SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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) November 5, 1998.
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Oakwood Mortgage Investors, Inc.
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(Exact name of registrant as specified in charter)
North Carolina 333-58497 56-1886793
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
7800 McCloud Road, Greensboro, North Carolina 27407
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (336) 664-2400
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(Former name or former address, if changed since last report.)
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Item 5. Other Events.
On November 5, 1998, the Registrant caused the issuance and sale of
$319,423,713 aggregate initial principal amount of Senior/Subordinated
Pass-Through Certificates, Series 1998-D (the "Certificates") pursuant to the
Series 1998-D Pooling and Servicing Agreement, dated as of October 1, 1998 (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 (July 1998
Edition) (the "Standard Terms"). The Certificates were issued in eight Classes
with Pass-Through Rates and initial Certificate Principal Balances as set forth
below:
Initial Certificate
Designation Pass-Through Rate Principal Balance
Class A-1 ARM.............. (1) $6,023,152
Class A.................... 6.400% $238,335,000
Class M-1.................. (2) $22,360,000
Class M-2.................. (3) $14,374,000
Class B-1.................. (4) $12,777,000
Class B-2.................. (5) $25,554,561
Class X.................... (6) (6)
Class R.................... (7) (7)
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(1) The Pass-Through Rate on the Class A-1 ARM Certificates for any
Distribution Date shall be the per annum rate equal to the lesser of (i)
One-Month LIBOR, as determined (except for the initial Distribution Date)
on the applicable Floating Rate Determination Date, plus the Class A-1 ARM
Margin and (ii) the Weighted Average Net Asset Rate of the Adjustable Rate
Assets. For the initial Distribution Date, the Pass-Through Rate for the
Class A-1 ARM Certificates will be 6.0195% per annum.
(2) The Pass-Through Rate on the Class M-1 Certificates for any Distribution
Date shall be equal to the lesser of (i) 7.415% per annum and (ii) the
Weighted Average Net Asset Rate of the Fixed Rate Assets.
(3) The Pass-Through Rate on the Class M-2 Certificates for any Distribution
Date shall be equal to the lesser of (i) 8.322% per annum and (ii) the
Weighted Average Net Asset Rate of the Fixed Rate Assets.
(4) The Pass-Through Rate on the Class B-1 Certificates for any Distribution
Date shall be equal to the lesser of (i) 8.650% per annum and (ii) the
Weighted Average Net Asset Rate of the Fixed Rate Assets.
(5) The Pass-Through Rate on the Class B-2 Certificates for any Distribution
Date shall be equal to the lesser of (i) 7.950% per annum and (ii) the
Weighted Average Net Asset Rate of the Fixed Rate Assets.
(6) The Class X Certificates have no Certificate Principal Balance and no
Pass-Through Rate.
(7) 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 1998-D (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 October 1, 1998, between the
Registrant and OAC. Elections will be made to treat certain assets owned by the
Trust as "real estate mortgage investment conduits" (each, a "REMIC") under the
Internal Revenue Code of
<PAGE>
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 ARM and Class A Certificates are collectively referred to
herein as the "Offered Certificates." The Offered Certificates are senior to the
Class M-1, Class M-2, Class B-1, Class B-2, Class X and Class R Certificates.
The Offered Certificates have been sold by the Registrant to Credit Suisse First
Boston Corporation (the "Underwriter") pursuant to a Terms Agreement, dated as
of November 3, 1998, among the Underwriter, the Registrant and OAC, which
incorporates by reference the Registrant's Underwriting Agreement Standard
Provisions, June 1995. The Class M-1, Class M-2, 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. The Class M- 1
and Class M-2 Certificates were sold thereafter by OFC to Credit Suisse First
Boston Corporation.
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.
<PAGE>
Exhibits
1.1 Terms Agreement, dated November 3, 1998, among the Registrant,
Oakwood Acceptance Corporation and Credit Suisse First Boston
Corporation, as Underwriter, relating to the Offered Certificates
(related exhibits available upon request of the Registrant)
4.1 Copy of the Series 1998-D Pooling and Servicing Agreement, dated as
of October 1, 1998, 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)
<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.
November 5, 1998 OAKWOOD MORTGAGE INVESTORS, INC.
By: /s/ Douglas R. Muir
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Name: Douglas R. Muir
Title: Vice President
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INDEX TO EXHIBITS
Page
1.1 Terms Agreement, dated November 3, 1998,
among the Registrant, Oakwood Acceptance
Corporation and Credit Suisse First Boston
Corporation, as Underwriter, relating to
the Offered Certificates (related exhibits
available upon request of the Registrant).....................
4.1 Copy of the Series 1998-D Pooling and
Servicing Agreement, dated as of
October 1, 1998, by and among the Registrant,
Oakwood Acceptance Corporation, as Servicer,
and PNC Bank, National Association (related
exhibits available upon request of the Trustee) ..............
OAKWOOD MORTGAGE INVESTORS, INC.
PASS-THROUGH CERTIFICATES
1998-D TERMS AGREEMENT
Dated: November 3, 1998
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 1998-D, Classes A-1 ARM, A,
M-1, M-2, B-1, B-2, X and R (collectively, the "Certificates"). The
Classes A-1 ARM and A 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 Credit Suisse
First Boston Corporation (the "Underwriter"), and the Underwriter hereby agrees
to purchase from the Company, on November 5, 1998, the aggregate outstanding
principal amount of the Underwritten Certificates set forth below at the
purchase price and on the terms set forth below; provided, however, that the
obligations of the Underwriter are subject to: (i) receipt by the Company of the
ratings on the Certificates as set forth herein, (ii) receipt by the Underwriter
of the Sales Agreement (the "Sales Agreement"), dated as of October 1, 1998, 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
Underwriter.
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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
October 1, 1998 among the Company, OAC, as servicer (the "Servicer") and PNC
Bank, National Association, as Trustee (the "Trustee"), which incorporates by
reference the Company's Standard Terms to Pooling and Servicing Agreement (July
1998 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 and adjustable-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 November 3,
1998, 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 such dates.
Registration Statement: References in the Standard Provisions to the
Registration Statement shall be deemed to include registration statement
No. 333-58497.
Scheduled Principal Balance of Assets: $319,423,714.
Cut-Off Date with Respect to the Assets : October 1, 1998.
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Terms of the Certificates:
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Initial
Class Principal Pass-Through Ratings Purchase
Designation Amount Rate S&P Moody's Price
- ----------------- --------------- -------------- ----- --------- --------------
- ----------------- --------------- -------------- ----- --------- --------------
(1)
A-1 ARM $6,023,152 6.400% per "AAA" "Aaa" 99.775000%
A $238,335,000 annum "AAA" "Aaa" 99.769605%
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(1) The Pass-Through Rate for the Class A-1 ARM Certificates will be the per
annum rate equal to the lesser of One-Month LIBOR, as determined on the
applicable Floating Rate Determination Date, plus the Class A-1 ARM
Margin, and the Weighted Average Net Asset Rate of the Adjustable Rate
Assets. The Class A-1 ARM Margin shall equal 0.80% on any Distribution
Date which occurs on or prior to the Call Option Date, and shall equal
1.30% on any other Distribution Date.
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 November 1998.
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 Underwriter has 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 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 $1,000 and integral multiples of $1 in
excess thereof.
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 November 5, 1998, 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 to the Underwriters 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 Underwriter has
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.
3
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Controlling Agreement: This Terms Agreement sets forth the complete
agreement among the Company, OAC and the Underwriter and fully supersedes all
prior agreements, both written and oral, relating to the issuance of the
Underwritten Certificates and all matters set forth 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: The 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 them in connection with the Underwritten
Certificates; (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 and (iii) any information attached
hereto as Exhibit 3 constitutes all "Series Term Sheets" (as such term is
defined in the no-action letter addressed to Greenwood Trust Company, Discover
Card Master Trust I dated April 5, 1996).
For purposes hereof, as to the Underwriter, the term "Derived Information"
means such information, if any, in the Series Term Sheets, Collateral Term
Sheets, Structural Term Sheets and/or Computational Materials that is not
contained in either (i) the Prospectus taking into account information
incorporated therein by reference (other than information incorporated by
reference from the Series Term Sheets, Collateral Term Sheets, Structural Term
Sheets and/or Computational Materials) or (ii) any computer tape furnished by
the Company (the "Computer Tape"). The Underwriter 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 Securities Act of 1933, as amended (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 prepared by the Underwriter and incorporated by reference
into the Registration Statement, or arise out of or are based upon the omission
or alleged omission to state in such Derived Information a material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading,
(except that no such indemnity shall be available for any losses, claims,
damages or liabilities, or actions in respect thereof to the extent any such
untrue statement or alleged untrue statement therein results directly from an
error in the information on the Computer Tape or in any other information
concerning the Mortgage Loans or the Contracts provided by the Company to the
Underwriter in writing or through electronic transmission) and agree 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 the Underwriter under
4
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this paragraph shall be in addition to any liability which the Underwriter may
otherwise have. Notwithstanding the provisions of this paragraph, the
Underwriter shall not 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 the Underwriter: It is understood and agreed that
the information set forth under the heading "Underwriting" in the Prospectus
Supplement (except for the last paragraph relating to the estimated fees and
expenses) is the only information furnished by the Underwriter for inclusion in
the Registration Statement and the Final Prospectus.
Trustee: PNC Bank, National Association will act as Trustee of the Trust.
Blue Sky Qualifications: The Underwriter specifies 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 Underwriter an
opinion of counsel pursuant to Section 6(d)(iii) of the Standard Provisions with
respect to the State of North Carolina and the Commonwealth of Pennsylvania.
Blackout Period: None.
Applicable Law: THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Notices: All communications hereunder will be in writing and effective
only upon receipt and will be mailed, delivered or telegraphed and confirmed to
the parties at:
Oakwood Mortgage Investors, Inc. and
Oakwood Acceptance Corporation
7800 McCloud Road (27409-9634)
P.O. Box 27081
Greensboro, North Carolina 27425-7081
Attention: Douglas Muir
Credit Suisse First Boston Corporation
11 Madison Avenue
20th Floor
New York, New York 10010
Attention: Fiachra O'Driscoll
5
<PAGE>
Request for Opinions: (a) The Company and OAC hereby request and authorize
Hunton & Williams and Myles E. Standish, Esq., as their counsel in this
transaction, to issue on behalf of the Company and OAC, such legal opinions to
the Underwriter, their 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 Underwriter hereby requests and authorizes Simpson Thacher &
Bartlett, as their special counsel in this transaction, to issue to the
Underwriter 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.
6
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The 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.
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Fiachra O'Driscoll
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Name: Fiachra O'Driscoll
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Title: Director
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Accepted and acknowledged
As of the Date First
Above Written:
OAKWOOD MORTGAGE INVESTORS, INC.
By: /s/ Douglas R. Muir
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Name: Douglas R. Muir
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Title: Vice President
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OAKWOOD ACCEPTANCE CORPORATION
By: /s/ Douglas R. Muir
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Name: Douglas R. Muir
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Title: Vice President
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7
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OAKWOOD MORTGAGE INVESTORS, INC.,
OAKWOOD ACCEPTANCE CORPORATION
AND
PNC BANK, NATIONAL ASSOCIATION,
TRUSTEE
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SERIES 1998-D POOLING AND SERVICING AGREEMENT
Dated as of October 1, 1998
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OAKWOOD MORTGAGE INVESTORS, INC.
SENIOR/SUBORDINATED
PASS-THROUGH CERTIFICATES, SERIES 1998-D
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<PAGE>
THIS SERIES 1998-D POOLING AND SERVICING AGREEMENT, dated as of October 1,
1998, is made with respect to the formation of OMI Trust 1998-D (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, July 1998 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 $319,423,713, to be known as the Senior/Subordinated Pass-Through
Certificates, Series 1998-D (the "Certificates"). The Certificates consist of 8
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 Schedules attached as Schedule I (as defined below) hereto. The Issuing
REMIC will consist of the six Subaccounts designated as provided herein. 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,
together with the related Asset Documents, and all payments thereon and proceeds
of the conversion, voluntary or involuntary, of the foregoing, including,
without limitation, all rights to receive all principal and interest payments
due on the Assets after the applicable Cut-off Date, including such scheduled
payments received by OMI or OAC on or prior to the applicable Cut-off Date, and
Principal Prepayments, Net Insurance Proceeds, Net Liquidation Proceeds,
Repurchase
S-1
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Prices and other unscheduled collections received on the Assets on
and after the applicable Cut-off 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 in the
Distribution Account for the Certificates and all proceeds thereof, whether in
the form of cash, instruments, securities or other properties; (d) 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 (e)
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
(e) 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.
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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:
"Accrual Date": The Accrual Date shall be (i) with respect to the Class
A-1 ARM Certificates, the Closing Date and (ii) with respect to all other
Classes of Certificates, October 1, 1998.
S-2
<PAGE>
"Adjusted Certificate Principal Balance": With respect to each Class of
Subordinated Certificates on any date of determination, its Certificate
Principal Balance immediately following the most recently preceding Distribution
Date reduced by all Writedown Amounts allocated to such Class on such
Distribution Date.
"Adjusted Subaccount Principal Balance": With respect to each of the
Corresponding Subaccounts relating to the Subordinated Certificates, on any date
of determination, its Subaccount Principal Balance immediately following the
most recently preceding Distribution Date reduced by all Writedown Amounts
allocated to such Subaccount on such Distribution Date.
"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-1 ARM, Class A and Class M
Certificates.
"Call Option Date": The Distribution Date on which, after taking into
account distributions of principal to be made on such Distribution Date, the sum
of the Certificate Principal Balances of the Certificates is less than 10% of
the sum of the original Certificate Principal Balances of the Certificates.
S-3
<PAGE>
"Carryover Interest Distribution 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 and as Carryover Interest Distribution Amounts on
the previous Distribution Date but not previously distributed, together with
interest accrued on such amount at the Pass-Through Rate in effect for such
Class during the related Interest Accrual Period. With respect to each
Subaccount on each Distribution Date, all amounts that were allocable to such
Subaccount as Priority Interest Distribution Amounts and as Carryover Interest
Distribution Amounts on the previous Distribution Date but not previously
distributed, together with interest accrued on any such amount at the
Pass-Through Rate in effect for the Corresponding Certificates with respect to
such Subaccount during the related Interest Accrual Period.
"Carryover Non-Priority Interest Distribution Amount": For any Subaccount,
on any Distribution Date, all amounts that were distributable on such Subaccount
as Non-Priority Interest Distribution Amounts on previous Distribution Dates
that remain unpaid.
"Carryover Writedown Interest Distribution Amount": With respect to each
Distribution Date and each related Class or Subaccount, all amounts that were
distributable on such Class or Subaccount as Writedown Interest Distribution
Amounts and Carryover Writedown Interest Distribution Amounts on the previous
Distribution Date but not previously distributed, plus interest accrued on any
such amount during the related Interest Accrual Period at the then applicable
Pass-Through Rate.
"Class A Certificates": The Class A 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 Certificate Principal Balance of the Class A
Certificates immediately prior to such Distribution Date and the denominator of
which is the sum of the Class A Certificate Principal Balance, the Class M-1
Adjusted Certificate Principal Balance, the Class M-2 Adjusted Certificate
Principal Balance, the Class B-1 Adjusted Certificate Principal Balance and the
Class B-2 Adjusted Certificate Principal Balance, each immediately prior to such
Distribution Date.
"Class A Principal Distribution Amount": For any Distribution Date, will
equal (i) prior to the Cross-over Date, the entire Principal Distribution
Amount, less the Class A-1 ARM Principal Distribution Amount, (ii) on any
Distribution Date as to which the Principal Distribution Tests are not met, the
entire Principal Distribution Amount, less the Class A-1 ARM Principal
Distribution Amount, or (iii) on any other Distribution Date, the Class A
Percentage of the difference between the Principal Distribution Amount and the
Class A-1 ARM Principal Distribution Amount. For any Distribution Date, if the
Class A Principal Distribution Amount exceeds the Class A Certificate Principal
Balance less the Principal Distribution Shortfall Carryover Amount with respect
to such Class and Distribution Date, then such excess amount shall be allocated
to the Class M-1 Principal Distribution Amount.
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"Class A Subaccount": The Class A Subaccount.
"Class A-1 ARM Certificates": The Class A-1 ARM Certificates.
"Class A-1 ARM Margin": For any Distribution Date on or prior to the Call
Option Date, 0.80%, and on any other Distribution Date, 1.30%.
"Class A-1 ARM Principal Distribution Amount": For any Distribution Date,
will equal the lesser of the entire Principal Distribution Amount attributable
to the Adjustable Rate Assets listed on Schedule I and the then current
Certificate Principal Balance of the Class A-1 ARM Certificates. For any
Distribution Date, if the Class A-1 ARM Principal Distribution Amount exceeds
the Class A-1 ARM Certificate Principal Balance less the Principal Distribution
Shortfall Carryover Amount with respect to such Class and Distribution Date,
then such excess amount shall be allocated to the Class M-1 Principal
Distribution Amount.
"Class A-1 ARM Subaccount": The Class A-1 ARM Subaccount.
"Class B Certificates": The Class B-1 Certificates and Class B-2
Certificates.
"Class B Subaccounts": Any or all, as appropriate, of the Class B-1 or
Class B-2 Subaccounts.
"Class B-1 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 Adjusted Certificate Principal Balance of the Class
B-1 Certificates immediately prior to such Distribution Date and the denominator
of which is the sum of the Class A Certificate Principal Balance, the Class M-1
Adjusted Certificate Principal Balance, the Class M-2 Adjusted Certificate
Principal Balance, the Class B-1 Adjusted Certificate Principal Balance and the
Class B-2 Adjusted Certificate Principal Balance, each immediately prior to such
Distribution Date.
"Class B-1 Principal Distribution Amount": For any Distribution Date will
equal (i) as long as the Class A Certificate Principal Balance, the Class M-1
Certificate Principal Balance and the Class M-2 Certificate Principal Balance
have not been reduced to zero and prior to the Cross-over Date, zero, (ii) on
any Distribution Date as to which the Principal Distribution Tests are not met
and the Class A Certificate Principal Balance, the Class M-1 Certificate
Principal Balance and the Class M-2 Certificate Principal Balance have not been
reduced to zero, zero, (iii) on any Distribution Date as to which the Principal
Distribution Tests are not met and the Class A Certificate Principal Balance,
the Class M-1 Certificate Principal Balance and the Class M-2 Certificate
Principal Balance each have been reduced to zero, the Principal Distribution
Amount, less the Class A-1 ARM Principal Distribution Amount, or (iv) on any
other Distribution Date, the Class B-1 Percentage of the difference between the
Principal Distribution Amount and the Class A-1 ARM Principal Distribution
Amount. For any Distribution Date, if the Class B-1 Principal Distribution
Amount exceeds the Class B-1 Certificate Principal Balance less the Principal
Distribution
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<PAGE>
Shortfall Carryover Amount with respect to such Class and Distribution Date,
then such excess amount shall be allocated to the Class B-2 Principal
Distribution Amount.
"Class B-2 Floor Amount": With respect to any Distribution Date, either
(a) 2.00% of the aggregate principal balance of the Pool Scheduled Principal
Balance as of the Cut-off Date, if the Class A-1 ARM Certificate Principal
Balance, the Class A Certificate Principal Balance, the Class M-1 Certificate
Principal Balance, the Class M-2 Certificate Principal Balance and the Class B-1
Certificate Principal Balance have not been reduced to zero immediately prior to
such Distribution Date, and (b) zero, if the Class A-1 ARM Certificate Principal
Balance, the Class A Certificate Principal Balance, the Class M-1 Certificate
Principal Balance, the Class M-2 Certificate Principal Balance and the Class B-1
Certificate Principal Balance have been reduced to zero immediately prior to
such Distribution Date.
"Class B-2 Percentage": With respect to any Distribution Date, the
percentage derived from the fraction (which shall not be greater than 1), the
numerator of which is the Class B-2 Adjusted Certificate Principal Balance
immediately prior to such Distribution Date and the denominator of which is the
sum of the Class A Certificate Principal Balance, the Class M-1 Adjusted
Certificate Principal Balance, the Class M-2 Adjusted Certificate Principal
Balance, the Class B-1 Adjusted Certificate Principal Balance and the Class B-2
Adjusted Certificate Principal Balance, each immediately prior to such
Distribution Date.
"Class B-2 Principal Distribution Amount": For any Distribution Date will
equal (i) as long as the Class A Certificate Principal Balance, the Class M-1
Certificate Principal Balance, the Class M-2 Certificate Principal Balance and
the Class B-1 Certificate Principal Balance have not been reduced to zero and
prior to the Cross-over Date, zero, (ii) on any Distribution Date as to which
the Principal Distribution Tests are not met and the Class A Certificate
Principal Balance, the Class M-1 Certificate Principal Balance, the Class M-2
Certificate Principal Balance and the Class B-1 Certificate Principal Balance
have not been reduced to zero, zero, (iii) on any Distribution Date as to which
the Principal Distribution Tests are not met and the Class A Certificate
Principal Balance, the Class M-1 Certificate Principal Balance, the Class M-2
Certificate Principal Balance and the Class B-1 Certificate Principal Balance
each have been reduced to zero, the Principal Distribution Amount, less the
Class A-1 ARM Principal Distribution Amount, or (iv) on any other Distribution
Date, the Class B-2 Percentage of the difference between the Principal
Distribution Amount and the Class A-1 ARM Principal Distribution Amount. If the
Class A Certificate Principal Balance, the Class M-1 Certificate Principal
Balance, the Class M-2 Certificate Principal Balance and the Class B-1
Certificate Principal Balance have not been reduced to zero on or before a
Distribution Date, then amounts otherwise allocable as Class B-2 Principal
Distribution Amounts shall be allocated first to the Class B-1 Principal
Distribution Amount, next to the Class M-2 Principal Distribution Amount then to
the Class M-1 Principal Distribution Amount, next to the Class A Principal
Distribution Amount, and finally to the Class A-1 ARM Principal Distribution
Amount to the extent that allocation of such amounts to the Class B-2 Principal
Distribution Amount would reduce the Class B-2 Certificate Principal Balance
below the Class B-2 Floor Amount. On any Distribution Date, the Class B-2
Principal Distribution Amount shall not exceed the Class B-2
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Certificate Principal Balance less the Principal Distribution Shortfall
Carryover Amount with respect to such Class and such Distribution Date.
"Class M Certificates": The Class M-1 and Class M-2 Certificates.
"Class M-1 Percentage": With respect to any Distribution Date, the
percentage derived from the fraction (which shall not be greater than 1), the
numerator of which is the Class M-1 Adjusted Certificate Principal Balance
immediately prior to such Distribution Date and the denominator of which is the
sum of the Class A Certificate Principal Balance, the Class M-1 Adjusted
Certificate Principal Balance, the Class M-2 Adjusted Certificate Principal
Balance, the Class B-1 Adjusted Certificate Principal Balance and the Class B-2
Adjusted Certificate Principal Balance, each immediately prior to such
Distribution Date.
"Class M-1 Principal Distribution Amount": For any Distribution Date will
equal (i) as long as the Class A Certificate Principal Balance has not been
reduced to zero and prior to the Cross-over Date, zero, (ii) on any Distribution
Date as to which the Principal Distribution Tests are not met and the Class A
Certificate Principal Balance has not been reduced to zero, zero, (iii) on any
Distribution Date as to which the Principal Distribution Tests are not met and
the Class A Certificate Principal Balance has been reduced to zero, the
Principal Distribution Amount, less the Class A-1 ARM Principal Distribution
Amount, or (iv) on any other Distribution Date, the Class M-1 Percentage of the
difference between the Principal Distribution Amount and the Class A-1 ARM
Principal Distribution Amount. For any Distribution Date, if the Class M-1
Principal Distribution Amount exceeds the Class M-1 Certificate Principal
Balance less the Principal Distribution Shortfall Carryover Amount with respect
to such Class and Distribution Date, then such amounts shall be allocated to the
Class M-2 Principal Distribution Amount.
"Class M-2 Percentage": With respect to any Distribution Date, the
percentage derived from the fraction (which shall not be greater than 1), the
numerator of which is the Class M-2 Adjusted Certificate Principal Balance
immediately prior to such Distribution Date and the denominator of which is the
sum of the Class A Certificate Principal Balance, the Class M-1 Adjusted
Certificate Principal Balance, the Class M-2 Adjusted Certificate Principal
Balance, the Class B-1 Adjusted Certificate Principal Balance and the Class B-2
Adjusted Certificate Principal Balance, each immediately prior to such
Distribution Date.
"Class M-2 Principal Distribution Amount": For any Distribution Date will
equal (i) as long as the Class A Certificate Principal Balance and the Class M-1
Certificate Principal Balance have not been reduced to zero and prior to the
Cross-over Date, zero, (ii) on any Distribution Date as to which the Principal
Distribution Tests are not met and the Class A Certificate Principal Balance and
the Class M-1 Certificate Principal Balance have not been reduced to zero, zero,
(iii) on any Distribution Date as to which the Principal Distribution Tests are
not met and the Class A Certificate Principal Balance and the Class M-1
Certificate Principal Balance have been reduced to zero, the Principal
Distribution Amount, less the Class A-1 ARM Principal Distribution Amount, or
(iv) on any other Distribution Date, the Class M-2 Percentage of the difference
between the Principal Distribution Amount and the Class A-1 ARM Principal
Distribution Amount. For any
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Distribution Date, if the Class M-2 Principal Distribution Amount exceeds the
Class M-2 Certificate Principal Balance less the Principal Distribution
Shortfall Carryover Amount with respect to such Class and Distribution Date,
then such amounts shall be allocated to the Class B-1 Principal Distribution
Amount.
"Class M Subaccounts": Any or all, as appropriate, of the Class M-1 or
Class M-2 Subaccounts.
"Class R Certificates": The Class R Certificates, which represent
beneficial ownership of 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.
"Class X Certificates": The Class X Certificates created pursuant to
Section 3 hereof.
"Class X Strip Amount": With respect to any Distribution Date, (i) 30
days' interest on the Subaccount Principal Balance of the Class A-1 ARM
Subaccount at a rate equal to the positive difference, if any, between the
Weighted Average Net Asset Rate of the Adjustable Rate Assets and the
Pass-Through Rate on the Class A-1 ARM Subaccount plus (ii) 30 days' interest on
the Subaccount Principal Balance of the Class A, Class M and Class B
Subaccounts, at a rate equal to the positive difference, if any, between the
Weighted Average Net Asset Rate of the Fixed Rate Assets and the weighted
average of the Pass-Through Rates on the Class A, Class M and Class B
Subaccount. Solely for the purposes of those calculations, the Pass-Through
Rates of the Class A-1 A-1 ARM, Class A, Class M and Class B Subaccounts shall
be the Pass-Through Rates on the respective Corresponding Certificates.
"Closing Date": November 5, 1998.
"Corporate Trust Office": The address set forth hereinbelow under
"Trustee".
"Corresponding Certificates": For any Subaccount, the Class of
Certificates bearing the same letter and numerical designation as that borne by
such Subaccount.
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<PAGE>
"Corresponding Subaccount" For any Class of Certificates, the Subaccount
bearing the same letter and numerical designation as that borne by such Class.
"Cross-over Date": The later to occur of (a) the Distribution Date
occurring in May 2003 or (b) the first Distribution Date on which the percentage
equivalent of a fraction (which shall not be greater than 1) the numerator of
which is the aggregate Adjusted Certificate Principal Balance of the
Subordinated Certificates for such Distribution Date and the denominator of
which is the Pool Scheduled Principal Balance on such Distribution Date, equals
or exceeds 1.75 times the percentage equivalent of a fraction (which shall not
be greater than 1) the numerator of which is the initial aggregate Adjusted
Certificate Principal Balance of the Subordinated Certificates and the
denominator of which is the Pool Scheduled Principal Balance as of the Cut-off
Date.
"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": October 1, 1998.
"ERISA Restricted Certificates": The Class M-1, Class M-2, Class B-1,
Class B-2, Class X and Class R Certificates.
"Excess Subaccount Principal Balance": With respect to each Subaccount,
the excess, if any, of the Subaccount Principal Balance over the Certificate
Principal Balance of the Corresponding Certificates.
"Fixed Rate Assets": The Assets other than the Adjustable Rate Assets.
"Floating Rate Determination Date": For any Interest Accrual Period for
the Class A-1 ARM Certificates, the second London Banking Day prior to the
commencement of such Interest Accrual Period.
"Guarantor": Oakwood Homes Corporation, a North Carolina corporation.
"Institutional Holder": An insurance company whose long-term debt is rated
at least A- (or equivalent rating) by a Rating Agency, or an equivalent rating
from any other nationally recognized statistical rating organization.
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<PAGE>
"Interest Distribution Amount": On each Distribution Date, an amount equal
to interest accrued at the applicable Pass-Through Rate for the related Interest
Accrual Period on (i) in the case of the Class A-1 ARM Certificates or the Class
A-1 ARM Subaccount, and the Class A Certificates or the Class A Subaccount, the
Certificate Principal Balance of such Class or the Subaccount Principal Balance
of such Subaccount, respectively, immediately prior to that Distribution Date
and (ii) in the case of the Subordinated Certificates or the Corresponding
Subaccounts, on the Adjusted Certificate Principal Balance of such Class or the
Subaccount Principal Balance of such Subaccount, respectively, immediately prior
to that Distribution Date.
"Issuing REMIC": The Trust REMIC consisting of the Subaccounts.
"Issuing REMIC Residual Interest": The residual interest (as defined
in Code section 860G(a)(2)) in the Issuing REMIC.
"Limited Guarantee": The Limited Guarantee by the Guarantor dated as of
October 1, 1998, for the benefit of the Trustee, of Limited Guarantee Payment
Amounts.
"Limited Guarantee Payment Amount": With respect to any Distribution Date, the
amount after giving effect to the allocation of the Available Distribution
Amount for such date, equal to the amount of shortfalls in collections on the
Assets otherwise distributable on such Distribution Date not in excess of the
sum of (a) any unpaid Interest Distribution Amount, Carryover Interest
Distribution Amount, Writedown Interest Distribution Amount and Carryover
Writedown Interest Distribution Amount distributable on such Distribution Date
pursuant to clauses (v) and (xi) of Section 5(b) hereof and (b) any unpaid
principal amounts payable on such Distribution Date pursuant to clause (xi)
under Section 5(b) hereof.
"London Banking Day": Any day on which commercial banks and foreign
exchange markets settle payments in London and New York City.
"Non-Priority Interest Distribution 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 Distribution 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.
"Offered Certificates": The Class A-1 ARM and Class A Certificates.
"One-Month LIBOR": For each applicable Interest Accrual Period, the per
annum rate established in accordance with the provisions of Section 14 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
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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.
"Principal Distribution Shortfall Carryover Amount": With respect to each
Distribution Date and each Class of Certificates, an amount equal to all
Principal Distribution Amounts distributable on such Class from previous
Distribution Dates that have not yet been distributed on such Class of
Certificates. With respect to each Distribution Date and each Corresponding
Subaccount, an amount equal to all Principal Distribution Amounts distributable
on the Corresponding Certificates from previous Distribution Dates that have not
yet been distributed on such Corresponding Certificates.
"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
------------------ ----------
May 2003 through October 2004 7%
November 2004 through October 2005 8%
November 2005 and after 9%
; and (d) the Current Realized Loss Ratio as of such Distribution Date does not
exceed 2.75%.
"Priority Interest Distribution Amount": For any Subaccount, on any
Distribution Date, an amount equal to the Interest Distribution Amount for the
Corresponding Certificates.
"Private Certificates": The Class M-1 Certificates, Class M-2
Certificates, 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 Moody's Investors Service, Inc. (99 Church
Street, 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
10004).
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<PAGE>
"Regular Certificates": The Class A-1 ARM Certificates, Class A
Certificates, Class M Certificates, Class B Certificates and Class X
Certificates.
"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 M-1, Class M-2, Class B-1, Class
B-2, Class X and Residual Certificates.
"Servicing Fee Rate": 1.00% per annum.
"Subaccount": Each of the following six 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:
Initial
Subaccount
Subaccount Pass-Through Rate Principal Balance
---------- ----------------- -----------------
A-1 ARM (1) $ 6,023,152
A (1) $238,335,000
M-1 (1) $ 22,360,000
M-2 (1) $ 14,374,000
B-1 (1) $ 12,777,000
B-2 (1) $ 25,554,561
(1) The Pass-Through Rate on the Class A-1 ARM Subaccount for any
Distribution Date shall be equal to the Weighted Average Net Asset Rate of
the Adjustable Rate Assets. The Pass-Through Rate on all other Subaccounts
for any Distribution Date shall be equal to the Weighted Average Net Asset
Rate of the Fixed Rate Assets.
The Final Scheduled Distribution Date for each Subaccount is as follows:
Final Scheduled
Subaccount Distribution Dates
---------- ------------------
A-1 ARM January 15, 2029
A January 15, 2029
M-1 January 15, 2029
M-2 January 15, 2029
B-1 January 15, 2029
B-2 January 15, 2029
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For purposes of Treasury Regulation ss.1.860G-1(a)(4), the latest possible
maturity date for each of the Subaccounts shall be its final Scheduled
Distribution Date as set forth above.
"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 6 hereof.
"Subordinated Certificates": The Class M-1, Class M-2, Class B-1,
Class B-2, Class X and Residual Certificates.
"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, 1600 Market Street, 30th Floor,
Philadelphia, PA 19103, Attn: OMI Trust 1998-D (the "Corporate Trust Office"),
or its successor in interest.
"Trust REMIC": Each of the Pooling REMIC and the Issuing REMIC.
"Underwriter": Credit Suisse First Boston Corporation (whose address
is 11 Madison Avenue, 20th Floor, New York, New York 10010).
"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 the Servicing Fee Rate.
"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 Distribution Amount": With respect to each
Distribution Date and each Class of Subordinated Certificates, interest accrued
during the related Interest Accrual Period at the applicable Pass-Through Rate
on any related Writedown Amount. With respect to each Distribution Date and each
Corresponding Subaccount, interest accrued during the related Interest Accrual
Period on any related Writedown Amount at the Pass-Through Rate applicable to
the Corresponding Certificates.
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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
$319,423,713, 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 8 Classes having the designations, initial Certificate Principal Balances,
Pass-Through Rates and Final Scheduled Distribution Dates set forth or described
below:
Initial Final
Certificate Scheduled
Principal Pass Through Distribution
Designation Balance Rate Date(8)
- ----------- ------- ---- -------
A-1 ARM $ 6,023,152 (1) January 15, 2029
A $238,335,000 6.400% January 15, 2029
M-1 $ 22,360,000 (2) January 15, 2029
M-2 $ 14,374,000 (3) January 15, 2029
B-1 $ 12,777,000 (4) January 15, 2029
B-2 $ 25,554,561 (5) January 15, 2029
X (6) (6) January 15, 2029
R (7) (7) January 15, 2029
(1) The Pass-Through Rate on the Class A-1 ARM Certificates for any
Distribution Date shall be the per annum rate equal to the lesser of (i)
One-Month LIBOR, as determined (except for the initial Distribution Date)
on the applicable Floating Rate Determination Date, plus the Class A-1 ARM
Margin and (ii) the Weighted Average Net Asset Rate of the Adjustable Rate
Assets. For the initial Distribution Date, the Pass-Through Rate for the
Class A-1 ARM Certificates will be 6.0195% per annum, and the initial
Interest Accrual Period for the Class A-1 ARM Certificates will commence
on the Closing Date and end on November 15, 1998.
(2) The Pass-Through Rate on the Class M-1 Certificates for any
Distribution Date shall be equal to the lesser of (i) 7.415% per annum and
(ii) the Weighted Average Net Asset Rate of the Fixed Rate Assets.
(3) The Pass-Through Rate on the Class M-2 Certificates for any
Distribution Date shall be equal to the lesser of (i) 8.322% per annum and
(ii) the Weighted Average Net Asset Rate of the Fixed Rate Assets.
(4) The Pass-Through Rate on the Class B-1 Certificates for any
Distribution Date shall be equal to the lesser of (i) 8.650% per annum and
(ii) the Weighted Average Net Asset Rate of the Fixed Rate Assets.
(5) The Pass-Through Rate on the Class B-2 Certificates for any
Distribution Date shall be equal to the lesser of (i) 7.950% per annum and
(ii) the Weighted Average Net Asset Rate of the Fixed Rate Assets.
(6) 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.
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(7) 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.
(8) For purposes of Treasury Regulation ss.1.860G-1(a)(4), the latest
possible maturity date of each Class of Certificates shall be the Final
Scheduled Distribution Date.
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 denominations of $1,000
and integral multiples of $1 in excess thereof.
The Class B Certificates, Class X Certificates and the Residual
Certificates will be issued in certificated, fully registered form. Each Class
of 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
of each Class 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 Amount 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 the Class A-1 ARM Subaccount and the Class A
Subaccount, (A) first, its Priority Interest Distribution Amount for such
Distribution Date, and (B) second, the related Carryover Interest
Distribution Amount for such Distribution Date, if any;
(ii) Second, to the Class M-1 Subaccount, (A) first, the related Priority
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such
Distribution Date;
(iii) Third, to the Class M-2 Subaccount, (A) first, the related Priority
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such
Distribution Date;
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(iv) Fourth, to the Class B-1 Subaccount, (A) first, the related Priority
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such
Distribution Date;
(v) Fifth, to the Class B-2 Subaccount, (A) first, the related Priority
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such
Distribution Date;
(vi) Sixth, concurrently, to the Class A-1 ARM Subaccount and the Class A
Subaccount, the related Principal Distribution Shortfall Carryover Amount
for the Class A-1 ARM Subaccount and the Class A Subaccount, if any, for
such Distribution Date, allocated between the Class A-1 ARM Subaccount and
the Class A Subaccount pro rata based on their respective Principal
Distribution Shortfall Carryover Amounts;
(vii) Seventh, concurrently, to the Class A-1 ARM Subaccount, the Class
A-1 ARM Principal Distribution Amount and to the Class A Subaccount, the
Class A Principal Distribution Amount in reduction of the Certificate
Principal Balance of such Classes, until reduced to zero;
(viii) Eighth, to the Class M-1 Subaccount, (A) first, any related
Writedown Interest Distribution Amount for such Distribution Date, (B)
second, any related Carryover Writedown Interest Distribution Amount for
such Distribution Date, (C) third, the related Principal Distribution
Shortfall Carryover Amount for the Class M-1 Subaccount, if any, for such
Distribution Date, and (D) fourth, the Class M-1 Principal Distribution
Amount, in reduction of the Subaccount Principal Balance of such Class,
until the Class M-1 Certificate Principal Balance is reduced to zero;
(ix) Ninth, to the Class M-2 Subaccount, (A) first, any related Writedown
Interest Distribution Amount for such Distribution Date, (B) second, any
related Carryover Writedown Interest Distribution Amount for such
Distribution Date, (C) third, the related Principal Distribution Shortfall
Carryover Amount for the Class M-2 Subaccount, if any, for such
Distribution Date, and (D) fourth, the Class M-2 Principal Distribution
Amount, in reduction of the Subaccount Principal Balance of such Class,
until the Class M-2 Certificate Principal Balance is reduced to zero;
(x) Tenth, to the Class B-1 Subaccount, (A) first, any related Writedown
Interest Distribution Amount for such Distribution Date, (B) second, any
related Carryover Writedown Interest Distribution Amount for such
Distribution Date, (C) third, the related Principal Distribution Shortfall
Carryover Amount for the Class B-1 Subaccount, if any, for such
Distribution Date, and (D) fourth, the Class B-1 Principal Distribution
Amount, in reduction of the Subaccount Principal Balance of such Class,
until the Class B-1 Certificate Principal Balance is reduced to zero;
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(xi) Eleventh, to the Class B-2 Subaccount, (A) first, any related
Writedown Interest Distribution Amount for such Distribution Date, (B)
second, any related Carryover Writedown Interest Distribution Amount for
such Distribution Date, (C) third, the related Principal Distribution
Shortfall Carryover Amount for the Class B-2 Subaccount, if any, for such
Distribution Date, and (D) fourth, the Class B-2 Principal Distribution
Amount, in reduction of the Subaccount Principal Balance of such Class,
until the Class B-2 Certificate Principal Balance is reduced to zero;
(xii) Twelfth, if Oakwood Acceptance Corporation is the Servicer, to the
Servicer in the following sequential order: (A) the Servicing Fee with
respect to such Distribution Date; and (B) any Servicing Fees from
previous Distribution Dates remaining unpaid;
(xiii) Thirteenth, to each Subaccount, (i) first, its Carryover
Non-Priority Interest Distribution Amount for such Distribution Date, (ii)
second, its Non-Priority Interest Distribution Amount for such
Distribution Date, and (iii) its remaining Subaccount Principal Balance in
each case with the Available Distribution Amount being allocated among the
Subaccounts pro rata based upon the total Excess Subaccount Principal
Balance remaining to be paid with respect to each Subaccount; and
(xiv) Finally, any remainder to 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 7 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 the Class A-1 ARM Certificates and the Class A
Certificates, (A) first, its Interest Distribution Amount for such
Distribution Date, and (B) second, the related Carryover Interest
Distribution Amount, if any, for such Distribution Date;
(ii) Second, to the Class M-1 Certificates, (A) first, the related
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such Distribution
Date;
(iii) Third, to the Class M-2 Certificates, (A) first, the related
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such Distribution
Date;
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(iv) Fourth, to the Class B-1 Certificates, (A) first, the related
Interest Distribution Amount for such Distribution Date, and (B) second,
any related Carryover Interest Distribution Amount for such Distribution
Date;
(v) Fifth, to the Class B-2 Certificates, (A) first, the related Interest
Distribution Amount for such Distribution Date and (B) second, any related
Carryover Interest Distribution Amount for such Distribution Date;
(vi) Sixth, concurrently, to the Class A-1 ARM Certificates and the Class
A Certificates, the related Principal Distribution Shortfall Carryover
Amount for the Class A-1 ARM Certificates and the Class A Certificates, if
any, for such Distribution Date, allocated between the Class A-1 ARM
Certificates and the Class A Certificates pro rata based on their
respective Principal Distribution Shortfall Carryover Amounts;
(vii) Seventh, concurrently, to the Class A-1 ARM Certificates, the Class
A-1 ARM Principal Distribution Amount and to the Class A Certificates, the
Class A Principal Distribution Amount in reduction of the Certificate
Principal Balance of such Classes, until reduced to zero;
(viii) Eighth, to the Class M-1 Certificates, (A) first, any related
Writedown Interest Distribution Amount for such Distribution Date, (B)
second, any related Carryover Writedown Interest Distribution Amount for
such Distribution Date, (C) third, the related Principal Distribution
Shortfall Carryover Amount for the Class M-1 Certificates, if any, for
such Distribution Date, and (D) fourth, the Class M-1 Principal
Distribution Amount, in reduction of the Certificate Principal Balance of
such Class, until it is reduced to zero;
(ix) Ninth, to the Class M-2 Certificates, (A) first, any related
Writedown Interest Distribution Amount for such Distribution Date, (B)
second, any related Carryover Writedown Interest Distribution Amount for
such Distribution Date, (C) third, the related Principal Distribution
Shortfall Carryover Amount for the Class M-2 Certificates, if any, for
such Distribution Date, and (D) fourth, the Class M-2 Principal
Distribution Amount, in reduction of the Certificate Principal Balance of
such Class, until it is reduced to zero;
(x) Tenth, to the Class B-1 Certificates, (A) first, any related Writedown
Interest Distribution Amount for such Distribution Date, (B) second, any
related Carryover Writedown Interest Distribution Amount for such
Distribution Date, (C) third, the related Principal Distribution Shortfall
Carryover Amount for the Class B-1 Certificates, if any, for such
Distribution Date, and (D) fourth, the Class B-1 Principal Distribution
Amount, in reduction of the Certificate Principal Balance of such Class,
until it is reduced to zero;
(xi) Eleventh, to the Class B-2 Certificates, (A) first, any related
Writedown Interest Distribution Amount for such Distribution Date, (B)
second, any related Carryover Writedown Interest Distribution Amount for
such Distribution Date, (C) third, the related
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Principal Distribution Shortfall Carryover Amount for the Class B-2
Certificates, if any, for such Distribution Date, and (D) fourth, the
Class B-2 Principal Distribution Amount, in reduction of the Certificate
Principal Balance of such Class, until it is reduced to zero;
(xii) Twelfth, to the Class X Certificates in the following sequential
order:
(A) the current Class X Strip Amount; and
(B) any Class X Carryover Strip Amount; and
(xiii) Finally, 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 any Class A, Class M or Class B Certificates issued after
the Closing Date in certificated, fully-registered form, the registered owner of
Class A, Class M or Class B Certificates with an aggregate initial Certificate
Principal Balance of at least $1,000,000, and (B) 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.
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Section 6. Limited Guarantee.
------------------
The Trustee is the beneficiary of the Limited Guarantee. No later than
1:00 p.m. New York City time on each Remittance Date, after taking into account
the amounts allocated to the various Subaccounts in accordance with Section 5(b)
hereof, the Trustee shall, in accordance with the related Remittance Report and
in accordance with the terms of the Limited Guarantee, notify the Guarantor of
any Limited Guarantee Payment Amount payable under the Limited Guarantee on the
related Distribution Date. In addition, the Servicer shall notify the Guarantor
as soon as practical (but no later than the related Remittance Date) after
determining that a Limited Guarantee Payment Amount shall be payable under the
Limited Guarantee on the related Distribution Date. Under the Limited Guarantee,
upon receipt of notice as described above, the Guarantor shall be required to
deliver the Limited Guarantee Payment Amount, if any, on or prior to the
Remittance Date for the related Distribution Date. Such Limited Guarantee
Payment Amount received by the Trustee shall be paid to the Holders of the Class
B-2 Certificates on such Distribution Date (or such later date, if such amounts
are received subsequent to such Distribution Date). In no event shall the
Limited Guarantee Payment Amount be distributed on any Class of Certificates
other than the Class B-2 Certificates and any such amounts received by the
Trustee which are not distributable to the Class B-2 Certificates shall be
returned by the Trustee to the Guarantor. The Trustee shall promptly notify the
Rating Agencies in the event a Limited Guarantee Payment Amount, if any, is not
received in a timely manner with respect to a Distribution Date. Any Limited
Guarantee Payment Amounts made by the Guarantor to the Trustee shall be made in
cash and shall be considered to be payments made to the Issuing REMIC in the
nature of a guarantee within the meaning of I.R.C. ss. 860G(d)(2)(B).
Section 7. Allocation of Writedown Amounts.
--------------------------------
On each Distribution Date, after all required distributions have been made
on the Certificates pursuant to Section 5 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 Subaccount, to be applied in reduction of the
Adjusted Subaccount Principal Balance of such Subaccount, until the
Adjusted Subaccount Principal Balance has been reduced to zero;
(b) Second, to the Class B-1 Subaccount, to be applied in reduction of the
Adjusted Subaccount Principal Balance of such Subaccount, until the
Adjusted Subaccount Principal Balance has been reduced to zero;
(c) Third, to the Class M-2 Subaccount, to be applied in reduction of the
Adjusted Subaccount Principal Balance of such Subaccount, until the
Adjusted Subaccount Principal Balance has been reduced to zero; and
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(d) Finally, to the Class M-1 Subaccount, to be applied in reduction of
the Adjusted Subaccount Principal Balance of such Subaccount, until the
Adjusted Subaccount Principal Balance has been reduced to zero.
(e) Writedown Amounts allocated to the Class B-2, Class B-1, Class M-2 and
Class M-1 Subaccounts pursuant to this Section 7 shall be allocated to the
Class B-2, Class B-1, Class M-2 and Class M-1 Certificates, respectively,
until the Adjusted Certificate Principal Balance of each such Class has
been reduced to zero.
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
Distribution Amount for the Corresponding Subaccount) and the Carryover
Interest Distribution Amount, as well as any Writedown Interest
Distribution Amount and any Carryover Writedown Interest Distribution
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 Amount 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,
the amount to be distributed to reduce the Principal Distribution
Shortfall Carryover Amount on each such Class based upon the Available
Distribution Amount for such Distribution Date.
(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 Subordinated Certificates
(which will be equal to the amount of any Writedown Amount to be allocated
to the Corresponding Subaccount) on such Distribution Date;
(5) the amount of the Limited Guarantee Payment Amount, if any, for such
Distribution Date and the aggregate amount of any unpaid Limited Guarantee
Payment Amounts for any previous Distribution Dates;
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(6) the Certificate Principal Balance of each Class of the Certificates
(which will be equal to the Subaccount Principal Balance of the
Corresponding Subaccount) and the Adjusted Certificate Principal Balance
of each Class of the Offered Subordinated Certificates (which will be
equal to the Adjusted 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;
(7) the aggregate Interest Distribution Amount remaining unpaid, if any,
and the aggregate Carryover Interest Distribution Amount remaining unpaid,
if any, for each Class of Certificates (which will be equal to the
Priority Interest Distribution Amount and Carryover Interest Distribution
Amount remaining unpaid on the Corresponding Subaccount), after giving
effect to all distributions to be made on such Distribution Date;
(8) the aggregate Writedown Interest Distribution Amount remaining unpaid,
if any, and the aggregate Carryover Writedown Interest Distribution 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
(9) the aggregate Principal Distribution Shortfall Carryover Amount
remaining unpaid, if any, for each Class of Certificates, after giving
effect to the distributions to be made 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-1 ARM, Class
A, Class M 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 the Underwriters (to the attention of the
person, if any, reported to the Trustee by the Underwriters) and to The
Bloomberg (to the address and to the person, if any specified to the Trustee by
Credit Suisse First Boston Corporation). The Trustee shall not be obligated to
mail any Remittance Report to The Bloomberg unless and until Credit Suisse 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.
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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 Amount for
such Distribution Date exceed the sum of all amounts to be allocated and
distributed on such Distribution Date pursuant to clauses (i) through (xi) 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 "Compensating Interest" is hereby
deleted in its entirety.
(ii) 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 ARM 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 ARM Certificates will be the period from the
Closing Date through November 15, 1998) and (ii) for the Class
A, Class M and Class B Certificates, the calendar month
preceding the month in which the Distribution Date occurs.
Interest on the Class A-1 ARM Certificates will be calculated
on the basis of a 360-day year and the actual number of days
elapsed in the applicable Interest Accrual Period. Interest on
the Class A Certificates, Class M-1 Certificates, Class M-2
Certificates, Class B-1 Certificates and Class B-2
Certificates will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
(iii) the definition of "Record Date" is hereby amended by
deleting the definition thereof and replacing such definition in its
entirety as follows:
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"Record Date": With respect to each Distribution Date,
the last Business Date of the month immediately preceding the
month in which such Distribution Date occurs; provided,
however, that with respect to the first Distribution Date, the
Record Date shall be the November 6, 1998, in respect of the
Class A-1 ARM, Class A, Class X and Class R Certificates, and
shall be November 13, 1998 with respect to the Class M-1,
Class M-2, Class B-1 and Class B-2 Certificates.
(b) Section 3.04 of the Standard Terms is hereby amended by deleting the
title "Advances and Compensating Interest" and replacing such title with the
title "Advances", and is amended further by deleting Section 3.04(e) in its
entirety.
(c) Section 5.05(a) of the Standard Terms is hereby amended by the
addition of the following to the end of the first paragraph thereof:
"Notwithstanding the foregoing, no Rule 144A Agreement,
Transferee Agreement or Opinion of Counsel shall be required
in connection with any Class M Certificate and the transfer
restrictions contained below shall apply to the acquisition,
holding and disposition of all such Certificates by the
Beneficial Owners thereof.
TRANSFER RESTRICTIONS
The Certificates have not been registered under the Securities Act and may
not be offered or sold within the United States or to, for the account or
benefit of, U.S. persons (as defined in Regulation S under the Securities Act)
except to qualified institutional buyers in reliance on the exemption from the
registration requirements of the Securities Act provided by Rule 144A.
Each purchaser of the Certificates will be deemed to have represented and
agreed as follows (terms used in this paragraph that are defined in Rule 144A or
Regulation S under the Securities Act are used herein as defined therein):
(1) the purchaser (A) is a qualified institutional buyer ("QIB"), (B) is aware
that the sale to it is being made in reliance on Rule 144A and (C) is acquiring
such Certificates for its own account or for the account of a QIB.
(2) the purchaser understands that the Certificates are being offered in a
transaction not involving any public offering in the United States within the
meaning of the Securities Act, that the Certificates have not been and will not
be registered under the Securities Act and that (A) if in the future it decides
to offer, resell, pledge or otherwise transfer any of the Certificates such
Certificates may be offered, resold, pledged or otherwise transferred only (i)
in the United States to a person whom the seller reasonably believes is a QIB in
a transaction meeting the requirements of Rule 144A, (ii) pursuant to an
exemption from registration under the Securities Act provided by Rule 144A(if
available) or (iii) pursuant to an effective registration statement under the
Securities
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Act, in each of cases (i) through (iii) in accordance with any applicable
securities laws of any State of the United States, and that (B) the purchaser
will, and each subsequent holder is required to, notify any subsequent purchaser
of such Certificates from it of the resale restrictions referred to in (A)
above.
(3) The purchaser understands that the Certificates will, until the
expiration of the applicable holding period with respect to the Certificates set
forth in clause (k) of Rule 144 promulgated under the Securities Act, unless
otherwise agreed by the Company and the Certificateholder, bear a legend
substantially to the following effect:
THIS CERTIFICATE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"), AND THIS CERTIFICATE MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS CERTIFICATE IS HEREBY NOTIFIED THAT THE SELLER
OF THIS CERTIFICATE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF
SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS CERTIFICATE AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS CERTIFICATE MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
(I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (III) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT. IN EACH OF CASES (I) THROUGH (III) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER OF THIS CERTIFICATE FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.
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 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
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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 the Servicer does not exercise 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 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 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
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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 ARM 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 ARM 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 ARM 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 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
US0001M 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 US0001M Index Page" means the
display designated as page "US0001M 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 quotations of major banks). If
any Reference Bank should be removed from the Bloomberg Screen US0001M
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 ARM Certificates will
be established by the Servicer as follows:
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(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 US0001M Index Page, One-Month LIBOR for the next Accrual
Period for the Class A-1 ARM 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 ARM 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 ARM 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 ARM 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.
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 ARM Certificates for the relevant Interest Accrual Period, in the
absence of manifest error, will be final and binding.
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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/ Judy A. Wisniewski
---------------------------
Name: Judy A. Wisniewski
Title: Assistant 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 2nd day of November, 1998 by Douglas R. Muir, Vice President of
Oakwood Mortgage Investors, Inc., a North Carolina corporation, on behalf of the
corporation.
/s/ Dena B. Cardwell
----------------------------
Notary Public
My Commission expires: November 30, 2000
STATE OF NORTH CAROLINA )
) s.
COUNTY OF GUILFORD )
The foregoing instrument was acknowledged before me in the County of
Guilford this 2nd day of November, 1998 by Douglas R. Muir, Vice President of
Oakwood Acceptance Corporation, a North Carolina corporation, on behalf of the
corporation.
/s/ Dena B. Cardwell
----------------------------
Notary Public
My Commission expires: November 30, 2000
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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 5th day of November, 1998, by Judy Wisniewski, Assistant Vice
President of PNC Bank, National Association, a national banking association, on
behalf of the association.
/s/ Joan F. Wilson
----------------------
Notary Public
My Commission expires: February 12, 2001
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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 ARM Certificate
Exhibit A Form of Class A Certificate
Exhibit M-1 Form of Class M-1 Certificate
Exhibit M-2 Form of Class M-2 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
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