<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 25, 1996.
Oakwood Mortgage Investors, Inc.
(Exact name of registrant as specified in charter)
North Carolina 33-99320 56-1886793
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2225 South Holden Road, Greensboro, North Carolina 27407
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (910) 855-2400
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE>
Item 5. Other Events.
On July 25, 1996, the Registrant caused the issuance and sale of
$215,662,295 aggregate initial principal amount of Senior/Subordinated
Pass-Through Certificates, Series 1996-B (the "Certificates") pursuant to the
Series 1996-B Pooling and Servicing Agreement, dated as of July 1, 1996 (the
"Pooling and Servicing Agreement"), among the Registrant, Oakwood Acceptance
Corporation, as Servicer, and PNC Bank, National Association, as Trustee, and
the related Standard Terms to the Pooling and Servicing Agreement (November 1995
Edition) (the "Standard Terms"). The Certificates were issued in ten Classes
with Pass-Through Rates and initial Certificate Principal Balances as set forth
below:
<TABLE>
<CAPTION>
Initial Certificate
Designation Pass-Through Rate Principal Balance
<S> <C> <C>
Class A-1.............................. (1) $45,290,000
Class A-2.............................. 6.80% $35,585,000
Class A-3.............................. 7.10% $32,350,000
Class A-4.............................. 7.35% $22,642,000
Class A-5.............................. 7.65% $32,350,000
Class A-6.............................. 8.00% $19,409,000
Class B-1.............................. (2) $17,253,000
Class B-2.............................. (3) $10,783,295
Class X................................ (4) (4)
Class R................................ (5) (5)
</TABLE>
- -----------------------------------
(1) The Pass-Through Rate on the Class A-1 Certificates for any
Distribution Date shall be the per annum rate equal to One-Month LIBOR, as
determined (except for the initial Distribution Date) on the Floating Rate
Determination Date, plus 0.11%, subject to a cap of 12.00% per annum. For the
initial Distribution Date, the Pass-Through Rate for the Class A-1 Certificates
will be 5.5475% per annum, and the initial Interest Accrual Period for the Class
A-1 Certificates commences on the Closing Date and ends on August 14, 1996.
(2) The Pass-Through Rate on the Class B-1 Certificates for any
Distribution Date shall be equal to the lesser of (i) 8.392% per annum or (ii)
the Weighted Average Net Asset Rate.
(3) The Pass-Through Rate on the Class B-2 Certificates for any
Distribution Date shall be equal to the lesser of (i) 9.644% per annum or (ii)
the Weighted Average Net Asset Rate.
(4) The Class X Certificates have no Certificate Principal Balance
and no Pass-Through Rate.
(5) The Class R Certificates have no Certificate Principal Balance
and no Pass-Through Rate.
The Certificates evidence, in the aggregate, the entire beneficial
ownership interest in OMI Trust 1996-B (the "Trust"), which consists primarily
of a pool of Assets transferred to the Trust by the Registrant pursuant to the
Pooling and Servicing Agreement. The Assets were purchased by the Registrant in
a privately-negotiated transaction with Oakwood Acceptance Corporation ("OAC")
pursuant to a Sales Agreement, dated as of July 1, 1996, between the Registrant
and OAC. Elections will be made to treat certain assets owned by the
-2-
<PAGE>
Trust as "real estate mortgage investment conduits" (each, a "REMIC") under the
Internal Revenue Code of 1986, as amended. The Certificates, except for the
Class R Certificates, will be designated as the "regular interests" in one of
such REMICs. The Class R Certificates will be designated as the "residual
interests" in each of the REMICs.
The Class A-1, Class A-2, Class A-3, Class A-4, Class A-5 and Class A-6
Certificates are collectively referred to herein as the "Offered Certificates."
The Offered Certificates have been sold by the Registrant to CS First
Boston Corporation and Greenwhich Capital Markets, Inc. (the "Underwriters")
pursuant to a Terms Agreement, dated as of July 18, 1996, among the
Underwriters, the Registrant and OAC, which incorporates by reference the
Registrant's Underwriting Agreement Standard Provisions, June 1995. The Class
B-1, Class B-2, Class X and Class R Certificates have been transferred to
Oakwood Financial Corporation, a Nevada corporation ("OFC") and an affiliate of
the Registrant.
Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Pooling and Servicing Agreement or, if not defined in
the Pooling and Servicing Agreement, the meanings assigned to them in the
Standard Terms.
-3-
<PAGE>
Exhibits
1.1 Terms Agreement, dated July 18, 1996, among the Registrant,
Oakwood Acceptance Corporation, CS First Boston Corporation
and Greenwich Capital Markets, Inc., as Underwriters, relating
to the Offered Certificates.
4.1 Copy of the Series 1996-B Pooling and Servicing Agreement,
dated as of July 1, 1996, by and among the Registrant, Oakwood
Acceptance Corporation, as Servicer, and PNC Bank, National
Association, as Trustee. (related exhibits available upon
request of the Trustee)
-4-
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
July 25, 1996 OAKWOOD MORTGAGE INVESTORS,
INC.
By: /s/ Doug R. Muir
Name: Doug R. Muir
Title: Vice President
-5-
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
1.1 Terms Agreement, dated July 18, 1996,
among the Registrant, Oakwood Acceptance
Corporation, CS First Boston Corporation,
and Greenwich Capital Makrets Inc., as
Underwriters, relating to the Offered Certificates........................................................
4.1 Copy of the Series 1996-B Pooling and Servicing Agreement, dated as of
July 1, 1996, by and among the Registrant, Oakwood Acceptance
Corporation, as Servicer,
and PNC Bank, National Association (related exhibits
available upon request of the Trustee) ..................................................................
-6-
</TABLE>
<PAGE>
OAKWOOD MORTGAGE INVESTORS, INC.
PASS-THROUGH CERTIFICATES
TERMS AGREEMENT
Dated: July 18, 1996
To: Oakwood Mortgage Investors, Inc. (the "Company")
Oakwood Acceptance Corporation ("OAC")
Re: Underwriting Agreement Standard Provisions dated
June 1995 (the "Standard Provisions")
Series Designation: Pass-Through Certificates, Series 1996-B,
Classes A-1, A-2, A-3, A-4, A-5, A-6, B-1, B-2, X and R
(collectively, the "Certificates"). The Classes A-1, A-2,
A-3, A-4, A-5 and A-6 Certificates are collectively
referred to herein as the "Underwritten Certificates."
UNDERWRITING AGREEMENT: Subject to the terms and conditions set forth
herein and to the terms of the Standard Provisions, which are incorporated by
reference herein, the Company hereby agrees to issue and sell to CS First Boston
Corporation and Greenwich Capital Markets, Inc. (the "Underwriters"), and the
Underwriters hereby severally agree to purchase from the Company, on July 25,
1996, the aggregate outstanding principal amount of the Underwritten
Certificates set forth in Schedule A hereto at the purchase price and on the
terms set forth below; provided, however, that the obligations of the
Underwriters are subject to: (i) receipt by the Company of the ratings on the
Certificates as set forth herein, (ii) receipt by the Underwriters of the Sales
Agreement (the "Sales Agreement"), dated as of July 1, 1996, by and between the
Company and OAC, and the Pooling and Servicing Agreement (as defined below),
each being in form and substance satisfactory to the Underwriters.
The Certificates will be issued by a trust (the "Trust") to be
established by the Company pursuant to a Pooling and Servicing Agreement, to be
dated as of July 1, 1996 among the Company, OAC, as servicer (the "Servicer")
and PNC Bank, National Association, as Trustee
<PAGE>
(the "Trustee"), which incorporates by reference the Company's Standard Terms to
Pooling and Servicing Agreement (November 1995 Edition) (collectively, the
"Pooling and Servicing Agreement"). The Certificates will represent in the
aggregate the entire beneficial ownership interest in the assets of the Trust
which will consist primarily of fixed-rate installment sales contracts secured
by units of manufactured housing (the "Contracts") with original terms to
maturity not exceeding 30 years and fixed-rate mortgage loans secured by
first-liens on the real estate to which the related manufactured homes are
deemed permanently affixed (the "Mortgage Loans" and, together with the
Contracts, the "Assets") with original terms to maturity not exceeding 30 years,
in each case having the characteristics described in the final Prospectus
Supplement, dated July 22, 1996, relating to the Underwritten Certificates (the
"Prospectus Supplement").
The Company and the Servicer specifically covenant to make available on
the Closing Date for sale, transfer and assignment to the Trust, Assets having
the characteristics described in the Prospectus Supplement; provided, however,
that there may be nonmaterial variances from the description of the Assets in
the Prospectus Supplement and the Assets actually delivered on the Closing Date.
REGISTRATION STATEMENT: References in the Standard Provisions to the
Registration Statement shall be deemed to include registration statement No.
33-99320.
INITIAL AGGREGATE SCHEDULED PRINCIPAL BALANCE OF ASSETS: Approximately
$215,662,295.
CUT-OFF DATE: July 1, 1996.
TERMS OF THE CERTIFICATES:
<TABLE>
<CAPTION>
================================================================================================================================
Initial Principal
Class Amount Pass-Through Ratings Purchase
Designation (approximate)(1) Rate Fitch S&P Price
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
A-1 $45,290,000 (2) "AAA" "AAA" 99.65000%
A-2 $35,585,000 (2) "AAA" "AAA" 99.58750%
A-3 $32,350,000 (2) "AAA" "AAA" 99.58750%
A-4 $22,642,000 (2) "AAA" "AAA" 99.52500%
A-5 $32,350,000 (2) "AAA" "AAA" 99.65000%
A-6 $19,409,000 (2) "AA-" "AA" 99.36875%
================================================================================================================================
</TABLE>
(1) The aggregate initial principal amount of the Certificates may be
increased or decreased by up to 5%. Any such increase or decrease may
be allocated disproportionately among the Classes of Certificates.
(2) The Pass-Through Rates for the Class A-1, Class A-2, Class A-3, Class
A-4, Class A-5 and Class A-6 Certificates will equal One-Month LIBOR
plus 0.11%, subject to a cap of 12.00% per annum, in the case of the
Class A-1 Certificates, 6.80% per annum, in the case of the Class A-2
Certificates, 7.10% per annum, in the case of the Class A-3
Certificates, 7.35% per annum in the case of the Class A-4
Certificates, 7.65% per annum in the case of the Class A-5 Certificates
and 8.0% per annum in the case of the Class A-6 Certificates.
2
<PAGE>
SUBORDINATION FEATURES: The Class A-6 Certificates will be subordinated
to the Class A-1, Class A-2, Class A-3, Class A-4 and Class A-5 Certificates as
described in the Prospectus Supplement.
RESERVE FUNDS: A Reserve Fund and a Mezzanine Reserve Fund will be
established and maintained as described in the Prospectus Supplement.
DISTRIBUTION DATES: Each Distribution Date shall be the 15th day of
each month, or if such day is not a business day, on the next succeeding
business day, commencing in August, 1996.
REMIC ELECTION: An election will be made to treat some or all of the
assets of the Trust as one or more real estate mortgage investment conduits for
federal income tax purposes (the "REMIC"). The Underwritten Certificates will be
designated as "regular interests" in the REMIC.
PURCHASE PRICE: The Underwriters have severally agreed to purchase the
Underwritten Certificates of each Class from the Company for the respective
purchase prices expressed in the table above as percentages of the initial
Certificate Principal Balance of each such class. Payment of the purchase price
for the Underwritten Certificates shall be made to the Company in federal or
similar immediately available funds payable to the order of the Company.
DENOMINATIONS: The Underwritten Certificates will be issued in
book-entry form in minimum denominations of $25,000 and integral multiples of
$1,000 in excess thereof, except that one Certificate of each Class of the
Underwritten Certificates may be issued in a different denomination.
FEES: It is understood that servicing fees may be withheld from the
payments on the Assets in each month prior to distributions on the Certificates
on the Distribution Date occurring in such month to the extent permissible under
the Pooling and Servicing Agreement.
CLOSING DATE AND LOCATION: 10:00 a.m. Eastern Time on July 25, 1996, at
the offices of Hunton & Williams, Riverfront Plaza, East Tower, 951 East Byrd
Street, Richmond, Virginia 23219-4074. The Company will deliver the Underwritten
Certificates in book-entry form only, through the same-day funds settlement
system of The Depository Trust Company on the Closing Date.
DUE DILIGENCE: At any time prior to the Closing Date, the Underwriters
have the right to inspect the Asset Files and the related loan origination
procedures and to confirm the existence of the related manufactured homes or
mortgaged properties to ensure conformity with the Final Prospectus and the
Prospectus Supplement.
CONTROLLING AGREEMENT: This Terms Agreement sets forth the complete
agreement among the Company, OAC and the Underwriters and fully supersedes all
prior agreements, both written and oral, relating to the issuance of the
Underwritten Certificates and all matters set forth
3
<PAGE>
herein. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Standard Provisions or the
Prospectus Supplement.
COMPUTATIONAL MATERIALS: Each Underwriter hereby represents and
warrants that (i) any information attached hereto as Exhibit 1 constitutes all
"Collateral Term Sheets (as such term is defined in the no-action letters
addressed to Kidder, Peabody Acceptance Corporation I, et al. dated May 20, 1994
and to the Public Securities Association dated February 17, 1995 (collectively,
the "PSA Letters")) disseminated by it in connection with the Underwritten
Certificates and (ii) any information attached hereto as Exhibit 2 constitutes
all "Structural Term Sheets" and "Computational Materials" disseminated by it in
connection with the Underwritten Certificates.
For purposes hereof, as to each Underwriter, the term "Derived
Information" means such portion, if any, of the Collateral Term Sheets,
Structural Term Sheets and/or Computational Materials which (i) is not contained
in the Prospectus without taking into account information incorporated therein
by reference and (ii) is not contained in any computer tape furnished by the
Company (the "Computer Tape"). Each Underwriter severally agrees, assuming (i)
all information provided by the Company (including the Computer Tape) is
accurate and complete in all material respects and (ii) the Company's
independent public accountants have determined that the Derived Information
agrees with the Computer Tape, to indemnify and hold harmless the Company, each
of the Company's officers and directors and each person who controls the Company
within the meaning of Section 15 of the Act against any and all losses, claims,
damages or liabilities, joint or several, to which they may become subject under
the Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
of a material fact contained in the Derived Information provided by such
Underwriter, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statement therein, in the light of the circumstances under which they
were made, not misleading, and agrees to reimburse each such indemnified party
for any legal or other expenses reasonably incurred by it in connection with
investigating or defending or preparing to defend any such loss, claim, damage,
liability or action as such expenses are incurred. The obligations of an
Underwriter under this paragraph shall be in addition to any liability which
such Underwriter may otherwise have. Notwithstanding the provisions of this
paragraph, no Underwriter shall be required to pay any amount with respect to
the indemnities provided hereunder in excess of the underwriting discount or
commission applicable to the Certificates purchased by it hereunder.
INFORMATION PROVIDED BY EACH UNDERWRITER: It is understood and agreed
that the information set forth under the heading "Underwriting" in the
Prospectus Supplement and the sentence regarding each Underwriter's intention to
establish a market in the Underwritten Certificates on the Cover Page of the
Prospectus Supplement is the only information furnished by the Underwriters for
inclusion in the Registration Statement and the Final Prospectus.
TRUSTEE: PNC Bank, National Association will act as Trustee of the
Trust.
4
<PAGE>
BLUE SKY QUALIFICATIONS: The Underwriters specify no jurisdictions and
the parties do not intend to qualify the Underwritten Securities in any
jurisdiction. The Company has agreed to pay all costs and expenses incurred in
connection with the preparation of a blue sky survey to be delivered on or prior
to the Closing Date.
STATE TAX OPINIONS: The Company shall deliver to the Underwriters an
opinion of counsel pursuant to Section 6(d)(iii) of the Standard Provisions with
respect to the Commonwealth of Virginia, the State of North Carolina, the
Commonwealth of Pennsylvania and the State of Illinois.
BLACKOUT PERIOD: None.
APPLICABLE LAW: THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
NOTICES: All communications hereunder will be in writing and effective
only upon receipt and, if sent to the Underwriters, will be mailed, delivered or
telegraphed and confirmed to the Underwriters at:
CS First Boston Corporation
Park Avenue Plaza
55 East 52nd Street
New York, New York 10055
Attention: Fiachra O'Driscoll
Greenwich Capital Markets, Inc.
600 Steamboat Road
Greenwich, Connecticut 06830
Attention: General Counsel
REQUEST FOR OPINIONS: (a) The Company and OAC hereby request and
authorize Hunton & Williams and Kennedy, Covington, Lobdell & Hickman, as their
counsel in this transaction, to issue on behalf of the Company and OAC, such
legal opinions to the Underwriters, their respective counsel, the Trustee and
the Rating Agencies as may be required by any and all documents, certificates or
agreements executed in connection with this Agreement.
(b) The Underwriters hereby request and authorize Simpson Thacher &
Bartlett, as their special counsel in this transaction, to issue to the
Underwriters such legal opinions as they may require, and the Company shall have
furnished to Simpson Thacher & Bartlett such documents as they may request for
the purpose of enabling them to pass upon such matters.
5
<PAGE>
Each Underwriter agrees, subject to the terms and provisions of the
Standard Provisions, a copy of which is attached hereto, and which is
incorporated by reference herein in its entirety and made a part hereof to the
same extent as if such provisions had been set forth in full herein, to purchase
the Underwritten Certificates.
CS FIRST BOSTON CORPORATION
By: /s/ Fiachra O'Driscoll
Name: Fiachra O'Driscoll
Title: Vice President
GREENWICH CAPITAL MARKETS, INC.
By: /s/ Pamela S. Brill
Name: Pamela S. Brill
Title: Vice President
Accepted and acknowledged
As of the Date First
Above Written:
OAKWOOD MORTGAGE INVESTORS, INC.
By: /s/ Doug R. Muir
Name: Doug R. Muir
Title: Vice President
OAKWOOD ACCEPTANCE CORPORATION
By: /s/ Doug R. Muir
Name: Doug R. Muir
Title: Vice President
6
<PAGE>
SCHEDULE A
Class A-1, Class A-2, Class A-3, Class A-4, Class A-5 and Class A-6 Certificates
<TABLE>
<CAPTION>
Class A-1 Class A-2 Class A-3
------------------------------------------------------------
<S> <C> <C> <C>
CS First Boston Corporation.................................. $22,645,000 $17,792,500 $16,175,000
Greenwich Capital Markets, Inc............................... $22,645,000 $17,792,500 $16,175,000
---------- ---------- ----------
Total....................................................... $45,290,000 $35,585,000 $32,350,000
========== ========== ==========
Class A-4 Class A-5 Class A-6
CS First Boston Corporation ................................. $11,321,000 $16,175,000 $9,704,500
Greenwich Capital Markets, Inc............................... $11,321,000 $16,175,000 $9,704,500
---------- ---------- ---------
Total....................................................... $22,642,000 $32,350,000 $19,409,000
========== ========== ==========
</TABLE>
7
<PAGE>
===========================================
OAKWOOD MORTGAGE INVESTORS, INC.,
OAKWOOD ACCEPTANCE CORPORATION
AND
PNC BANK, NATIONAL ASSOCIATION,
TRUSTEE
----------
POOLING AND SERVICING AGREEMENT
DATED AS OF JULY 1, 1996
----------
OAKWOOD MORTGAGE INVESTORS, INC.
SENIOR/SUBORDINATED
PASS-THROUGH CERTIFICATES, SERIES 1996-B
===========================================
<PAGE>
THIS SERIES 1996-B POOLING AND SERVICING AGREEMENT, dated as of July 1,
1996, is made with respect to the formation of OMI Trust 1996-B (the "Trust"),
among OAKWOOD MORTGAGE INVESTORS, INC., a North Carolina corporation ("OMI"),
OAKWOOD ACCEPTANCE CORPORATION, a North Carolina corporation ("OAC" and, in its
capacity as servicer, the "Servicer"), and PNC BANK, NATIONAL ASSOCIATION, a
national banking association, as trustee (the "Trustee"), under this Agreement
and the Standard Terms to Pooling and Servicing Agreement, November 1995 Edition
(the "Standard Terms"), all the provisions of which are incorporated herein as
modified hereby and shall be a part of this Agreement as if set forth herein in
full (this Agreement with the Standard Terms so incorporated, the "Pooling and
Servicing Agreement"). Capitalized terms used and not otherwise defined herein
shall have the respective meanings given them in the Standard Terms.
PRELIMINARY STATEMENT
The Board of Directors of OMI has duly authorized the formation of the
Trust to issue a Series of Certificates with an aggregate initial principal
amount of $215,662,295, to be known as the Senior/Subordinated Pass-Through
Certificates, Series 1996-B (the "Certificates"). The Certificates consist of 10
Classes that in the aggregate evidence the entire beneficial ownership interest
in the Trust.
In accordance with Section 10.01 of the Standard Terms, the Trustee
will make an election to treat all of the assets of the Trust as two real estate
mortgage investment conduits (each, a "REMIC" and, individually, the "Pooling
REMIC" and the "Issuing REMIC") for federal income tax purposes. The Pooling
REMIC will consist of the Distribution Account and the Assets listed on the
Asset Schedule attached as Schedule I (as defined below) hereto. The Issuing
REMIC will consist of the eight Subaccounts designated as provided herein, the
Mezzanine Reserve Fund, and the Reserve Fund. The "startup day" of each REMIC
for purposes of the REMIC Provisions is the Closing Date.
GRANTING CLAUSES
To provide for the distribution of the principal of and interest on the
Certificates in accordance with their terms, all of the sums distributable under
the Pooling and Servicing Agreement with respect to the Certificates and the
performance of the covenants contained in this Pooling and Servicing Agreement,
OMI hereby bargains, sells, conveys, assigns and transfers to the Trustee, in
trust and as provided in this Pooling and Servicing Agreement, without recourse
and for the exclusive benefit of the Holders of the Certificates, all of OMI's
right, title and interest in and to, and any and all benefits accruing to OMI
from, (a) the Contracts listed in Schedule IA hereto and the Mortgage Loans
(together with the Contracts, the "Assets") listed in Schedule IB hereto
(Schedule IA and Schedule IB shall be collectively referred to herein as
"Schedule I"), together with the related Asset Documents, and all payments
thereon and proceeds of the conversion, voluntary or involuntary, of the
foregoing, including,
S - 1
<PAGE>
without limitation, all rights to receive all principal and interest payments
due on the Assets after the Cut-off Date, including such scheduled payments
received by OMI or OAC on or prior to the Cut-off Date, and Principal
Prepayments, Net Insurance Proceeds, Net Liquidation Proceeds, Repurchase Prices
and other unscheduled collections received on the Assets on and after the Cutoff
Date; (b) the security interests in the Manufactured Homes, Mortgaged Properties
and Real Properties granted by the Obligors pursuant to the related Assets; (c)
all funds, other than investment earnings, relating to the Assets on deposit in
the Certificate Account or the Distribution Account for the Certificates and all
proceeds thereof, whether in the form of cash, instruments, securities or other
properties; (d) the Mezzanine Reserve Fund, the Reserve Fund and all amounts on
deposit in each; (e) any and all rights, privileges and benefits accruing to OMI
under the Sales Agreement with respect to the Assets (provided that OMI shall
retain its rights to indemnification from the Seller under such Sales Agreement,
but also hereby conveys its rights to such indemnification to the Trustee as its
assignee), including the rights and remedies with respect to the enforcement of
any and all representations, warranties and covenants under such Sales
Agreement; and (f) proceeds of all the foregoing (including, but not by way of
limitation, all proceeds of any Standard Hazard Insurance Policy or FHA
Insurance, or any other insurance policy relating to any of the Assets, cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel
paper, checks, deposit accounts, rights to payment of any and every kind, and
other forms of obligations and receivables that at any time constitute all or
part or are included in the proceeds of any of the foregoing) to make
distributions on the Certificates as specified herein (the items referred to in
clauses (a) through (f) above shall be collectively referred to herein as the
"Trust Estate").
The Trustee acknowledges the foregoing, accepts the trusts hereunder in
accordance with the provisions hereof and the Standard Terms and agrees to
perform the duties herein or therein required to the best of its ability to the
end that the interests of the Holders of the Certificates may be adequately and
effectively protected.
SECTION 1. STANDARD TERMS.
OMI, the Servicer and the Trustee acknowledge that the Standard Terms
prescribe certain obligations of OMI, the Servicer and the Trustee with respect
to the Certificates. OMI, the Servicer and the Trustee agree to observe and
perform such prescribed duties, responsibilities and obligations, and
acknowledge that, except to the extent inconsistent with the provisions of this
Pooling and Servicing Agreement, the Standard Terms are and shall be a part of
this Pooling and Servicing Agreement to the same extent as if set forth herein
in full.
SECTION 2. DEFINED TERMS.
With respect to the Certificates and in addition to or in replacement
for the definitions set forth in Section 1.01 of the Standard Terms, the
following definitions shall be assigned to the defined terms set forth below:
"Accelerated Principal Distribution Amount": With respect to any
Distribution Date an amount equal to the amount of the Available Distribution
remaining after all required
S - 2
<PAGE>
distributions pursuant to clauses (i) through (xvii) of Section 5(b) hereof have
been made on such Distribution Date, but in no event in excess of 1/12 of 0.50%
of the then outstanding aggregate Pool Scheduled Principal Balance.
"Accrual Date": The Accrual Date with respect to the Class A-1
Certificates shall be the Closing Date, and the Accrual Date with respect to all
other Classes of Certificates shall be July 1, 1996.
"Average Sixty-Day Delinquency Ratio": With respect to any Distribution
Date, the arithmetic average of the Sixty-Day Delinquency Ratios for such
Distribution Date and the two preceding Distribution Dates. The "Sixty-Day
Delinquency Ratio" for a Distribution Date is the percentage derived from the
fraction, the numerator of which is the aggregate Scheduled Principal Balance
(as of the end of the preceding Prepayment Period) of all Assets (including
Assets in respect of which the related Manufactured Home, Real Property or
Mortgage Property has been repossessed or foreclosed upon but not yet disposed
of) as to which a Monthly Payment thereon is delinquent 60 days or more as of
the end of the related Collection Period, and the denominator of which is the
Pool Scheduled Principal Balance for such Distribution Date.
"Average Thirty-Day Delinquency Ratio": With respect to any
Distribution Date, the arithmetic average of the Thirty-Day Delinquency Ratios
for such Distribution Date and the two preceding Distribution Dates. The
"Thirty-Day Delinquency Ratio" for a Distribution Date is the percentage derived
from the fraction, the numerator of which is the aggregate Scheduled Principal
Balance (as of the end of the preceding Prepayment Period) of all Assets
(including Assets in respect of which the related Manufactured Home, Real
Property or Mortgage Property has been repossessed or foreclosed upon but not
yet disposed of) as to which a Monthly Payment thereon is delinquent 30 days or
more as of the end of the related Collection Period, and the denominator of
which is the Pool Scheduled Principal Balance for such Distribution Date.
"Book-Entry Certificates": The Class A Certificates.
"Carryover Interest Amount": With respect to each Class of
Certificates, except the Class X Certificates and the Residual Certificates, and
each Distribution Date, all amounts that were distributable on such Class as
Interest Distribution Amounts on previous Distribution Dates that remain unpaid,
together with interest on each overdue Interest Distribution Amount that
comprises the Carryover Interest Amount at the Pass-Through Rate in effect for
such Class from time to time from the last day of the Interest Accrual Period in
which such overdue Interest Distribution Amount accrued through the last day of
the related Interest Accrual Period, to the extent not previously distributed.
With respect to each Subaccount on each Distribution Date, all amounts that were
allocable to such Subaccount as Priority Interest Amounts on previous
Distribution Dates that remain unpaid, together with interest on each overdue
Priority Interest Amount that comprises the Carryover Interest Amount at the
applicable Pass-Through Rate in effect for the Corresponding Certificates with
respect to such Subaccount from time to time from the last day of the Interest
Accrual Period in which such overdue Priority Interest Amount accrued through
the last day of the related Interest Accrual Period, to the extent not
previously distributed.
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<PAGE>
"Carryover Non-Priority Interest Amount": For any Subaccount, on any
Distribution Date, all amounts that were distributable on such Subaccount as
Non-Priority Interest Amounts on previous Distribution Dates that remain unpaid.
"Carryover Writedown Interest Amount": With respect to each
Distribution Date and each Class or Subaccount, Writedown Interest Amounts
remaining unpaid from previous Distribution Dates.
"Class A Certificates": The Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates, Class A-5
Certificates and Class A-6 Certificates.
"Class A Percentage": With respect to each Distribution Date, the
percentage derived from the fraction (which shall not be greater than 1), the
numerator of which is the aggregate Certificate Principal Balance of the Class A
Certificates immediately prior to such Distribution Date and the denominator of
which is the aggregate Certificate Principal Balance of all the Certificates
immediately prior to such Distribution Date.
"Class A Subaccounts": Any or all, as appropriate, of the Class A-1,
Class A-2, Class A-3, Class A-4, Class A-5 or Class A-6 Subaccounts.
"Class B Certificates": The Class B-1 Certificates and Class B-2
Certificates.
"Class B-1 Reserve Fund": The component fund of the Reserve Fund
established pursuant to Section 6(b) hereof and to be applied specifically to
the Class B-1 Certificates. The Class B-1 Reserve Fund shall be deemed to be a
"Reserve Fund" as such term is defined in the Standard Terms.
"Class B-1 Reserve Fund Draw Amount": On any Distribution Date, the
lesser of (i) the amount on deposit in the Class B-1 Reserve Fund, (ii) the
aggregate amount of any Interest Distribution Amounts, Carryover Interest
Amounts, Writedown Interest Amounts and Carryover Writedown Interest Amounts due
on the Class B-1 Certificates that are not distributed out of the Available
Distribution for such Distribution Date and (iii) $323,494.
"Class B-1 Reserve Fund Required Amount": $323,494.
"Class B-2 Reserve Fund": The component fund of the Reserve Fund
established pursuant to Section 6(b) hereof and to be applied specifically to
the Class B-2 Certificates. The Class B-2 Reserve Fund shall be deemed to be a
"Reserve Fund" as such term is defined in the Standard Terms.
"Class B-2 Reserve Fund Draw Amount": On any Distribution Date, the
lesser of (i) the amount on deposit in the Class B-2 Reserve Fund, (ii) the
aggregate amount of any Interest Distribution Amounts, Carryover Interest
Amounts, Writedown Interest Amounts and Carryover Writedown Interest Amounts due
on the Class B-2 Certificates that are not distributed out of the Available
Distribution for such Distribution Date and (iii) $215,662.
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<PAGE>
"Class B-2 Reserve Fund Required Amount": $215,662.
"Class B Cross-over Date": The later to occur of (a) the Distribution
Date occurring in January 2001 or (b) the first Distribution Date on which (1)
the percentage of the Pool Scheduled Principal Balance that is represented by
the sum of (i) the Class B Principal Balance plus (ii) any Excess Asset
Principal Balance equals or exceeds (2) 1.75 times the initial Class B
Percentage.
"Class B Percentage": With respect to each Distribution Date, the
difference between 100% and the Class A Percentage for such Distribution Date.
"Class B Principal Distribution Tests": With respect to each
Distribution Date: (a) the Average Sixty-Day Delinquency Ratio as of such
Distribution Date does not exceed 5%; (b) the Average Thirty-Day Delinquency
Ratio as of such Distribution Date does not exceed 7%; (c) the Cumulative
Realized Losses as of such Distribution Date do not exceed an amount equal to
the percentage set forth below of the initial aggregate Certificate Principal
Balance of all the Certificates:
Distribution Dates Percentage
August 1996 through August 1997 4%
January 2001 through August 2002 7%
August 2002 through January 2003 8%
January 2003 and after 9%
; and (d) the Current Realized Loss Ratio as of such Distribution Date does not
exceed 2.75%.
"Class B Subaccounts": Any or all, as appropriate, of the Class B-1 or
Class B-2 Subaccounts.
"Class R Certificates": The Class R Certificates, which comprise both
the Pooling REMIC Residual Interest and the Issuing REMIC Residual Interest.
"Class R-1 Certificates": Following the division of the Class R
Certificates into two separately transferable, certificated and fully registered
certificates in accordance with Section 11(b) hereof, the Class R-1
Certificates, which will represent the Issuing REMIC Residual Interest.
"Class R-2 Certificates": Following the division of the Class R
Certificates into two separately transferable, certificated and fully registered
certificates in accordance with Section 11(b) hereof, the Class R-2
Certificates, which will represent the Pooling REMIC Residual Interest.
"Class X Carryover Strip Amount": With respect to the Class X
Certificates on each Distribution Date, all amounts that were distributable on
such Class as Class X Strip Amounts on previous Distribution Dates that remain
unpaid.
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<PAGE>
"Class X Strip Amount": With respect to any Distribution Date, the sum
of (i) 30 days interest on the aggregate Certificate Principal Balance of the
Class A-2, Class A-3, Class A-4, Class A-5 and Class A-6 Certificates, at a rate
equal to the difference, if any, between the Weighted Average Net Asset Rate
less 50 basis points and the weighted average of the Pass- Through Rates on the
Class A-2, Class A-3, Class A-4, Class A-5 and Class A-6 Certificates, (ii) 30
days interest on the sum of (A) the aggregate Certificate Principal Balance of
the Class B Certificates and (B) any Excess Asset Principal Balance, at a rate
equal to the difference, if any, between the Weighted Average Net Asset Rate
less 50 basis points and the weighted average of the Pass-Through Rates on the
Class B Certificates and (iii) 30 days interest on the aggregate Certificate
Principal Balance of the Class A-1 Certificates, at a rate equal to the positive
difference, if any, between the Weighted Net Asset Rate less 50 basis points and
the Pass-Through Rate on the Class A-1 Certificates.
"Closing Date": July 25, 1996.
"Corresponding Certificates": For any Subaccount, the Class of
Certificates bearing the same letter and numerical designation as that borne by
such Subaccount.
"Corresponding Subaccount" For any Class of Certificates, the
Subaccount bearing the same letter and numerical designation as that borne by
such Class.
"Cumulative Realized Losses": With respect to any Distribution Date,
the aggregate Realized Losses incurred on the Assets during the period from the
Cut-off Date through the end of the related Prepayment Period.
"Current Realized Loss Ratio": With respect to any Distribution Date,
the annualized percentage derived from the fraction, the numerator of which is
the sum of the aggregate Realized Losses for the three preceding Prepayment
Periods and the denominator of which is the arithmetic average of the Pool
Scheduled Principal Balances for such Distribution Date and the preceding two
Distribution Dates.
"Cut-off Date": July 1, 1996.
"ERISA Restricted Certificates": The Class A-6, Class B-1, Class B-2,
Class X and Class R Certificates.
"Excess Asset Principal Balance": As of any Distribution Date, the
amount, if any, by which the related Pool Scheduled Principal Balance of the
Assets as of the first day of the month preceding the month in which such
Distribution Date occurs after deducting all Monthly Payments of principal due
on the first day of such preceding month exceeds the aggregate Certificate
Principal Balance of all the Certificates immediately prior to such Distribution
Date.
"Floating Rate Determination Date": For any Interest Accrual Period for
the Class A-1 Certificates after the initial Interest Accrual Period, the second
London Banking Day prior to the commencement of such Interest Accrual Period.
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<PAGE>
"Interest Distribution Amount": With respect to each Class of
Certificates (except the Class X Certificates and the Residual Certificates) or
each Subaccount, as applicable, on each Distribution Date, an amount equal to
interest accrued at the applicable Pass-Through Rate for the related Interest
Accrual Period on the Certificate Principal Balance of such Class or the
Subaccount Principal Balance of such Subaccount immediately prior to that
Distribution Date.
"Issuing REMIC": The Trust REMIC consisting of the Subaccounts, the
Mezzanine Reserve Fund, and the Reserve Fund.
"Issuing REMIC Residual Interest": The residual interest (as defined in
Code section 860G(a)(2)) in the Issuing REMIC.
"London Banking Day": Any day on which commercial banks and foreign
exchange markets settle payments in London and New York City.
"Mezzanine Reserve Fund": The mezzanine reserve fund established
pursuant to Section 6(a) hereof. The Mezzanine Reserve Fund shall be deemed to
be a "Reserve Fund" as such term is defined in the Standard Terms.
"Mezzanine Reserve Fund Draw Amount": On any Distribution Date, the
lesser of (i) the amount on deposit in the Mezzanine Reserve Fund, (ii) the
aggregate amount of any Interest Distribution Amounts, Carryover Interest
Amounts, Writedown Interest Amounts and Carryover Writedown Interest Amounts due
on the Class A-6 Certificates that are not distributed out of the Available
Distribution for such Distribution Date and (iii) $431,325.
"Mezzanine Reserve Fund Required Amount": $431,325.
"Non-Priority Interest Amount": For any Subaccount, on any Distribution
Date, an amount equal to the positive difference, if any, between (i) the
related Interest Distribution Amount for such Subaccount and (ii) the related
Priority Interest Amount for such Subaccount.
"Notional Principal Balance": The Notional Principal Balance of the
Class X Certificates on any date shall equal the sum of all of the Subaccount
Principal Balances on such date, which shall equal the sum of all of the
Certificate Principal Balances plus any Excess Asset Principal Balance.
"One-Month LIBOR": For each applicable Interest Accrual Period, the per
annum rate established in accordance with the provisions of Section 14 hereof.
"Outstanding Certificate Writedown Amount": With respect to any Class
of Certificates on any Distribution Date, the aggregate of all Writedown Amounts
allocated to such Class on previous Distribution Dates, less all amounts
distributed to such Class on previous Distribution Dates to reduce such amounts
pursuant to clause (x), (xi), (xii) and (xiii), as applicable, of Section 5(b)
hereof.
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<PAGE>
"Outstanding Subaccount Writedown Amount": With respect to any
Subaccount on any Distribution Date, the aggregate of all Writedown Amounts
allocated to such Subaccount on previous Distribution Dates, less all amounts
allocated to such Subaccount on previous Distribution Dates to reduce such
amounts pursuant to clauses (x), (xi), (xii) and (xiii), as applicable, of
Section 5(a) hereof.
"Pass-Through Rate": With respect to each Class of Certificates (except
the Class X Certificates and the Residual Certificates) on any Distribution
Date, the per annum rate for such Class set forth in the table in Section 3
hereof. With respect to any Subaccount on any Distribution Date, the then
applicable Weighted Average Net Asset Rate.
"Pooling REMIC": The Trust REMIC consisting of the Assets and the
Distribution Account.
"Pooling REMIC Residual Interest": The residual interest (as defined in
Code section 860G(a)(2)) in the Pooling REMIC.
"Priority Interest Amount": For any Subaccount, on any Distribution
Date, an amount equal to interest accrued at the applicable Pass-Through Rate
for the related Interest Accrual Period on the Corresponding Certificates.
"Private Certificates": The Class B-1 Certificates, Class B-2
Certificates, Class X Certificates and Residual Certificates.
"Qualified Bidders": Firms and institutions that are engaged in the
business of buying and selling manufactured housing paper.
"Rating Agency": Each of Fitch Investors Service, L.P. (One State
Street Plaza, New York, New York 10004), and Standard & Poor's Ratings Services,
a division of The McGraw- Hill Companies, Inc. (26 Broadway, New York, New York
10007).
"Regular Certificates": The Class A Certificates, Class B Certificates
and Class X Certificates.
"Reserve Fund": Together, the Class B-1 Reserve Fund and the Class B-2
Reserve Fund.
"Reserve Fund Draw Amount": The sum of the Class B-1 Reserve Fund Draw
Amount and the Class B-2 Reserve Fund Draw Amount.
"Reserve Fund Required Amount": The sum of the Class B-1 Reserve Fund
Required Amount and the Class B-2 Reserve Fund Required Amount.
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<PAGE>
"Residual Certificates": The Class R Certificates or, following the
division of the Class R Certificates into two separately transferable,
certificated and fully registered certificates in accordance with Section 11(b)
hereof, the Class R-1 Certificates and Class R-2 Certificates.
"Rule 144A Certificates": The Class B-1, Class B-2, Class X and
Residual Certificates.
"Senior Certificates": The Class A-1, Class A-2, Class A-3, Class A-4
and Class A-5 Certificates.
"Senior Subaccounts": The Class A-1, Class A-2, Class A-3, Class A-4
and Class A-5 Subaccounts.
"Servicing Fee Rate": 1.00% per annum.
"Subaccount": Each of the following eight subaccounts established
solely for purposes of the REMIC Provisions by the Trustee, which have the
Pass-Through Rates and initial Subaccount Principal Balances set forth below:
<TABLE>
<CAPTION>
INITIAL
PASS-THROUGH SUBACCOUNT
SUBACCOUNT RATE PRINCIPAL BALANCE
---------- ---- -----------------
<S> <C> <C>
A-1 (1) $45,290,000
A-2 (1) 35,585,000
A-3 (1) 32,350,000
A-4 (1) 22,642,000
A-5 (1) 32,350,000
A-6 (1) 19,409,000
B-1 (1) 17,253,000
B-2 (1) 10,783,295
</TABLE>
(1) The Pass-Through Rate on each Subaccount for any Distribution Date
shall be equal to the Weighted Average Net Asset Rate.
The final scheduled Distribution Date for each Subaccount is October
15, 2026.
"Subaccount Principal Balance": With respect to each Subaccount, on any
date of determination, the amount identified as the "Initial Subaccount
Principal Balance" of such Subaccount in the definition of "Subaccount" above,
minus all amounts allocated to such Subaccount in reduction of its Subaccount
Principal Balance pursuant to Sections 5(a) and 7 hereof.
"Subordinated Certificates": The Class A-6, Class B-1, Class B-2, Class
X and Residual Certificates.
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<PAGE>
"Trustee": PNC Bank, National Association, not in its individual
capacity but solely as Trustee under this Pooling and Servicing Agreement, or
any successor trustee appointed as herein provided. Notices to the Trustee shall
be sent to Corporate Trust Department, 1700 Market Street, Suite 1412,
Philadelphia, PA 19103, Attn: OMI Trust 1996-B (the "Corporate Trust Office"),
or its successor in interest.
"Trust REMIC": Each of the Pooling REMIC and the Issuing REMIC.
"Underwriters": CS First Boston Corporation (whose address is Park
Avenue Plaza, 55 East 52nd Street, New York, NY 10055), and Greenwich Capital
Markets, Inc. (whose address is 600 Steamboat Road, 3rd Floor, Greenwich,
Connecticut 06830).
"Weighted Average Net Asset Rate": With respect to any Distribution
Date, the weighted average of the Asset Rates applicable to the Monthly Payments
that were due during the related Collection Period on Assets that were
Outstanding at the beginning of the related Prepayment Period, less 1.00% per
annum.
"Writedown Amount": With respect to each Distribution Date, the amount,
if any, by which (i) the aggregate Certificate Principal Balance of all the
Certificates, after all distributions have been made on the Certificates on such
Distribution Date pursuant to Section 5(b) hereof, exceeds (ii) the Pool
Scheduled Principal Balance of the Assets for the next Distribution Date.
"Writedown Interest Amount": With respect to each Distribution Date and
each Class of Certificates, interest accrued during the related Interest Accrual
Period at the applicable Pass- Through Rate on any related Outstanding
Certificate Writedown Amount. With respect to each Distribution Date and each
Subaccount, interest accrued during the related Interest Accrual Period on any
related Outstanding Subaccount Writedown Amount at the Pass-Through Rate
applicable to the Corresponding Certificates.
SECTION 3. CERTIFICATES.
The aggregate initial principal amount of Certificates that may be
executed and delivered under this Pooling and Servicing Agreement is limited to
$215,662,295, except for Certificates executed and delivered upon registration
of transfer of, or in exchange for, or in lieu of, other Certificates pursuant
to Sections 5.04 or 5.07 of the Standard Terms. The Certificates shall be issued
in ten Classes having the designations, initial Certificate Principal Balances,
Pass-Through Rates and Final Scheduled Distribution Dates set forth or described
below:
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<PAGE>
<TABLE>
<CAPTION>
INITIAL FINAL
CERTIFICATE SCHEDULED
PRINCIPAL PASS THROUGH DISTRIBUTION
DESIGNATION BALANCE RATE DATE
<S> <C> <C> <C>
A-1 $45,290,000 (1) October 15, 2026
A-2 $35,585,000 6.80% October 15, 2026
A-3 $32,350,000 7.10% October 15, 2026
A-4 $22,642,000 7.35% October 15, 2026
A-5 $32,350,000 7.65% October 15, 2026
A-6 $19,409,000 8.00% October 15, 2026
B-1 $17,253,000 (2) October 15, 2026
B-2 $10,783,295 (3) October 15, 2026
X (4) (4) October 15, 2026
R (5) (5) October 15, 2026
</TABLE>
(1) The Pass-Through Rate on the Class A-1 Certificates for
any Distribution Date shall be the per annum rate equal to One-Month
LIBOR, as determined (except for the initial Distribution Date) on the
Floating Rate Determination Date, plus 0.11%, subject to a cap of
12.00% per annum. For the initial Distribution Date, the Pass-Through
Rate for the Class A-1 Certificates will be 5.5475% per annum, and the
initial Interest Accrual Period for the Class A-1 Certificates
commences on the Closing Date and ends on August 14, 1996.
(2) The Pass-Through Rate on the Class B-1 Certificates for
any Distribution Date shall be equal to the lesser of (i) 8.392% per
annum or (ii) the Weighted Average Net Asset Rate.
(3) The Pass-Through Rate on the Class B-2 Certificates for
any Distribution Date shall be equal to the lesser of (i) 9.644% per
annum or (ii) the Weighted Average Net Asset Rate.
(4) The Class X Certificates shall have no Certificate
Principal Balance and no Pass-Through Rate. The Class X Certificates
will represent the right to receive, on each Distribution Date, the
applicable Class X Strip Amount and any Class X Carryover Strip Amount.
(5) The Class R Certificates shall have no Certificate
Principal Balance and no Pass-Through Rate, and shall represent the
residual interest in both the Pooling REMIC and the Issuing REMIC.
Following the division of the Class R Certificates into two separately
transferable, certificated and fully registered certificates in
accordance with Section 11(b) hereof, the Class R-1 and Class R-2
Certificates shall have no Certificate Principal Balances and no
Pass-Through Rates and shall represent the residual interest in the
Issuing REMIC and the Pooling REMIC, respectively.
SECTION 4. DENOMINATIONS.
The Book-Entry Certificates will be registered as one or more certificates
in the name of the Clearing Agency or its nominee. Beneficial interests in the
Book-Entry Certificates will be held by the Beneficial Owners through the
book-entry facilities of the Clearing Agency, in minimum
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<PAGE>
denominations of $25,000 and integral multiples of $1,000 in excess thereof,
except that one Certificate of each such Class may be issued in a different
denomination that evidences the remainder of the aggregate initial Certificate
Principal Balance of each Class.
The Class B, Class X and Residual Certificates will be issued in
certificated, fully-registered form. The Class B Certificates will be issued in
minimum denominations of $100,000 and integral multiples of $1,000 in excess
thereof, except that one Certificate may be issued in a different denomination
that evidences the remainder of the aggregate initial Certificate Principal
Balance of such Class. The Class X Certificates and the Residual Certificates
will be issued in minimum Percentage Interests equal to 10%.
SECTION 5. DISTRIBUTIONS.
(a) On each Distribution Date, the Trustee (or the Paying Agent on
behalf of the Trustee) shall allocate the Available Distribution to the various
Subaccounts, and, where applicable, OAC, to the extent of the amount thereof
remaining after application pursuant to clauses (1) through (4) of Section 4.03
of the Standard Terms, in the following manner and in the following order of
priority:
(i) First, concurrently, to each Senior Subaccount, (A) first,
its Priority Interest Amount for such Distribution Date, with the
Available Distribution being allocated among the Senior Subaccounts
PRO RATA based on their respective Priority Interest Amount, and (B)
second, the related Carryover Interest Amount, if any, for such
Distribution Date, allocated first to pay all interest accrued and
unpaid on overdue Priority Interest Amounts and then to pay such
overdue Priority Interest Amounts, in each case with the Available
Distribution being allocated among the Senior Subaccounts PRO RATA
based on their respective Carryover Interest Amounts;
(ii) Second, to the Class A-6 Subaccount, (A) first, the
related Priority Interest Amount for such Distribution Date, and (B)
second, any related Carryover Interest Amount for such Distribution
Date, allocated first to pay all interest accrued and unpaid on
overdue Priority Interest Amounts and then to pay such overdue
Priority Interest Amounts;
(iii) Third, to the Class B-1 Subaccount, (A) first, the
related Priority Interest Amount for such Distribution Date, and (B)
second, any related Carryover Interest Amount for such Distribution
Date, allocated first to pay all interest accrued and unpaid on
overdue Priority Interest Amounts and then to pay such overdue
Priority Interest Amounts;
(iv) Fourth, to the Class B-2 Subaccount, the related
Priority Interest Amount for such Distribution Date;
(v) Fifth, to the Class A Subaccounts, (A) if the Class B
Cross-over Date has not yet occurred or if the Class B Principal
Distribution Tests are not met for such
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<PAGE>
Distribution Date, the Principal Distribution Amount, or (B) if the
Class B Cross-over Date has occurred and the Class B Principal
Distribution Tests are met for such Distribution Date, the Class A
Percentage of the Principal Distribution Amount, in either case
allocated in the following sequential order:
(1) First, to the Class A-1 Subaccount in reduction
of the Subaccount Principal Balance of such Subaccount, until
it has been reduced to zero;
(2) Second, to the Class A-2 Subaccount in reduction
of the Subaccount Principal Balance of such Subaccount, until
it has been reduced to zero;
(3) Third, to the Class A-3 Subaccount in reduction
of the Subaccount Principal Balance of such Subaccount, until
it has been reduced to zero;
(4) Fourth, to the Class A-4 Subaccount in reduction
of the Subaccount Principal Balance of such Subaccount, until
it has been reduced to zero;
(5) Fifth, to the Class A-5 Subaccount in reduction
of the Subaccount Principal Balance of such Subaccount, until
it has been reduced to zero; and
(6) Sixth, to the Class A-6 Subaccount in reduction
of the Subaccount Principal Balance of such Subaccount, until
it has been reduced to zero;
PROVIDED, HOWEVER, that on any Distribution Date on which a
Writedown Amount is to be allocated to the Senior Subaccounts
or on which there exists an Outstanding Subaccount Writedown
Amount on a Senior Subaccount, the Principal Distribution
Amount or applicable percentage thereof will be allocated among
the Senior Subaccounts PRO RATA based upon their respective
Subaccount Principal
Balances;
(vi) Sixth, concurrently, to each Senior Subaccount, (A) first,
any Writedown Interest Amount for such Subaccount and Distribution
Date, with the Available Distribution being allocated among such
Subaccounts PRO RATA based on their respective Writedown Interest
Amounts, and (B) second, any related Carryover Writedown Interest
Amount for such Distribution Date, in each case with the Available
Distribution being allocated among the Senior Subaccounts PRO RATA
based on their respective Carryover Writedown Interest Amounts;
(vii) Seventh, to the Class A-6 Subaccount, (A) first, any
related Writedown Interest Amount for such Distribution Date, and (B)
second, any related Carryover Writedown Interest Amount for such
Distribution Date;
(viii) Eighth, to the Class B-1 Subaccount, (A) first, any
related Writedown Interest Amount for such Distribution Date, and (B)
second, any related Carryover Writedown Interest Amount for such
Distribution Date;
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<PAGE>
(ix) Ninth, to the Class B-2 Subaccount, (A) first, any related
Writedown Interest Amount for such Distribution Date, and (B) second,
any related Carryover Writedown Interest Amount for such Distribution
Date;
(x) Tenth, concurrently, to each Senior Subaccount, any
Outstanding Subaccount Writedown Amount for such Subaccount and
Distribution Date, with the Available Distribution being allocated
among such Subaccounts PRO RATA based upon their respective
Outstanding Subaccount Writedown Amounts;
(xi) Eleventh, to the Class A-6 Subaccount, any Outstanding
Subaccount Writedown Amount for such Subaccount and Distribution
Date;
(xii) Twelfth, (A) if the Class B Cross-over Date has occurred
and the Class B Principal Distribution Tests are met for such
Distribution Date, to the Class B-1 Subaccount, any Outstanding
Subaccount Writedown Amount for such Subaccount and Distribution Date;
or (B) if the Class B Cross-over Date has not yet occurred or the
Class B Principal Distribution Tests are not met for such Distribution
Date, any Outstanding Subaccount Writedown Amount for such Subaccount
and Distribution Date shall be distributed pursuant to clause (v)
above;
(xiii) Thirteenth, (A) if the Class B Cross-over Date has
occurred and the Class B Principal Distribution Tests are met for such
Distribution Date, to the Class B-2 Subaccount, any Outstanding
Subaccount Writedown Amount for such Subaccount and Distribution Date;
or (B) if the Class B Cross-over Date has not yet occurred or the
Class B Principal Distribution Tests are not met for such Distribution
Date, any Outstanding Subaccount Writedown Amount for such Subaccount
and Distribution Date shall be distributed pursuant to clause (v)
above;
(xiv) Fourteenth, to the Class B Subaccounts, (A) if the Class
B Cross-over Date has occurred and the Class B Principal Distribution
Tests are met for such Distribution Date, the Class B Percentage of
the Principal Distribution Amount, or (B) if the Class A Principal
Balance has been or is reduced to zero on or before such Distribution
Date, the entire Principal Distribution Amount (less the portion
thereof, if any, distributed pursuant to clause (v) above), in either
case allocated between the Class B-1 and Class B-2 Subaccounts PRO
RATA based upon their respective Subaccount Principal Balances, but
distributable on any Distribution Date first to the Class B-1
Subaccount and thereafter to the Class B-2 Subaccount;
(xv) Fifteenth, to the Class B-2 Subaccount, any related
Carryover Interest Amount for such Distribution Date, allocated first
to pay all interest accrued and unpaid on overdue Priority Interest
Amounts and then to pay such overdue Priority Interest Amounts;
(xvi) Sixteenth, to each Subaccount, (i) first, its Carryover
Non-Priority Interest Amount for such Distribution Date and (ii)
second, its Non-Priority Interest Amount for
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<PAGE>
such Distribution Date, in each case with the Available Distribution
being allocated among the Subaccounts pro rata based upon their
respective Subaccount Principal Balances; provided, however, that the
aggregate amount allocated pursuant to this clause (xvi) shall not
exceed the amounts deposited to the Mezzanine Reserve Fund and the
Reserve Fund pursuant to clause (xvi) of Section 5(b) hereof.
(xvii) Seventeenth, if OAC is the Servicer, the Servicing Fee
with respect to such Distribution Date;
(xviii) Eighteenth, to each Subaccount, (i) first, to the
extent not allocated pursuant to clause (xvi) of this Section 5(a),
its Carryover Non-Priority Interest Amount for such Distribution Date
and (ii) second, to the extent not allocated pursuant to clause (xvi)
of this Section 5(a), its Non-Priority Interest Amount for such
distribution date, in each case with the Available Distribution being
allocated among the Subaccounts PRO RATA based upon their respective
Subaccount Principal Balances; and
(ix) Nineteenth, any remainder to the Holders of the Pooling
REMIC Residual Interest.
(b) On each Distribution Date, after all Subaccount allocations have
been made as described in Section 5(a) above and Section 6 below, the Trustee
(or the Paying Agent on behalf of the Trustee) shall withdraw all amounts
allocated to the various Subaccounts, and shall distribute such amounts in the
following manner and in the following order of priority:
(i) First, concurrently, to each Class of Senior Certificates,
(A) first, its Interest Distribution Amount for such Distribution
Date, with the Available Distribution being allocated among such
Classes PRO RATA based on their respective Interest Distribution
Amounts, and (B) second, the related Carryover Interest Amount, if
any, for such Distribution Date, allocated first to pay all interest
accrued and unpaid on overdue Interest Distribution Amounts and then
to pay such overdue Interest Distribution Amounts, in each case with
the Available Distribution being allocated among the Classes of Senior
Certificates PRO RATA based on their respective Carryover Interest
Amounts;
(ii) Second, to the Class A-6 Certificates, (A) first, the
related Interest Distribution Amount for such Distribution Date, and
(B) second, any related Carryover Interest Amount for such
Distribution Date, allocated first to pay all interest accrued and
unpaid on overdue Interest Distribution Amounts and then to pay such
overdue Interest Distribution Amounts;
(iii) Third, to the Class B-1 Certificates, (A) first, the
related Interest Distribution Amount for such Distribution Date, and
(B) second, any related Carryover Interest Amount for such
Distribution Date, allocated first to pay all interest accrued and
unpaid on overdue Interest Distribution Amounts and then to pay such
overdue Interest Distribution Amounts;
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(iv) Fourth, to the Class B-2 Certificates, the related
Interest Distribution Amount for such Distribution Date;
(v) Fifth, to the Class A Certificates, (A) if the Class B
Cross-over Date has not yet occurred or if the Class B Principal
Distribution Tests are not met for such Distribution Date, the
Principal Distribution Amount, or (B) if the Class B Cross-over Date
has occurred and the Class B Principal Distribution Tests are met for
such Distribution Date, the Class A Percentage of the Principal
Distribution Amount, in either case allocated in the following
sequential order:
(1) First, to the Class A-1 Certificates in
reduction of the Certificate Principal Balance of such Class,
until it has been reduced to zero;
(2) Second, to the Class A-2 Certificates in
reduction of the Certificate Principal Balance of such Class,
until it has been reduced to zero;
(3) Third, to the Class A-3 Certificates in
reduction of the Certificate Principal Balance of such Class,
until it has been reduced to zero;
(4) Fourth, to the Class A-4 Certificates in
reduction of the Certificate Principal Balance of such Class,
until it has been reduced to zero;
(5) Fifth, to the Class A-5 Certificates in
reduction of the Certificate Principal Balance of such Class,
until it has been reduced to zero; and
(6) Sixth, to the Class A-6 Certificates in
reduction of the Certificate Principal Balance of such Class,
until it has been reduced to zero;
PROVIDED, HOWEVER, that on any Distribution Date on which a
Writedown Amount is to be allocated to the Senior Certificates
or on which there exists an Outstanding Certificate Writedown
Amount on a Class of Senior Certificates, the Principal
Distribution Amount or applicable percentage thereof will be
allocated among the Senior Certificates PRO RATA based upon
their respective Certificate Principal Balances;
(vi) Sixth, concurrently, to each Class of Senior Certificates,
(A) first, any Writedown Interest Amount for such Class and
Distribution Date, with the Available Distribution being allocated
among such Classes PRO RATA based on their respective Writedown
Interest Amounts, and (B) second, any related Carryover Writedown
Interest Amount for such Distribution Date, in each case with the
Available Distribution being allocated among the Classes of Senior
Certificates PRO RATA based on their respective Carryover Writedown
Interest Amounts;
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(vii) Seventh, to the Class A-6 Certificates, (A) first, any
related Writedown Interest Amount for such Distribution Date, and (B)
second, any related Carryover Writedown Interest Amount for such
Distribution Date;
(viii) Eighth, to the Class B-1 Certificates, (A) first, any
related Writedown Interest Amount for such Distribution Date, and (B)
second, any related Carryover Writedown Interest Amount for such
Distribution Date;
(ix) Ninth, to the Class B-2 Certificates, (A) first, any
related Writedown Interest Amount for such Distribution Date, and (B)
second, any related Carryover Writedown Interest Amount for such
Distribution Date;
(x) Tenth, concurrently, to each Class of Senior Certificates,
any Outstanding Certificate Writedown Amount for such Class and
Distribution Date, with the Available Distribution being allocated
among such Classes PRO RATA based upon their respective Outstanding
Writedown Amounts;
(xi) Eleventh, to the Class A-6 Certificates, any Outstanding
Certificate Writedown Amount for such Class and Distribution Date;
(xii) Twelfth, (A) if the Class B Cross-over Date has occurred
and the Class B Principal Distribution Tests are met for such
Distribution Date, to the Class B-1 Certificates, any Outstanding
Certificate Writedown Amount for such Class and Distribution Date; or
(B) if the Class B Cross-over Date has not yet occurred or the Class B
Principal Distribution Tests are not met for such Distribution Date,
any Outstanding Certificate Writedown Amount for such Class and
Distribution Date shall be distributed pursuant to clause (v) above;
(xiii) Thirteenth, (A) if the Class B Cross-over Date has
occurred and the Class B Principal Distribution Tests are met for such
Distribution Date, to the Class B-2 Certificates, any Outstanding
Certificate Writedown Amount for such Class and Distribution Date; or
(B) if the Class B Cross-over Date has not yet occurred or the Class B
Principal Distribution Tests are not met for such Distribution Date,
any Outstanding Certificate Writedown Amount for such Class and
Distribution Date shall be distributed pursuant to clause (v) above;
(xiv) Fourteenth, to the Class B Certificates, (A) if the Class
B Cross-over Date has occurred and the Class B Principal Distribution
Tests are met for such Distribution Date, the Class B Percentage of
the Principal Distribution Amount, or (B) if the Class A Principal
Balance has been or is reduced to zero on or before such Distribution
Date, the entire Principal Distribution Amount (less the portion
thereof, if any, distributed pursuant to clause (v) above), in either
case allocated between the Class B-1 and Class B-2 Certificates PRO
RATA based upon their respective Certificate Principal Balances, but
distributable on any Distribution Date first to the Class B-1
Certificates and thereafter to the Class B-2 Certificates;
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(xv) Fifteenth, to the Class B-2 Certificates, any related
Carryover Interest Amount for such Distribution Date, allocated first
to pay all interest accrued and unpaid on overdue Interest
Distribution Amounts and then to pay such overdue Interest
Distribution Amounts;
(xvi) Sixteenth, to the Mezzanine Reserve Fund and the Reserve
Fund in the following sequential order:
(1) to the Mezzanine Reserve Fund until the amount on
deposit therein equals the Mezzanine Reserve Fund Required
Amount; and
(2) to the Reserve Fund until the amount on deposit
therein equals the Reserve Fund Required Amount, in the
following sequential order;
(A) first, to the Class B-1 Reserve Fund
until the amount on deposit therein equals the Class
B-1 Reserve Fund Required Amount; and
(B) second, to the Class B-2 Reserve Fund
until the amount on deposit therein equals the Class
B-2 Reserve Fund Required Amount;
(xvii) Seventeenth, to the Class X Certificates, the current
Class X Strip Amount;
(xviii) Eighteenth, pro rata to the Class B-1 and Class B-2
Certificates, the Accelerated Principal Distribution Amount for such
Distribution Date;
(xix) Nineteenth, to the Class X Certificates, any Class X
Carryover Strip Amount; and
(xx) Twentieth, any remainder to the holders of the Issuing
REMIC Residual Interest.
(c) All distributions or allocations made with respect to each Class
on each Distribution Date shall be allocated PRO RATA among the outstanding
Certificates of such Class based on their respective Percentage Interests. So
long as the Book-Entry Certificates are registered in the name of a Clearing
Agency or its nominee, the Trustee shall make all distributions or allocations
on such Certificates by wire transfers of immediately available funds to the
Clearing Agency or its nominee. In the case of Certificates issued in
fully-registered, certificated form, payment shall be made either (i) by check
mailed to the address of each Certificateholder as it appears in the Certificate
Register on the Record Date immediately prior to such Distribution Date or (ii)
by wire transfer of immediately available funds to the account of a Holder at a
bank or other entity having appropriate facilities therefor, if such Holder
shall have so notified the Trustee in writing at least five Business Days prior
to the Record Date immediately prior to such Distribution Date and such Holder
is (A) with respect to the Class B Certificates, the registered owner of Class B
Certificates with an aggregate initial Certificate Principal Balance of at least
$1,000,000, (B) with respect to any Class A Certificates issued after
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the Closing Date in certificated, fully-registered form, the registered owner of
Class A Certificates with an aggregate initial Certificate Principal Balance of
at least $5,000,000, and (C) with respect to the Residual Certificates or Class
X Certificates, the registered owner of the Residual Certificates or Class X
Certificates evidencing an aggregate Percentage Interest of at least 50%. The
Trustee may charge any Holder its standard wire transfer fee for any payment
made by wire transfer. Final distribution on the Certificates will be made only
upon surrender of the Certificates at the offices of the Trustee set forth in
the notice of such final distribution sent by the Trustee to all
Certificateholders pursuant to Section 9.01 of the Standard Terms.
(d) (1) Any amounts remaining in the Distribution Account on any
Distribution Date after all allocations and distributions required to be made by
this Pooling and Servicing Agreement have been made, and any amounts remaining
in the Pooling REMIC after payment in full of all of the Regular Interests
therein and any administrative expenses associated with the Trust, will be
distributed to the Holders of the Pooling REMIC Residual Interest.
(2) Any amounts remaining in the Subaccounts on any Distribution Date
after all distributions required to be made by this Pooling and Servicing
Agreement have been made, and any amounts remaining in the Issuing REMIC after
payment in full of the Regular Interests therein and any administrative expenses
associated with the Trust, will be distributed to the Holders of the Issuing
REMIC Residual Interest.
SECTION 6. MEZZANINE RESERVE FUND AND RESERVE FUND.
(a)(1) A Mezzanine Reserve Fund is hereby established as part of the
Trust Estate. The Mezzanine Reserve Fund shall be an asset of the Issuing REMIC.
The Trustee shall hold the Mezzanine Reserve Fund and maintain its status at all
times as an Eligible Account. The account for the Mezzanine Reserve Fund shall
be in the name of the Trustee, or shall be designated in a manner that reflects
that all funds in such account are held in trust for the benefit of the Trustee.
The Trustee shall invest all amounts on deposit in the Mezzanine Reserve Fund in
Eligible Investments as directed in writing by the holders of a majority in
interest (by Percentage Interest) of the Issuing REMIC Residual Interest. All
net income and gain, if any, from such investments shall become funds available
in the Mezzanine Reserve Fund.
(2) On each Distribution Date, after the amounts allocated to the
various Subaccounts have been allocated in accordance with Section 5(b) hereof,
the Trustee shall, in accordance with the related Remittance Report, withdraw
from the Mezzanine Reserve Fund the amount of the Mezzanine Reserve Fund Draw
Amount, if any, for such Distribution Date. Such Mezzanine Reserve Fund Draw
Amount, if any, will be applied on the Class A-6 Certificates in accordance with
clauses (ii) and (vii) under Section 5(b) hereof (in that order).
(3) If, after the disbursement of the related Mezzanine Reserve Fund
Draw Amount, if any, in accordance with Section 6(a)(2) above on any
Distribution Date other than the final Distribution Date, the amount on deposit
in the Mezzanine Reserve Fund exceeds the Mezzanine Reserve Fund Required
Amount, the amount of such excess shall be withdrawn and distributed to the
holders of the Issuing REMIC Residual Interest.
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(4) On the final Distribution Date, after the disbursement of the
Mezzanine Reserve Fund Draw Amount, if any, in accordance with Section 6(a)(2)
above, the amount, if any, on deposit in the Mezzanine Reserve Fund will be
withdrawn by the Trustee and distributed in the following order of priority: (i)
first, to the Class A-6 Certificates in reduction of any remaining Outstanding
Certificate Writedown Amount relating thereto, with such amount being allocated
to reduce any related Outstanding Certificate Writedown amount to zero; and (ii)
second, to the holders of the Issuing REMIC Residual Interest, whereupon the
Mezzanine Reserve Fund shall be terminated.
(b)(1) The Class B-1 Reserve Fund and the Class B-2 Reserve Fund are
hereby established as part of the Trust Estate. The Class B-1 Reserve Fund and
the Class B-2 Reserve Fund collectively constitute the Reserve Fund. The Reserve
Fund shall be an asset of the Issuing REMIC. The Trustee shall hold the Class
B-1 Reserve Fund and the Class B-2 Reserve Fund and maintain the status of each
at all times as an Eligible Account. The account for each of the Class B-1
Reserve Fund and the Class B-2 Reserve Fund shall be in the name of the Trustee,
or shall be designated in a manner that reflects that all funds in such accounts
are held in trust for the benefit of the Trustee. The Trustee shall invest all
amounts on deposit in the Class B-1 Reserve Fund or the Class B-2 Reserve Fund
in Eligible Investments as directed in writing by the holders of a majority in
interest (by Percentage Interest) of the Issuing REMIC Residual Interest. All
net income and gain, if any, from such investments shall become funds available
in the Class B-1 Reserve Fund or the Class B-2 Reserve Fund, as the case may be.
(2) On each Distribution Date, after the amounts allocated to the
various Subaccounts have been allocated in accordance with Section 5(b) hereof,
the Trustee shall, in accordance with the related Remittance Report, withdraw
from the Class B-1 Reserve Fund the amount of the Class B-1 Reserve Fund Draw
Amount, if any, for such Distribution Date. Such Class B-1 Reserve Fund Draw
Amount, if any, will be applied on the Class B-1 Certificates in accordance with
clauses (iii) and (viii) under Section 5(b) hereof (and in that order).
(3) On each Distribution Date, after the amounts allocated to the
various Subaccounts have been allocated in accordance with Section 5(b) hereof,
the Trustee shall, in accordance with the related Remittance Report, withdraw
from the Class B-2 Reserve Fund the amount of the Class B-2 Reserve Fund Draw
Amount, if any, for such Distribution Date. Such Class B-2 Reserve Fund Draw
Amount, if any, will be applied on the Class B-2 Certificates in accordance with
clauses (iv), (ix) and (xv) under Section 5(b) hereof (and in that order).
(4) If, after the disbursement of the related Class B-1 Reserve Fund
Draw Amount and Class B-2 Reserve Fund Draw Amount, if any, in accordance with
Sections 6(b)(2) and 6(b) (3) above on any Distribution Date other than the
final Distribution Date, the amount on deposit in the Class B-1 Reserve Fund
exceeds the Class B-1 Reserve Fund Required Amount or the amount on deposit in
the Class B-2 Reserve Fund exceeds the Class B-2 Reserve Fund Required Amount,
the amount of such excess shall be withdrawn and distributed in the following
order of priority; (i) first, to the Class X Certificates, the Class X Strip
Amount for such Distribution Date, to the extent not previously distributed,
(ii) second, to the Class X Certificates, any Class
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X Carryover Strip Amount for such Distribution Date, to the extent not
previously distributed, and (iii) third, to the holders of the Issuing REMIC
Residual Interest.
(5) On the final Distribution Date, after the disbursement of the
Class B-1 Reserve Fund Draw Amount and the Class B-2 Reserve Fund Draw Amount,
if any, in accordance with Sections 6(b)(2) and 6(b)(3) above, the amount, if
any, on deposit in the Class B-1 Reserve Fund and the Class B-2 Reserve Fund
will be withdrawn by the Trustee and distributed in the following order of
priority: (i) first, to the Class B-1 Certificates and Class B-2 Certificates,
each as the case may be, in reduction of any remaining Outstanding Certificate
Writedown Amounts relating thereto, to reduce any related Outstanding
Certificate Writedown Amount to zero; (ii) second, to the Class X Certificates,
the Class X Strip Amount for such Distribution Date, to the extent not
previously distributed; (iii) third, to the Class X Certificates, any Class X
Carryover Strip Amount for such Distribution Date, to the extent not previously
distributed; and (iv) fourth, to the holders of the Issuing REMIC Residual
Interest, whereupon the Class B-1 Reserve Fund and the Class B-2 Reserve Fund
shall be terminated.
SECTION 7. ALLOCATION OF WRITEDOWN AMOUNTS.
On each Distribution Date, after all required distributions have been
made on the Certificates pursuant to Sections 5 and 6 above, the Writedown
Amount, if any, shall be allocated on such Distribution Date in the following
manner and in the following order of priority:
(a) First, to the Class B-2 Certificates and to the Class B-2
Subaccount, to be applied in reduction of the Certificate Principal
Balance of such Class and the Subaccount Principal Balance of such
Subaccount, respectively, until the Certificate Principal Balance has
been reduced to zero;
(b) Second, to the Class B-1 Certificates and to the Class B-1
Subaccount, to be applied in reduction of the Certificate Principal
Balance of such Class and the Subaccount Principal Balance of such
Subaccount, respectively, until the Certificate Principal Balance has
been reduced to zero;
(c) Third, to the Class A-6 Certificates and to the Class A-6
Subaccount, to be applied in reduction of the Certificate Principal
Balance of such Class and the Subaccount Principal Balance of such
Subaccount, respectively, until they have been reduced to zero; and
(d) Finally, to the Senior Certificates and to the Senior
Subaccounts, to be allocated among the Classes of Senior Certificates
and among the Senior Subaccounts PRO RATA based upon their respective
Certificate Principal Balances and Subaccount Principal Balances,
respectively, and applied in reduction of the Certificate Principal
Balance of each such Class or in reduction of the Subaccount Principal
Balance of each such Subaccount until it has been reduced to zero.
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SECTION 8. REMITTANCE REPORTS.
(a) The Remittance Report for each Distribution Date shall identify
the following items, in addition to the items specified in Section 4.01 of the
Standard Terms:
(1) the Interest Distribution Amount for each Class of the
Certificates for such Distribution Date (which shall equal the
Priority Interest Amount for the Corresponding Subaccount) and the
Carryover Interest Amount, as well as any Writedown Interest Amount
and any Carryover Writedown Interest Amount, for each Class of the
Certificates for such Distribution Date, and the amount of interest of
each such category to be distributed on each such Class based upon the
Available Distribution for such Distribution Date;
(2) the amount to be distributed on such Distribution Date on
each Class of the Certificates to be applied to reduce the Certificate
Principal Balance of such Class (which will be equal to the amount to
be allocated on such Distribution Date on the Corresponding Subaccount
to be applied to reduce the Subaccount Principal Balance of such
Subaccount), separately identifying any portion of such amount
attributable to any prepayments and separately identifying any
Accelerated Principal Distribution Amount to be distributed on the
Class B-1 and Class B-2 Certificates;
(3) the aggregate amount, if any, to be distributed
on the Residual Certificates;
(4) the amount of any Writedown Amounts to be allocated to
reduce the Certificate Principal Balance of any Class of Certificates
(which will be equal to the amount of any Writedown Amount to be
allocated to the Corresponding Subaccount) on such Distribution Date;
(5) (a) the amount of any Mezzanine Reserve Fund Draw Amount,
any Class B-1 Reserve Fund Draw Amount and any Class B-2 Reserve Fund
Draw Amount for such Distribution Date, separately identifying the
portions of such Mezzanine Reserve Fund Draw Amount, Class B-1 Draw
Amount and Class B-2 Reserve Fund Draw Amount to be applied as
interest on each of the Class A-6, Class B-1 and Class B-2 Subaccounts
(and, hence, on the Class A-6, Class B-1 and Class B-2 Certificates),
as the case may be, (b) the amount to be deposited into the Mezzanine
Reserve Fund, the Class B-1 Reserve Fund and the Class B-2 Reserve
Fund pursuant to clause (xvi) under Section 5(b) above, and (c) the
amount on deposit in the Mezzanine Reserve Fund, the Class B-1 Reserve
Fund and the Class B-2 Reserve Fund both immediately before and
immediately after the Distribution Date;
(6) the Certificate Principal Balance of each Class of the
Certificates (which will be equal to the Subaccount Principal Balance
of the Corresponding Subaccount) after giving effect to the
distributions to be made (and any Writedown Amounts to be allocated)
on such Distribution Date;
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(7) the aggregate Interest Distribution Amount remaining
unpaid, if any, and the aggregate Carryover Interest Amount remaining
unpaid, if any, for each Class of Certificates (which will be equal to
the Priority Interest Amount and Carryover Interest Amount remaining
unpaid on the Corresponding Subaccount), after giving effect to all
distributions to be made on such Distribution Date;
(8) the amount of any Outstanding Certificate Writedown Amount,
if any, with respect to each Class of Certificates (which will be
equal to the Outstanding Subaccount Writedown Amount with respect to
the Corresponding Subaccount), after giving effect to all
distributions to be made (and any Writedown Amount to be allocated) on
such Distribution Date;
(9) the aggregate Writedown Interest Amount remaining unpaid,
if any, and the aggregate Carryover Writedown Interest Amount
remaining unpaid, if any, for each Class of Certificates (which will
be equal to such amounts remaining unpaid on the Corresponding
Subaccount), after giving effect to all distributions to be made on
such Distribution Date; and
(10) the amount of any Excess Asset Principal Balance as of
the close of business on such Distribution Date.
In the case of information furnished pursuant to clauses (1), (2) and
(3) above, the amounts shall be expressed, with respect to any Class A or Class
B Certificate, as a dollar amount per $1,000 denomination.
(b) In addition to mailing a copy of the related Remittance Report to
each Certificateholder on each Distribution Date in accordance with Section 4.01
of the Standard Terms, on each Distribution Date, the Trustee shall mail a copy
of the related Remittance Report to each Underwriter (to the attention of the
person, if any, reported to the Trustee by the applicable Underwriter) and to
THE BLOOMBERG (to the address and to the person, if any specified to the Trustee
by CS First Boston Corporation). The Trustee shall not be obligated to mail any
Remittance Report to THE BLOOMBERG unless and until CS First Boston Corporation
shall have notified the Trustee in writing of the name and address to which such
reports are to be mailed, which notice, once delivered, will be effective for
all Distribution Dates after the date such notice is received by the Trustee
unless and until superseded by a subsequent notice.
SECTION 9. LIMITED RIGHT OF SERVICER TO RETAIN SERVICING FEES
FROM COLLECTIONS.
The Servicer may retain its Servicing Fee and any other servicing
compensation provided for herein and in the Standard Terms from gross interest
collections on the Assets prior to depositing such collections into the
Certificate Account; PROVIDED, HOWEVER, that OAC as Servicer may only so retain
its Servicing Fee in respect of a Distribution Date from gross interest
collections on the Assets to the extent that the amounts on deposit in the
Certificate Account and attributable to the Available Distribution for such
Distribution Date exceed the sum
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of all amounts to be allocated and distributed on such Distribution Date
pursuant to clauses (i) through (xvi) under Section 5(b) hereof.
SECTION 10. MODIFICATIONS OF STANDARD TERMS.
The following modifications to the Standard Terms shall be in effect
with respect to the Certificates only.
(a) Section 1.01 of the Standard Terms is hereby amended as
follows:
(i) the definition of "Contract Documents" is hereby amended by
deleting the final paragraph thereof and replacing such
paragraph in its entirety as follows:
In the case of any Land Secured Contract,
the related Contract Documents shall consist of the
following documents in lieu of those listed in clause
(c) of the foregoing paragraph: (i) the original
recorded Mortgage for the related Real Property, with
evidence of recordation noted thereon or attached
thereto, or a certified copy thereof issued by the
appropriate recording office (or, if the Mortgage is
in the process of being recorded, a photocopy of the
Mortgage, which may be on microfilm or optical disk
maintained by the Servicer in its records separate
from the other related Contract Documents); (ii) if
the Mortgage does not name the related Seller as
mortgagee therein or beneficiary thereof, an original
recorded assignment or assignments of the Mortgage
from the Persons named as mortgagee in, or
beneficiary of, such Mortgage, to the related Seller,
with evidence of recordation noted thereon or
attached thereto, or a certified copy of each such
assignment issued by the appropriate recording office
(or, if such an original assignment is in the process
of being recorded, a photocopy of each such
assignment, which may be on microfilm or optical disk
maintained by the Servicer in its records separate
from the other related Contract Documents); (iii) a
copy of the power of attorney delivered by the Seller
to the Trustee authorizing the Trustee to execute and
record assignments of Mortgages securing Land Secured
Contracts from the Seller to the Trustee in the event
that recordation of such assignments becomes
necessary for foreclosure on the related Real
Property by or on behalf of the Trustee; and (iv) if
such Land Secured Contract's original principal
balance was $40,000 or greater, a copy of the title
search report and bring-down thereof (or evidence of
title insurance) with respect to the related Real
Property.
(ii) the definition of "Eligible Investment" is hereby amended
by deleting the word "or" from paragraph (d) thereof; by adding
the word "or" after the
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semicolon in paragraph (e) thereof; and by adding a paragraph
(f) at the end thereof to read in its entirety as follows:
(f) money market accounts or money market
mutual funds investing primarily in obligations of
the United States government, and further investing
exclusively in debt obligations, PROVIDED, HOWEVER,
that such money market accounts or money market
mutual funds shall be rated in a rating category
sufficient to support the initial ratings assigned to
a related Series of Certificates.
(iii) the definition of "Interest Accrual Period" is hereby
amended by deleting the definition thereof and replacing such
definition in its entirety as follows:
"Interest Accrual Period": With respect to
each Distribution Date (i) for the Class A-1
Certificates, the period commencing on the 15th day
of the preceding month through the 14th day of the
month in which such Distribution Date occurs (except
that the first Interest Accrual Period for the Class
A-1 Certificates will be the period from the Closing
Date through August 14, 1996) and (ii) for the Class
A-2, Class A-3, Class A- 4, Class A-5, Class A-6 and
Class B Certificates, the calendar month preceding
the month in which the Distribution Date occurs.
(iv) the definition of "Mortgage Loan Documents" is hereby
amended by adding to the end of paragraph (e) thereof the
following:
and that such Title Insurance Policy is freely
assignable to and will inure to the benefit of the
Trustee (subject to recordation of the related
Assignment of Mortgage).
(v) the words "Servicing Fees and" is hereby deleted from the
two parenthetical phrases included in the definition of "Due
Date Interest Shortfall"; and
(vi) the definition of "Qualified Bank" is restated as follows:
"Qualified Bank": Any domestic bank not
affiliated with the Seller or OMI (1) having
long-term unsecured debt obligations rated in one of
the two highest rating categories of Standard &
Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc. ("S&P") (and of Fitch
Investors Service, L.P. ("Fitch") if such bank's
long-term unsecured debt obligations are rated by
Fitch) or short-term unsecured debt obligations rated
in S&P's highest applicable rating category (and in
Fitch's highest applicable rating category if such
bank's short-term unsecured debt obligations are
rated by Fitch), (2) having commercial paper or
short-term unsecured debt obligations rated in S&P's
highest applicable rating
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category (and in Fitch's highest applicable rating
category if such bank's commercial paper or
short-term unsecured debt obligations are rated by
Fitch), or (3) that is otherwise acceptable to each
applicable Rating Agency.
(b) Section 2.02 of the Standard Terms is hereby amended by the
addition of the following Section 2.02(c)(4) thereto:
(4) RECORDATION AND/OR DELIVERY OF OPINIONS IN CERTAIN
CIRCUMSTANCES. (A) If, at any time more than 10% of the Pool Scheduled
Principal Balance is comprised of Mortgage Loans, Seller shall either
record Assignments of Mortgages or obtain one or more Opinions of
Counsel to the effect that recording is not required to protect the
Trustee's right, title and interest in and to such Mortgage Loans (or,
in case a court should recharacterize the sale of the Mortgage Loans
as a financing, to perfect a first priority security interest in favor
of the Trustee in the related Mortgage Loan), in either case with
respect to a sufficient quantity of Mortgage Loans so that less than
10% of the Pool Scheduled Principal Balance is comprised of Mortgage
Loans with unrecorded Assignments or as to which there exists no
Opinion of Counsel.
(B) If, at any time the credit rating assigned to Oakwood Homes
Corporation, a North Carolina corporation, by Standard & Poor's Rating
Services, a division of the McGraw-Hill Companies, Inc., is reduced to
less than "BB+", Seller shall either record Assignments of Mortgages
with respect each Mortgage Loan; or obtain one or more Opinions of
Counsel with respect to each Mortgage Loan to the effect that
recording is not required to protect the Trustee's right, title and
interest in and to such Mortgage Loans (or, in case a court should
recharacterize the sale of the Mortgage Loans as a financing, to
perfect a first priority security interest in favor of the Trustee in
the related Mortgage Loan).
(C) In the event that, subsequent to the receipt of an Opinion
of Counsel as provided in Section 2.02(c)(4)(A) or (B), the Servicer
is advised that recording is required to protect the right, title and
interest of the Trustee in and to any Mortgage Loan for which
recordation of an Assignment of Mortgage was not previously required,
the Servicer shall promptly notify the Trustee, and the Trustee shall
within five Business Days of its receipt of such notice deliver each
previously unrecorded Assignment of Mortgage to the Servicer for
recordation.
(c) Section 5.02 of the Standard Terms is hereby amended by deleting
the words "be equal to" and replacing it with the words "not be less than" on
the fourth line of the first paragraph thereof.
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SECTION 11. REMIC ADMINISTRATION.
(a) For purposes of the REMIC Provisions, all of the Certificates
(except the Residual Certificates) will be designated as the "regular interests"
in the Issuing REMIC, the eight Subaccounts will be designated as the "regular
interests" in the Pooling REMIC, the Class R Certificates will be designated as
the "residual interest" in each of the Issuing REMIC and the Pooling REMIC and,
following the division of the Class R Certificates into two separately
transferable, certificated and fully registered certificates in accordance with
Section 11(b) below, the Class R-1 Certificates will be designated as the
"residual interest" in the Issuing REMIC and the Class R-2 Certificates will be
designated as the "residual interest" in the Pooling REMIC.
(b) Upon the request of any registered Holder of a Class R
Certificate, the Trustee shall issue to such Holder two separately transferable,
certificated and fully registered Certificates (a Class R-1 Certificate and a
Class R-2 Certificate), in substantially the forms of Exhibit R-1 and Exhibit
R-2 attached hereto. In the event that the Class R Certificates are exchanged
for separately transferrable Class R-1 and Class R-2 Certificates: (1) the Class
R-1 Certificates will be designated as the residual interest in the Issuing
REMIC, (2) the Class R-2 Certificates will be designated as the residual
interest in the Pooling REMIC, (3) the Holders of a majority of the Percentage
Interest in the Class R-1 Certificates together with the Holders of a majority
of the Percentage Interest in the Class R-2 Certificates will have the option to
make a Terminating Purchase given to the Holders of a majority of the Percentage
Interest in the Residual Certificates pursuant to Section 9.01 of the Standard
Terms, and (4) the restrictions on the transfer of a Residual Certificate
provided in the Standard Terms will apply to both the Class R-1 and the Class
R-2 Certificates.
SECTION 12. AUCTION CALL.
(a) If neither the Servicer nor the Residual Majority exercises its
optional termination right as described in Section 9.01 of the Standard Terms
within 90 days after it first becomes entitled to do so, the Trustee shall use
commercially reasonable efforts to solicit bids for the purchase of all Assets,
REO Properties and Repo Properties remaining in the Trust from no fewer than two
prospective purchasers that it believes to be Qualified Bidders. If OAC is then
the Servicer of the Assets, the solicitation of bids shall be conditioned upon
the continuation of OAC as the servicer of the Assets on terms and conditions
substantially similar to those in the Pooling and Servicing Agreement, except
that it shall not be required to pay compensating interest or make Advances.
(b) If the Trustee receives bids from at least two Qualified Bidders
and the net proceeds of the highest bid are equal to or greater than the
Termination Price, the Trustee shall promptly advise the Servicer of the highest
bid and the terms of purchase, and the Servicer shall have three Business Days,
at its option, to match the terms of such bid. The Trustee shall thereafter sell
the Assets, REO Properties and Repo Properties either (i) to the Servicer, if it
shall so elect, or (ii) to the highest bidder, and in either case the Trustee
shall distribute the net proceeds of such sale in redemption of the Certificates
in compliance with Article IX of the
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Standard Terms and Section 5 hereof. Any such sale must also comply with the
requirements applicable to a Terminating Purchase set forth in Section 9.02 of
the Standard Terms.
(c) Any costs incurred by the Trustee in connection with such sale
(including without limitation any legal opinions or consents required by Section
9.02 of the Standard Terms) shall be deducted from the bid price of the Assets,
REO Properties and Repo Properties in determining the net proceeds therefrom.
(d) If the Trustee does not obtain bids from at least two Qualified
Bidders, or does not receive a bid such that the net proceeds therefrom would at
least equal the Termination Price, it shall not sell the Assets, REO Properties
and Repo Properties, and shall thereafter have no obligation to attempt to sell
same.
(e) The Servicer shall cooperate with and provide necessary
information to the Trustee in connection with any auction sale as described
herein.
SECTION 13. VOTING RIGHTS.
The Voting Rights applicable to the Certificates shall be allocated
0.5% to the Class R Certificates, 0.5% to the Class X Certificates and 99% to
the other Certificates in proportion with their respective Certificate Principal
Balance.
SECTION 14. DETERMINATION OF ONE-MONTH LIBOR.
(a) The Class A-1 Certificates will be entitled to receive on each
Distribution Date interest distributions at the Pass-Through Rate for such Class
as specified in Section 3 hereof.
(b) With respect to the Class A-1 Certificates, One-Month LIBOR shall
be determined as follows:
On each Floating Rate Determination Date, the Servicer will
determine the arithmetic mean of the London Interbank Offered Rate
("LIBOR") quotations for one-month Eurodollar deposits ("One-Month
LIBOR") for the succeeding Interest Accrual Period for the Class A-1
Certificates on the basis of the Reference Banks' offered LIBOR
quotations provided to the Servicer as of 11:00 a.m. (London time) on
such Floating Rate Determination Date. As used herein with respect to
a Floating Rate Determination Date, "Reference Banks" means four
leading banks engaged in transactions in Eurodollar deposits in the
international Eurocurrency market (i) with an established place of
business in London, (ii) whose quotations appear on the Bloomberg
Screen LIUS01M Index Page on the Floating Rate Determination Date in
question and (iii) which have been designated as such by the Servicer
and are able and willing to provide such quotations to the Servicer on
each Floating Rate Determination Date; and "Bloomberg Screen LIUS01M
Index Page" means the display designated as page "LIUS01M" on the
Bloomberg Financial Markets Commodities News (or such other pages as
may replace such page on that service for the purpose of displaying
LIBOR
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quotations of major banks). If any Reference Bank should be removed
from the Bloomberg Screen LIUS01M Index Page or in any other way fails
to meet the qualifications of a Reference Bank, the Servicer may, in
its sole discretion, designate an alternative Reference Bank.
On each Floating Rate Determination Date, One-Month LIBOR for
the next succeeding Interest Accrual Period for the Class A-1
Certificates will be established by the Servicer as follows:
(i) If, on any Floating Rate Determination Date, two or more of
the Reference Banks provide offered One-Month LIBOR quotations on the
Bloomberg Screen LIUS01M Index Page, One-Month LIBOR for the next
Accrual Period for the Class A-1 Certificates will be the arithmetic
mean of such offered quotations (rounding such arithmetic mean if
necessary to the nearest five decimal places).
(ii) If, on any Floating Rate Determination Date, only one or
none of the Reference Banks provides such offered One-Month LIBOR
quotations for the next applicable Interest Accrual Period, One-Month
LIBOR for the next Accrual Period for the Class A-1 Certificates will
be the higher of (x) One-Month LIBOR as determined on the previous
Floating Rate Determination Date and (y) the Reserve Interest Rate.
The "Reserve Interest Rate" will be the rate per annum that the
Servicer determines to be either (A) the arithmetic mean (rounding
such arithmetic mean if necessary to the nearest five decimal places)
of the one-month Eurodollar lending rate that New York City banks
selected by the Servicer are quoting, on the relevant Floating Rate
Determination Date, to the principal London offices of at least two
leading banks in the London interbank market or (B) in the event that
the Servicer can determine no such arithmetic mean, the lowest
one-month Eurodollar lending rate that the New York City banks
selected by the Servicer are quoting on such Floating Rate
Determination Date to leading European banks.
(iii) If, on any Floating Rate Determination Date, the Servicer
is required but is unable to determine the Reserve Interest Rate in
the manner provided in paragraph (ii) above, One-Month LIBOR for the
next applicable Interest Accrual Period will be One- Month LIBOR as
determined on the previous Floating Rate Determination Date.
Notwithstanding the foregoing, One-Month LIBOR for an Interest Accrual
Period shall not be based on One-Month LIBOR for the previous Interest Accrual
Period on the Class A-1 Certificates for two consecutive Floating Rate
Determination Dates. If, under the priorities described above, One-Month LIBOR
for an Interest Accrual Period on the Class A-1 Certificates would be based on
One-Month LIBOR for the previous Floating Rate Determination Date for the second
consecutive Floating Rate Determination Date, the Servicer shall select an
alternative index (over which the Servicer has no control) used for determining
one-month Eurodollar lending rates that is calculated and published (or
otherwise made available) by an independent third party.
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The establishment of One-Month LIBOR (or an alternative index) by the
Servicer and the Servicer's subsequent calculation of the Pass-Through Rate on
the Class A-1 Certificates for the relevant Interest Accrual Period, in the
absence of manifest error, will be final and binding.
SECTION 15. GOVERNING LAW.
The Pooling and Servicing Agreement shall be construed in accordance
with and governed by the laws of the State of North Carolina applicable to
agreements made and to be performed therein. The parties hereto agree to submit
to the personal jurisdiction of all federal and state courts sitting in the
State of North Carolina and hereby irrevocably waive any objection to such
jurisdiction. In addition, the parties hereto hereby irrevocably waive any
objection that they may have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any federal or state
court sitting in the State of North Carolina, and further irrevocably waive any
claim that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum.
SECTION 16. FORMS OF CERTIFICATES.
Each of the Schedules and Exhibits attached hereto or referenced
herein are incorporated herein by reference as contemplated by the Standard
Terms. Each Class of Certificates shall be in substantially the related form
attached hereto, as set forth in the Index to Schedules and Exhibits attached
hereto.
SECTION 17. COUNTERPARTS.
This Pooling and Servicing Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all of such counterparts shall together constitute but one and the same
instrument.
SECTION 18. ENTIRE AGREEMENT.
This Pooling and Servicing Agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof, and fully
supersedes any prior or contemporaneous agreements relating to such subject
matter.
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<PAGE>
IN WITNESS WHEREOF, OMI, the Servicer and the Trustee have caused this
Pooling and Servicing Agreement to be duly executed by their respective officers
thereunto duly authorized and their respective signatures duly attested all as
of the day and year first above written.
OAKWOOD MORTGAGE INVESTORS, INC.
By: /s/ Douglas R. Muir
Name: Douglas R. Muir
Title: Vice President
OAKWOOD ACCEPTANCE CORPORATION
By: /s/ Douglas R. Muir
Name: Douglas R. Muir
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION,
AS TRUSTEE
By: /s/ Alfred J. Perrazelli, Jr.
Name: Alfred J. Perrazelli, Jr.
Title: Vice President
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<PAGE>
STATE OF NORTH CAROLINA )
) s.
COUNTY OF GUILFORD )
The foregoing instrument was acknowledged before me in the County of
Guilford this 25th day of July, 1996 by Douglas R. Muir, Vice President of
Oakwood Mortgage Investors, Inc., a North Carolina corporation, on behalf of the
corporation.
/s/ R. A. Vutoro
Notary Public
My Commission expires: April 26, 1999
STATE OF NORTH CAROLINA )
) s.
COUNTY OF GUILFORD )
The foregoing instrument was acknowledged before me in the County of
Guilford this 25th day of July, 1996 by Douglas R. Muir, Vice President of
Oakwood Acceptance Corporation, a North Carolina corporation, on behalf of the
corporation.
/s/ R. A. Vutoro
Notary Public
My Commission expires: April 26, 1999
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<PAGE>
COMMONWEALTH OF PENNSYLVANIA )
) s.
CITY OF PHILADELPHIA )
The foregoing instrument was acknowledged before me in the City of
Philadelphia, this 24th day of July, 1996, by Alfred J. Perazzelli, Jr., Vice
President of PNC Bank, National Association, a national banking association, on
behalf of the association.
/s/ Marla M. Brownstein
Notary Public
My Commission expires: May 8, 2000
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<PAGE>
INDEX TO SCHEDULES AND EXHIBITS
SCHEDULE IA Contract Schedule
SCHEDULE IB Mortgage Loan Schedule
EXHIBIT A-1 Form of Class A-1 Certificate
EXHIBIT A-2 Form of Class A-2 Certificate
EXHIBIT A-3 Form of Class A-3 Certificate
EXHIBIT A-4 Form of Class A-4 Certificate
EXHIBIT A-5 Form of Class A-5 Certificate
EXHIBIT A-6 Form of Class A-6 Certificate
EXHIBIT B-1 Form of Class B-1 Certificate
EXHIBIT B-2 Form of Class B-2 Certificate
EXHIBIT X Form of Class X Certificate
EXHIBIT R Form of Class R Certificate
EXHIBIT R-1 Form of Class R-1 Certificate
EXHIBIT R-2 Form of Class R-2 Certificate
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