670-0126, Attention: Donna Fanning or
such other address as the Trustee may hereafter furnish to the Contract Seller,
the Insurer and the Servicer; (c) in the case of the Insurer, MBIA Insurance
Corporation, 113 King Street, Armonk, New York 10504, Attention: Insured
Portfolio Management, Structured Finance or such other address as the Insurer
may hereafter furnish to the Contract Seller, the Trustee and the Servicer, (d)
in the case of the Rating Agencies, (i) Moody's Investors Service, Inc., 99
Church Street, New York, New York 10007 and (ii) S&P, 26 Broadway, 15th Floor,
New York, New York 10004, (e) in the case of the Auction Agent, Bankers Trust
Company, 4 Albany Street, New York, New York 10006, Attention: Corporate Trust
and Agency Group and (f) in the case of the Market Agent, Salomon Smith Barney
Inc., 388 Greenwich Street, New York, New York 10013, Attention: General
Counsel. Notices to Certificateholders shall be deemed given when mailed, first
class postage prepaid, to their respective addresses appearing in the
Certificate Register.
Section 11.06 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 11.07 Assignment.
----------
Notwithstanding anything to the contrary contained herein, except as
provided pursuant to Sections 7.04 and 7.06, this Agreement may not be assigned
by the Servicer without the prior written consent of the Trustee and the
Contract Seller.
89
<PAGE>
Section 11.08 Limitations 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 representative or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a petition or winding up of the Trust
Fund, or otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
herein) 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
party 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 an Event
of Default and of the continuance thereof, as hereinbefore provided, and unless
the Holders of Certificates evidencing not less than 25% of the Voting Rights
evidenced by the Certificates shall also have made written request to 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 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 and offer of indemnity shall have neglected or refused to institute any
such action, suit or proceeding; it being understood and intended, 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 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 herein provided and for the
common benefit of all Certificateholders. For the protection and enforcement of
the provisions of this Section 11.08, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.09 Inspection and Audit Rights.
---------------------------
The Servicer agrees that, on reasonable prior notice, it will permit any
representative of the Contract Seller or the Trustee during the Servicer's
normal business hours, to examine all the books of account, records, reports and
other papers of the Servicer relating to the Contracts, to make copies and
extracts therefrom, to cause such books to be audited by independent certified
public accountants selected by the Contract Seller or the Trustee and to discuss
its affairs, finances and accounts relating to the Contracts with its officers,
employees and independent public accountants (and by this provision the Servicer
hereby authorizes such accountants to discuss with such representative such
affairs, finances and accounts), all at such reasonable times and as often as
may be reasonably requested. Any out-of-pocket expense incident to the exercise
90
<PAGE>
by the Contract Seller or the Trustee of any right under this Section 11.09
shall be borne by the party requesting such inspection; all other such expenses
shall be borne by the Servicer.
Section 11.10 Certificates Nonassessable and Fully Paid.
-----------------------------------------
It is the intention of the Contract Seller that Certificateholders shall
not be personally liable for obligations of the Trust Fund, that the interests
in the Trust Fund represented by the Certificates shall be nonassessable for any
reason whatsoever, and that the Certificates, upon due authentication thereof by
the Trustee pursuant to this Agreement, are and shall be deemed fully paid.
Section 11.11 Third Party Beneficiary
-----------------------
Each of the Insurer and the Market Agent shall be a third party beneficiary
of this Agreement. The Insurer shall be entitled to bring a claim against the
Contract Seller for its failure to perform its obligations under Section 3.05 or
a claim against the Servicer for any failure by the Servicer to make Monthly
Advances as required under Section 5.01 or any deposit or other payment required
under this Agreement.
Section 11.12 Purchases Upon Conversion
-------------------------
The Holders of the Class R Certificates, by their acceptance of such
Certificates shall agree that with respect to each Contract that converts from a
variable Contract Rate to a fixed Contract Rate during any Collection Period
pursuant to the terms of such Contract that they will:
(i) Repurchase such Contracts not later than the 5th day following such
Collection Period at a price equal to the Scheduled Principal Balance of such
Contract on the date of such conversion, plus all accrued and unpaid interest
thereon to such date of conversion. Amounts in respect of such price shall be
delivered to the Servicer for deposit to the Certificate Account.
(ii) Any amounts received as payment in respect of any such Contract
repurchased pursuant to clause (i) above after the date of repurchase (other
than the amount referred to in clause (i) above), shall not be a part of the
Trust Fund and shall be paid by the Servicer to the Holders of the Class R
Certificates or, if such amounts have been deposited into the Certificate
Account, shall be withdrawn therefrom by the Servicer and paid by the Servicer
to the Holders of the Class R Certificates.
(iii) Promptly after the purchase referred to in this Section 11.12, the
Trustee shall execute such documents as are presented to it by the Servicer on
behalf of the Holder of the Class R Certificate and are reasonably necessary to
convey the purchased Contract to the Holder of the Class R Certificate.
91
<PAGE>
IN WITNESS WHEREOF, the GCC and the Trustee have caused their names to be
signed hereto by their respective officers thereunto duly authorized as of the
day and year first above written.
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, but solely as
Trustee
By: /s/ Somsri Helmer
--------------------
Name: Somsri Helmer
Title: Trust Officer
GREENPOINT CREDIT CORP.,
as Contract Seller and Servicer
By: /s/ Charles O. Ryan
---------------------
Name: Charles O. Ryan
Title: Senior Vice President
92
<PAGE>
STATE OF CALIFORNIA )
) ss.
COUNTY OF SAN DIEGO )
On March 11, 1999 before me, Trace A. Wherry-Phillips, Notary Public,
personally appeared Charles O. Ryan, proved to me on the basis of satisfactory
evidence to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity and that
by his signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.
WITNESS my hand and official seal.
/s/ Trace A. Wherry-Phillips
----------------------------
Notary Public
My Commission expires /s/ 02 August 1999
------------------
[Notarial Seal]
93
<PAGE>
STATE OF ILLINOIS )
) ss.
COUNTY OF COOK )
On this 17th day of March, 1999, before me, a notary public in and for said
--
State, appeared Somsri Helmer, personally known to me on the basis of
satisfactory evidence to be a Trust Officer of The First National Bank of
Chicago, a national banking association that executed the within instrument, and
also known to me to be the person who executed it on behalf of such corporation,
and acknowledged to me that such national banking association executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
/s/ Maria Birrueta
------------------
Notary Public
My Commission expires _________
[Notarial Seal]
94
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<S> <C>
Schedule I............................. Auction Procedures
Exhibit A.............................. Contract Schedule
Exhibit B-1............................ Form of Class A-1 Certificate
Exhibit B-2............................ Form of Class A-2 Certificate
Exhibit C.............................. Form of Reverse of Certificates
Exhibit D.............................. Form of Class R Certificate
Exhibit E.............................. Form of Certificate Regarding Substitution of Eligible Substitute
Contract
Exhibit F.............................. Form of Certificate of Servicing Officer
Exhibit G-1............................ Form of Transfer Affidavit
Exhibit G-2............................ Form of Transferor Certificate for Class R Certificates
Exhibit H.............................. Form of Certificate Insurance Policy
Exhibit I.............................. Form of Depository Agreement
Exhibit J.............................. Termination Auction Procedures
Exhibit K.............................. Notice of Ratings
</TABLE>
<PAGE>
EXHIBIT A
CONTRACT SCHEDULE
(SEE ATTACHED)
Exhibit A-1
<PAGE>
EXHIBIT B-1
FORM OF CLASS A-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
<TABLE>
<CAPTION>
<S> <C> <C>
Certificate No. : A-1-__
Date of Pooling and Servicing Agreement : March 1, 1999
Cut-Off Date : February 28, 1999
First Distribution Date : April 15, 1999
Initial Certificate Balance of
this Certificate ("Denomination") : $
Initial Certificate Balance of all
Class A-1 Certificates : $89,637,432
Pass-Through Rate : LIBOR plus .22%
Month of Last Scheduled
Distribution Date : February, 2019
CUSIP : 395386AF2
</TABLE>
Exhibit B-1-1
<PAGE>
GreenPoint Credit Manufactured Housing Contract Trust
Pass-Through Certificates, Series 1999-2
evidencing a percentage interest in any distributions allocable to the
Class A-1 Certificates with respect to a Trust Fund consisting primarily of
a pool of conventional manufactured housing contracts (the "Contracts")
formed and sold by
GreenPoint Credit Corp., (the "Contract Seller")
which manufactured housing contracts were originated or acquired by Contract
Seller, and are initially serviced by GreenPoint Credit Corp., (the "Servicer").
Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Balance at any time may be less than
the Certificate Balance as set forth herein. Neither this Certificate nor the
Contracts are insured or guaranteed by the Contract Seller, the Servicer or the
Trustee referred to below or any of their respective Affiliates or by any
governmental agency or instrumentality.
This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination of
this Certificate by the aggregate of the denominations of all Class A-1
Certificates) in certain monthly distributions with respect to a Trust Fund
consisting of the Contracts deposited by the Contract Seller. The Trust Fund
was created pursuant to a Pooling and Servicing Agreement, dated as of March 1,
1999 (the "Agreement"), between GreenPoint Credit Corp., as Contract Seller and
Servicer, and The First National Bank of Chicago, as trustee (the "Trustee").
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the
15th day of each month or, if such 15th day is not a Business Day, the Business
Day immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the applicable Record Date in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the Class A-1 Distribution Amount on such Distribution Date
pursuant to Section 5.02 of the Agreement. The Record Date applicable to each
Distribution Date is the close of business on the day preceding such
Distribution Date. Distributions to the Holder of this Class A-1 Certificate
shall be applied first to interest and then to principal.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall hold Class A-1
Certificates evidencing a Percentage Interest aggregating 10% or more or, if
not, by check mailed
Exhibit B-1-2
<PAGE>
by first class mail to the address of such Certificateholder appearing in the
Certificate Register. The final distribution on each Certificate will be made in
like manner, but only upon presentment and surrender of such Certificate at the
Corporate Trust Office or such other location specified in the notice to
Certificateholders of such final distribution.
Reference is hereby made to the further provisions of this Certificate set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless the certificate of authentication hereon has
been manually executed by an authorized officer of the Trustee.
* * *
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated:
-----------------------
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, but solely as
Trustee
By
---------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1 Certificates
referred to in the within-named Agreement
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, but solely as Trustee
By ----------------------------------------
Authorized Signatory
Exhibit B-1-3
<PAGE>
EXHIBIT B-2
FORM OF CLASS A-2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
<TABLE>
<CAPTION>
<S> <C> <C>
Certificate No. : A-2-__
Date of Pooling and Servicing Agreement : March 1, 1999
Cut-Off Date : February 28, 1999
First Distribution Date : April 19, 1999
Initial Certificate Balance of
this Certificate ("Denomination") : $
Initial Certificate Balance of all
Class A-2 Certificates : $100,000,000
Pass-Through Rate : Auction Rate
Month of Last Scheduled
Distribution Date : March, 2029
CUSIP : 395386AG0
</TABLE>
Exhibit B-2-1
<PAGE>
GreenPoint Credit Manufactured Housing Contract Trust
Pass-Through Certificates, Series 1999-2
evidencing a percentage interest in any distributions allocable to the
Class A-2 Certificates with respect to a Trust Fund consisting primarily of
a pool of conventional manufactured housing contracts (the "Contracts")
formed and sold by
GreenPoint Credit Corp., (the "Contract Seller")
which manufactured housing contracts were originated or acquired by Contract
Seller, and are initially serviced by GreenPoint Credit Corp., (the "Servicer").
Principal in respect of this Certificate is distributable monthly as set
forth herein. Accordingly, the Certificate Balance at any time may be less than
the Certificate Balance as set forth herein. Neither this Certificate nor the
Contracts are insured or guaranteed by the Contract Seller, the Servicer or the
Trustee referred to below or any of their respective Affiliates or by any
governmental agency or instrumentality.
This certifies that Cede & Co. is the registered owner of the Percentage
Interest evidenced by this Certificate (obtained by dividing the denomination of
this Certificate by the aggregate of the denominations of all Class A-2
Certificates) in certain monthly distributions with respect to a Trust Fund
consisting of the Contracts deposited by the Contract Seller. The Trust Fund
was created pursuant to a Pooling and Servicing Agreement, dated as of March 1,
1999 (the "Agreement"), between GreenPoint Credit Corp., as Contract Seller and
Servicer, and The First National Bank of Chicago, as trustee (the "Trustee").
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, a distribution will be made on the
18th day of each month or, if such 18th day is not a Business Day, the Business
Day immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the applicable Record Date in an
amount equal to the product of the Percentage Interest evidenced by this
Certificate and the Class A-2 Distribution Amount on such Distribution Date
pursuant to Section 5.02 of the Agreement. The Record Date applicable to each
Distribution Date is the The Record Date applicable to each Distribution Date is
the close of business on the day preceding such Distribution Date.
Distributions to the Holder of this Class A-2 Certificate shall be applied first
to interest and then to principal.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall hold Class A-2
Exhibit B-2-2
<PAGE>
Certificates evidencing a Percentage Interest aggregating 10% or more or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the Corporate Trust Office or such other
location specified in the notice to Certificateholders of such final
distribution.
Reference is hereby made to the further provisions of this Certificate set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the Agreement
or be valid for any purpose unless the certificate of authentication hereon has
been manually executed by an authorized officer of the Trustee.
* * *
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated:
----------------
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, but solely as a Trustee
By ----------------------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-2 Certificates
referred to in the within-named Agreement
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, but solely as Trustee
By --------------------------------------------------
Authorized Signatory
Exhibit B-2-3
<PAGE>
EXHIBIT C
FORM OF REVERSE OF CERTIFICATES
GreenPoint Credit Manufactured Housing Contract Trust
Pass-Through Certificates, Series 1999-2
This Certificate is one of a duly authorized issue of Certificates
designated as GreenPoint Credit Manufactured Housing Contract Trust Pass-Through
Certificates, Series 1999-2 issued in three Classes (Class A-1, Class A-2 and
Class R, herein collectively called the "Certificates"), and representing a
beneficial ownership interest, as described in the Agreement, in (i) the related
Contracts, (ii) the distributions thereon on or after the Cut-Off Date (to the
extent described herein), and (iii) the Certificate Account and such assets as
are deposited therein from time to time and any investments thereof, together,
in each case, with any and all income, proceeds and payments with respect
thereto.
The Certificateholder, by its acceptance of this Certificate, agrees that
it will look solely to the funds on deposit in the Certificate Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
for any amount payable under this Certificate or the Agreement or, except as
expressly provided in the Agreement, subject to any liability under the
Agreement.
This Certificate does not purport to summarize the Agreement and reference
is made to the Agreement for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Trustee.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Contract Seller, the Servicer and the Trustee with the consent of the
Holders of a Majority In Interest of each Class of Regular Certificates affected
by such amendment. Any such consent by the Holder of this Certificate shall be
conclusive and binding on such Holder and upon all future Holders of this
Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof,
in certain limited circumstances, without the consent of the Holders of any of
the Certificates.
As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register of the Trustee upon surrender of this Certificate for registration of
transfer at the Corporate Trust Office or the office or agency maintained by the
Trustee in New York, New York, accompanied by a written instrument of transfer
in form satisfactory to the Trustee and the Certificate Registrar duly executed
by the holder hereof or such holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of the same Class in authorized
denominations and evidencing the same
Exhibit C-1
<PAGE>
aggregate Percentage Interest in the Trust Fund will be issued to the designated
transferee or transferees.
The Certificates are issuable only as registered Certificates without
coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Contract Seller and the Trustee and any agent of the Contract Seller or
the Trustee may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and neither of the Contract Seller, the
Trustee, nor any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the Pool Scheduled Principal Balance is
less than or equal to 10% of the Cut-Off Date Pool Principal Balance, the
Servicer will have the option to repurchase, upon giving notice mailed no later
than the 10th day of the month next preceding the month of the exercise of such
option, all Outstanding Contracts at a price equal to the greater of Outstanding
Contracts at a price equal to the greater of (a) the sum of (x) 100% of the
Scheduled Principal Balance of each Contract (other than any Contract as to
which the related Manufactured Home has been acquired and not yet disposed of
and whose fair market value is included pursuant to Clause (y) below) as of the
final Distribution Date, and (y) the fair market value of such acquired property
(as determined by the Servicer as of the close of business on the third Business
Day next preceding the date upon which notice of any such termination is
furnished to Certificateholders pursuant to Section 10.01(c)(i) of the
Agreement), and (b) the aggregate fair market value (as determined by the
Servicer as of the close of business on such third Business Day) of all the
assets in the Trust Fund, plus, in the case of both clause (a) and clause (b),
an amount sufficient to pay any Class A-1 Unpaid Interest Shortfall, Class A-2
Unpaid Interest Shortfall and the remittance of all funds due hereunder;
provided, however, that if any Enhancement Payment has been made and not yet
- -------- -------
reimbursed, the Servicer (or the Holders of the Class R Certificates) may only
exercise this option with the consent of the Insurer, provided, further, that
-------- -------
the purchase price of such Contracts shall in no event be less than the Minimum
Termination Amount as of the Distribution Date on which the Servicer purchases
such Contracts. If the Servicer does not exercise its option, the Holders of
the Class R Certificates, on any Distribution Date after the first Distribution
Date on which the Pool Scheduled Principal Balance is less than 10% of the Cut-
Off Date Pool Principal, upon the purchase by the Holders of the Class R
Certificates of the Outstanding Contracts at a price equal to the greater of (a)
the sum of (x) 100% of the Scheduled Principal Balance of each Contract (other
than any Contract as to which the related Manufactured Home has been acquired
and not yet disposed of and whose fair market value is included pursuant to
Clause (y) below) as of the final Distribution Date, and (y) the fair market
value of such acquired property (as determined by the Servicer as of the close
of
Exhibit C-2
<PAGE>
business on the third Business Day next preceding the date upon which notice
of any such termination is furnished to Certificateholders pursuant to Section
10.01 of the Agreement), and (b) the aggregate fair market value (as determined
by the Servicer as of the close of business on such third Business Day) of all
the assets in the Trust Fund, plus, in the case of both clause (a) and clause
(b), an amount sufficient to pay any Class A-1 Unpaid Interest Shortfall, Class
A-2 Unpaid Interest Shortfall and any Enhancement Payments made by the Insurer
but not yet reimbursed and the remittance of all funds due hereunder, provided,
--------
that the purchase price of such Contracts shall in no event be less than the
Minimum Termination Amount as of the Distribution Date on which the Servicer
purchases such Contracts.
On any Distribution Date on which the Pool Scheduled Principal Balance is
less than or equal to 10% of the Cut-Off Date Pool Principal Balance, the
Servicer may request that the Trustee conduct an auction (a "Termination
Auction") by soliciting bids for the purchase of all Contracts remaining in the
Trust Fund, and in any event, if the Servicer has not exercised the option
described in the preceding paragraph within ninety days following the
Distribution Date as of which the Pool Scheduled Principal Balance is less than
10% of the Cut-Off Date Pool Principal Balance, the Trustee shall conduct such
termination auction. In the event that satisfactory bids are received as
described in the Agreement, the net sale proceeds will be distributed to
Certificateholders, in the same order of priority as collections received in
respect of the Contracts. A satisfactory bid is one in which the purchase price
of the Contracts then outstanding is at least equal to the Minimum Termination
Amount (as hereinafter defined) plus any unreimbursed Enhancement Payment. Such
a bid must be made in accordance with certain auction procedures set forth in
the Agreement, which include a requirement that the Trustee receive good faith
bids for such Contracts from at least two prospective purchasers (at least one
of whom is not the Contract Seller or an affiliate thereof) that are considered
by the Trustee, in its sole discretion, to be (i) competitive participants in
the market for manufactured housing installment sale contracts or installment
loan agreements and (ii) willing and able purchasers of such Contracts. As of
any time after the Pool Scheduled Principal Balance is less than 10% of the Cut-
Off Date Pool Principal Balance, the "Minimum Termination Amount" is an amount
equal to the respective Certificate Balances of all Classes of Certificates that
remain outstanding as of such time, together with any shortfall in interest due
on such Certificates in respect of prior Distribution Dates and one month's
interest at the applicable Pass-Through Rates on such Certificate Balances. A
sale and consequent termination of the Trust Fund pursuant to a Termination
Auction must constitute a "qualified liquidation" of the Trust Fund under
Section 860F of the Code, including the requirement that the qualified
liquidation takes place over a period not to exceed 90 days. If satisfactory
bids are not received, the Trustee shall decline to sell the Contracts and shall
not be under any obligation to solicit any further bids or otherwise negotiate
any further sale of the Contracts.
Any repurchase pursuant to a Termination Auction or by the Servicer will be
made at the price specified in the Agreement. In the event that no such early
termination occurs, the obligations and responsibilities created by the
Agreement will terminate upon the later of the final payment or other
liquidation of the last Contract remaining in the Trust Fund and the disposition
of all REO Property in respect thereof and the distribution to
Certificateholders of all amounts required to be distributed pursuant to the
Agreement. In no event, however, will the
Exhibit C-3
<PAGE>
trust created by the Agreement continue beyond the expiration of 21 years from
the death of the last survivor of the descendants living at the date of the
Agreement of the certain person named in the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
Exhibit C-4
<PAGE>
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________
_______________________________________________________________________
_______________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a like
denomination and Class, to the above named assignee and deliver such Certificate
to the following address:
-----------------------------------------------------------------
Dated:
----------------------------------------------
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to____________________________________, for the account of ____
______________________,account number ____________________, or, if mailed by
check, to _____________________________________________________________________,
Applicable statements should be mailed to _____________________________________.
This information is provided by _____________________, the assignee named
above, or _____________________________________, as its agent.
Exhibit C-5
<PAGE>
EXHIBIT D
FORM OF CLASS R CERTIFICATE
THE CLASS R CERTIFICATE HAS NO PRINCIPAL BALANCE, DOES NOT BEAR INTEREST AND
WILL NOT RECEIVE ANY DISTRIBUTIONS EXCEPT AS PROVIDED HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
NO TRANSFER OF THIS CERTIFICATE OR ANY INTEREST HEREIN MAY BE MADE TO ANY
PERSON, UNLESS THE TRANSFEREE PROVIDES EITHER A CERTIFICATION PURSUANT TO
SECTION 6.02(b) OF THE AGREEMENT OR AN OPINION OF COUNSEL SATISFACTORY TO THE
SERVICER, THE CONTRACT SELLER AND THE TRUSTEE THAT THE PURCHASE OF THIS
CERTIFICATE WILL NOT CONSTITUTE OR RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION
UNDER SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA"), OR SECTION 4975 OF THE CODE AND WILL NOT SUBJECT THE
SERVICER, THE CONTRACT SELLER OR THE TRUSTEE TO ANY OBLIGATION OR LIABILITY IN
ADDITION TO THOSE UNDERTAKEN IN THE AGREEMENT.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT") OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE RESOLD OR TRANSFERRED UNLESS IT IS IN A TRANSACTION WHICH IS EXEMPT FROM
REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 6.02 OF THE AGREEMENT. NEITHER THIS
CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED TO A "DISQUALIFIED
ORGANIZATION" AS DEFINED IN SECTION 860(e)(5) OF THE CODE.
THE HOLDERS OF THE CLASS R CERTIFICATES, BY PURCHASING SUCH CLASS R
CERTIFICATES, SHALL BE DEEMED TO CONSENT (1) TO THE APPOINTMENT OF THE SERVICER
AS THE TAX MATTERS PERSON FOR THE TRUST FUND OR, IF THE SERVICER DETERMINES, IN
ITS SOLE DISCRETION, THAT IT CANNOT ACT IN SUCH CAPACITY, TO THE APPOINTMENT OF
THE HOLDER HOLDING THE LARGEST PERCENTAGE INTEREST IN THE OUTSTANDING CLASS R
CERTIFICATES AS THE TAX MATTERS PERSON FOR THE TRUST FUND. IF THE HOLDER OF THE
LARGEST PERCENTAGE INTEREST IN THE OUTSTANDING CLASS R CERTIFICATES IS APPOINTED
AS THE TAX MATTERS PERSON, SUCH HOLDER SHALL BE DEEMED TO CONSENT, WITH RESPECT
TO ITS CAPACITY AS TAX MATTERS PERSON, TO THE APPOINTMENT OF THE SERVICER AS ITS
ATTORNEY-IN-FACT AND AGENT.
Exhibit D-1
<PAGE>
THE HOLDERS OF THE CLASS R CERTIFICATES, BY PURCHASING SUCH CLASS R
CERTIFICATES, SHALL BE FURTHER DEEMED TO AGREE TO EXECUTE ANY DOCUMENTS REQUIRED
TO GIVE EFFECT TO THE FOREGOING PROVISIONS, AS SET FORTH MORE FULLY IN THE
AGREEMENT.
THIS CLASS R CERTIFICATE IS SUBORDINATE IN RIGHT OF PAYMENT TO THE REGULAR
CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
<TABLE>
<CAPTION>
<S> <C> <C>
Certificate No. : R-__
Date of Pooling and
Servicing Agreement : March 1, 1999
Cut-Off Date : February 28, 1999
First Distribution Date : April 15, 1999
Percentage Interest
Evidenced by this
Class R Certificate _____%
</TABLE>
Exhibit D-2
<PAGE>
GreenPoint Credit Manufactured Housing Contract Trust
Pass-Through Certificates, Series 1999-2
evidencing a percentage interest in any distributions allocable to the
Class R Certificates with respect to a Trust Fund consisting primarily of a
pool of conventional manufactured housing contracts (the "Contracts")
formed and sold by
GreenPoint Credit Corp., (the "Contract Seller")
which manufactured housing contracts were originated or acquired by Contract
Seller, and are initially serviced by GreenPoint Credit Corp., (the "Servicer").
Neither this Certificate nor the Contracts are insured or guaranteed by the
Contract Seller, the Servicer or the Trustee referred to below or any of their
respective Affiliates or by any governmental agency or instrumentality.
This certifies that __________ is the registered owner of the Percentage
Interest evidenced by this Certificate in certain monthly distributions with
respect to a Trust Fund consisting of the Contracts deposited by the Contract
Seller. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement, dated as of March 1, 1999 (the "Agreement"), between GreenPoint
Credit Corp., as Contract Seller and Servicer, and The First National Bank of
Chicago, as trustee (the "Trustee"). To the extent not defined herein, the
capitalized terms used herein have the meanings assigned in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound
including, but not limited to, Section 11.12 thereof.
The Trustee will cause to be distributed to the Class R Certificateholder
the amounts to which such Holder is entitled pursuant to the terms of the
Agreement. Such distributions will be made by check mailed to the address of
the Person entitled thereto, as such address shall appear on the Certificate
Register or by wire or other transfer of immediately available funds if such
Person has given the Trustee written instructions at least ten days prior to the
related Distribution Date. Notwithstanding the above, the final distribution on
this Class R Certificate will be made only upon presentation and surrender of
this Class R Certificate at the Corporate Trust Office or the office or agency
maintained by the Trustee for such purpose.
No transfer of this Class R Certificate will be made unless the Trustee has
received either (i) an Opinion of Counsel acceptable to and in form and
substance satisfactory to the Trustee, the Contract Seller and the Servicer with
respect to the permissibility of such transfer under the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and Section 4975 of the
Internal Revenue Code (the "Code") and stating, among other things, that the
transferee's acquisition of Class R Certificate will not constitute or result in
a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975
of the Code and will not subject the Servicer, the Contract Seller or the
Trustee to any obligation or liability in addition to those undertaken in the
Agreement or (ii) a representation letter, in the form as described by the
Exhibit D-3
<PAGE>
Agreement, stating that the transferee is not an employee benefit or other plan
subject to the prohibited transaction provisions of ERISA or Section 4975 of the
Code (a "Plan"), or any other person (including an investment manager, a named
fiduciary or a trustee of any Plan) acting, directly or indirectly, on behalf of
or purchasing any Certificate with "plan assets" of any Plan.
No transfer of a Class R Certificate shall be made unless such transfer is
exempt from the registration requirements of the Securities Act of 1933, as
amended, (the "Act"), or is made in accordance with said Act. In the event that
such a transfer is to be made, the prospective transferee of such Certificate
shall be required to provide the Trustee, the Contract Seller and the Servicer
with an investment letter substantially in the form described by the Agreement,
as required under Section 6.02 of the Agreement. The Holder hereof desiring to
effect such transfer shall, and does hereby agree to, indemnify the Trustee, the
Contract Seller, the Servicer and the Certificate Registrar acting on behalf of
the Trustee against any liability that may result if the transfer is not so
exempt or is not made in accordance with the Act or any similar state laws.
Each Holder of this Class R Certificate will be deemed to have agreed to be
bound by the restrictions of Section 6.02 of the Agreement, including but not
limited to the restrictions that (i) each person holding or acquiring any
Ownership Interest in this Class R Certificate must be a Permitted Transferee,
(ii) no Ownership Interest in this Class R Certificate may be transferred
without delivery to the Trustee of (a) a transfer affidavit of the proposed
transferee and (b) a transfer certificate of the transferor, each of such
documents to be in the form described in the Agreement, (iii) each person
holding or acquiring any Ownership Interest in this Class R Certificate must
agree to require a transfer affidavit and to deliver a transfer certificate to
the Trustee as required pursuant to the Agreement, (iv) each person holding or
acquiring an Ownership Interest in this Class R Certificate must agree not to
transfer an Ownership Interest in this Class R Certificate if it has actual
knowledge that the proposed transferee is not a permitted transferee and (v) any
attempted or purported transfer of any ownership interest in this Class R
Certificate in violation of such restrictions will be absolutely null and void
and will vest no rights in the purported transferee.
Reference is hereby made to the further provisions of this certificate set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
This certificate shall not be entitled to any benefit under the agreement
or be valid for any purpose unless the certificate of authentication hereon has
been manually executed by an authorized officer of the Trustee.
Exhibit D-4
<PAGE>
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: __________________
THE FIRST NATIONAL BANK OF CHICAGO,
in its individual capacity, but solely as Trustee
By
----------------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class R Certificates
referred to in the within-named Agreement
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity, but solely as Trustee
By
--------------------------------------------------
Authorized Signatory
Exhibit D-5
<PAGE>
EXHIBIT E
FORM OF CERTIFICATE REGARDING
SUBSTITUTION OF ELIGIBLE SUBSTITUTE CONTRACT
The undersigned certify that they are [title] and [title], respectively of
GreenPoint Credit Corp., (the "Contract Seller"), and that as such they are duly
authorized to execute and deliver this certificate on behalf of the Contract
Seller pursuant to Section 3.05(b) of the Pooling and Servicing Agreement (the
"Agreement") dated as of March 1, 1999 between GreenPoint Credit Corp., as
Contract Seller and Servicer, and The First National Bank of Chicago as Trustee
(all capitalized terms used herein without definition having the respective
meanings specified in the Agreement), and further certify that:
1. The Contracts on the attached schedule are to be substituted on the date
hereof pursuant to Section 3.05(b) of the Agreement and each such Contract is an
Eligible Substitute Contract.
2. The Contract File for each such Contract being substituted for a Replaced
Contract is in the custody of the Servicer and each such Contract has been
stamped in accordance with Section 3.02(x) of the Agreement.
3. The UCC-1 financing statement in respect of the Contracts to be
substituted, in the form required by Section 3.05(b)(ii) of the Agreement, has
been filed with the appropriate office in California.
4. There has been deposited in the Certificate Account each amount listed on
the schedule attached hereto as the amount by which the remaining principal
balance of each Replaced Contract exceeds the remaining principal balance as of
the beginning of the month of substitution of each Contract being substituted
therefor.
IN WITNESS WHEREOF, I have affixed hereunto my signature this ______ day
of ____, __.
GREENPOINT CREDIT CORP.
By ____________________________________________
[Name] ________________________________________
[Title]________________________________________
By ____________________________________________
[Name]_________________________________________
[Title]________________________________________
Exhibit E-1
<PAGE>
EXHIBIT F
[FORM OF CERTIFICATE OF SERVICING OFFICER]
The undersigned certifies that he is a [title] of [Servicer], a [
----------
corporation][(the "Servicer"), and that as such he is duly authorized to
execute and deliver this certificate on behalf of the Servicer pursuant to
Section 5.05 of the Pooling and Servicing Agreement (the "Agreement") dated as
of March 1, 1999 between GreenPoint Credit Corp., as Contract Seller and
Servicer and The First National Bank of Chicago, as Trustee (all capitalized
terms used herein without definition having the respective meanings specified in
the Agreement), and further certifies that:
1. To the best of such officer's knowledge, the Monthly Report for the
period from to attached to this certificate is
-------------- -------------
complete and accurate in accordance with the requirements of Sections 5.04 and
5.05 of the Agreement; and
2. As of the date hereof, such officer is not aware of the occurrence of an
Event of Default or of an event that, with notice or lapse of time or both,
would become an Event of Default.
IN WITNESS WHEREOF, I have affixed hereunto my signature this day
------
of , .
-------- -------
[SERVICER]
By
____________________________________________
[Name]
_________________________________________
[Title]
_______________________________________
Exhibit F-1
<PAGE>
EXHIBIT G-1
FORM OF TRANSFER AFFIDAVIT
STATE OF )
)ss
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. That he/she is [Title of Officer] of [Name of Owner] (record or
beneficial owner of the GreenPoint Credit Manufactured Housing Contract Trust
Pass-Through Certificates, Series 1999-2, Class R (the "Owner")), a [savings
institution][corporation] duly organized and existing under the laws of [the
State of ____________][the United States], on behalf of which he/she makes this
affidavit and agreement.
2. That the Owner (i) is not and will not be a "disqualified
organization" as of [date of transfer] within the meaning of Section 860E(e)(5)
of the Internal Revenue Code of 1986, as amended (the "Code"), (ii) will
endeavor to remain other than a disqualified organization for so long as it
retains its ownership interest in the Class R Certificates, and (iii) is
acquiring the Class R Certificates for its own account or for the account of
another Owner from which it has received an affidavit and agreement in
substantially the same form as this affidavit and agreement. (For this purpose,
a "disqualified organization" means the United States, any state or political
subdivision thereof, any agency or instrumentality of any of the foregoing
(other than an instrumentality all of the activities of which are subject to tax
and, except for the Federal Home Loan Mortgage Corporation, a majority of whose
board of directors is not selected by any agency or instrumentality of such
foreign government or organization, any rural electric or telephone cooperative,
or any organization (other than certain farmers' cooperatives) that is generally
exempt from federal income tax unless such organization is subject to the tax on
unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of Class R Certificates to disqualified organizations under the Code;
(ii) that such tax would be on the transferor, or, if such transfer is through
an agent (which person includes a broker, nominee or middleman) for a
disqualified organization, on the agent; (iii) that the person otherwise liable
for the tax shall be relieved of liability for the tax if the transferee
furnishes to such person an affidavit that the transferee is not a disqualified
organization and, at the time of transfer, such person does not have actual
knowledge that the affidavit is false; and (iv) that the Class R Certificates
may be "noneconomic residual interests" within the meaning of Treasury
regulations promulgated pursuant to the Code and that the transferor of a
noneconomic residual interest will remain liable for any taxes due with respect
to the income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding Class R Certificates if at any time during the taxable year of
the pass-through entity a
Exhibit G-1-1
<PAGE>
disqualified organization is the record holder of an interest in such entity.
(For this purpose, a "pass through entity" includes a regulated investment
company, a real estate investment trust or common trust fund, a partnership,
trust or estate, and certain cooperatives.)
5. The Owner is not an employee benefit plan or other plan subject to
the prohibited transaction provisions of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or Section 4975 of the Code, or an investment
manager, named fiduciary or a trustee of any such plan, or any other Person
acting, directly or indirectly, on behalf of or purchasing any Certificate with
"plan assets" of any such plan.
6. That the Owner is aware that the Trustee will not register the
transfer of any Class R Certificates unless the transferee, or the transferee's
agent, delivers to it an affidavit and agreement, among other things, in
substantially the same form as this affidavit and agreement. The Owner expressly
agrees that it will not consummate any such transfer if it knows or believes
that any of the representations contained in such affidavit and agreement are
false.
7. That the Owner has reviewed the restrictions set forth on the face
of the Class R Certificates and the provisions of Section 6.02(c) of the Pooling
and Servicing Agreement (the "Agreement") under which the Class R Certificates
were issued (in particular, clause (iii)(A) and (iii)(B) of Section 6.02(c)
which authorize the Trustee to deliver payments to a person other than the Owner
and negotiate a mandatory sale by the Trustee in the event the Owner holds such
Certificates in violation of Section 6.02(c)). The Owner expressly agrees to be
bound by and to comply with such restrictions and provisions.
8. That the Owner has reviewed the provisions of the Agreement
defining the obligations of the REMIC Administrator (as defined in the
Agreement) and hereby assumes such obligations of the REMIC Administrator and
delegates such duties to the Servicer (as defined in the Agreement); provided,
however, that such delegation will not relieve the Owner of its obligations as
REMIC Administrator. The Owner expressly agrees to be bound by and to comply
with such provisions.
9. That the Owner has reviewed the provisions of that certain Auction
Agent Agreement (the "Auction Agent Agreement"), dated as of March 18, 1999,
among Bankers Trust Company (the "Auction Agent"), The First National Bank of
Chicago, in its capacity as Trustee under the Agreement (the "Trustee") and
GreenPoint Bank ("GreenPoint"), in its capacity as Holder of the Class R
Certificates (as defined in the Auction Agent Agreement) and that certain
Broker-Dealer Agreement (the "Broker-Dealer Agreement"), dated as of March 18,
1999, among the Auction Agent, Salomon Smith Barney Inc. (the "Broker-Dealer")
and GreenPoint, defining the obligation of the Holder of the Class R
Certificates to pay the Auction Agent Fee (as defined in the Auction Agent
Agreement) and the Broker-Dealer Fee (as defined in the Broker-Dealer Agreement)
and hereby assumes such obligations of the Holder of the Class R Certificates.
The Owner expressly agrees to be bound by and to comply with such provisions.
10. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to constitute
a reasonable arrangement to
Exhibit G-1-2
<PAGE>
ensure that the Class R Certificates will only be owned, directly or indirectly,
by an Owner that is not a disqualified organization.
11. The Owner's Taxpayer Identification Number is ____________.
12. This affidavit and agreement relates only to the Class R
Certificates held by the Owner and not to any other holder of the Class R
Certificates. The Owner understands that the liabilities described herein relate
only to the Class R Certificates.
13. That no purpose of the Owner relating to the transfer of any of
the Class R Certificates by the Owner is or will be to impede the assessment or
collections of any tax.
14. That the Owner has no present knowledge or expectation that it
will be unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding. In this regard, the Owner hereby represents to
and for the benefit of the person from whom it acquired the Class R Certificate
that the Owner intends to pay taxes associated with holding such Class R
Certificate as they become due, fully understanding that it may incur tax
liabilities in excess of any cash flows generated by the Class R Certificate.
15. That the Owner has no present knowledge or expectation that it
will become insolvent or subject to a bankruptcy proceeding for so long as any
of the Class R Certificates remain outstanding.
16. The Owner is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in, or under the
laws of, the United States state thereof (including the District of Columbia),
or an estate or trust whose income from sources without the United States is
includible in gross income for United States federal income tax purposes
regardless of its connection with the conduct of a trade or business within the
United States.
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer and its corporate seal to be hereunto affixed, duly
attested, this _____ day ____ of ____, 19__.
[NAME OF TRANSFEREE]
By: _____________________________________________
Name:
Title:
[Corporate Seal]
ATTEST:
___________________________
[Assistant] Secretary
Exhibit G-1-3
<PAGE>
Personally appeared before me the above-named _________________, known
or proved to me to be the same person who executed the foregoing instrument and
to be the ___________________ of the Transferee, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.
Subscribed and sworn before me this _____ day of _______, __.
---------------------------------------------
NOTARY PUBLIC
My Commission expires the __ day of ________,
19__.
Exhibit G-1-4
<PAGE>
EXHIBIT G-2
FORM OF TRANSFEROR CERTIFICATE
FOR CLASS R CERTIFICATES
GreenPoint Credit Corp. Date:
10089 Willow Creek Road
San Diego, California 92131
The First National Bank of Chicago,
as Trustee
One First National Plaza, Suite 0126
Chicago, Illinois 60603
Re: GreenPoint Credit Manufactured Housing Contract
Pass-Through Certificates, Series 1999-2
----------------------------------------
Ladies and Gentlemen:
This letter is delivered to you in connection with the transfer by
________(the "Transferor") to _________(the "Buyer") of $___________Initial
Principal Balance of GreenPoint Credit Manufactured Housing Contract Trust Pass-
Through Certificates, Series 1999-2, Class R (the "Certificates"), issued
pursuant to Section 6.02(c) of the Pooling and Servicing Agreement (the
"Agreement"), dated as of March 1, 1999 between GreenPoint Credit Corp., as
Contract Seller and Servicer, and The First National Bank of Chicago, as the
Trustee. All terms used herein and not otherwise defined shall have the
meanings set forth in the Agreement. The Transferor hereby certifies,
represents and warrants to, and covenants with, the Contract Seller and the
Trustee that:
1. No purpose of the Transferor relating to the transfer of the
Certificate by the Transferor to the Buyer is or will be to impede the
assessment or collection of any tax.
2. The Transferor understands that the Buyer has delivered to the
Trustee and the Servicer a transfer affidavit and agreement in the form attached
to the Agreement as Exhibit G-1. The Transferor does not know or believe that
any representation contained therein is false.
3. The Transferor has at the time of the transfer conducted a
reasonable investigation of the financial condition of the Buyer as contemplated
by Treasury Regulations Section 1.860E-1(c)(4)(i) and, as a result of that
investigation, the Transferor has determined that the Buyer has historically
paid its debts as they become due and has found no significant evidence to
indicate that the Buyer will not continue to pay its debts as they become due in
the future. The Transferor understands that the transfer of a Class R
Certificate may not be respected for United States income tax purposes (and the
Transferor may continue to be liable for United States income taxes associated
therewith) unless the Transferor has conducted such an investigation.
Exhibit G-2-1
<PAGE>
4. The Transferor has no actual knowledge that the proposed Buyer is
not both a United States Person and a Permitted Transferee.
5. The Transferor further certifies that (a) we understand that such
Certificates have not been registered under the Securities Act of 1933, as
amended (the "Act"), and are being disposed of by us in a transaction that is
exempt from the registration requirements of the Act, (b) neither the Transferor
nor anyone acting on its behalf has (i) offered, pledged, sold, disposed of or
otherwise transferred any Certificate, any interest in any Certificate or any
other similar security from any person in any manner, (ii) solicited any offer
to buy or to accept a pledge, disposition or other transfer of any Certificate,
any interest in any Certificate or any other similar security from any person in
any manner, (iii) otherwise approached or negotiated with respect to any
Certificate, any interest in any Certificate or any other similar security from
any person in any manner, (iv) made any general solicitation by means of general
advertising or in any other manner, or (v) taken any other action, that (as to
any of (i) through (iv) above) would constitute a distribution of the
Certificates under the Act, that would render the disposition of any Certificate
a violation of Section 5 of the Act or any state securities law, or that would
require registration or qualification pursuant thereto, or (c) to the extent
such transfer is pursuant to Rule 144A under the Act, we have not offered the
Certificates to anyone other than a "qualified institutional buyer" as defined
in Rule 144A and the Act. The Transferor will not act, in any manner set forth
in the foregoing sentence with respect to any Certificate. The Transferor has
not and will not sell or otherwise transfer any of the Certificates, except in
compliance with the provisions of the Agreement.
Very truly yours,
________________________________________________
Name of Transferor
By: ____________________________________________
Name:
Title:
Exhibit G-2-2
<PAGE>
EXHIBIT H
FORM OF CERTIFICATE INSURANCE POLICY
(SEE ATTACHED)
Exhibit H-1
<PAGE>
EXHIBIT 1
FORM OF DEPOSITORY AGREEMENT
(SEE ATTACHED REP LETTER)
Exhibit I-1
<PAGE>
EXHIBIT J
TERMINATION AUCTION PROCEDURES
------------------------------
The following sets forth the auction termination procedures to be followed
in connection with a sale effected pursuant to Section 10.0l(b) of the Pooling
and Servicing Agreement (the "Agreement"), dated as of March 1, 1999, between
GreenPoint Credit Corp, as Contract Seller and Servicer, and The First National
Bank of Chicago (the "Trustee"). Capitalized terms used herein that are not
otherwise defined shall have the meanings described thereto in the Agreement.
I. Pre-Auction Process
-------------------
(a) Upon receiving notice of the Auction Termination Date, the Advisor
will initiate its general Termination Auction procedures consisting
of the following' (i) with the assistance of the Servicer, prepare
a general solicitation package along with a confidentiality
agreement; (ii) develop a list of qualified bidders, in a
commercially reasonable manner; (iii) initiate contact with all
qualified bidders; (vi) send a confidentiality agreement to all
qualified bidders; (v) upon receipt of a signed confidentiality
agreement, send solicitation packages to all interested bidders on
behalf of the Trustee; and (vi) notify the Servicer of all
potential bidders and anticipated timetable.
(b) The general solicitation package will include' (i) the prospectus
supplement and prospectus from the initial public offering of any
of the Certificates; (ii) a copy of all monthly servicing reports
or a copy of all annual servicing reports and the prior year's
monthly servicing reports; (iii) a form of a Sale and Servicing
Agreement prepared by the Trustee and the Servicer (or prepared by
the Advisor and approved by the Trustee and the Servicer); (iv) a
description of the minimum purchase price required to cause the
Trustee to sell the Contracts as set forth in Section 10.01 (a) of
the Agreement; (v) a formal bidsheet; (vi) a detailed timetable;
and (vii) a preliminary data tape of the Pool Scheduled Principal
Balance as of a recent Distribution Date reflecting the same data
attributes used to create the Cut-Off Date tables for the
prospectus supplement dated March 10, 1999 relating to the public
offering of certain of the Certificates. None of the Trustee, the
Servicer or the Contract Seller shall be required to produce an
updated prospectus or prospectus supplement, and the auction
procedures shall be carried out in a manner that does not
constitute a public offering of securities.
(c) The Trustee, with the assistance of the Servicer and the Advisor,
will maintain an auction package beginning at the time of closing
of the transaction, which will contain the documents listed under
clauses (i)-(ii) of the preceding paragraph. If the Advisor is
unable to perform its role as advisor to the Trustee, the Servicer
acting in its capacity under the Agreement will select a successor
Advisor and inform the Trustee of its actions.
Exhibit K-1
<PAGE>
(d) The Advisor will send solicitation packages to all bidders at least
15 Business Days before the Auction Termination Date. Bidders will
be required to submit any due diligence questions in writing to the
Advisor for determination of their relevancy, no later than 10
Business Days before the Auction Termination Date. The Servicer and
the Advisor will be required to satisfy all relevant questions at
least five Business Days prior to the Auction Termination Date and
distribute the questions and answers to all bidders.
II. Auction Process
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(a) The Advisor, any underwriter, or any Certificate Owner will be
allowed to bid in the Auction, but will not be required to do so.
(b) The Servicer will also be allowed to bid in the Termination Auction
if it deems appropriate, but will not be required to do so.
(c) On the Auction Termination Date, all bids will be due by facsimile
to the offices of the Trustee by 1:00 p.m. New York City time, with
the winning bidder to be notified by 2:00 p.m. New York City time.
All acceptable bids (as described in Section 10.01 (b) of the
Agreement) will be due on a conforming basis on the bid sheet
contained in the solicitation package.
(d) If the Trustee receives fewer than two market value bids from
participants in the market for manufactured housing installment
sales contracts and installment loan contracts willing and able to
purchase the Contracts, the Trustee shall decline to consummate the
sale.
(e) Upon notification to the winning bidder, a good faith deposit equal
to one percent (1%) of the Pool Scheduled Principal Balance will be
required to be wired to the Trustee upon acceptance of the bid.
This deposit, along with any interest income attributable to it,
will be credited to the purchase price but will not be refundable.
The trustee will establish a separate account for the acceptance of
the good faith deposit, until such time as the account is fully
funded and all monies are transferred into the Certificate Account,
such time not to be later than one Business Day before the related
Distribution Date (as described above).
(f) The winning bidder will receive on the Auction Termination Date a
copy of the draft Sale and Servicing Agreement and Servicer's
Representations and Warranties (which shall be substantially
identical to the representations and warranties set forth in
Section 3.01 of the Agreement).
(g) The Advisor will provide to the Trustee a letter concluding whether
or not the winning bid is a fair market value bid. The Advisor will
also provide such letter if it is the winning bidder. In the case
where the Advisor or the Servicer is the winning bidder it will
provide for market comparables and valuations in its letter.
Exhibit K-1
<PAGE>
(h) The Termination Auction will stipulate the Servicer be retained to
service the Contracts sold pursuant to the terms of the Sale and
Servicing Agreement.
(i) The Termination Auction will stipulate that such sale and
consequent termination of the Trust Fund must constitute a
"qualified liquidation" of the Trust Fund under Section 860F of the
Code, including the requirement that such liquidation take place
over a period not to exceed 90 days. The Trustee may, in its
discretion, require that the purchaser of the Contracts provide the
Trustee with an Opinion of Counsel to that effect.
Exhibit K-1
<PAGE>
Exhibit K
NOTICE OF RATINGS
-----------------
GREENPOINT CREDIT
MANUFACTURED HOUSING CONTRACT TRUST
PASS-THROUGH CERTIFICATES, SERIES 1999-2
The undersigned certifies that he is a [title] of [Servicer], a [
----------
corporation][(the "Servicer"), and that as such he is duly authorized to
execute and deliver this certificate on behalf of the Servicer pursuant to
Section 4.23 of the Pooling and Servicing Agreement (the "Agreement") dated as
of March 1, 1999 between GreenPoint Credit Corp., as Contract Seller and
Servicer and The First National Bank of Chicago, as Trustee (all capitalized
terms used herein without definition having the respective meanings specified in
the Agreement), and further certifies that:
NOTICE IS HEREBY GIVEN to the [Auction Agent [if the Class A-2 Certificates are
held in Book-Entry Form]] [Trustee [if the Class A-2 Certificates are no longer
maintained in Book-Entry Form] by the Servicer pursuant to Section 2.3(a) of the
Auction Agent Agreement that:
1. as of the date of this notice the rating by Moody's on the Class
A-2 Certificates is ____ ; and
2. as of the date of this notice the rating by Standard & Poor's on
the Class A-2 Certificates is ____ ;
The Auction Agent may rely on such ratings for all purposes of the Pooling and
Servicing Agreement, including determination of the Maximum Auction Rate
thereunder, from the date hereof until further notice from the undersigned.
[_________], not in its individual capacity but
solely as Servicer
By: __________________________________
Name:
Title:
Exhibit K-1
