VANDERBILT MORTGAGE AND FINANCE, INC.,
AS SELLER AND SERVICER,
XXXXXXX HOMES, INC.,
AS PROVIDER OF THE LIMITED GUARANTEE
and
JPMORGAN CHASE BANK, AS TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of October 25, 2001
Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificates
Series 2001-C
Table of Contents
Page
Article I
DEFINITIONS
Section 1.01 Definitions...................................................................... 1
Section 1.02 Determination of Scheduled Payments.............................................. 28
Article II
CONVEYANCE OF CONTRACTS; TRUST FUND; PERFECTION OF SECURITY
INTEREST; CUSTODY OF CONTRACTS
Section 2.01 Conveyance of Contracts and Other Rights......................................... 29
Section 2.02 Filing; Name Change or Relocation................................................ 30
Section 2.03 Acceptance by Trustee............................................................ 31
Section 2.04 Delivery of Land-and-Home Contract Files and Mortgage Loan
Files and Recordation............................................................ 31
Section 2.05 REMIC Election; Designation of Regular and Residual Interests;
Tax Year......................................................................... 33
Section 2.06 Designation of Startup Day....................................................... 33
Section 2.07 REMIC Certificate Maturity Date.................................................. 33
Article III
REPRESENTATIONS AND WARRANTIES
Section 3.01 Representations and Warranties Regarding Vanderbilt.............................. 34
Section 3.02 Representations and Warranties Regarding Each Contract........................... 35
Section 3.03 Representations and Warranties Regarding the Contracts
in the Aggregate................................................................. 37
Section 3.04 Representations and Warranties Regarding the Contract Files, the
Land-and-Home Contract Files and the Mortgage Loan Files......................... 38
Section 3.05 Repurchases of Contracts or Substitution of Contracts for Breach of
Representations and Warranties................................................... 39
Article IV
THE CERTIFICATES
Section 4.01 The Certificates................................................................. 43
Section 4.02 Registration of Transfer and Exchange of Certificates............................ 43
Section 4.03 Mutilated, Destroyed, Lost or Stolen Certificate................................. 47
Section 4.04 Persons Deemed Owners............................................................ 47
Section 4.05 Appointment of Paying Agent...................................................... 47
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Section 4.06 Access to List of Certificateholders' Names and Addresses........................ 48
Section 4.07 Authenticating Agents............................................................ 48
Section 4.08 Class R Certificate.............................................................. 48
Article V
ADMINISTRATION AND SERVICING OF CONTRACTS
Section 5.01 Responsibility for Contract Administration and Servicing......................... 53
Section 5.02 Standard of Care................................................................. 53
Section 5.03 Records.......................................................................... 53
Section 5.04 Inspection....................................................................... 53
Section 5.05 Establishment of and Deposits in the Certificate Account......................... 54
Section 5.06 Payment of Taxes................................................................. 55
Section 5.07 Enforcement...................................................................... 55
Section 5.08 Transfer of the Certificate Account.............................................. 56
Section 5.09 Maintenance of Hazard Insurance Policies......................................... 56
Section 5.10 Fidelity Bond and Errors and Omissions Insurance................................. 57
Section 5.11 Collections under Hazard Insurance Policies; Consent to Transfers of
Manufactured Homes; Assumption Agreements........................................ 57
Section 5.12 Realization upon Defaulted Contracts............................................. 58
Section 5.13 Costs and Expenses............................................................... 59
Section 5.14 Trustee to Cooperate............................................................. 59
Section 5.15 Servicing and Other Compensation................................................. 60
Section 5.16 Custody of Contracts............................................................. 60
Section 5.17 REMIC Compliance................................................................. 61
Section 5.18 Establishment of and Deposits in the Distribution Account........................ 63
Article VI
PAYMENTS TO THE CERTIFICATEHOLDERS; WITHDRAWALS FROM
CERTIFICATE ACCOUNT
Section 6.01 Monthly Payments................................................................. 65
Section 6.02 Permitted Withdrawals from the Certificate Account............................... 70
Section 6.03 [Reserved]....................................................................... 71
Section 6.04 Monthly Advances by the Servicer................................................. 71
Section 6.05 Limited Guarantee................................................................ 71
Section 6.06 Alternate Credit Enhancement..................................................... 72
Section 6.07 Calculation of the Remittance Rates with respect to the Floating
Rate Certificates ............................................................... 72
Article VII
REPORTS
Section 7.01 Monthly Reports.................................................................. 73
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Section 7.02 Certificate of Servicing Officer................................................. 75
Section 7.03 Other Data....................................................................... 75
Section 7.04 Annual Statement as to Compliance................................................ 75
Section 7.05 Annual Independent Public Accountants' Servicing Report.......................... 75
Section 7.06 Statements to Certificateholders................................................. 75
Article VIII
INDEMNITIES; VANDERBILT AND THE SERVICER
Section 8.01 Liabilities to Obligors.......................................................... 78
Section 8.02 Tax Indemnification.............................................................. 78
Section 8.03 Servicer's Indemnities........................................................... 78
Section 8.04 Operation of Indemnities......................................................... 78
Section 8.05 Merger or Consolidation of Vanderbilt or the Servicer............................ 79
Section 8.06 Limitation on Liability of the Servicer and Others............................... 79
Section 8.07 Assignment by Servicer........................................................... 79
Section 8.08 Successor to the Servicer........................................................ 80
Article IX
DEFAULT
Section 9.01 Events of Default................................................................ 82
Section 9.02 Waiver of Defaults............................................................... 83
Section 9.03 Trustee to Act; Appointment of Successor......................................... 83
Section 9.04 Notification to Certificateholders............................................... 83
Section 9.05 Effect of Transfer............................................................... 83
Section 9.06 Transfer of the Accounts......................................................... 84
Article X
CONCERNING THE TRUSTEE
Section 10.01 Duties of Trustee................................................................ 85
Section 10.02 Certain Matters Affecting the Trustee............................................ 86
Section 10.03 Trustee Not Liable for Certificates or Contracts................................. 87
Section 10.04 Trustee May Own Certificates..................................................... 87
Section 10.05 Servicer to Pay Fees and Expenses of Trustee..................................... 87
Section 10.06 Eligibility Requirements for Trustee............................................. 88
Section 10.07 Resignation and Removal of the Trustee........................................... 88
Section 10.08 Successor Trustee................................................................ 89
Section 10.09 Merger or Consolidation of Trustee............................................... 89
Section 10.10 Appointment of Co-Trustee or Separate Trustee.................................... 89
Section 10.11 Appointment of Office or Agency.................................................. 90
Section 10.12 Trustee May Enforce Claims Without Possession of Certificates.................... 91
Section 10.13 Suits for Enforcement............................................................ 91
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Article XI
TERMINATION
Section 11.01 Termination...................................................................... 92
Article XII
MISCELLANEOUS PROVISIONS
Section 12.01 Severability of Provisions....................................................... 95
Section 12.02 Limitation on Rights of Certificateholders....................................... 95
Section 12.03 Acts of Certificateholders....................................................... 95
Section 12.04 [Reserved]....................................................................... 96
Section 12.05 Amendment........................................................................ 96
Section 12.06 Recordation of Agreement......................................................... 98
Section 12.07 Contribution of Assets........................................................... 98
Section 12.08 Duration of Agreement............................................................ 98
Section 12.09 Governing Law.................................................................... 98
Section 12.10 Notices.......................................................................... 98
Section 12.11 Merger and Integration of Documents.............................................. 98
Section 12.12 Headings......................................................................... 99
Section 12.13 Counterparts..................................................................... 99
TESTIMONIUM
EXHIBIT A-1 - Contract Schedule
EXHIBIT A-2 - Form of Custodial Agreement
EXHIBIT B-1 - Form of Face of Class A Certificate
EXHIBIT B-2 - Form of Face of Class M-1 Certificate
EXHIBIT C - Form of Face of Class B Certificate
EXHIBIT D - Form of Face of Class R Certificate
EXHIBIT E - Form of Reverse of Certificates
EXHIBIT F - Form of Certificate Regarding Substitution of Eligible Substitute Contracts
EXHIBIT G - Form of Certificate of Servicing Officer Regarding Monthly Report
EXHIBIT H - Form of Transfer Affidavit
EXHIBIT I - Form of Investment Letter
EXHIBIT J - List of Sellers and Originators of Acquired Contracts
EXHIBIT K - Form of Power of Attorney
EXHIBIT L - Form of Limited Power of Attorney
iv
AGREEMENT, dated as of October 25, 2001, among Vanderbilt Mortgage
and Finance, Inc., a corporation organized and existing under the laws of the
State of Tennessee, as Seller and Servicer ("Vanderbilt"), Xxxxxxx Homes,
Inc., a corporation organized and existing under the laws of the State of
Delaware, as provider of the Limited Guarantee ("Xxxxxxx"), and JPMorgan Chase
Bank, a New York banking corporation, not in its individual capacity but
solely as Trustee (the "Trustee").
WHEREAS, in the regular course of its business, Vanderbilt
originates, purchases and services manufactured housing installment sales
contracts, installment loan agreements and mortgage loans, which provide for
installment payments by or on behalf of the owner of the manufactured home and
grant a security interest in the related manufactured home (and in addition,
in certain cases, mortgages or deeds of trust on the real estate on which such
manufactured home is located);
WHEREAS, Vanderbilt and the Trustee wish to set forth the terms and
conditions pursuant to which the "Trust Fund," as hereinafter defined, will
acquire the "Contracts" as hereinafter defined, and Vanderbilt will manage and
service the Contracts;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, Xxxxxxxxxx, Xxxxxxx and the Trustee agree as
provided herein:
Article I
DEFINITIONS
Section 1.01 Definitions. Whenever used herein, unless the context
otherwise requires, the following words and phrases shall have the following
meanings:
ACQUIRED CONTRACTS: 1,711 Contracts having an aggregate principal
balance as of the Cut-off Date of approximately $59,578,866, which Vanderbilt
purchased from the sellers listed on Exhibit J, all of which Contracts were
originated by the Originators listed in Exhibit J hereto.
ACTUARIAL CONTRACT: Any Contract pursuant to which the portion of any
scheduled payment allocable to interest is calculated on the basis that each
monthly payment is applied on its Due Date, regardless of when it is actually
made.
ADJUSTABLE RATE CONTRACT: Each Contract sold to the Trust which bears
interest at a variable rate.
AFFILIATE: As to any specified Person, any other Person controlling
or controlled by or under common control with such specified Person. For the
purposes of this definition, "controls," when used with respect to any
specified Person, means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" or
"controlled" have meanings correlative to the foregoing.
AGGREGATE INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of the Class A-1 Interest Formula
Distribution Amount, Class A-2 Interest Formula Distribution Amount, Class A-3
Interest Formula Distribution Amount, Class A-4 Interest Formula Distribution
Amount, Class A-5 Interest Formula Distribution Amount, Class M-1 Interest
Formula Distribution Amount, Class B-1 Interest Formula Distribution Amount
and Class B-2 Interest Formula Distribution Amount.
AGGREGATE NET LIQUIDATION LOSSES: With respect to the time of
reference thereto, the aggregate of the amounts by which (i) the outstanding
principal balance of each Contract that, during such time of reference, had
become a Liquidated Contract, plus accrued and unpaid interest thereon to the
Due Date for such Contract in the Due Period in which such Contract became a
Liquidated Contract, exceeds (ii) the Net Liquidation Proceeds for such
Contract.
AGREEMENT: This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
AMORTIZATION SCHEDULE: With respect to any Contract, the amortization
schedule for such Contract at the time of reference thereto after adjustments
for previous Partial Prepayments but without giving effect to any adjustments
by reason of the bankruptcy of the Obligor or any similar proceeding or
moratorium or any waiver, extension or grace period.
ANNUAL PERCENTAGE RATE OR APR: As to any Contract and any time, the
per annum rate of interest then being borne by such Contract, as set forth on
the face thereof.
APPLICANTS: As defined in Section 4.06.
APPRAISED VALUE: With respect to any Manufactured Home, the value of
such Manufactured Home as determined by a professional appraiser or an
employee of the Servicer who, as part of such employment, regularly appraises
manufactured housing units.
AUTHENTICATING AGENT: An authenticating agent appointed pursuant to
Section 4.07.
AVAILABLE DISTRIBUTION AMOUNT: As to any Remittance Date, (a) the sum
of (i) the amount on deposit in the Certificate Account as of the end of the
Due Period ending immediately prior to such Remittance Date and (ii) the
Monthly Advance with respect to the Contracts made in respect of such
Remittance Date, reduced by (b) the sum of (i) scheduled payments deposited
therein of principal and interest for Contracts due after such Due Period and
(ii) amounts permitted to be withdrawn by the Servicer from the Certificate
Account pursuant to clauses (i) through (v), inclusive, and (vii) of Section
6.02 and (iii) all Interest Deficiency Withdrawals, if any, made by the
Servicer with respect to the preceding Remittance Date pursuant to Section
6.02(ix).
AVAILABLE FUNDS SHORTFALL: As to any Remittance Date, the amount, if
any, by which the Available Distribution Amount is less than the amount
required to be distributed on the Certificates on such Remittance Date
pursuant to clauses A(i) through (x) or clauses B(i) through (x), as
applicable, of Section 6.01(a).
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AVERAGE SIXTY-DAY DELINQUENCY RATIO: As to any Remittance Date, the
arithmetic average of the Sixty-Day Delinquency Ratios for such Remittance
Date and the two preceding Remittance Dates. The "Sixty-Day Delinquency Ratio"
for a Remittance Date is the percentage derived from the fraction, the
numerator of which is the aggregate of the outstanding principal balances (as
of the end of the preceding Due Period) of all Contracts (including Contracts
in respect of which the related Manufactured Home has been repossessed but not
yet disposed of) as to which a scheduled monthly payment thereon (without
giving effect to any adjustments thereto by reason of a bankruptcy or similar
proceeding of the Obligor or any extension or modification granted to such
Obligor) is delinquent 60 days or more as of the end of the related Due Period
and the denominator of which is the Pool Scheduled Principal Balance for such
Remittance Date.
BI-WEEKLY CONTRACT: Any Contract pursuant to which the scheduled
level payment of interest and principal is due every 14 days.
BOOK-ENTRY CERTIFICATE: Any Certificate registered in the name of the
Depository or its nominee ownership of which is reflected on the books of the
Depository or on the books of a Person maintaining an account with such
Depository (directly or as an indirect participant in accordance with the
rules of such Depository).
BUSINESS DAY: Any day other than (i) a Saturday or Sunday, or (ii) a
day on which banking institutions in the State of New York are authorized or
obligated by law or executive order to be closed.
BUY-DOWN LOAN: A Contract on which the obligor has paid a fee at the
time of origination to reduce the periodic interest rate.
CERTIFICATE: A Certificate for Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificates, Series 2001-C, executed,
countersigned and delivered by the Trustee substantially in the form of
Exhibits X-0, X-0, C or D and E.
CERTIFICATES: The Class A-1 Certificates, Class A-2 Certificates,
Class A-3 Certificates, Class A-4 Certificates, Class A-5 Certificates, Class
M-1 Certificates, Class B-1 Certificates and Class B-2 Certificates.
CERTIFICATE ACCOUNT: The custodial account or accounts created and
maintained pursuant to Section 5.05.
CERTIFICATEHOLDER or HOLDER: The Person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the
purposes of giving any consent, waiver, request or demand pursuant to this
Agreement, any Certificate registered in the name of Vanderbilt, the Servicer
or any Person known to a Responsible Officer of the Trustee to be an Affiliate
of the Servicer and any Certificate to the extent that, to the knowledge of a
Responsible Officer of the Trustee, the Servicer or any Affiliate of the
Servicer is the Certificate Owner shall be deemed not to be outstanding and
the Percentage Interest or Fractional Interest, as the case may be, evidenced
thereby shall not be taken into account in determining whether the requisite
amount of Percentage Interests or Fractional Interests necessary to effect any
such consent, waiver, request or demand has been obtained, unless, in the case
of the Senior Certificates, all
3
such Certificates are held by such Persons or, in the case of the Subordinate
Certificates, all such Certificates and all Senior Certificates are held by
such Persons, or such Certificates have been fully paid.
CERTIFICATE OWNER: With respect to a Certificate, the Person who is
the beneficial owner of a Book-Entry Certificate.
CERTIFICATE REGISTER: The register maintained pursuant to Section
4.02.
CERTIFICATE REGISTRAR: The Trustee, or the agent appointed pursuant
to Section 4.02(a).
CLASS: Pertaining to Class A-1 Certificates, Class A-2 Certificates,
Class A-3 Certificates, Class A-4 Certificates, Class A-5 Certificates, Class
M-1 Certificates, Class B-1 Certificates or Class B-2 Certificates, as the
case may be.
CLASS A CERTIFICATE: Any one of the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates and Class A-5
Certificates.
CLASS A DISTRIBUTION AMOUNT: As to any Remittance Date, the sum of
the Class A-1 Distribution Amount, the Class A-2 Distribution Amount, the
Class A-3 Distribution Amount, the Class A-4 Distribution Amount and the Class
A-5 Distribution Amount.
CLASS A PERCENTAGE: As to any Remittance Date, the percentage derived
from the fraction (which shall not be greater than 1) whose numerator is the
Class A Principal Balance immediately prior to such Remittance Date and whose
denominator is the Pool Scheduled Principal Balance immediately prior to such
Remittance Date.
CLASS A PRINCIPAL BALANCE: As to any Remittance Date, the sum of the
Class A-1 Principal Balance, Class A-2 Principal Balance, Class A-3 Principal
Balance, Class A-4 Principal Balance and Class A-5 Principal Balance (before
giving effect to distributions on the Certificates on such Remittance Date).
CLASS A-1 CERTIFICATE: Any one of the Certificates designated Class
A-1, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits B-1 and E hereto.
CLASS A-1 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class A-1 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS A-1 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class A-1 Remittance Rate on the Class A-1 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class A-1 Unpaid Interest Shortfall.
4
CLASS A-1 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class A-1
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class A-1 Interest Formula Distribution
Amount."
CLASS A-1 PRINCIPAL BALANCE: At any time, the Original Class A-1
Principal Balance minus the sum of all amounts previously distributed on the
Class A-1 Certificates since the Closing Date pursuant to clauses A(ii) and
B(ii) of Section 6.01(a).
CLASS A-1 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) the sum of (a) LIBOR as of the second LIBOR Business Day prior to the
first day of the related Interest Period (or as of the second LIBOR Business
Day prior to the Closing Date in the case of the first Interest Period) per
annum and (b) 0.20% (twenty basis points) per annum and (ii) the Weighted
Average Net Contract Rate for such Remittance Date.
CLASS A-1 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class A-1 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class A-1 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class A-1 Remittance Rate on the amount thereof
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class A-1 Interest Formula Distribution Amount" were actually
distributed on the Class A-1 Certificates on any particular Remittance Date,
the distribution of interest on the Class A-1 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant to clause (a) of such definition and then to any Class A-1 Unpaid
Interest Shortfall pursuant to clause (b) of such definition.
CLASS A-2 CERTIFICATE: Any one of the Certificates designated Class
A-2, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits B-1 and E hereto.
CLASS A-2 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class A-2 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS A-2 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class A-2 Remittance Rate on the Class A-2 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class A-2 Unpaid Interest Shortfall.
CLASS A-2 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class A-2
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class A-2 Interest Formula Distribution
Amount."
5
CLASS A-2 PRINCIPAL BALANCE: At any time, the Original Class A-2
Principal Balance minus the sum of all amounts previously distributed on the
Class A-2 Certificates since the Closing Date pursuant to clauses A(ii) and
B(ii) of Section 6.01(a).
CLASS A-2 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 4.235% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS A-2 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class A-2 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class A-2 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class A-2 Remittance Rate on the amount thereof
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class A-2 Interest Formula Distribution Amount" were actually
distributed on the Class A-2 Certificates on any particular Remittance Date,
the distribution of interest on the Class A-2 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant to clause (a) of such definition and then to any Class A-2 Unpaid
Interest Shortfall pursuant to clause (b) of such definition.
CLASS A-3 CERTIFICATE: Any one of the Certificates designated Class
A-3, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits B-1 and E hereto.
CLASS A-3 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class A-3 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS A-3 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class A-3 Remittance Rate on the Class A-3 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class A-3 Unpaid Interest Shortfall.
CLASS A-3 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class A-3
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class A-3 Interest Formula Distribution
Amount."
CLASS A-3 PRINCIPAL BALANCE: At any time, the Original Class A-3
Principal Balance minus the sum of all amounts previously distributed on the
Class A-3 Certificates since the Closing Date pursuant to clauses A(ii) and
B(ii) of Section 6.01(a).
CLASS A-3 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 5.060% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS A-3 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class A-3 Interest Shortfalls
for prior Remittance
6
Dates exceeds the aggregate of the amounts distributed on the Class A-3
Certificates on prior Remittance Dates in respect of such Interest Shortfalls,
plus accrued interest (to the extent payment thereof is legally permissible)
at the Class A-3 Remittance Rate on the amount thereof from such prior
Remittance Date to such current Remittance Date. For purposes of determining
whether amounts distributable pursuant to clause (b) of the definition of
"Class A-3 Interest Formula Distribution Amount" were actually distributed on
the Class A-3 Certificates on any particular Remittance Date, the distribution
of interest on the Class A-3 Certificates on such Remittance Date shall be
allocated first to the monthly interest requirement calculated pursuant to
clause (a) of such definition and then to any Class A-3 Unpaid Interest
Shortfall pursuant to clause (b) of such definition.
CLASS A-4 CERTIFICATE: Any one of the Certificates designated Class
A-4, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits B-1 and E hereto.
CLASS A-4 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class A-4 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS A-4 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class A-4 Remittance Rate on the Class A-4 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class A-4 Unpaid Interest Shortfall.
CLASS A-4 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class A-4
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class A-4 Interest Formula Distribution
Amount."
CLASS A-4 PRINCIPAL BALANCE: At any time, the Original Class A-4
Principal Balance minus the sum of all amounts previously distributed on the
Class A-4 Certificates since the Closing Date pursuant to clauses A(ii) and
B(ii) of Section 6.01(a).
CLASS A-4 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 5.960% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS A-4 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class A-4 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class A-4 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class A-4 Remittance Rate on the amount thereof
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class A-4 Interest Formula Distribution Amount" were actually
distributed on the Class A-4 Certificates on any particular Remittance Date,
the distribution of interest on the Class A-4 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant
7
to clause (a) of such definition and then to any Class A-4 Unpaid Interest
Shortfall pursuant to clause (b) of such definition.
CLASS A-5 CERTIFICATE: Any one of the Certificates designated Class
A-5, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits B-1 and E hereto.
CLASS A-5 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class A-5 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS A-5 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class A-5 Remittance Rate on the Class A-5 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class A-5 Unpaid Interest Shortfall.
CLASS A-5 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class A-5
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class A-5 Interest Formula Distribution
Amount."
CLASS A-5 PRINCIPAL BALANCE: At any time, the Original Class A-5
Principal Balance minus the sum of all amounts previously distributed on the
Class A-5 Certificates since the Closing Date pursuant to clauses A(iv) and
B(iv) of Section 6.01(a).
CLASS A-5 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 6.525% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS A-5 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class A-5 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class A-5 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class A-5 Remittance Rate on the amount thereof
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class A-5 Interest Formula Distribution Amount" were actually
distributed on the Class A-5 Certificates on any particular Remittance Date,
the distribution of interest on the Class A-5 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant to clause (a) of such definition and then to any Class A-5 Unpaid
Interest Shortfall pursuant to clause (b) of such definition.
CLASS B CERTIFICATE: Any one of the Class B-1 Certificates or Class
B-2 Certificates, as the case may be.
CLASS B PERCENTAGE: As to any Remittance Date, 100% minus the sum of
the Class A Percentage and Class M-1 Percentage for such Remittance Date.
8
CLASS B PRINCIPAL BALANCE: As to any Remittance Date, the sum of the
Class B-1 Principal Balance and the Class B-2 Principal Balance (before giving
effect to distributions on the Certificates on such Remittance Date).
CLASS B-1 CERTIFICATE: Any one of the Certificates designated Class
B-1, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits C and E hereto.
CLASS B-1 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class B-1 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS B-1 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class B-1 Remittance Rate on the Class B-1 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class B-1 Unpaid Interest Shortfall.
CLASS B-1 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class B-1
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class B-1 Interest Formula Distribution
Amount."
CLASS B-1 PRINCIPAL BALANCE: At any time, the Original Class B-1
Principal Balance minus the sum of (i) all amounts previously distributed on
the Class B-1 Certificates pursuant to clauses A(viii) and B(viii) of Section
6.01(a).
CLASS B-1 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 6.805% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS B-1 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class B-1 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class B-1 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class B-1 Remittance Rate on the amount thereof
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class B-1 Interest Formula Distribution Amount" were actually
distributed on the Class B-1 Certificates on any particular Remittance Date,
the distribution of interest on the Class B-1 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant to clause (a) of such definition and then to any Class B-1 Unpaid
Interest Shortfall pursuant to clause (b) of such definition.
CLASS B-2 CERTIFICATE: Any one of the Certificates designated Class
B-2, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits C-1 and E hereto.
9
CLASS B-2 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class B-2 Certificates on such Remittance
Date pursuant to Section 6.01 (excluding the amount of the Guarantee Payment,
if any, with respect to such Remittance Date).
CLASS B-2 FLOOR AMOUNT: As to any Remittance Date, $8,470,254.98.
CLASS B-2 FORMULA DISTRIBUTION AMOUNT: As to any Remittance Date, an
amount equal to the sum of (a) the Class B-2 Interest Formula Distribution
Amount for such Remittance Date and (b) the greater of (x) the Class B-2
Principal Liquidation Loss Amount for such Remittance Date and (y) an amount
equal to the amount, if any, of principal that would be distributable on the
Class B-2 Certificates on such Remittance Date pursuant to clauses (A)(x) or
(B)(x), as the case may be, of Section 6.01(a) hereof, assuming that the
Available Distribution Amount for such Remittance Date remaining after
distribution of the amounts specified in (x) clauses A(i), A(iii), A(v),
A(vii) and A(ix) in the aggregate or (y) clauses B(i), B(iii), B(v), B(vii)
and B(ix) in the aggregate, as the case may be, of Section 6.01(a) hereof is
at least equal to the Formula Principal Distribution Amount for such
Remittance Date.
CLASS B-2 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class B-2 Remittance Rate on the Class B-2 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class B-2 Unpaid Interest Shortfall.
CLASS B-2 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed in respect of interest on the Class B-2
Certificates on such Remittance Date is less than the amount computed pursuant
to clause (a) of the definition of "Class B-2 Interest Formula Distribution
Amount."
CLASS B-2 PRINCIPAL BALANCE: At any time, the Original Class B-2
Principal Balance minus the sum of (i) all amounts previously distributed on
the Class B-2 Certificates pursuant to clauses A(x) and B(x) of Section
6.01(a).
CLASS B-2 PRINCIPAL LIQUIDATION LOSS AMOUNT: As to any Remittance
Date, the amount, if any, by which the sum of the Class A Principal Balance,
the Class M-1 Principal Balance and the Class B Principal Balance for such
Remittance Date exceeds the Pool Scheduled Principal Balance for such
Remittance Date, in each case, after giving effect to all distributions on the
Certificates on account of principal on such Remittance Date (exclusive of the
Guarantee Payment, if any).
CLASS B-2 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 7.885% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS B-2 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class B-2 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class B-2 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class B-2 Remittance Rate on the amount thereof
10
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class B-2 Interest Formula Distribution Amount" were actually
distributed on the Class B-2 Certificates on any particular Remittance Date,
the distribution of interest on the Class B-2 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant to clause (a) of such definition and then to any Class B-2 Unpaid
Interest Shortfall pursuant to clause (b) of such definition.
CLASS M-1 AND CLASS B PRINCIPAL DISTRIBUTION TEST: The Class M-1 and
Class B Principal Distribution Test is met in respect of a Remittance Date if
the following conditions are satisfied:
(i) such Remittance Date is on or after the December 7, 2006
Remittance Date;
(ii) the Class M-1 Percentage plus the Class B Percentage for such
Remittance Date is equal to at least 21.44%;
(iii) the Average Sixty-Day Delinquency Ratio for the Contracts as of
such Remittance Date does not exceed 5.00%;
(iv) the Cumulative Realized Losses for the Contracts do not exceed
(x) 7% of the Pool Original Principal Balance, as of the December
2006 Remittance Date, (y) 8% of the Pool Original Principal Balance
as of the December 2007 Remittance Date, and (z) 9% of the Pool
Original Principal Balance as of the December 2008 Remittance Date
and thereafter;
(v) the Current Realized Loss Ratio for the Contracts as of such
Remittance Date does not exceed 2.75%; and
(vi) the Class B-2 Principal Balance is not less than the Class B-2
Floor Amount.
CLASS M-1 CERTIFICATE: Any one of the Certificates designated Class
M-1, executed and countersigned as provided herein, substantially in the form
set forth in Exhibits B-2 and E hereto.
CLASS M-1 DISTRIBUTION AMOUNT: As to any Remittance Date, the
aggregate amount distributed on the Class M-1 Certificates on such Remittance
Date pursuant to Section 6.01.
CLASS M-1 INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance
Date, an amount equal to the sum of (a) interest accrued during the related
Interest Period at the Class M-1 Remittance Rate on the Class M-1 Principal
Balance as of such Remittance Date (before giving effect to the distribution
on such Remittance Date) and (b) any Class M-1 Unpaid Interest Shortfall.
CLASS M-1 INTEREST SHORTFALL: As to any Remittance Date, any amount
by which the amount distributed on the Class M-1 Certificates on such
Remittance Date is less than
11
the amount computed pursuant to clause (a) of the definition of "Class M-1
Interest Formula Distribution Amount."
CLASS M-1 PERCENTAGE: As to any Remittance Date, the percentage
derived from the fraction (which shall not be greater than 1) whose numerator
is the Class M-1 Principal Balance immediately prior to such Remittance Date
and whose denominator is the Pool Scheduled Principal Balance immediately
prior to such Remittance Date.
CLASS M-1 PRINCIPAL BALANCE: At any time, the Original Class M-1
Principal Balance minus the sum of all amounts previously distributed on the
Class M-1 Certificates since the Closing Date pursuant to clauses A(vi) and
B(vi) of Section 6.01(a).
CLASS M-1 REMITTANCE RATE: As to any Remittance Date, the lesser of
(i) 6.760% per annum and (ii) the Weighted Average Net Contract Rate for such
Remittance Date.
CLASS M-1 UNPAID INTEREST SHORTFALL: As to any Remittance Date, the
amount, if any, by which the aggregate of the Class M-1 Interest Shortfalls
for prior Remittance Dates exceeds the aggregate of the amounts distributed on
the Class M-1 Certificates on prior Remittance Dates in respect of such
Interest Shortfalls, plus accrued interest (to the extent payment thereof is
legally permissible) at the Class M-1 Remittance Rate on the amount thereof
from such prior Remittance Date to such current Remittance Date. For purposes
of determining whether amounts distributable pursuant to clause (b) of the
definition of "Class M-1 Interest Formula Distribution Amount" were actually
distributed on the Class M-1 Certificates on any particular Remittance Date,
the distribution of interest on the Class M-1 Certificates on such Remittance
Date shall be allocated first to the monthly interest requirement calculated
pursuant to clause (a) of such definition and then to any Class M-1 Unpaid
Interest Shortfall pursuant to clause (b) of such definition.
CLASS R CERTIFICATE: The Certificate executed and countersigned as
provided herein, substantially in the form set forth in Exhibits D and E
hereto.
CLASS R DISTRIBUTION AMOUNT: As to any Remittance Date, the aggregate
amount distributed on the Class R Certificate pursuant to Section 6.01.
CLOSING DATE: November 29, 2001.
CODE: The Internal Revenue Code of 1986, as amended.
COMPUTER TAPE: The computer tape generated by Vanderbilt which
provides information relating to the Contracts, and includes the master file
and the history file.
CONTRACT FILE: As to each Contract, other than a Land-and-Home
Contract or a Mortgage Loan, (a) the original of the Contract (except for
fewer than 15 Contracts, in which case the related Contract File shall contain
a photocopy of the original Contract together with a certificate from the
Obligor under such Contract certifying that such photocopy is a true copy of
the original Contract), and, in the case of each Bi-weekly Contract, the
original of the bi-weekly rider for such Contract, and, in the case of each
Equity Builder Contract, the original of the
12
graduated payment rider for such Contract; (b) the original title document for
the related Manufactured Home of the type issued to lienholders, unless the
laws of the jurisdiction in which the related Manufactured Home is located do
not provide for the issuance of such title documents for such Manufactured
Home; (c) evidence of one or more of the following types of perfection of the
security interest in the related Manufactured Home granted by such Contract,
as appropriate: (1) notation of such security interest on the title document,
(2) a financing statement meeting the requirements of the UCC, with evidence
of recording in the appropriate offices indicated thereon, or (3) such other
evidence of perfection of a security interest in a manufactured housing unit
as is customary in such jurisdiction; (d) the assignment of the Contract
(which may be in a blanket form that also covers other Contracts or contracts)
from the Originator to Vanderbilt; and (e) any extension, modification or
waiver agreement(s). In addition, as to each Land Secured Contract, the
related Mortgage with evidence of recording thereon.
CONTRACT POOL: The pool of Contracts held in the Trust Fund.
CONTRACT RATE ADJUSTMENT DATE: As to each Adjustable Rate Contract, a
date on which the related APR may adjust, as provided in such Contract.
CONTRACT SCHEDULE: The list (as such list may be amended from time to
time) identifying each Contract constituting part of the corpus of the Trust
Fund as of the Cut-off Date, and which (a) identifies each Contract as either
a Fixed Rate Contract or Adjustable Rate Contract and by contract number and
name and address of the Obligor and (b) sets forth as to each Contract (i) the
unpaid principal balance as of the related Transfer Date determined by giving
effect to payments received prior to the related Transfer Date, (ii) the
amount of each scheduled payment due from the Obligor, and (iii) the APR.
CONTRACTS: The manufactured housing installment sale contracts and
installment loan agreements, including any Land-and-Home Contracts and any
Mortgage Loans, described in the Contract Schedule and constituting part of
the corpus of the Trust Fund, which Contracts are to be sold and assigned by
Vanderbilt to the Trustee and which are the subject of this Agreement. The
Contracts include, without limitation, all related security interests and any
and all rights to receive payments which are due pursuant thereto from and
after the Cut-off Date, but exclude any rights to receive payments which are
due pursuant thereto prior to the Cut-off Date.
CORPORATE TRUST OFFICE: The principal office of the Trustee at which
at any particular time its corporate business in connection with this
Agreement shall be administered, which office at the date of execution of this
Agreement is located at 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000.
CUMULATIVE REALIZED LOSSES: As to any Remittance Date, the Aggregate
Net Liquidation Losses for the period from the Cut-off Date through the end of
the related Due Period.
CURRENT REALIZED LOSS RATIO: As to any Remittance Date, the
annualized percentage derived from the fraction, the numerator of which is the
sum of the Aggregate Net Liquidation Losses for the three preceding Due
Periods and the denominator of which is the
13
arithmetic average of the Pool Scheduled Principal Balances for such
Remittance Date and the preceding two Remittance Dates.
CUSTODIAL AGREEMENT: As defined in Section 2.04(a).
CUT-OFF DATE: October 25, 2001.
DEFICIENCY EVENT: The Remittance Date, if any, on which the Pool
Scheduled Principal Balance becomes equal to or less than the Class A
Principal Balance.
DEFINITIVE CERTIFICATES: Any Certificate evidenced by a physical
certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 4.02(g).
DEPOSITORY: The initial Depository shall be The Depository Trust
Company, the nominee of which is Cede & Co., as the registered Holder of (i)
one Class A-1 Certificate evidencing $110,200,000 in initial aggregate
principal balance of the Class A-1 Certificates, (ii) one Class A-2
Certificate evidencing $100,170,000 in initial aggregate principal balance of
the Class A-2 Certificates, (iii) one Class A-3 Certificate evidencing
$57,100,000 in initial aggregate principal balance of the Class A-3
Certificates, (iv) one Class A-4 Certificate evidencing $86,162,000 in initial
aggregate principal balance of the Class A-4 Certificates, (v) one Class A-5
Certificate evidencing $18,000,000 in initial aggregate principal balance of
the Class A-5 Certificates, (vi) one Class M-1 Certificate evidencing
$16,940,000 in initial aggregate principal balance of the Class M-1
Certificates, (vii) one Class B-1 Certificate evidencing $14,823,000 in
initial aggregate principal balance of the Class B-1 Certificates and (viii)
one Class B-2 Certificate evidencing $20,117,749 in initial aggregate
principal balance of the Class B-2 Certificates. The Depository shall at all
times be a "clearing corporation" as defined in Section 8-102(3) of the
Uniform Commercial Code of the State of New York.
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DETERMINATION DATE: The fifth Business Day prior to each Remittance
Date.
DISTRIBUTION ACCOUNT: The custodial account or accounts created and
maintained pursuant to Section 5.18.
DUE DATE: The day of the month (or in the case of a Bi-weekly
Contract or Semi-Monthly Contract, each day in the month) on which each
scheduled payment of principal and interest is due on a Contract, exclusive of
any days of grace.
DUE PERIOD: With respect to any Remittance Date, the period
commencing on the 26th day of the second month preceding the month of such
Remittance Date and ending on the 25th day of the month preceding the month of
such Remittance Date.
ELECTRONIC LEDGER: The electronic master record of Vanderbilt's
manufactured housing installment sales contracts and installment loan
agreements clearly identifying each Contract that is part of the corpus of the
Trust Fund.
14
ELIGIBLE ACCOUNT: An account that is either (i) maintained with a
depository institution the commercial paper or short-term unsecured debt
obligations of which is rated "P-1" by Moody's and "A-1+" by S&P, (ii) a trust
account maintained with the Trustee in its corporate trust department or (iii)
otherwise acceptable to the Rating Agencies, as evidenced by a letter from the
Rating Agencies, without a reduction or withdrawal of the rating of the
Certificates.
ELIGIBLE INVESTMENTS: One or more of the following:
(a) direct obligations of, or guaranteed as to the full and timely
payment of principal and interest by, the United States or any agency
or instrumentality thereof when such obligations are backed by the
full faith and credit of the United States;
(b) repurchase agreements on obligations specified in clause (a)
maturing not more than one month from the date of acquisition
thereof, provided that the long-term unsecured obligations of the
party agreeing to repurchase such obligations are at the time rated
by each Rating Agency in the two highest rating category available
from such Rating Agency; and provided further that the short-term
debt obligations of the party agreeing to repurchase shall be at the
time rated "P-1" by Moody's and "A-1+" by S&P;
(c) federal funds, certificates of deposit, time deposits, demand
deposits and bankers' acceptances, each of which shall not have an
original maturity of more than 90 days, of any depository institution
or trust company incorporated under the laws of the United States or
any state; provided that the short-term obligations of such
depository institution or trust company shall be at the time rated
"P-1" by Moody's and "A-1+" by S&P;
(d) commercial paper (having original maturities of not more than 270
days) of any corporation incorporated under the laws of the United
States or any state thereof; provided that such commercial paper
shall be at the time rated "P-1" by Moody's and "A-1+" by S&P;
(e) any money market fund rated "P-1" by Moody's and "A-1+" by S&P;
and
(f) other obligations or securities that are acceptable to the Rating
Agencies as an Eligible Investment hereunder and will not result in a
reduction in or withdrawal of the then current rating or ratings of
the Certificates, as evidenced by a letter to such effect from the
Rating Agencies;
provided, however, that no instrument shall be an Eligible Investment if such
instrument evidences a right to receive only interest payments with respect to
the obligations underlying such instrument.
ELIGIBLE SUBSTITUTE CONTRACT: As to any Replaced Contract for which
such Eligible Substitute Contract is being substituted pursuant to Section
3.05(b), a Contract that (a) as of the date of its substitution, satisfies all
of the representations and warranties (which, except when expressly stated to
be as of origination, shall be deemed to be determined as of the date of its
substitution rather than as of the Cut-off Date or the Closing Date) in
Section 3.02 and does not cause any of the representations and warranties in
Section 3.03, after giving effect to such substitution, to be incorrect, (b)
after giving effect to the scheduled payment or payments due in
15
the month of such substitution, has a Scheduled Principal Balance that is not
greater than the Scheduled Principal Balance of such Replaced Contract, (c)
has an APR that is at least equal to the APR of such Replaced Contract, (d)
has a remaining term to scheduled maturity that is not greater than the
remaining term to scheduled maturity of the Replaced Contract, (e) has not
been delinquent for more than 31 days as to any scheduled payment due within
twelve months of the date of its substitution, (f) if the Replaced Contract is
secured by a Manufactured Home which was new at the time of origination, it
shall be replaced by a new Eligible Substitute Contract and (g) if the
Replaced Contract is secured by a Manufactured Home which is a double-wide,
the Eligible Substitute Contract shall be a double-wide. Notwithstanding the
foregoing, in the event that on any date more than one Eligible Substitute
Contract is substituted for one or more Replaced Contracts, the requirement
set forth in clause (b) above with respect to Scheduled Principal Balance may
be satisfied if the aggregate of the Scheduled Principal Balances of such
Eligible Substitute Contracts is not greater than the aggregate of the
Scheduled Principal Balances of such Replaced Contracts; the requirement set
forth in clause (c) above with respect to APR may be satisfied if the weighted
average APR of such Eligible Substitute Contracts is at least equal to the
weighted average APR of such Replaced Contracts (provided that the APR of each
Eligible Substitute Contract to be substituted for a Fixed Rate Contract shall
be equal to or greater than the Weighted Average Net Contract Rate); the
requirement set forth in clause (d) above with respect to remaining term to
scheduled maturity may be satisfied if the weighted average remaining term to
scheduled maturity of such Eligible Substitute Contracts is not greater than
the weighted average remaining term to scheduled maturity of such Replaced
Contracts; provided that no Eligible Substitute Contract shall have a
scheduled maturity date later than December 15, 2031.
EQUITY BUILDER CONTRACT: Contracts which provide for interest-only
payments during the first year, and after the first year, the payment amount
increases annually such that the Contract is fully amortized for the remainder
of the term of the Contract. The payment increase is based upon a percentage
of the required interest payment during the first year.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA RESTRICTED CERTIFICATE: The Class R Certificate and any other
certificate that does not satisfy the applicable rating requirement under the
Underwriter's Exemption.
EVENT OF DEFAULT: Any one of the events described in Section 9.01
hereof.
EXTENSION FEE: Any extension fee paid by the Obligor on a Contract.
FIDELITY BOND: A fidelity bond to be maintained by the Servicer
pursuant to Section 5.10.
FILE: A Contract File, Land-and-Home Contract File or a Mortgage Loan
File.
FIRST REMITTANCE DATE: December 7, 2001.
FIXED RATE CERTIFICATES: The Class A-2, Class A-3, Class A-4, Class
A-5, Class M-1, Class B-1 and Class B-2 Certificates.
16
FIXED RATE CONTRACT: Each Contract sold to the Trust which bears
interest at a fixed rate.
FLOATING RATE CERTIFICATES: The Class A-1 Certificates.
FORMULA PRINCIPAL DISTRIBUTION AMOUNT: As to any Remittance Date, an
amount equal to the sum of (a) all scheduled payments of principal due on each
Outstanding Contract during the Due Period immediately preceding such
Remittance Date, (b) the Scheduled Principal Balance of each Contract which,
during the Due Period preceding the month of such Remittance Date, was
purchased by Vanderbilt pursuant to Section 3.05 of this Agreement, (c) all
Partial Prepayments received with respect to Contracts during such preceding
Due Period, (d) the Scheduled Principal Balance of each Contract for which a
Principal Prepayment in Full was received during such preceding Due Period,
(e) the Scheduled Principal Balance of each Contract that became a Liquidated
Contract during such Due Period and (f) any previously undistributed
shortfalls in the distribution of the amounts in clauses (a) through (e) in
respect of prior Remittance Dates (other than any such shortfall with respect
to which a Guarantee Payment has been made to the Class B-2
Certificateholders).
FRACTIONAL INTEREST: As to any Certificate of any Class, the product
of (a) the Percentage Interest evidenced by such Certificate multiplied by (b)
the amount derived from dividing the Principal Balance of such Class by the
sum of the Class A Principal Balance, Class M-1 Principal Balance and Class B
Principal Balance.
GROSS MARGIN: With respect to each Adjustable Rate Contract, the
percentage set forth in the related Contract to be added to the related index
for use in determining such Contract's APR on each date of adjustment thereof.
GUARANTEE PAYMENT: As to any Remittance Date, the amount, if any, by
which (a) the Class B-2 Formula Distribution Amount for such Remittance Date
exceeds (b) the Remaining Amount Available.
GUARANTEE REIMBURSEMENT AMOUNT: As to any Remittance Date, an amount
equal to the lesser of (a) the Available Distribution Amount for such
Remittance Date less the portion thereof that represents the sum of the
amounts (i) distributed on the Certificates (other than the Class R
Certificate) on such Remittance Date and (ii) paid to the Servicer in respect
of the Monthly Servicing Fee pursuant to clause A(xiii) or B(xiii) of Section
6.01(a) on such Remittance Date and (b) the aggregate amount of outstanding
Guarantee Payments that remain unreimbursed as of such Remittance Date.
HAZARD INSURANCE POLICY: With respect to each Contract, the policy of
fire and extended coverage insurance (and federal flood insurance, if
applicable) required to be maintained for the related Manufactured Home, as
provided in Section 5.09, and which, as provided in Section 5.09, may be a
blanket insurance policy maintained by the Servicer in accordance with the
terms and conditions of Section 5.09.
INDEX: As to any Adjustable Rate Contract, the published rate upon
which the related Remittance Rate is calculated.
17
INITIAL PRINCIPAL AMOUNT: With respect to the Contracts,
$423,512,749.20.
INTEREST DEFICIENCY AMOUNT: With respect to the Class A-5
Certificates, the Class M-1 Certificates and the Class B-1 Certificates and
any Remittance Date, the Interest Formula Distribution Amount with respect to
each such Class remaining unpaid after application of the Available
Distribution Amount in accordance with Section 6.01(a).
INTEREST DEFICIENCY WITHDRAWAL: With respect to any Remittance Date
and:
(i) the Class A-5 Certificates, the lesser of:
(a) if such Remittance Date occurs between December 1, 2001 and
November 30, 2002 and the Cumulative Realized Losses as of such
Remittance Date are greater than 7.50% of the Initial Principal
Amount of the Contracts, zero;
(b) if such Remittance Date occurs between December 1, 2002 and
November 30, 2003 and the Cumulative Realized Losses as of such
Remittance Date are greater than 12.75% of the Initial
Principal Amount of the Contracts, zero;
(c) if such Remittance Date occurs between December 1, 2003 and
November 30, 2004 and the Cumulative Realized Losses as of such
Remittance Date are greater than 18.00% of the Initial
Principal Amount of the Contracts, zero;
(d) if such Remittance Date occurs after December 1, 2004 and
the Cumulative Realized Losses as of such Remittance Date are
greater than 21.50% of the Initial Principal Amount of the
Contracts, zero;
(e) the applicable Interest Deficiency Amount; and
(f) the amount remaining on deposit in the Certificate Account
after withdrawal of the Available Distribution Amount;
(ii) the Class M-1 Certificates, the lesser of:
(a) if such Remittance Date occurs between December 1, 2001 and
November 30, 2002 and the Cumulative Realized Losses as of such
Remittance Date are greater than 6.00% of the Initial Principal
Amount of the Contracts, zero;
(b) if such Remittance Date occurs between December 1, 2002 and
November 30, 2003 and the Cumulative Realized Losses as of such
Remittance Date are greater than 10.25% of the Initial
Principal Amount of the Contracts, zero;
(c) if such Remittance Date occurs between December 1, 2003 and
November 30, 2004 and the Cumulative Realized Losses as of such
Remittance Date are greater than 14.50% of the Initial
Principal Amount of the Contracts, zero;
18
(d) if such Remittance Date occurs after December 1, 2004 and
the Cumulative Realized Losses as of such Remittance Date are
greater than 17.00% of the Initial Principal Amount of the
Contracts, zero;
(e) the applicable Interest Deficiency Amount; and
(f) the amount remaining on deposit in the Certificate Account
after making the Class A-5 Interest Deficiency Withdrawal; and
(iii) the Class B-1 Certificates, the lesser of:
(a) if such Remittance Date occurs between December 1, 2001 and
November 30, 2002 and the Cumulative Realized Losses as of such
Remittance Date are greater than 5.25% of the Initial Principal
Amount of the Contracts, zero;
(b) if such Remittance Date occurs between December 1, 2002 and
November 30, 2003 and the Cumulative Realized Losses as of such
Remittance Date are greater than 9.00% of the Initial Principal
Amount of the Contracts, zero;
(c) if such Remittance Date occurs between December 1, 2003 and
November 30, 2004 and the Cumulative Realized Losses as of such
Remittance Date are greater than 12.75% of the Initial
Principal Amount of the Contracts, zero;
(d) if such Remittance Date occurs after December 1, 2004 and
the Cumulative Realized Losses as of such Remittance Date are
greater than 5.00% of the Initial Principal Amount of the
Contracts, zero;
(e) the applicable Interest Deficiency Amount; and
(f) the amount remaining on deposit in the Certificate Account
after making the Class M-1 Interest Deficiency Withdrawal.
INTEREST FORMULA DISTRIBUTION AMOUNT: As to any Remittance Date, the
Class A-1 Interest Formula Distribution Amount, the Class A-2 Interest Formula
Distribution Amount, the Class A-3 Interest Formula Distribution Amount, the
Class A-4 Interest Formula Distribution Amount, the Class A-5 Interest Formula
Distribution Amount, the Class M-1 Interest Formula Distribution Amount, the
Class B-1 Interest Formula Distribution Amount or the Class B-2 Interest
Formula Distribution Amount, as applicable.
INTEREST PERIOD: With respect to the Floating Rate Certificates and
any Remittance Date, the period commencing on the preceding Remittance Date
(or in the case of the first Remittance Date, the Closing Date) through the
day preceding such Remittance Date. With respect to the Fixed Rate
Certificates and any Remittance Date, the period from the first day of the
calendar month preceding the month of such Remittance Date through the last
day of such calendar month.
19
LAND-AND-HOME CONTRACT: A Contract that is secured by a Mortgage on
real estate on which the related Manufactured Home is situated, and which
Manufactured Home is considered or classified as part of the real estate under
the laws of the jurisdiction in which it is located.
LAND-AND-HOME CONTRACT FILE: With respect to each Land-and-Home
Contract,
(a) the original of the Land-and-Home Contract, and, in the case of
each Bi-weekly Contract, the original of the bi-weekly rider for such
Contract, and, in the case of each Equity Builder Contract, the
original of the graduated payment rider for such Contract;
(b) the original related Mortgage with evidence of recording thereon
and any title document for the related Manufactured Home;
(c) with respect to any Land-and-Home Contract not originated by
Vanderbilt, the assignment of the Land-and-Home Contract from the
originator to Vanderbilt with evidence of recording thereon;
(d) with respect to any Land-and-Home Contract originated by
Vanderbilt, an endorsement of such Land-and-Home Contract by
Vanderbilt without recourse;
(e) with respect to the Land-and-Home Contracts located in the ten
states with the highest concentration of Land-and-Home Contracts, an
Opinion of Counsel to the effect that Vanderbilt need not cause to be
recorded any assignment which relates to Land-and-Home Contracts in
such states to protect the Trustee's and the Certificateholders'
interest in such Land-and-Home Contracts; provided, however, if
Vanderbilt fails to deliver such an Opinion of Counsel for any such
states, with respect to the Land-and-Home Contracts located in those
states, Vanderbilt shall provide an original executed assignment of
the Mortgage, with evidence of recording thereon, showing the
assignment from Vanderbilt to the Trustee or the separate trustee, as
applicable; and
(f) any extension, waiver or modification agreement(s) for each Land-
and-Home Contract on the Schedule.
LAND SECURED CONTRACT: A Contract that is secured by (i) a security
interest in a Manufactured Home and (ii) a Mortgage on real estate on which
the related Manufactured Home is situated, but such Manufactured Home is not
considered or classified as part of the real estate under the laws of the
jurisdiction in which it is located.
LATE PAYMENT FEES: Any late payment fees paid by Obligors on
Contracts after all sums received have been allocated first to regular
installments due or overdue and all such installments are then paid in full.
LIBOR: As to any date, the rate for United States dollar deposits for
one month which appear on the Telerate Screen LIBOR Page 3750 as of 11:00
A.M., London time. If such rate does not appear on such page (or such other
page as may replace that page on that service, or if such service is no longer
offered, such other service for displaying LIBOR or comparable rates
20
as may be reasonably selected by the Seller after consultation with the
Trustee), the rate will be the Reference Bank Rate. If no such quotations can
be obtained and no Reference Bank Rate is available, LIBOR will be LIBOR
applicable to the preceding Remittance Date.
LIBOR BUSINESS DAY: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the State of New York or in the
city of London, England are required or authorized by law to be closed.
LIFETIME CAP: With respect to an Adjustable Rate Contract, the
maximum APR, if any, that may be borne by such Contract over its term, as set
forth as such therein.
LIMITED GUARANTEE: The obligation of Xxxxxxx to make Guarantee
Payments as set forth in Section 6.05.
LIQUIDATED CONTRACT: Any defaulted Contract as to which the Servicer
has determined that all amounts which it expects to recover from or on account
of such Contract have been recovered; provided that any defaulted Contract in
respect of which the related Manufactured Home and, in the case of
Land-and-Home Contracts, Mortgaged Property have been realized upon and
disposed of and the proceeds of such disposition have been received shall be
deemed to be a Liquidated Contract.
LIQUIDATION EXPENSES: All reasonable out-of-pocket expenses
(exclusive of overhead expenses) which are incurred by the Servicer in
connection with the liquidation of any defaulted Contract, on or prior to the
date on which the related Manufactured Home and, in the case of Land-and-Home
Contracts, Mortgaged Property are disposed of, including, without limitation,
legal fees and expenses, any unreimbursed amount expended by the Servicer
pursuant to Section 5.06 or 5.09 (to the extent such amount is reimbursable
under the terms of Section 5.06 or 5.09, as the case may be) respecting such
Contract and any unreimbursed expenditures for property taxes or for property
restoration or preservation that are related to such liquidation.
LIQUIDATION PROCEEDS: Cash (including insurance proceeds other than
those applied to the restoration of the related Manufactured Home or released
to the related Obligor in accordance with the normal servicing procedures of
the Servicer) received in connection with the liquidation of defaulted
Contracts, whether through repossession or otherwise.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage, the
numerator of which is the original principal balance of the related Contract
and the denominator of which is the Original Value of the related Manufactured
Home (including for this purpose the Original Value of any Mortgaged Property
not constituting a part of the Manufactured Home).
MANUFACTURED HOME: A unit of manufactured housing which meets the
requirements of Section 25(e)(10) of the Code, including all accessions
thereto, securing the indebtedness of the Obligor under the related Contract.
MINIMUM APR: With respect to an Adjustable Rate Contract, the minimum
APR, if any, that may be borne by such Contract over its term, as set forth as
such therein.
21
MONTHLY ADVANCE: As to any Remittance Date, the aggregate of all
scheduled payments of principal and interest which were due during the related
Due Period on any Contracts that remained Outstanding at the end of such Due
Period and were not collected during such Due Period, exclusive of any such
scheduled payment which the Servicer has determined would be a Nonrecoverable
Advance if an advance in respect of such scheduled payment were made.
MONTHLY ADVANCE REIMBURSEMENT AMOUNT: Any amount received or deemed
to be received by the Servicer pursuant to Section 6.04(c) in reimbursement of
a Monthly Advance made out of its own funds.
MONTHLY REPORT: The monthly report described in Section 7.01.
MONTHLY SERVICING FEE: With respect to any Remittance Date, an amount
equal to one-twelfth of 1.25% of the Pool Scheduled Principal Balance for the
immediately preceding Remittance Date.
MOODY'S: Xxxxx'x Investors Service, Inc. or its successor in
interest.
MORTGAGE: The mortgage or deed of trust creating a lien on an estate
in fee simple interest in the real property securing a Contract.
MORTGAGE LOANS: The mortgage loans or deeds of trust secured by a
mortgage or deed of trust of one- to four-family residential properties,
described in the Contract Schedule and constituting part of the corpus of the
Trust, which are to be sold and assigned by Vanderbilt to the Trustee and
which are the subject of this Agreement. The Mortgage Loans include, without
limitation, all related security interests and any and all rights to receive
payments which are due pursuant thereto from and after the Cut-off Date, but
exclude any rights to receive payments which are due pursuant thereto prior to
the Cut-off Date.
MORTGAGE LOAN FILE: With respect to each Mortgage Loan,
(a) the original related Mortgage, with evidence of recording
indicated thereon, and the original related mortgage note, if any;
(b) the original assignment and any intervening assignments of the
Mortgage, with evidence of recording thereon, showing a complete
chain of assignment of the Mortgage Loan from origination of the
Mortgage Loan to Vanderbilt;
(c) the original assignment, with evidence of recording thereon,
showing the assignment from Vanderbilt to the Trustee or the separate
trustee, as applicable; and
(d) any extension, modification or waiver agreement(s) for each
Mortgage Loan on the Schedule.
MORTGAGED PROPERTY: The property subject to a Mortgage.
22
NET LIQUIDATION PROCEEDS: As to any Liquidated Contract, Liquidation
Proceeds net of the sum of (i) Liquidation Expenses and (ii) any amount
required to be paid to the Obligor or any other Person with an interest in the
Manufactured Home or any related Mortgaged Property that is senior to the
interest of the Trust Fund.
NON RECORDATION OPINION: As defined in Section 2.04(d).
NONRECOVERABLE ADVANCE: Any advance made or proposed to be made
pursuant to Section 6.04, which the Servicer believes, in its good faith
judgment, is not, or if made would not be, ultimately recoverable from
Liquidation Proceeds or otherwise. In determining whether an advance is or
will be nonrecoverable, the Servicer need not take into account that it might
receive any amounts in a deficiency judgment. The determination by the
Servicer that any advance is, or if made would constitute, a Nonrecoverable
Advance, shall be evidenced by an Officer's Certificate of the Servicer
delivered to the Trustee and stating the reasons for such determination.
OBLIGOR: Each Person who is indebted under a Contract or who has
acquired a Manufactured Home subject to a Contract.
OFFICER'S CERTIFICATE: A certificate signed by the President, a Vice
President, the Treasurer, the Secretary or one of the Assistant Treasurers or
Assistant Secretaries or any other duly authorized officer of Vanderbilt or
the Servicer, as appropriate, and delivered to the Trustee as required by this
Agreement.
OPINION OF COUNSEL: A written opinion of counsel, who may be the
counsel for Vanderbilt or the Servicer and who shall be acceptable to the
Trustee.
ORIGINAL CLASS A-1 PRINCIPAL BALANCE: $110,200,000.
ORIGINAL CLASS A-2 PRINCIPAL BALANCE: $100,170,000.
ORIGINAL CLASS A-3 PRINCIPAL BALANCE: $57,100,000.
ORIGINAL CLASS A-4 PRINCIPAL BALANCE: $86,162,000.
ORIGINAL CLASS A-5 PRINCIPAL BALANCE: $18,000,000.
ORIGINAL CLASS M-1 PRINCIPAL BALANCE: $16,940,000.
ORIGINAL CLASS B-1 PRINCIPAL BALANCE: $14,823,000.
ORIGINAL CLASS B-2 PRINCIPAL BALANCE: $20,117,749.
ORIGINAL VALUE: With respect to any Manufactured Home that was new at
the time the related Contract was originated, the sum of the down payment
(including the value allocated to any trade-in unit or land pledged as
additional security or in lieu of the down payment), the original amount
financed on the related Contract, which may include sales and other taxes and
premiums for related insurance, and, in the case of a Land-and-Home Contract,
the value of the
23
land securing the Contract as estimated by the dealer. With respect to any
Manufactured Home that was used at the time the related Contract was
originated, the total delivered sales price of such Manufactured Home
(including, for this purpose, any Mortgaged Property not constituting a part
of the Manufactured Home), plus sales and other taxes and, to the extent
financed under such Contract, premiums for related insurance.
ORIGINATOR: Any of the originators of Acquired Contracts listed in
Exhibit J hereto.
OUTSTANDING: With respect to any Contract as to the time of reference
thereto, a Contract that has not been fully prepaid, has not become a
Liquidated Contract, and has not been purchased pursuant to Section 3.05 prior
to such time of reference.
OUTSTANDING AMOUNT ADVANCED: As to any Remittance Date, the aggregate
of all Monthly Advances remitted by the Servicer out of its own funds pursuant
to Section 6.04, less the aggregate of all related Monthly Advance
Reimbursement Amounts actually received prior to such Remittance Date.
OWNERSHIP INTEREST: As defined in Section 4.08(b).
PARTIAL PREPAYMENT: Any Principal Prepayment other than a Principal
Prepayment in Full.
PAYING AGENT: Any paying agent appointed pursuant to Section 4.05.
PERCENTAGE INTEREST: As to any Certificate of any Class, the
percentage interest evidenced thereby in distributions required to be made on
the Certificates of such Class, such percentage interest being equal to the
percentage obtained by dividing the denomination of such Certificate by the
aggregate of the denominations of all of the outstanding Certificates of such
Class (or, in the case of the Class R Certificate, being equal to the
percentage specified on the face of such Class R Certificate).
PERIODIC CAP: With respect to an Adjustable Rate Contract, the
provision in each Adjustable Rate Contract that limits permissible increases
and decreases in such Contract's APR on any date on which such APR adjusts
pursuant to the terms of such Contract.
PERMITTED TRANSFEREE: As defined in Section 4.08(b).
PERSON: Any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
PLAN ASSETS: As defined in Section 4.02(b).
POOL FACTOR: As of any Remittance Date and as to any Class of
Certificates, the percentage obtained by dividing the Class A-1 Principal
Balance, the Class A-2 Principal Balance, the Class A-3 Principal Balance, the
Class A-4 Principal Balance, the Class A-5 Principal Balance, the Class M-1
Principal Balance, the Class B-1 Principal Balance or the Class B-2 Principal
Balance, as the case may be (after giving effect to the distribution on such
24
Remittance Date), by the Original Class A-1 Principal Balance, the Original
Class A-2 Principal Balance, the Original Class A-3 Principal Balance, the
Original Class A-4 Principal Balance, the Original Class A-5 Principal
Balance, the Original Class M-1 Principal Balance, the Original Class B-1
Principal Balance or the Original Class B-2 Principal Balance, respectively,
carried out to seven decimal places.
POOL ORIGINAL PRINCIPAL BALANCE: $423,512,749.20, which is the
aggregate principal balance of the Contracts as of the Cut-off Date.
POOL SCHEDULED PRINCIPAL BALANCE: As to any Remittance Date, the Pool
Original Principal Balance less the aggregate of the Formula Principal
Distribution Amounts (exclusive of the amounts in clause (f) of the definition
of "Formula Principal Distribution Amount") for all prior Remittance Dates.
PRINCIPAL BALANCE: The Class A-1 Principal Balance, the Class A-2
Principal Balance, the Class A-3 Principal Balance, the Class A-4 Principal
Balance, the Class A-5 Principal Balance, the Class M-1 Principal Balance, the
Class B-1 Principal Balance or the Class B-2 Principal Balance, as applicable.
PRINCIPAL PREPAYMENT: (i) Subject to clause (ii) of this definition,
with respect to any Due Date for a Contract, any payment or any portion
thereof or other recovery on such Contract (other than a Liquidated Contract
or a Contract repurchased pursuant to Section 3.05) received on or prior to
such Due Date (but after the immediately preceding Due Date) that exceeds the
amount necessary to bring such Contract current as of such Due Date and that
the Obligor has notified or confirmed with the Servicer are to be treated as a
prepayment of principal; (ii) notwithstanding the provisions of the preceding
clause (i), if any payment or any portion thereof or other recovery on a
Contract (other than a Liquidated Contract or a Contract repurchased pursuant
to Section 3.05) is sufficient to pay the outstanding principal balance of
such Contract, all accrued and unpaid interest at the APR to the payment date
and, at the option of the Servicer, all other outstanding amounts owing on
such Contract, the portion of the payments or recoveries on such Contract
during such Due Period that is equal to the Scheduled Principal Balance of
such Contract after giving effect to the scheduled payment on such Contract
due in such Due Period; and (iii) any cash deposit made with respect to a
Contract pursuant to Section 3.05.
PRINCIPAL PREPAYMENT IN FULL: Any Principal Prepayment specified in
clause (ii) of the definition of the term "Principal Prepayment."
PRIVATE CERTIFICATES: The Class R Certificates; provided however, any
Class of Certificates offered pursuant to an effective registration statement
shall no longer be a Private Certificate.
RATING AGENCIES: Moody's and S&P.
RECORD DATE: With respect to the initial Remittance Date, the Closing
Date. With respect to any Remittance Date thereafter, the close of business of
the last Business Day of the month preceding the month of the related
Remittance Date, except that, with respect to the Class A-1 Certificates,
after the initial Remittance Date, the Record Date will be the Business
25
Day preceding the related Remittance Date. In the event that a Definitive
Certificate is issued with respect to a Class of Certificates, the
Record Date with respect to such Class will be the close of business of the
last Business Day of the month preceding the month of the related Remittance
Date.
RECORDED DOCUMENTS: As defined in Section 2.04(b).
REMAINING AMOUNT AVAILABLE: As to any Remittance Date, the Available
Distribution Amount less the sum of the Class A Distribution Amount, the Class
M-1 Distribution Amount and the Class B-1 Distribution Amount.
REMIC: A real estate mortgage investment conduit within the meaning
of Section 860D(a) of the Code.
REMIC CERTIFICATE MATURITY DATE: The "latest possible maturity date"
of the Regular Certificates as that term is defined in Section 2.07.
REMIC PROVISIONS: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Section 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time.
REMITTANCE DATE: The 7th day of any month, or if such 7th day is not
a Business Day, the first Business Day immediately following the 7th day of
the month, commencing with December 7, 2001.
REMITTANCE RATE: As to each Class of Certificates, the Class A-1
Remittance Rate, the Class A-2 Remittance Rate, the Class A-3 Remittance Rate,
the Class A-4 Remittance Rate, the Class A-5 Remittance Rate, the Class M-1
Remittance Rate, the Class B-1 Remittance Rate or the Class B-2 Remittance
Rate, as applicable.
REO ACCOUNT: As defined in Section 5.17.
REPLACED CONTRACT: As defined in Section 3.05(b).
REPOSSESSION PROFITS: As to any Remittance Date, the excess, if any,
of Net Liquidation Proceeds in respect of each Contract that became a
Liquidated Contract during the related Due Period over the sum of the unpaid
principal balance of such Contract plus accrued and unpaid interest at the
related APR on the unpaid principal balance thereof from the Due Date to which
interest was last paid by the Obligor to the Due Date for such Contract in the
month in which such Contract became a Liquidated Contract.
REPURCHASE OBLIGATION: The obligation of Vanderbilt, set forth in
Section 3.05, to repurchase the related Contracts as to which there exists an
uncured breach of a representation or warranty contained in Section 3.02 or
3.03.
REPURCHASE PRICE: With respect to any Contract required to be
repurchased hereunder, an amount equal to the remaining principal amount
outstanding on such Contract as
26
of the beginning of the Due Period in which such repurchase occurs plus accrued
interest from the Due Date with respect to which the Obligor last made the
entire payment then due to the Due Date (or the latest-occurring Due Date, in
the case of a Bi-weekly Contract or a Semi-Monthly Contract) in the Due Period
in which such Contract is repurchased.
RESPONSIBLE OFFICER: When used with respect to the Trustee, any
officer with direct responsibility for the administration of this Agreement
and any other officer of the Trustee customarily performing functions similar
to those performed by any of the above designated officers and also to whom,
with respect to a particular matter, such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.
SCHEDULED PRINCIPAL BALANCE: As to any Contract and any Remittance
Date or the Cut-off Date, the principal balance of such Contract as of the Due
Date (or, in the case of a Bi-weekly Contract or a Semi-Monthly Contract, the
latest occurring Due Date) in the Due Period next preceding such Remittance
Date or the Cut-off Date as specified in the Amortization Schedule at the time
relating thereto after giving effect to the payment of principal due on such
Due Date and irrespective of any delinquency in payment by, or extension
granted to, the related Obligor.
SEMI-MONTHLY CONTRACT: Any Contract pursuant to which the scheduled
level payment of interest and principal is due twice each month.
SENIOR CERTIFICATE: Any one of the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates or Class A-4 Certificates.
SERVICER: Vanderbilt or its successor in interest or any successor
under this Agreement as provided by Section 8.08.
SERVICING FILE: All documents, records, and other items maintained by
the Servicer with respect to a Contract and not included in the corresponding
Contract File, Land-and-Home Contract File or Mortgage Loan File, as
applicable, including the credit application, credit reports and
verifications, appraisals, tax and insurance records, payment records,
insurance claim records, correspondence, and all historical computerized data
files.
SERVICING OFFICER: Any officer of the Servicer involved in, or
responsible for, the administration and servicing of the Contracts whose name
appears on a list of servicing officers furnished on the Closing Date to the
Trustee by the Servicer, as such list may from time to time be amended.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc.
or its successor in interest.
STEP-UP RATE CONTRACT: Any Contract bearing interest during an
initial period or periods at a fixed rate or fixed rates that are lower than
the fixed rate borne thereafter.
SUBORDINATE CERTIFICATE: Any one of the Class A-5 Certificates, Class
M-1 Certificates, Class B-1 Certificates or Class B-2 Certificates.
27
TRANSFER: As defined in Section 4.08(b).
TRANSFER AFFIDAVIT: As defined in Section 4.08(b).
TRANSFER DATE: With respect to each Contract, the Closing Date.
TRANSFEREE: As defined in Section 4.08(b).
TRUST FUND: The corpus of the trust created by this Agreement, to the
extent described herein, consisting of the Contracts (including, without
limitation, the security interest created thereby), including all rights to
receive payments on the Contracts that have not been received prior to the
Cut-off Date (including any such payments that were due prior to the Cut-off
Date but were not received by Vanderbilt prior to the Cut-off Date); such
assets as shall from time to time be identified as deposited in the
Certificate Account; all Manufactured Homes and any related Mortgaged
Properties that secured Contracts not purchased pursuant to Section 3.05 and
that have been acquired in realizing upon such Contracts; the Mortgages; the
Repurchase Obligation; the proceeds of the Hazard Insurance Policies; and the
Limited Guarantee for the benefit of the Class B-2 Certificateholders.
TRUSTEE: JPMorgan Chase Bank, or its successors or assigns or any
successor under this Agreement.
TRUSTEE'S FEES: The fees, expenses and disbursements of the Trustee
set forth in Section 10.05.
UCC: The Uniform Commercial Code as in effect in the relevant
jurisdiction or, in the case of Louisiana, the comparable provisions of
Louisiana law.
UNDERWRITERS: Credit Suisse First Boston Corporation and Bear,
Xxxxxxx & Co. Inc.
VANDERBILT: Vanderbilt Mortgage and Finance, Inc., a Tennessee
corporation, or its successor in interest or any successor under this
Agreement appointed as herein provided.
WEIGHTED AVERAGE NET CONTRACT RATE: As to any Remittance Date, the
per annum rate equal to (i) the weighted average of the Annual Percentage
Rates borne by the Contracts that were Outstanding Contracts on the first day
of the related Interest Period (weighted on the basis of the respective
Scheduled Principal Balances of the Contracts on the first day of such
Interest Period) less (ii) (x) if Vanderbilt is the Servicer, 0.00% or (y) if
Vanderbilt is no longer the Servicer, 1.25%.
Section 1.02 Determination of Scheduled Payments. Scheduled payments
due on any Contract shall be determined without giving effect to any
adjustments required by reason of the bankruptcy of the related Obligor or any
similar proceeding or moratorium or any waiver, extension or grace period.
[End of Article I]
28
Article II
CONVEYANCE OF CONTRACTS; TRUST FUND;
PERFECTION OF SECURITY INTEREST;
CUSTODY OF CONTRACTS
Section 2.01 Conveyance of Contracts and Other Rights.
(a) Vanderbilt, concurrently with the execution and delivery hereof,
does hereby transfer, sell, assign, set over and otherwise convey to the
Trustee or in the case of any Contracts from Alaska, California, Delaware,
District of Columbia, Florida, Georgia, Maine, Maryland, Minnesota, Missouri,
Montana, Nevada, Texas, Utah or Washington, a separate trustee, without
recourse (i) all of the right, title and interest of Vanderbilt in and to the
Contracts (including, without limitation, the security interests created
thereby) and any related Mortgages, including all interest and principal
payments that have not been received prior to the Cut-off Date (including any
such payments that were due prior to the Cut-off Date but were not received by
Vanderbilt prior to the Cut-off Date), (ii) all of the rights under any Hazard
Insurance Policy relating to a Manufactured Home securing a Contract for the
benefit of the creditor of such Contract, (iii) all documents contained in the
Contract Files, Land-and-Home Contract Files and Mortgage Loan Files, if any,
(iv) the Certificate Account and all funds and other assets deposited therein
and all instruments, securities (including without limitation, Eligible
Investments) or other property in which the Certificate Account may be
invested in whole or in part from time to time and (v) all proceeds derived
from any of the foregoing.
As of the related Transfer Date, the ownership of each Contract and
the contents of the related Contract File, Land-and-Home Contract File or
Mortgage Loan File, as applicable, and Servicing File are vested in the
Trustee or separate trustee, as the case may be. The contents of each File and
Servicing File are and shall be held in trust by the Servicer for the benefit
of the Trustee or such separate trustee, as the case may be, as the owner
thereof and the Servicer's possession of the contents of each Servicing File
so retained is for the sole purpose of servicing the related Contract, and
such retention and possession by the Servicer is in a custodial capacity only.
The contents of the Land-and-Home Contract Files and the Mortgage Loan Files,
if any, shall be delivered to the Trustee, or a custodian on behalf of the
Trustee, in accordance with Section 2.04 hereof. Neither Vanderbilt nor the
Servicer shall take any action inconsistent with the Trustee's or such
separate trustee's, as the case may be, ownership of the Contracts, and
Vanderbilt and the Servicer shall promptly indicate to all inquiring parties
that the Contracts have been sold, transferred, assigned, set over and
conveyed to the Trustee or such separate trustee, as the case may be, and
shall not claim any ownership interest in the Contracts.
(b) Although the parties intend that the conveyance of Vanderbilt's
right, title and interest in and to the items of property listed in Section
2.01(a) pursuant to this Agreement shall constitute a purchase and sale and
not a loan, if such conveyance is deemed to be a loan, the parties intend that
the rights and obligations of the parties to such loan shall be established
pursuant to the terms of this Agreement. The parties also intend and agree
that Vanderbilt shall be deemed to have granted to the Trustee, and Vanderbilt
does hereby grant to the Trustee, a perfected first priority security interest
in all of the right, title and interest in, to and under the items of property
listed in Section 2.01(a), and that this Agreement shall constitute a security
29
agreement under applicable law. If the trust created by this Agreement
terminates prior to the satisfaction of the claims of any Person in any
Certificates, the security interest created hereby shall continue in full
force and effect and the Trustee shall be deemed to be the collateral agent
for the benefit of such Person.
Vanderbilt acknowledges and agrees that the conveyance of the
Contracts for the consideration stated in this Agreement is a transfer for
sufficient value and consideration and that the transfer is not an avoidable
conveyance under any applicable state or federal fraudulent conveyance laws.
Section 2.02 Filing; Name Change or Relocation.
(a) On or prior to the Transfer Date, the Servicer shall cause to be
filed in the office of the Secretary of State of Tennessee, UCC-1 financing
statements describing the Contracts being transferred on such Transfer Date
and naming Vanderbilt as "Seller" and the Trustee (or a separate trustee) as
"Purchaser." Each financing statement shall bear a statement on the face
thereof indicating that the parties intend the financing statement to evidence
a true sale of the Contracts, but that if the transaction is recharacterized
as a loan from the described Purchaser to the described Seller, the financing
statement is to perfect the described Purchaser's security interest in the
Contracts. The Servicer shall cause to be filed all necessary continuation
statements for each of the foregoing UCC-1 financing statements. From time to
time, the Servicer shall take and cause to be taken such actions and execute
such documents as are necessary to perfect and protect the Certificateholders'
interests in the Contracts and their proceeds and the Manufactured Homes and
any related Mortgaged Property against all other Persons, including, without
limitation, the filing of financing statements, amendments thereto and
continuation statements, the execution of transfer instruments and the making
of notations on or taking possession of all records or documents of title;
provided, however, that Vanderbilt, so long as it is the Servicer, shall not
be required to cause notations to be made on any document of title relating to
any Manufactured Home or to execute any transfer instrument (including,
without limitation, any UCC-3 assignments) relating to any Manufactured Home
(other than a notation or a transfer instrument necessary to show Vanderbilt
as the lienholder or legal title holder) or to file documents in real property
records with respect to a Manufactured Home or related Contract or any related
Mortgaged Property, absent notice from the Trustee or Vanderbilt or actual
knowledge that such Manufactured Home (other than a Manufactured Home securing
a Land-and-Home Contract) has become real property under applicable state law;
provided that the preceding proviso shall not have any effect on the
representation and warranty in Section 3.02(k) and Vanderbilt's obligations in
respect thereof in Section 3.05; provided, further, that the Servicer (if
Vanderbilt is not the Servicer) shall not be required to protect the Trustee
from any liens, claims, charges or other encumbrances on the Contracts, their
proceeds or the Manufactured Homes created by Vanderbilt or conveyances of the
Contracts or their proceeds by Vanderbilt. Nothing in the preceding sentence
shall be construed to limit the indemnification obligations of the Servicer
set forth in Section 10.05 hereof. Vanderbilt agrees to take whatever action
is necessary to enable the Servicer to file financing statements and otherwise
act to perfect and protect the Certificateholders' interests in the Contracts,
the Manufactured Homes and any related Mortgage or Mortgaged Property. In
particular, Vanderbilt shall deliver to the Trustee on or before the Closing
Date a power of attorney substantially in the form as Exhibit K hereto,
authorizing the Trustee to, among other things, record assignments of
Mortgages securing Land
30
Secured Contracts. Assuming that Vanderbilt and the Trustee perform
such actions as are required at the direction of the Servicer, the Servicer
will maintain a perfected first priority security interest in each
Manufactured Home and any related Mortgaged Property so long as the related
Contract is the property of the Trust Fund; provided, however, that
Vanderbilt, so long as it is the Servicer, shall not be required to cause
notations to be made on any document of title relating to any Manufactured
Home, to execute any transfer instrument (including, without limitation, any
UCC-3 assignments) relating to any Manufactured Home (other than a notation or
a transfer instrument necessary to show Vanderbilt as lienholder or legal
title holder) or to file documents in real property records with respect to a
Manufactured Home or related Contract or any related Mortgaged Property,
absent notice from the Trustee, or Vanderbilt or actual knowledge that such
Manufactured Home (other than a Manufactured Home securing a Land-and-Home
Contract) has become real property under applicable state law.
(b) During the term of this Agreement, Vanderbilt shall not change
its name, identity, structure or state of incorporation without first giving
notice to the Trustee. If any change in Vanderbilt's name, identity, structure
or state of incorporation would make any financing or continuation statement
or notice of lien filed under this Agreement seriously misleading within the
meaning of applicable provisions of the UCC or any title statute, Vanderbilt,
no later than five days after the effective date of such change, shall file
such amendments as may be required to preserve and protect the
Certificateholders' interests in the Contracts and proceeds thereof and in the
Manufactured Homes.
(c) Vanderbilt hereby represents and warrants that it is incorporated
in the State of Tennessee.
(d) The Servicer agrees to pay all reasonable costs and disbursements
in connection with the perfection and the maintenance of perfection, as
against all third parties, of the Certificateholders' right, title and
interest in and to the Contracts (including, without limitation, the security
interest in the Manufactured Homes granted thereby) and any related Mortgages.
Section 2.03 Acceptance by Trustee. The Trustee hereby acknowledges
conveyance of the Contracts and any related Mortgages to the Trustee, or a
separate trustee, as the case may be, and declares that the Trustee, directly
or through a custodian (which, except with respect to the Land-and-Home
Contracts and the Mortgage Loan Files, shall be the Servicer pursuant to
Section 5.16), holds and will hold such Files in trust for the use and benefit
of all present and future Certificateholders. The Trustee hereby certifies
that although it has not undertaken any independent investigation or review of
any Contract, any Contract File, any Land-and-Home Contract File, any Mortgage
Loan File or any Servicing File, no Responsible Officer of the Trustee has
received written notice or has actual knowledge of (a) any adverse claim, lien
or encumbrance with respect to any Contract, (b) any Contract being overdue or
dishonored, (c) any evidence on the face of any Contract of any security
interest therein adverse to the Trustee's interest, or (d) any defense against
or claim against any Contract by the Obligor or by any other party.
Section 2.04 Delivery of Land-and-Home Contract Files and Mortgage
Loan Files and Recordation.
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(a) In connection with the conveyance pursuant to Section 2.01, with
respect to each Land-and-Home Contract and each Mortgage Loan, if any,
Vanderbilt shall (i) enter into a custodial agreement (the "Custodial
Agreement") on the Closing Date substantially in the form attached hereto as
Exhibit A-2 and (ii) deliver or cause to be delivered the related
Land-and-Home Contract Files and Mortgage Loan Files, as applicable, to the
custodian under the Custodial Agreement on behalf of the Trustee, within 30
days of the Closing Date in accordance with such Custodial Agreement. Such
delivery of the Files shall be accompanied by a certificate of delivery signed
by Vanderbilt substantially in the form set forth as Exhibit A to the
Custodial Agreement.
(b) In lieu of the items to be recorded and delivered pursuant to
Sections (b), (c) and (e) of the definition of Land-and-Home Contract File and
Sections (a), (b) and (c) of the definition of Mortgage Loan File (the
"Recorded Documents"), if the original Mortgage or assignment has not been
returned by the applicable recording office or is not otherwise available,
Vanderbilt shall provide the custodian with a copy thereof together with an
Officer's Certificate (which may be a blanket Officer's Certificate of
Vanderbilt covering all such Mortgages and assignments) certifying that the
copy is a true and correct copy of the original Mortgage or original
assignment, as applicable, submitted for recording, which will be (1) replaced
by the original Mortgage or original assignment when it is so returned or (2)
if the recording office in the applicable jurisdiction retains the original
Mortgage or original assignment or the original Mortgage or original
assignment has been lost, a copy of such item certified by the applicable
recording office.
(c) Vanderbilt shall deliver each Recorded Document (or if the
recording office in the applicable jurisdiction retains the original Mortgage
or original assignment or the original Mortgage or original assignment has
been lost, a copy of such item certified by the applicable recording office)
to the custodian no later than the earlier of (i) five Business Days after
receipt thereof and (ii) within 180 days of the Closing Date. In addition,
within that same time period, Vanderbilt shall deliver to the custodian any
other original documents constituting a part of the Files.
(d) Within 30 days of the Closing Date and with respect to the ten
states which have the highest concentration of Land-and-Home Contracts, by
Cut-off Date principal balance of the Contract Pool, Vanderbilt shall deliver
an Opinion of Counsel to the Trustee and the Rating Agencies to the effect
that Vanderbilt need not cause to be recorded any assignment which relates to
Land-and-Home Contracts in such states to protect the Trustee's and the
Certificateholders' interest in such Land-and-Home Contracts (a "Non
Recordation Opinion"). Such Opinions of Counsel shall be addressed to the
Trustee and the Rating Agencies. In the event that any Opinion of Counsel
referred to in the preceding sentence is not obtainable with respect to a
state after reasonable effort, then Vanderbilt shall either record the
assignments of mortgage for each Land-and-Home Contract located in such state
or substitute an Eligible Substitute Contract (which would not be a
Land-and-Home Contract in such state) for each Land-and-Home Contract in such
state, in each case, within 90 days of the Closing Date. At the conclusion of
the 90 day period, the aggregate principal balance of Land-and-Home Contracts
for which a Non Recordation Opinion has not been delivered and for which the
related assignments of mortgage have not been recorded shall not exceed 10% of
the total principal balance of the Contract Pool.
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Section 2.05 REMIC Election; Designation of Regular and Residual
Interests; Tax Year. Vanderbilt will cause the Trust Fund to elect to be
treated as a REMIC. The Class A Certificates, Class M-1 Certificates and Class
B Certificates will constitute "regular interests" in the REMIC. The Class R
Certificate will constitute the sole class of "residual interest" in the
REMIC. The Holder of the Class R Certificate hereby agrees to pay any taxes
assessed against it as holder of the "residual interest" in the REMIC. The tax
year of the Trust Fund shall be the calendar year, and the Trust Fund shall
use the accrual method of accounting.
Section 2.06 Designation of Startup Day. The Closing Date is hereby
designated as the "startup day" of the REMIC within the meaning of Section
860G(a)(9) of the Code.
Section 2.07 REMIC Certificate Maturity Date. Each of the Class A
Certificates, Class M-1 Certificates and Class B Certificates will be retired
on or before the Remittance Date in January 2035. The foregoing date
represents the date by which the Certificates would be reduced to zero on the
date on which the Contract with the latest maturity date in the Contract Pool
matures plus 37 months.
[End of Article II]
33
Article III
REPRESENTATIONS AND WARRANTIES
Section 3.01 Representations and Warranties Regarding Vanderbilt.
Vanderbilt makes the following representations and warranties to the Trustee
and the Certificateholders:
(a) Organization and Good Standing; Licensing. Vanderbilt is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Tennessee and has the corporate power to own its assets
and to transact the business in which it is currently engaged. Vanderbilt is
duly qualified to do business as a foreign corporation and is in good standing
in each jurisdiction in which the character of the business transacted by it
or properties owned or leased by it requires such qualification and in which
the failure so to qualify would have a material adverse effect on the
business, properties, assets, or condition (financial or other) of Vanderbilt.
Vanderbilt was properly licensed in each jurisdiction at the time of its
purchase or origination, as applicable, of each Contract in such jurisdiction
to the extent required by the laws of such jurisdiction as applied to the
purchase or origination, as applicable, and servicing of such Contract.
(b) Authorization; Binding Obligations. Vanderbilt has the power and
authority to make, execute, deliver and perform this Agreement and perform all
of the transactions contemplated to be performed by it under the Agreement,
and has taken all necessary corporate action to authorize the execution,
delivery and performance of this Agreement. When executed and delivered, this
Agreement will constitute the legal, valid and binding obligation of
Vanderbilt enforceable in accordance with its terms, except as enforcement of
such terms may be limited by bankruptcy, insolvency or similar laws affecting
the enforcement of creditors' rights generally and by the availability of
equitable remedies.
(c) No Consent Required. Vanderbilt is not required to obtain the
consent of any other party or any consent, license, approval or authorization
from, or registration or declaration with, any governmental authority, bureau
or agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement, except such as have been obtained.
(d) No Violations. The execution, delivery and performance of this
Agreement by Vanderbilt will not violate any provision of any existing law or
regulation or any order or decree of any court applicable to Vanderbilt or the
charter or bylaws of Vanderbilt, or constitute a material breach of any
mortgage, indenture, contract or other agreement to which Vanderbilt is a
party or by which Vanderbilt may be bound.
(e) Litigation. No litigation or administrative proceeding of or
before any court, tribunal or governmental body is currently pending, or to
the knowledge of Vanderbilt, threatened, against Vanderbilt or any of its
properties or with respect to this Agreement or the Certificates which, if
adversely determined, would in the opinion of Vanderbilt have a material
adverse effect on the transactions contemplated by this Agreement.
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Section 3.02 Representations and Warranties Regarding Each Contract.
Vanderbilt represents and warrants to the Trustee and the Certificateholders
as to each Contract as of the Closing Date (except as otherwise expressly
stated):
(a) Contract Schedule. The information set forth in the Contract
Schedule is true and correct.
(b) Payments. As of the Cut-off Date, no scheduled payment of
principal or interest on any Contract was more than 59 days past due and was
not made directly or indirectly by Vanderbilt on behalf of the Obligor.
(c) No Waivers. The terms of the Contract and any related Mortgage
have not been waived, altered or modified in any respect, except by
instruments or documents identified in the Contract File, the Land-and-Home
Contract File or the Mortgage Loan File, as applicable.
(d) Binding Obligation. The Contract and any related Mortgage is the
legal, valid and binding obligation of the Obligor thereunder and is
enforceable in accordance with its terms, except as such enforceability may be
limited by laws affecting the enforcement of creditors' rights generally and
by general principles of equity.
(e) No Defenses. The Contract and any related Mortgage is not subject
to any right of rescission, setoff, counterclaim or defense, including the
defense of usury, and the operation of any of the terms of the Contract or the
exercise of any right thereunder will not render the Contract unenforceable in
whole or in part or subject to any right of rescission, setoff, counterclaim
or defense, including the defense of usury, and no such right of rescission,
setoff, counterclaim or defense has been asserted with respect thereto.
(f) Insurance. The Manufactured Home securing the Contract is covered
by a Hazard Insurance Policy in the amount required by Section 5.09. All
premiums due as of the Closing Date on such insurance have been paid in full.
(g) Origination. The Contract was either (i) originated by a
manufactured housing dealer acting, to the best of Vanderbilt's knowledge, in
the regular course of its business and was purchased by Vanderbilt or an
Originator in the regular course of its business, or (ii) originated by
Vanderbilt or an Originator in the regular course of its business.
(h) Lawful Assignment. The Contract and any related Mortgage was not
originated in and is not subject to the laws of any jurisdiction whose laws
would make the transfer or ownership of the Contract under this Agreement or
pursuant to transfers of Certificates unlawful or render the Contract
unenforceable.
(i) Compliance with Law. All requirements of any federal, state or
local law, including, without limitation, usury, truth-in-lending and equal
credit opportunity laws and lender licensing laws, applicable to the Contract
and any related Mortgage have been complied with, and the Servicer shall, for
at least the period of this Agreement, maintain in its possession, available
for the Trustee's inspection, and shall deliver to the Trustee upon demand,
evidence of compliance with all such requirements.
35
(j) Contract in Force. The Contract and any related Mortgage has not
been satisfied or subordinated in whole or in part or rescinded, and the
Manufactured Home securing the Contract has not been released from the lien of
the Contract and any related Mortgage in whole or in part.
(k) Valid Security Interest. The Contract, together with any related
Mortgage or certificate of title, creates a valid, subsisting and enforceable
first priority security interest in favor of Vanderbilt in the Manufactured
Home covered thereby and, in the case of a Land-and-Home Contract or a
Mortgage Loan, a first mortgage lien on the related Mortgaged Property; and
the Trustee has a valid and perfected first priority security interest in such
Manufactured Home and, in the case of a Land-and-Home Contract or a Mortgage
Loan, a first mortgage lien on the related Mortgaged Property.
(l) Capacity of Parties. All parties to the Contract and any related
Mortgage had capacity to execute the Contract.
(m) Good Title. Vanderbilt originated or purchased the Contract and
any related Mortgage for value and took possession thereof in the ordinary
course of its business, without knowledge that the Contract was subject to any
security interest. Immediately prior to the transfer of the Contract and any
related Mortgage by Vanderbilt, Vanderbilt had good and marketable title
thereto free and clear of any encumbrance, equity, loan, pledge, charge, claim
or security interest and was the sole owner thereof with full right to
transfer the Contract and any related Mortgage to the Trustee.
(n) No Defaults. As of the Closing Date, there was no default,
breach, violation or event permitting acceleration existing under the Contract
and any related Mortgage and no event which, with notice and the expiration of
any grace or cure period, would constitute such a default, breach, violation
or event permitting acceleration under such Contract (except payment
delinquencies permitted by clause (b) above). Vanderbilt has not waived any
such default, breach, violation or event permitting acceleration.
(o) No Liens. As of the Closing Date, there are, to the best of
Vanderbilt's knowledge, no liens or claims which have been filed for work,
labor or materials affecting the Manufactured Home or related Mortgaged
Property securing the Contract or the Mortgage Loan, as applicable, which are
or may be liens prior to, or equal or coordinate with, the lien of the
Contract.
(p) Equal Installments. Except for Equity Builder Contracts, each
Fixed Rate Contract has a fixed APR and provides for level monthly, bi-weekly
or semi-monthly payments of principal and interest which fully amortize the
loan over its term. If the Contract is an Adjustable Rate Contract, it has a
variable APR based on the Index. The Contract is an Actuarial Contract.
(q) Enforceability. Each Contract and any related Mortgage contains
customary and enforceable provisions such as to render the rights and remedies
of the holder thereof adequate for the realization against the collateral of
the benefits of the security.
36
(r) One Original. There is only one original executed Contract, and
each original Contract is in the custody of Vanderbilt or otherwise held on
behalf of the Trustee on the Closing Date.
(s) Loan-to-Value Ratio. At the time of its origination each Contract
had a Loan-to-Value Ratio not greater than 100%.
(t) Primary Residence. To the best of Vanderbilt's knowledge, at the
time of origination of the Contracts, at least 92% of the Manufactured Homes
securing the Contracts were the related Obligors' primary residences.
(u) Not Real Estate. Except with respect to Land-and-Home Contracts
and Mortgage Loans, the related Manufactured Home is personal property, was
personal property at the time of the execution and delivery of the related
Contract by the parties thereto, and is not and was not, at such time,
considered or classified as part of the real estate on which it is located
under the laws of the jurisdiction in which it is located. The related
Manufactured Home is, to the best of Vanderbilt's knowledge, free of damage
and in good repair.
(v) Notation of Security Interest. If the related Manufactured Home
is located in a state in which notation of a security interest on the title
document is required or permitted to perfect such security interest, the title
document shows, or if a new or replacement title document with respect to such
Manufactured Home is being applied for such title document will be issued
within 180 days and will show, Vanderbilt or the related Originator as the
holder of a first priority security interest in such Manufactured Home. If the
related Manufactured Home is located in a state in which the filing of a
financing statement or the making of a fixture filing under the UCC is
required to perfect a security interest in manufactured housing, such filings
or recordings have been duly made and show Vanderbilt as secured party. If the
related Manufactured Home secures a Land-and-Home Contract, the related land
securing such Land-and-Home Contract is subject to a Mortgage properly filed
in the appropriate public recording office and naming Vanderbilt as mortgagee.
In each such case, the Trustee has the same rights as the secured party of
record would have (if such secured party were still the owner of the Contract)
against all Persons claiming an interest in such Manufactured Home.
(w) Qualified Mortgage for REMIC. Each Contract is secured by a
"single family residence" within the meaning of Section 25(e)(10) of the Code
and is a "qualified mortgage" under Section 860G(a)(3) of the Code.
(x) Stamping of Contracts. Within seven days after the Closing Date,
each Contract will have been stamped with the following legend: "This Contract
has been assigned to JPMorgan Chase Bank, as Trustee, or a separate trustee,
under the Pooling and Servicing Agreement dated as of October 25, 2001 or to
any successor Trustee thereunder."
(y) [Reserved]
Section 3.03 Representations and Warranties Regarding the Contracts
in the Aggregate. Vanderbilt represents and warrants that:
37
(a) Amounts. The aggregate principal amount payable by Obligors under
the Contracts as of the Cut-off Date (including scheduled principal payments
due before the Cut-off Date but received by Vanderbilt on or after the Cut-off
Date and excluding scheduled principal payments due on or after the Cut-off
Date but received by Vanderbilt prior to the Cut-off Date) equal or exceed the
Initial Principal Amount and each Contract has an APR equal to or greater than
7.75%.
(b) Characteristics. The Contracts have the following characteristics
as of the Cut-off Date: (i) except for Contracts secured by Manufactured Homes
and real estate located in Texas, Tennessee, North Carolina, South Carolina,
Florida, and Kentucky, not more than 4.84% of the Contracts, by remaining
principal balance, are secured by Manufactured Homes or Mortgaged Properties
and located in any one state; (ii) no Contract has a remaining maturity of
less than 34 months or more than 360 months; (iii) the final scheduled payment
date on the Contract with the latest maturity is December 15, 2031; (iv) no
less than approximately 68.46% of the Initial Principal Amount is attributable
to loans for purchases of Manufactured Homes or Mortgaged Properties that were
new at the time the related Initial Contracts were originated, and no more
than approximately 31.54% of the Initial Principal Amount is attributable to
loans for purchases of Manufactured Homes or Mortgaged Properties that were
used at the time the related Contracts were originated; (v) no Contract was
originated before March 1, 1991; (vi) no more than 9.68% of the Contracts by
Cut-Off Date principal balance are Contracts for which the related land was
pledged in lieu of a down payment or a trade-in; (vii) approximately 6.72% of
the Contracts by Cut-Off Date principal balance are Land-and-Home Contracts
(excluding Mortgage Loans) and no more than 9.24% of the Contracts by Cut-Off
Date principal balance are Mortgage Loans; (viii) 9.39% of the Contracts by
Cut-off Date principal balance is an Equity Builder Contract; (ix) 100% and 0%
of the Adjustable Rate Contracts by aggregate unpaid principal balance reset
annually and semi-annually, respectively; and (x) 100% of the Adjustable Rate
Contracts by aggregate unpaid principal balance consist of variable rate
contracts which adjust based on the monthly average yield on U.S. treasury
securities adjusted to a constant maturity of 5 years.
(c) Computer Tape. The Computer Tape made available by the Servicer
as of the close of business on October 25, 2001 was accurate as of its date
and includes a description of the same Contracts that are described in the
Contract Schedule.
(d) Marking Records. On or before the Closing Date, Vanderbilt will
have caused the portions of the Electronic Ledger relating to the Contracts
constituting part of the Trust Fund to be clearly and unambiguously marked to
indicate that such Contracts constitute part of the Trust Fund and are owned
by the Trust Fund in accordance with the terms of the trust created hereunder.
(e) No Adverse Selection. Except for the effect of the
representations and warranties made in Section 3.02 and 3.03 and the effect of
the geographical distribution of the Manufactured Homes, no adverse selection
procedures have been employed in selecting the Contracts.
Section 3.04 Representations and Warranties Regarding the Contract
Files, the Land-and-Home Contract Files and the Mortgage Loan Files.
Vanderbilt represents and warrants that:
38
(a) Possession. Immediately prior to the Closing Date, the Servicer
will have possession of each original Contract and the remainder of the
related Contract File. In addition, the Servicer will have possession of the
Servicing Files with respect to each Contract, including each Land-and-Home
Contract and each Mortgage Loan. There are and there will be no custodial
agreements in effect materially and adversely affecting the right of
Vanderbilt to make, or to cause to be made, any delivery required hereunder.
(b) Bulk Transfer Laws. The transfer, assignment and conveyance of
the Contracts, the Contract Files, the Land-and-Home Contract Files and the
Mortgage Loan Files by Vanderbilt pursuant to this Agreement are not subject
to the bulk transfer or any similar statutory provisions in effect in any
applicable jurisdiction.
Section 3.05 Repurchases of Contracts or Substitution of Contracts
for Breach of Representations and Warranties.
(a) Vanderbilt shall either (i) repurchase a Contract at its
Repurchase Price, or (ii) if Vanderbilt is able to satisfy the conditions of
Section 3.05(b), remove a Contract from the Trust Fund and substitute therefor
an Eligible Substitute Contract in accordance with and subject to the
limitations of Section 3.05(b), in each case not later than one Business Day
after the first Determination Date which is more than 90 days after Vanderbilt
becomes aware, or receives written notice from the Servicer or the Trustee, of
a breach of a representation or warranty of Vanderbilt set forth in Sections
3.02 or 3.03 of this Agreement that materially adversely affects the Trust
Fund's interest in such Contract, unless such breach has been cured; provided,
however, that with respect to any Contract incorrectly described on the
Contract Schedule with respect to unpaid principal balance, which Vanderbilt
would otherwise be required to repurchase pursuant to this Section, Vanderbilt
may, in lieu of repurchasing such Contract, deposit in the Certificate Account
not later than one Business Day after such Determination Date cash in an
amount sufficient to cure such deficiency or discrepancy; and provided,
further, that with respect to a breach of a representation or warranty
relating to the Contracts in the aggregate and not to each particular
Contract, Vanderbilt may select Contracts to repurchase or substitute for such
that, had such Contracts not been included as part of the Contract Pool and
after giving effect to such substitution, if any, there would have been no
breach of such representation or warranty. It is understood and agreed that
the obligation of Vanderbilt to repurchase or substitute for any Contract as
to which a breach of a representation or warranty set forth in Section 3.02 or
3.03 of this Agreement has occurred and is continuing shall constitute the
sole remedy respecting such breach available to the Certificateholders or the
Trustee; provided, however, that Vanderbilt shall defend and indemnify the
Trustee, the Trust Fund and Certificateholders against all costs, expenses,
losses, damages, claims and liabilities, including reasonable fees and
expenses of counsel, which may be asserted against or suffered by any of them
as a result of third-party claims arising out of any breach of a
representation or warranty set forth in Section 3.02 or 3.03. Nothing in the
preceding sentence shall be construed to limit the indemnification obligations
of the Servicer set forth in Section 10.05 hereof. Notwithstanding any other
provision of this Agreement, the obligation of Vanderbilt under this Section
shall not terminate upon an Event of Default and the indemnification
obligation of the Servicer in this Section shall survive the resignation or
removal of the Trustee and the termination of this Agreement.
39
Notwithstanding any other provision of this Agreement to the
contrary, any amount received on or recovered with respect to repurchased
Contracts or Replaced Contracts during or after the Due Period in which such
repurchase occurs shall be the property of Vanderbilt and need not be
deposited in the Certificate Account.
Notwithstanding the foregoing, Vanderbilt shall not deposit cash into
the Certificate Account pursuant to this Section 3.05 after the end of the
three month period beginning on the Closing Date unless it shall first have
obtained an Opinion of Counsel to the effect that such deposit will not give
rise to any tax under Section 860F(a)(1) of the Code or Section 860G(d) of the
Code. Any such deposit shall not be invested. If Vanderbilt is required to
purchase such Contract (or deposit cash in the Certificate Account),
Vanderbilt shall guarantee the payment of any tax under Section 860F(a)(1) of
the Code or under Section 860G(d) of the Code by paying to the Trustee the
amount of such tax not later than five Business Days before such tax shall be
due and payable to the extent that amounts previously paid over to and then
held by the Trustee pursuant to Section 5.17 hereof are insufficient to pay
such tax and all other taxes chargeable under Section 5.17. If a payment of
tax by Vanderbilt is required in connection with a repurchase, Vanderbilt
shall give the Trustee notice of such tax and the amount of such tax and the
date by which Vanderbilt shall provide funds to the Trustee to cover such tax.
The Trustee shall hold any amount paid to it pursuant to the preceding
sentence in an account that is not part of the Trust Fund. The Servicer shall
give notice to the Trustee at the time of such repurchase of the amounts due
from Vanderbilt pursuant to the guarantee of Vanderbilt and notice as to who
should receive such payment.
The Trustee shall have no obligation to pay any such amounts pursuant
to this Section other than from moneys provided to it by Vanderbilt or from
moneys held in the funds and accounts created under this Agreement. The
Trustee shall be deemed conclusively to have complied with this Section if it
follows the directions of the Servicer.
In the event any tax that is guaranteed by Vanderbilt is refunded to
the Trust Fund or otherwise is determined not to be payable, Vanderbilt shall
be repaid the amount of such refund or that portion of any guarantee payment
made by Vanderbilt that is not applied to the payment of such tax.
Notwithstanding the above provisions of this Section 3.05(a),
Vanderbilt shall not be required to repurchase or substitute for any Contract
on account of a breach of the representation or warranty contained in Section
3.02(k) or (v) solely on the basis of failure by Vanderbilt to cause notations
to be made on any document of title relating to any Manufactured Home or to
execute any transfer instrument relating to any Manufactured Home (other than
a notation or a transfer instrument necessary to show Vanderbilt as lienholder
or legal title holder) unless (i) a court of competent jurisdiction has
adjudged that, because of such failure, the Trustee does not have a perfected
first-priority security interest in the related Manufactured Home or (ii) (A)
the Servicer has received written advice of counsel (with a copy to the
Trustee) to the effect that a court of competent jurisdiction has held that,
solely because of a substantially similar failure on the part of a pledgor or
assignor of manufactured housing contracts (who has perfected the assignment
or pledge of such contracts), a perfected first-priority security interest was
not created in favor of the pledgee or assignee (as the case may be) in a
related manufactured home which is located in such jurisdiction and which is
subject to the same laws regarding the
40
perfection of security interest therein as apply to Manufactured Homes located
in such jurisdiction, and (B) the Servicer shall not have completed all
appropriate remedial action with respect to such Manufactured Home within 180
days after receipt of such written advice. Any such advice shall be from
counsel selected by the Servicer on a non-discriminatory basis from among the
counsel used by the Servicer in its general business in the jurisdiction in
question. The Servicer shall have no obligation on an ongoing basis to seek
any advice with respect to the matters described in clause (ii) above.
However, the Servicer shall seek advice with respect to such matters
whenever information comes to the attention of its General Counsel which
causes such General Counsel to determine that a holding of the type described
in clause (ii) (A) might exist.
(b) On or prior to the date that is the second anniversary of the
Closing Date, Vanderbilt, at its election, may substitute one or more
Contracts for a Contract that it is obligated to repurchase pursuant to
Section 3.05(a) (such Contract being referred to as the "Replaced Contract")
upon satisfaction of the following conditions:
(i) each Contract to be substituted for the Replaced Contract is an
Eligible Substitute Contract and Vanderbilt delivers an Officer's
Certificate, substantially in the form of Exhibit F hereto, to the
Trustee certifying that such Contract is an Eligible Substitute Contract,
describing in reasonable detail how such Contract satisfies the
definition of the term "Eligible Substitute Contract" (as to satisfaction
of representations and warranties, such description shall be that such
Contract satisfies such representations and warranties) and certifying
that (a) the Contract File for such Contract is in the possession of the
Servicer or (b) the Land-and-Home Contract File or the Mortgage Loan File
for such Contract is in the possession of a custodian acting on behalf of
the Trustee;
(ii) Vanderbilt shall have delivered to the Trustee evidence of
filing with the appropriate office in Tennessee of a UCC-1 financing
statement describing such Contract executed by Vanderbilt as seller,
naming the Trustee as purchaser and bearing the statement set forth in
Section 2.02(a);
(iii) Vanderbilt shall have delivered to the Trustee an Opinion of
Counsel (a) to the effect that the substitution of such Contract for such
Replaced Contract will not cause the Trust Fund to fail to qualify as a
REMIC at any time under then applicable REMIC Provisions or cause any
"prohibited transaction" that will result in the imposition of a tax
under such REMIC Provisions and (b) to the effect that no filing or other
action other than the filing of a financing statement on Form UCC-1 with
the Secretary of State of the State of Tennessee, naming Vanderbilt as
debtor and the Trustee as secured party, and the filing of continuation
statements as required by Section 2.02(a) of this Agreement, is necessary
to perfect as against third parties the conveyance of the Contracts by
Vanderbilt to the Trustee; and
(iv) if the aggregate of the Scheduled Principal Balances of the
Replaced Contracts, if any, is greater than the Scheduled Principal
Balances of the Contracts substituted for such Replaced Contracts,
Vanderbilt shall have deposited in the Certificate Account the amount of
such excess and shall have included in the Officer's Certificate required
by clause (i) above a certification that such deposit has been made.
41
Upon satisfaction of such conditions, the Servicer shall add each such
Contract to, and delete each such Replaced Contract from (or cause such
addition and deletion to be accomplished), the Contract Schedule and shall
deliver a copy of such amended Contract Schedule to the Trustee. Such
substitution shall be effected prior to the first Determination Date that
occurs more than 90 days after Vanderbilt becomes aware, or receives written
notice from the Servicer or the Trustee, of the breach referred to in Section
3.05(a).
(c) Promptly after the repurchase referred to in Section 3.05(a) or
the substitution referred to in Section 3.05(b), the Trustee shall execute
such documents as are presented to it by Vanderbilt and are reasonably
necessary to reconvey, without recourse, representation or warranty, the
repurchased Contract or Replaced Contract, as the case may be, to Vanderbilt.
[End of Article III]
42
Article IV
THE CERTIFICATES
Section 4.01 The Certificates. The Class A, Class M-1, Class B and
Class R Certificates shall be substantially in the forms annexed hereto as
Exhibit X-0, Xxxxxxx X-0, Exhibit C and Exhibit D, respectively, and Exhibit E
(reverse of all Certificates), with such immaterial changes as Vanderbilt
deems appropriate, and on original issue, shall be executed by manual or
facsimile signature by an authorized officer of the Trustee, countersigned by
the Trustee and delivered to or upon the written order of Vanderbilt. The
Class A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates, Class
A-4 Certificates, Class A-5 Certificates, Class M-1 Certificates, Class B-1
Certificates and Class B-2 Certificates shall each be evidenced initially by
single certificates representing $110,200,000, $100,170,000, $57,100,000,
$86,162,000, $18,000,000, $16,940,000, $14,823,000 and $20,117,749,
respectively, in initial aggregate principal balance, beneficial ownership of
such Certificates to be held through Book-Entry Certificates. The Class R
Certificate shall initially be held in the name of Vanderbilt SPC, Inc. Each
Certificate other than the Class R Certificate shall be issued in minimum
dollar denominations of $50,000 and integral dollar multiples of $1 in excess
thereof. Upon original issuance, the sum of the denominations of each Class of
the Class A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates,
Class A-4 Certificates, Class A-5 Certificates, Class M-1 Certificates, Class
B-1 Certificates and Class B-2 Certificates, as the case may be, shall equal
the Original Class A-1 Principal Balance, the Original Class A-2 Principal
Balance, the Original Class A-3 Principal Balance, the Original Class A-4
Principal Balance, the Original Class A-5 Principal Balance, the Original
Class M-1 Principal Balance, the Original Class B-1 Principal Balance and the
Original Class B-2 Principal Balance, respectively. The Class R Certificate
shall not have a principal balance.
The Certificates shall be countersigned by manual signature on behalf
of the Trustee by one of its authorized officers or its Authenticating Agent
pursuant to Section 4.07. Certificates bearing the signatures of individuals
who were at any time the proper officers of the Trustee shall bind the
Trustee, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the countersignature and delivery of such
Certificate or did not hold such offices at the date of such Certificates. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless there appears on such Certificate a manual
countersignature by the Trustee or its Authenticating Agent and such
countersignature upon any Certificate shall be conclusive evidence, and the
only evidence, that such Certificate has been duly countersigned and delivered
hereunder. All Certificates shall be dated the date of their countersignature.
The rights of the Certificateholders to receive payments with respect
to the Trust Fund in respect of the Certificates, and all ownership interests
of the Certificateholders in such payments, shall be as set forth in this
Agreement.
Section 4.02 Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at its Corporate Trust Office
or, at the election of the Trustee, at the office of its designated agent in
New York City, a Certificate Register in
43
which, subject to such reasonable regulations as it may prescribe, the Trustee
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided.
(b) Subject to Section 4.02(c) and the other provisions of this
Section, upon surrender for registration of transfer of any Certificate at any
office or agency of the Trustee maintained for such purpose, the Trustee shall
execute, countersign and deliver, in the name of the designated transferee or
transferees, a Certificate of a like aggregate Percentage Interest and dated
the date of countersignature by the Trustee or its Authenticating Agent. No
transfer of an ERISA Restricted Certificate that is a Definitive Certificate
shall be made unless the Trustee shall have received either (i) a
representation from the proposed transferee to the effect that it is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code or a person acting on behalf of any such plan or using the assets of any
such plan to effect such transfer, (ii) except in the case of a Class R
Certificate, if the purchaser is an insurance company, a representation that
the purchaser is an insurance company which is purchasing such Certificates
with funds contained in an "insurance company general account" (as such term
is defined in Section V(e) of Prohibited Transaction Class Exemption 95-60
("PTCE 95-60") and that the purchase and holding of such Certificates are
covered under Section I and III of PTCE 95-60 or (iii) in the case of any such
ERISA Restricted Certificate presented for registration in the name of an
employee benefit plan subject to ERISA, or a plan or arrangement subject to
Section 4975 of the Code (or comparable provisions of any subsequent
enactments), or a trustee of any such plan or any other person acting on
behalf of any such plan or arrangement or using such plan's or arrangement's
assets, an Opinion of Counsel satisfactory to the Trustee, which Opinion of
Counsel shall not be an expense of either the Trustee, the Trust Fund,
Vanderbilt or the Servicer, addressed to the Trustee, to the effect that the
purchase or holding of such Certificate will not result in the assets of the
Trust Fund being deemed to be "plan assets" and subject to the prohibited
transaction provisions of ERISA and the Code and will not subject the Trustee
to any obligation in addition to those expressly undertaken in this Agreement
or to any liability. For purposes of the preceding sentence, with respect to
an ERISA Restricted Certificate that is a Book-Entry Certificate, in the event
the representation letter referred to in the preceding sentence is not
furnished, such representation shall be deemed to have been made to the
Trustee by the transferee's (including an initial acquiror's) acceptance of
the Certificates. Notwithstanding anything else to the contrary herein, any
purported transfer of an ERISA Restricted Certificate to or on behalf of an
employee benefit plan subject to ERISA or to the Code without the delivery to
the Trustee of an Opinion of Counsel satisfactory to the Trustee as described
above shall be void and of no effect.
Each Private Certificate shall bear a legend substantially to the
following effect:
"THIS CLASS [ ] CERTIFICATE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR
TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH
ACT OR LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS
WHICH ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT OR
UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN
ACCORDANCE WITH THE PROVISIONS
44
OF SECTION 4.02 [WITH RESPECT TO CLASS R: SECTION 4.08]
OF THE AGREEMENT REFERRED TO HEREIN."
No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement or in
accordance with an exemption from the requirements under the Securities Act of
1933, as amended, or any applicable state securities laws. If such a transfer
is to be made in reliance upon an exemption from said Act and laws, prior to
the registration of any such transfer (i) the Trustee or Vanderbilt may
require a written Opinion of Counsel acceptable to and in form and substance
satisfactory to the Trustee and Vanderbilt that such transfer may be made
pursuant to an exemption, describing the applicable exemption and the basis
therefor, from said Act and laws or is being made pursuant to said Act and
laws, which Opinion of Counsel shall not be an expense of the Trustee,
Vanderbilt or the Servicer, and (ii) the Trustee shall require the transferee
to execute a certification, substantially in the form of Exhibit I hereto,
acceptable to and in form and substance satisfactory to Vanderbilt and the
Trustee setting forth the facts surrounding such transfer; provided that such
Opinion of Counsel shall not be required in the case of transfers by or to
Vanderbilt SPC, Inc. Such Opinions of Counsel shall not be an expense of the
Trustee, Vanderbilt or the Servicer. If a transfer of a Private Certificate is
to be made pursuant to an effective registration statement, prior to
registration of any such transfer, the transferor shall surrender such Private
Certificate to be exchanged at any office or agency of the Trustee maintained
for such purpose. Whenever such Private Certificate is so surrendered for
exchange, the Trustee or its Authenticating Agent shall execute, countersign
and deliver, a Certificate or Certificates which does not include the legend
set forth in the preceding paragraph. Each such Certificate which is also a
Book-Entry Certificate shall include the legend set forth Section 4.03(g) and
shall be delivered to the Depository.
(c) At the option of the Certificateholder, a Certificate may be
exchanged for another Certificate or Certificates of the same Class and of
authorized denominations of the same aggregate denomination, upon surrender of
the Certificate to be exchanged at any office or agency of the Trustee
maintained for such purpose. Whenever the Certificate is so surrendered for
exchange, the Trustee or its Authenticating Agent shall execute, countersign
and deliver, the Certificate or Certificates which the Certificateholder
making the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange (if so required by the
Trustee) shall be duly endorsed by, or be accompanied by a written instrument
of transfer in the form satisfactory to the Trustee or the Certificate
Registrar duly executed by, the Holder thereof or his attorney duly authorized
in writing.
(d) No service charge shall be made to the Holder for any
registration of transfer or exchange of a Certificate, but the Trustee may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of such
Certificate.
(e) All Certificates surrendered for registration of transfer or
exchange shall be held in accordance with the retention policy of the Trustee.
(f) Except as provided in paragraph (g) below, the Book-Entry
Certificates shall at all times remain registered in the name of the
Depository or its nominee and at all times: (i) transfer
45
of the Book-Entry Certificates may not be registered by the Trustee except to
another Depository; (ii) the Depository shall maintain book-entry records with
respect to the Certificate Owners and with respect to ownership and transfers
of such Book-Entry Certificates; (iii) ownership and transfers of registration
of the Book-Entry Certificates on the books of the Depository shall be
governed by applicable rules established by the Depository; (iv) the
Depository may collect its usual and customary fees, charges and expenses from
its Depository Participants; (v) the Trustee shall deal only with the
Depository and its nominee, which, in the case of the initial Depository,
shall be Cede & Co., as registered Holder of the Book-Entry Certificates for
purposes of exercising the rights of Holders under this Agreement, and
requests and directions for and votes of such Persons shall not be deemed to
be inconsistent if they are made with respect to different Certificate Owners;
and (vi) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and Persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners.
All transfers by Certificate Owners of Book-Entry Certificates shall
be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owner. Each
Depository Participant shall only transfer Book-Entry Certificates of
Certificate Owners it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
(g) If (x)(i) Vanderbilt or the Depository advises the Trustee in
writing that the Depository is no longer willing, qualified or able to
properly discharge its responsibilities as Depository, and (ii) the Trustee
and Vanderbilt are unable to locate a qualified successor, (y) Vanderbilt at
its option advises the Trustee in writing that it elects to terminate the
book-entry system through the Depository and obtains the consent of the
Trustee and the Servicer to such termination, or (z) after the occurrence of
an Event of Default, the Depository notifies the Trustee that Certificate
Owners representing Fractional Interests aggregating not less than 51% of the
aggregate Fractional Interests of the Book-Entry Certificates together have
advised the Depository through the Depository Participants in writing that the
continuation of a book-entry system through the Depository is no longer in the
best interests of the Certificate Owners, the Trustee shall send notice to the
Depository for distribution to the Certificate Owners, of the occurrence of
any such event and of the availability of definitive, fully registered
Certificates (the "Definitive Certificates") to Certificate Owners requesting
the same. Upon surrender to the Trustee of the Certificates by the Depository,
accompanied by registration instructions from the Depository for registration
of transfer, the Trustee shall countersign the Definitive Certificates.
Neither Vanderbilt nor the Trustee shall be liable for any delay in delivery
of such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of Definitive Certificates;
all references herein to obligations imposed upon or to be performed by the
Depository shall be deemed to be imposed upon and performed by the Trustee, to
the extent applicable with respect to such Definitive Certificates, and the
Trustee shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder.
(h) On or prior to the Closing Date, there shall be delivered to the
Depository one Class A-1 Certificate, one Class A-2 Certificate, one Class A-3
Certificate, one Class A-4 Certificate, one Class A-5 Certificate, one Class
M-1 Certificate, one Class B-1 Certificate and
46
one Class B-2 Certificate in registered form registered in the name of the
Depository's nominee, Cede & Co., the total face amount of each of which
represents 100% of the Original Class A-1 Principal Balance, 100% of the
Original Class A-2 Principal Balance, 100% of the Original Class A-3 Principal
Balance, 100% of the Original Class A-4 Principal Balance, 100% of the
Original Class A-5 Principal Balance, 100% of the Original Class M-1 Principal
Balance, 100% of the Original Class B-1 Principal Balance and 100% of the
Original Class B-2 Principal Balance, respectively. Each Certificate registered
in the name of the Depository shall bear the following legend:
"Unless this Certificate is presented by an authorized
representative of The Depository Trust Company to the Trustee or its
agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of The
Depository Trust Company and any payment is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co.,
has an interest herein."
(i) All transfers of a Class R Certificate shall be made in
accordance with Section 4.08.
Section 4.03 Mutilated, Destroyed, Lost or Stolen Certificate. If (i)
any mutilated Certificate is surrendered to the Trustee or the Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Trustee and any Certificate
Registrar such security or indemnity as may be required by it to save each of
them harmless, then, in the absence of notice to a Responsible Officer of the
Trustee that such Certificate has been acquired by a bona fide purchaser, the
Trustee shall countersign and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of the
same Class and of like tenor and denomination. Upon the issuance of any new
Certificate under this Section, the Trustee may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses connected therewith. Any
replacement Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the Trust Fund, as if
originally issued, whether or not the destroyed, lost or stolen Certificate
shall be found at any time.
Section 4.04 Persons Deemed Owners. Vanderbilt, the Servicer, the
Certificate Registrar, the Trustee and any Paying Agent may treat the Person
in whose name any Certificate is registered as the owner of such Certificate
for the purpose of receiving payments pursuant to Section 6.01 and for all
other purposes whatsoever, and none of Vanderbilt, the Servicer, any Paying
Agent, the Certificate Registrar nor the Trustee shall be affected by notice
to the contrary.
Section 4.05 Appointment of Paying Agent. The Trustee may appoint a
Paying Agent for the purpose of making distributions to Certificateholders
pursuant to Section 6.01 and payments pursuant to Section 5.17. Any Paying
Agent or its parent company so appointed either shall be a bank or trust
company or shall have a rating acceptable to the Rating Agencies. In the event
of any such appointment, on or prior to each Remittance Date, the Trustee
shall deposit or cause to be deposited with the Paying Agent, from amounts in
each Certificate Account, a sum sufficient to make the payments to the related
Certificateholders in the amounts and in the
47
manner provided for in Section 6.01, such sum to be held in trust for the
benefit of the related Certificateholders. The Trustee initially appoints
itself as Paying Agent.
The Trustee shall cause each Paying Agent (other than itself) to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee that such Paying Agent is at all times acting as
agent for the Trustee and such Paying Agent will hold all sums held by it for
the payment to Certificateholders in trust for the benefit of the
Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders.
Section 4.06 Access to List of Certificateholders' Names and
Addresses. The Certificate Registrar will furnish to the Trustee (if the
Trustee is not the Certificate Registrar), Vanderbilt and the Servicer within
five days after receipt by the Certificate Registrar of a written request
therefor from the Trustee, Vanderbilt or the Servicer a list, in such form as
the Trustee, Vanderbilt or the Servicer reasonably may require, of the names
and addresses of the Certificateholders as of the most recent Record Date. If
Holders of Certificates of any Class evidencing, as to such Class, aggregate
Percentage Interests of 25% or more (the "Applicants") apply in writing to the
Trustee, and such application states that the Applicants desire to communicate
with other Certificateholders of such Class with respect to their rights under
this Agreement or under the Certificates of such Class and is accompanied by a
copy of the communication which such Applicants propose to transmit, then the
Trustee, within five Business Days after the receipt of such application,
shall afford such Applicants access during normal business hours to the most
recent list of Certificateholders of such Class held by the Trustee. If such
list is as of a date more than 90 days prior to the date of receipt of such
applicants' request, the Trustee promptly shall request from the Certificate
Registrar a current list as provided above, and shall afford such Applicants
access to such list promptly upon receipt. Every Certificateholder, by
receiving and holding a Certificate, agrees with the Certificate Registrar and
the Trustee that neither the Servicer, the Certificate Registrar, Vanderbilt
nor the Trustee shall be held accountable by reason of the disclosure of any
such information as to the names and addresses of the Certificateholders
hereunder, regardless of the source from which such information was derived.
Section 4.07 Authenticating Agents. The Trustee may appoint one or
more Authenticating Agents with power to act on its behalf and subject to its
direction in the execution and delivery of the Certificates. For all purposes
of this Agreement, the execution and delivery of Certificates by the
Authenticating Agent pursuant to this Section shall be deemed to be the
execution and delivery of Certificates "by the Trustee."
Section 4.08 Class R Certificate.
(a) The Class R Certificate shall not be assigned or transferred
except in accordance with this Section 4.08 and any other applicable provision
of this Agreement.
(b) Each Person who has or acquires any Ownership Interest (as
defined below) in the Class R Certificate shall be deemed by the acceptance or
acquisition of such Ownership Interest in such Class R Certificate to have
agreed to be bound by the following provisions and to have irrevocably
appointed the Servicer as its attorney-in-fact to negotiate the terms of any
mandatory sale under clause (vi) below and to execute all instruments of
transfer and to do all other things
48
necessary in connection with any such sale, and the rights of each Person
acquiring any Ownership Interest in a Class R Certificate are expressly subject
to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Class R Certificate shall be a Permitted Transferee (as defined below)
and shall promptly notify the Servicer and the Trustee of any change or
impending change in its status as a Permitted Transferee.
(ii) Any Ownership Interest in a Class R Certificate may not be
subject to a Transfer (as defined below) without the express written
consent of the Servicer (with a copy to the Trustee), and the Trustee
shall not recognize the Transfer (as defined below) of such Class R
Certificate, and such proposed Transfer shall not be effective, without
such consent with respect thereto. In connection with any proposed
Transfer of any Ownership Interest in a Class R Certificate, the Servicer
shall, as a condition to such consent, require delivery to it, in form
and substance satisfactory to it, and the proposed Transferee shall
deliver to the Servicer and the Trustee, the following:
(A) an affidavit (a "Transfer Affidavit") of the proposed
Transferee in the form attached as Exhibit H hereto; and
(B) an express agreement by the proposed Transferee to be bound
by and to abide by the provisions of this Section.
The Servicer shall notify the Trustee of any such Transfer to which
it consents.
(iii) Notwithstanding the delivery of a Transfer Affidavit by a
proposed Transferee under clause (ii) above, if the Servicer or a
Responsible Officer of the Trustee has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of any Ownership
Interest in a Class R Certificate to such proposed Transferee shall be
effected.
(iv) Each Person holding or acquiring any Ownership Interest in a
Class R Certificate shall agree (A) to require a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer any Ownership
Interest in such Class R Certificate and (B) not to Transfer any
Ownership Interest in such Class R Certificate or to cause the Transfer
of any Ownership Interest in such Class R Certificate to any other Person
if it has actual knowledge that such Person is not a Permitted
Transferee.
(v) Any attempted or purported Transfer of any Ownership Interest in
a Class R Certificate in violation of the provisions of this Section
shall be absolutely null and void and shall vest no rights in the
purported Transferee. If any purported Transferee shall become the holder
of an Ownership Interest in a Class R Certificate in violation of the
provisions of this Section, then, upon discovery by a Responsible Officer
of the Trustee of, or due notification to the Trustee that the
recognition of the Transfer of such Ownership Interest in such Class R
Certificate was not in fact permitted by this Section, the last preceding
Permitted Transferee shall be restored to all rights as Holder thereof
retroactive to the date of Transfer of such Ownership Interest in such
Class R Certificate. The Trustee shall promptly notify the Servicer if it
discovers or receives notice of such an
49
impermissible Transfer. The Trustee shall be under no liability to any
Person for permitting the Transfer of an Ownership Interest in a Class R
Certificate that is in fact not permitted by this Section or for making
any payments in respect of a Class R Certificate to the Holder thereof
or taking any other action with respect to such Holder under the
provisions of this Agreement so long as the Transfer was made with the
express prior written consent of the Servicer. The Trustee shall be
entitled but not obligated to recover from any Holder of a Class R
Certificate that was in fact not a Permitted Transferee at the time it
became a Holder or, at such subsequent time as it became other than a
Permitted Transferee, all payments made on such Class R Certificate
at and after such time. Any such payments so recovered by the Trustee
shall be paid and delivered by the Trustee to the last preceding
Permitted Transferee of such Class R Certificate.
(vi) If any purported Transferee shall be a Holder of a Class R
Certificate in violation of the restrictions in this Section, then the
Servicer shall have the right without notice to the Holder or any prior
Holder of such Class R Certificate to sell such Class R Certificate to a
purchaser selected by the Servicer on such terms as the Servicer may
choose. Such purchaser may be the Servicer itself or any Affiliate of the
Servicer. The proceeds of such sale, net of commissions (which may
include commissions payable to the Servicer or its Affiliates), expenses
and taxes due, if any, will be remitted by the Servicer to the last
preceding Permitted Transferee of such Class R Certificate, except that
in the event that the Servicer determines that the Holder or any prior
Holder of such Class R Certificate will be liable for any amount due
under this Section or any other provisions of this Agreement, the
Servicer shall so inform the Trustee, and the Trustee shall withhold a
corresponding amount from such remittance as security for such claim. The
terms and conditions of any sale under this clause (vi) shall be
determined in the sole discretion of the Servicer, and it shall not be
liable for the exercise of such discretion to any Person holding or
purporting to hold a Class R Certificate.
Upon notice to the Servicer that any legal or beneficial interest in
any portion of a Class R Certificate has been transferred, either directly or
indirectly, to any Person that is not a Permitted Transferee or an agent
thereof (including a broker, nominee, or middleman) in contravention of the
foregoing restrictions, or that is a pass-through entity, as defined in
Section 860E(e)(6) of the Code, an interest in which is held of record by a
Person that is not a "Permitted Transferee," the Servicer agrees to furnish to
the Internal Revenue Service and those Persons specified in Section 860E(e)(5)
of the Code such information necessary to the application of Section 860E(e)
of the Code as may be required by the Code, including but not limited to, the
present value of the total anticipated excess inclusions with respect to such
Class R Certificate (or portion thereof) for periods after such Transfer and
the total excess inclusions for any taxable year allocable to any holder of an
interest in such pass-through entity which is not a Permitted Transferee. At
the election of the Servicer, the Servicer may charge a reasonable fee for
computing and furnishing such information to the transferor or to such agent
or to such pass-through entity referred to above; however, the Servicer shall
in no event be excused from furnishing such information to the Internal
Revenue Service. The foregoing restrictions on transfer contained in this
Section 4.08(b) shall cease to apply to Transfers occurring on or after the
date on which there shall have been delivered to the Trustee, Vanderbilt and
the Servicer, in form and substance satisfactory to the Servicer, an Opinion
of Counsel that eliminating such
50
restrictions will not cause the Trust Fund to fail to qualify as a REMIC at any
time while the Certificates are outstanding.
"Ownership Interest" means any legal or beneficial, direct or
indirect, ownership or other interest.
"Permitted Transferee" means any Person other than (a) the United
States, a State or any political subdivision thereof, any possession of the
United States, or any agency or instrumentality of any of the foregoing (other
than an instrumentality that is a corporation if all of its activities are
subject to tax and, except for the Federal Home Loan Mortgage Corporation, a
majority of its board of directors is not selected by any such governmental
unit), (b) a foreign government, international organization or agency or
instrumentality of either of the foregoing (other than an instrumentality that
is a corporation if all of its activities are subject to tax and a majority of
its board of directors is not selected by any such governmental unit), (c) an
organization which is exempt from tax imposed by Chapter 1 of the Code
(including the tax imposed by Code Section 511 on unrelated business taxable
income) on any excess inclusions (as defined in Code Section 860E(c)(1)) with
respect to a Class R Certificate (except certain farmers' cooperatives
described in Code Section 521), (d) rural electric and telephone cooperatives
described in Code Section 1381(a)(2), (e) a Non-U.S., Person, (f) an "electing
large partnership" within the meaning of Section 775 of the Code, and (g) any
other Person so designated by the Servicer based upon an Opinion of Counsel
that the Transfer of an Ownership Interest in a Class R Certificate to such
Person may cause the Trust Fund to fail to qualify as a REMIC at any time that
the Certificates are outstanding. The terms "United States," "State" and
"International Organization" shall have the meanings set forth in Code Section
7701 or successor provisions. A "Non-U.S. Person" means an individual,
corporation, partnership or other entity which is not a "U.S. Person."
A "U.S. Person" means (i) a citizen or resident of the United States,
(ii) a corporation, partnership or other entity treated as a corporation or
partnership for United States federal income tax purposes organized in or
under the laws of the United States or any state thereof or the District of
Columbia (other than a partnership that is not treated as a United States
person under any applicable Treasury regulations) or (iii) an estate the
income of which is includible in gross income for United States tax purposes,
regardless of its source, or (iv) a trust if a court within the United States
is able to exercise primary supervision over the administration of the trust
and one or more United States persons have authority to control all
substantial decisions of the trust. Notwithstanding the preceding sentence, to
the extent provided in regulations, certain trusts in existence on August 20,
1996 and treated as United States persons prior to such date that elect to
continue to be treated as United States persons shall be considered United
States persons as well.
"Transfer" means any direct or indirect transfer or sale of any
Ownership Interest in a Class R Certificate.
"Transferee" means any Person who is acquiring by Transfer any
Ownership Interest in a Class R Certificate.
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(c) Except as otherwise provided herein, a Class A-5, Class M-1,
Class B-1 or Class B-2 Certificate shall not be registered in the name of
Vanderbilt or any Affiliate thereof, unless the Trustee shall first have
received written notification from the Rating Agencies that such Transfer will
not cause a reduction or withdrawal of the rating then assigned to any of the
Certificates.
[End of Article IV]
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Article V
ADMINISTRATION AND SERVICING OF CONTRACTS
Section 5.01 Responsibility for Contract Administration and
Servicing. The Servicer shall service and administer the Contracts and,
subject to the terms of this Agreement, shall have full power and authority to
do any and all things which it may deem necessary or desirable in connection
with such servicing and administration. Subject to Section 5.02, without
limiting the generality of the foregoing, the Servicer hereby is authorized
and empowered when the Servicer believes it appropriate in its best judgment,
to execute and deliver, on behalf of the Certificateholders and the Trustee or
any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge and all other comparable instruments,
with respect to the Contracts and any related Mortgages and with respect to
the Manufactured Homes and any related Mortgaged Property. The Trustee shall
execute and deliver to the Servicer any powers of attorney and other documents
prepared by the Servicer and certified to the Trustee as being necessary or
appropriate to enable the Servicer to service and administer the Contracts.
Such power of attorney shall be in the form of Exhibit L hereto.
The Servicer may perform its servicing and administration functions,
as Servicer, pursuant to this Agreement through one or more subservicers. All
actions by any subservicer with respect to the servicing and administration of
the Contracts shall be treated as though done by the Servicer itself. All
documents, instruments or contracts executed by any subservicer on behalf of
the Servicer shall be treated by the Trustee as though executed by the
Servicer itself. The Servicer shall remain primarily liable for all actions of
any subservicer.
Section 5.02 Standard of Care. In managing, administering, servicing
and making collections on the Contracts pursuant to this Agreement, the
Servicer will exercise the same degree of skill and care, consistent with the
terms of this Agreement, that the Servicer exercises with respect to similar
manufactured housing contracts owned and serviced by the Servicer but in no
event shall such standard be lower than the standard prevailing in the
industry; provided, however, that notwithstanding the foregoing, the Servicer
shall not release or waive the right to collect the unpaid balance on any
Contract; provided further that nothing herein shall require the Servicer to
violate any applicable law.
Section 5.03 Records. The Servicer, during the period it is servicer
hereunder, shall maintain such books of account and other records as will
enable the Trustee (if the Trustee so elects) to determine the status of each
Contract. Without limiting the generality of the preceding sentence, the
Servicer shall keep such records in respect of Liquidation Expenses as will
enable the Trustee (if the Trustee so elects) to determine that the correct
amount of Net Liquidation Proceeds in respect of a Liquidated Contract has
been deposited in the related Certificate Account.
Section 5.04 Inspection.
(a) At all times during the term hereof, the Servicer shall afford
the Trustee and its authorized agents reasonable access during normal business
hours to the Servicer's records relating to the Contracts and will cause its
personnel to assist in any examination of such records
53
by the Trustee or any of its authorized agents. The examination
referred to in this Section will be conducted in a manner which does not
interfere unreasonably with the Servicer's normal operations or customer or
employee relations. Without otherwise limiting the scope of the examination
the Trustee may make, the Trustee or its authorized agents, using generally
accepted audit procedures, may in their discretion verify the status of each
Contract and review the records relating thereto for conformity to Monthly
Reports prepared pursuant to Article VII and compliance with the standards
represented to exist as to each Contract in this Agreement
(b) At all times during the term hereof, the Servicer shall keep
available a copy of the Contract Schedule at its principal executive office
for inspection by Certificateholders.
(c) On or before each Determination Date, the Servicer will, upon the
written request of the Trustee, provide to the Trustee a list of outstanding
Contracts, setting forth the principal balance of each such Contract as of the
Due Period immediately preceding such Determination Date.
(d) Notwithstanding the provisions of this Section 5.04, the Trustee
shall at no time have any duty or obligation to examine any records of the
Servicer or to recalculate or otherwise verify the accuracy of any certificate
or report prepared by the Servicer (including certificates or reports as to
the amount required to be deposited into the Certificate Account), and no
implied duty to do so shall be asserted against the Trustee.
Section 5.05 Establishment of and Deposits in the Certificate
Account. On or before the Closing Date, the Trustee shall have established,
and thereafter shall maintain, a Certificate Account which is an Eligible
Account, in the form of one or more separate custodial accounts, titled
"Manufactured Housing Contract Senior/Subordinate Pass-Through Certificates,
2001-C (Vanderbilt Mortgage and Finance, Inc., Seller), in trust for the
Trustee." The Trustee shall cause monies in the Certificate Account to be
invested in Eligible Investments as directed in writing by the Servicer, which
shall mature or, in the case of a money market fund, be redeemed not later
than the Business Day immediately preceding the Remittance Date next following
the date of such investment (except that if such Eligible Investment is an
obligation of the institution that maintains the Certificate Account, then
such Eligible Investments shall mature or, in the case of a money market fund,
be redeemed not later than such Remittance Date) and shall not be sold or
disposed of prior to its maturity. All such Eligible Investments shall be made
in the name of the Trustee. The Servicer shall promptly notify the Trustee
upon obtaining knowledge that an instrument or account in which the
Certificate Account is invested has ceased to be an Eligible Investment or
Eligible Account. All net income and gain realized from any such investments,
to the extent provided by this Agreement, shall be added to the Certificate
Account.
The Servicer shall deposit in the Certificate Account, as promptly as
practicable (but not later than the close of business of the second Business
Day) following receipt thereof:
(1) All amounts received from Obligors with respect to principal of
and interest on the Contracts;
(2) All Net Liquidation Proceeds with respect to the Contracts;
(3) All amounts required to be deposited by Vanderbilt pursuant to
Sections 3.05(a) and
54
(b) with respect to the Contracts;
(4) All Monthly Advances with respect to the Contracts pursuant to
Section 6.04; and
(5) All amounts required to be withdrawn from an REO Account and
deposited in the Certificate Account in accordance with Section
5.17.
Section 5.06 Payment of Taxes. If the Servicer becomes aware of the
nonpayment by an Obligor of a personal property tax or other tax or charge
which may result in a lien upon a Manufactured Home prior to, or equal to or
coordinate with, the lien of the related Contract, the Servicer, consistent
with Section 5.02, shall take action to avoid the attachment of any such lien.
If the Servicer shall have paid any such personal property tax or other tax or
charge directly on behalf of an Obligor, the Servicer shall seek reimbursement
therefor only from the related Obligor (except as provided in the last
sentence of this Section) and may separately add such amount to the Obligor's
obligation as provided by the Contract, but, for the purposes of this
Agreement, may not add such amount to the remaining principal balance of the
Contract. If the Servicer shall have repossessed a Manufactured Home on behalf
of the Certificateholders and the Trustee, the Servicer shall pay the amount
of any such personal property tax or other tax or charge arising during the
time such Manufactured Home is in the Servicer's possession, unless the
Servicer is contesting in good faith such personal property tax or other tax
or charge or the validity of the claimed lien on such Manufactured Home. If
the Obligor does not reimburse the Servicer for payment of taxes pursuant to
this Section and the related Contract is liquidated after a default, the
Servicer shall be reimbursed for its payment of such taxes out of the related
Liquidation Proceeds.
Section 5.07 Enforcement.
(a) The Servicer, consistent with Section 5.02, will act with respect
to the Contracts in such manner as will maximize the receipt of principal and
interest on such Contracts.
(b) The Servicer shall xxx to enforce or collect upon Contracts, in
its own name, if possible, or as agent for the Trust Fund. If the Servicer
elects to commence a legal proceeding to enforce a Contract, the act of
commencement shall be deemed to be an automatic assignment of the Contract to
the Servicer for purposes of collection only. If, however, in any enforcement
suit or legal proceeding it is held that the Servicer may not enforce a
Contract on the ground that it is not a real party in interest or a holder
entitled to enforce the Contract, the Trustee on behalf of the
Certificateholders shall, at the Servicer's expense, take such steps as the
Servicer deems necessary to enforce the Contract, including bringing suit in
its name or the names of the Certificateholders. If there has been a recovery
of attorneys' fees in favor of the Servicer or the Trust Fund in an action
involving the enforcement of a Contract, the Servicer shall be reimbursed out
of such recovery for its out-of-pocket attorney's fees and expenses incurred
in such enforcement action.
(c) The Servicer shall exercise any rights of recourse against third
persons that exist with respect to any Contract in accordance with Section
5.02. In exercising recourse rights, the Servicer is authorized on the
Trustee's behalf to reassign the Contract or to resell the related
55
Manufactured Home to the Person against whom recourse exists at the price set
forth in the document creating the recourse.
(d) The Servicer may grant to the Obligor on any Contract any rebate,
refund or adjustment out of the Certificate Account that is required because
of an overpayment in connection with the prepayment in full of such Contract
or otherwise. The Servicer will not permit any rescission or cancellation of
any Contract.
Section 5.08 Transfer of the Certificate Account. The Trustee may
transfer the Certificate Account to a different depository institution from
time to time, so long as the Certificate Account remains an Eligible Account.
The Trustee shall give notice of any transfer of the Certificate Account to
the Rating Agencies prior to such transfer.
Section 5.09 Maintenance of Hazard Insurance Policies.
(a) Except as otherwise provided in subsection (b) of this Section
5.09, the Servicer shall cause to be maintained with respect to each Contract
one or more Hazard Insurance Policies which provide, at a minimum, the same
coverage as a standard form fire and extended coverage insurance policy that
is customary for manufactured housing, issued by a company authorized to issue
such policies in the state in which the Manufactured Home is located, and in
an amount which is not less than the maximum insurable value of such
Manufactured Home or the principal balance due from the Obligor on the related
Contract, whichever is less; provided that such Hazard Insurance Policies may
provide for customary deductible amounts, and provided further that the amount
of coverage provided by each Hazard Insurance Policy shall be sufficient to
avoid the application of any co-insurance clause contained therein. If a
Manufactured Home is located within a federally designated special flood
hazard area, the Servicer shall also cause such flood insurance to be
maintained, which coverage shall be at least equal to the minimum amount
specified in the preceding sentence or such lesser amount as may be available
under the federal flood insurance program. Each Hazard Insurance Policy caused
to be maintained by the Servicer shall contain a standard loss payee clause in
favor of the Servicer and its successors and assigns. If any Obligor is in
default in the payment of premiums on its Hazard Insurance Policy or Policies,
the Servicer shall pay such premiums out of its own funds, and may add
separately such premium to the Obligor's obligation as provided by the
Contract, but may not add such premium to the remaining principal balance of
the Contract for purposes of this Agreement. If the Obligor does not reimburse
the Servicer for payment of such premiums and the related Contract is
liquidated after a default, the Servicer shall be reimbursed for its payment
of such premiums out of the related Liquidation Proceeds.
(b) The Servicer may, in lieu of causing individual Hazard Insurance
Policies to be maintained with respect to each Manufactured Home pursuant to
subsection (a) of this Section 5.09, and shall, to the extent that the related
Contract does not require the Obligor to maintain a Hazard Insurance Policy
with respect to the related Manufactured Home, maintain one or more blanket
insurance policies covering losses as provided in subsection (a) of this
Section resulting from the absence or insufficiency of individual Hazard
Insurance Policies. Any such blanket policy shall be substantially in the form
that is the industry standard for blanket insurance policies issued to cover
Manufactured Homes and in the amount sufficient to cover all losses on the
Contracts. The Servicer shall pay, out of its own funds, the premium for such
policy on the
56
basis described therein and shall deposit in the Certificate Account,
on the Business Day next preceding the Determination Date following the Due
Period in which the insurance proceeds from claims in respect of any Contracts
under such blanket policy are or would have been received, the deductible
amount with respect to such claims. The Servicer shall not, however, be
required to deposit any deductible amount with respect to claims under
individual Hazard Insurance Policies maintained pursuant to subsection (a) of
this Section.
(c) If the Servicer shall have repossessed a Manufactured Home on
behalf of the Trustee or foreclosed upon or otherwise acquired any Mortgaged
Property, the Servicer shall either (i) maintain at its expense a Hazard
Insurance Policy with respect to such Manufactured Home or Mortgaged Property
meeting the requirements of subsections (a) or (b), except that the Servicer
shall be responsible for depositing any deductible amount with respect to all
claims under individual Hazard Insurance Policies, or (ii) indemnify the Trust
Fund against any damage to such Manufactured Home prior to resale or other
disposition.
(d) Any cost incurred by the Servicer in maintaining any of the
foregoing insurance, for the purpose of calculating monthly distributions to
Certificateholders, shall not be added to the amount owing under the Contract,
notwithstanding that the terms of the Contract so permit. The Servicer shall
not be entitled to reimbursement from Vanderbilt, the Trustee or the
Certificateholders for such costs. Such costs (other than the cost of the
blanket policy) shall only be recovered out of late payments by the Obligor
for such premiums or, if the related Contract is liquidated after a default,
out of the related Liquidation Proceeds.
Section 5.10 Fidelity Bond and Errors and Omissions Insurance. The
Servicer shall maintain, at its own expense, a blanket fidelity bond and an
errors and omissions insurance policy, with broad coverage with responsible
companies acceptable to the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation, on all officers, employees or other
persons acting in any capacity with regard to the Contracts to handle funds,
money, documents and papers relating to the Contracts. Any such fidelity bond
and errors and omissions insurance shall protect and insure the Servicer
against losses, including forgery, theft, embezzlement, fraud, errors and
omissions and negligent acts of such persons. No provision of this Section
5.10 requiring such fidelity bond and errors and omissions insurance shall
diminish or relieve the Servicer from its duties and obligations as set forth
in this Agreement. The minimum coverage under any such bond and insurance
policy, shall be in an amount as is customary for servicers that service a
portfolio of manufactured housing installment sales contracts of $100 million
or more and that are generally acceptable as servicers to institutional
investors. Upon request of the Trustee, the Servicer shall cause to be
delivered to the Trustee a certified true copy of such fidelity bond and
insurance policy and a statement from the surety and the insurer that such
fidelity bond or insurance policy shall in no event be terminated or
materially modified without 30 days' prior written notice to the Trustee.
Section 5.11 Collections under Hazard Insurance Policies; Consent to
Transfers of Manufactured Homes; Assumption Agreements.
(a) In connection with its activities as administrator and servicer
of the Contracts, the Servicer agrees to present, on behalf of itself, the
Trustee and Certificateholders, claims to the insurer under any Hazard
Insurance Policies and, in this regard, to take such reasonable action as
57
shall be necessary to permit recovery under any Hazard Insurance Policies. Any
amounts collected by the Servicer under any such Hazard Insurance Policies
shall be deposited within two Business Days after receipt in the Certificate
Account pursuant to Section 5.05, except to the extent they are applied to the
restoration of the related Manufactured Home or released to the related
Obligor in accordance with the normal servicing procedures of the Servicer.
(b) The Servicer shall not withhold its consent to any transfer of
ownership of a Manufactured Home in accordance with the related Contract
unless the proposed transferee does not meet the Servicer's then applicable
underwriting standards (exclusive of down payment requirements). In addition,
the Servicer shall not withhold such consent if such withholding of consent is
not permitted under applicable law and governmental regulations.
(c) In any case in which a Manufactured Home is to be conveyed to a
Person by an Obligor, and such Person is to enter into an assumption agreement
or modification agreement or supplement to the Contract, upon the closing of
such conveyance, the Servicer shall cause the originals of the assumption
agreement, the release (if any), or the modification or supplement to the
Contract to be deposited with the Contract File, the Land-and-Home Contract
File or the Mortgage Loan File, as applicable, for such Contract. Any fee
collected by the Servicer for entering into an assumption or substitution of
liability agreement with respect to such Contract will be retained by the
Servicer as additional servicing compensation. In connection with any such
assumption, the rate of interest borne by, and all other material terms of,
the related Contract shall not be changed.
(d) Notwithstanding any of the foregoing, the Servicer shall not
permit the extension of the maturity date of any Contract beyond the
latest-occurring scheduled maturity date of any Contract as of the Cut-off
Date.
Section 5.12 Realization upon Defaulted Contracts. Subject to
applicable law, the Servicer shall repossess, foreclose upon or otherwise
comparably convert the ownership of Manufactured Homes and any related
Mortgaged Property securing all Contracts that come into default and which the
Servicer believes in its good faith business judgment will not be brought
current; provided, however, that notwithstanding anything else in this
Agreement to the contrary, but subject to the requirements of law, the
Servicer shall commence repossession, foreclosure and other realization
procedures in respect of any Contract that is at any one time delinquent as to
all or part of five or more (or ten or more, in the case of Bi-weekly
Contracts and Semi-Monthly Contracts) scheduled payments; provided that if the
Servicer has actual knowledge that a Mortgaged Property is affected by
hazardous waste, then the Servicer shall not cause the Trust Fund to acquire
title to such Mortgaged Property in a foreclosure or similar proceeding. For
purposes of the last proviso in the preceding sentence, the Servicer shall not
be deemed to have actual knowledge that a Mortgaged Property is affected by
hazardous waste unless it shall have received written notice that hazardous
waste is present on such property and such written notice has been made a part
of the Servicing File with respect to the related Contract. Such written
notice shall be provided to the Trustee. In the event that the Trustee is
responsible for foreclosing on a Contract, if the Trustee has actual knowledge
that a Mortgaged Property is affected by hazardous waste, then the Trustee
shall not cause the Trust Fund to acquire title to such Mortgaged Property in
a foreclosure or similar proceeding. In connection with such repossession,
foreclosure or other conversion, the Servicer shall follow such practices and
58
procedures as it shall deem necessary or advisable and as shall be consistent
with Section 5.02. Subject to the foregoing proviso, in the event that title
to any Mortgaged Property is acquired in foreclosure or by deed in lieu of
foreclosure, the deed or certificate of sale shall be issued to the Trustee,
as Trustee, or, at its election, to its nominee on behalf of the Trustee, as
Trustee. The Servicer shall manage, conserve and protect such Manufactured
Homes and any related Mortgaged Property for the purposes of their prompt
disposition and sale, and shall dispose of such Manufactured Homes and any
related Mortgaged Property on such terms and conditions as it deems in the
best interests of the Certificateholders. In connection with such activities,
the Servicer shall follow such practices and procedures as are consistent with
Section 5.02.
Section 5.13 Costs and Expenses. All costs and expenses incurred by
the Servicer in carrying out its duties under this Agreement, including all
fees and expenses incurred in connection with the enforcement of Contracts
(including enforcement of defaulted Contracts and repossessions of
Manufactured Homes securing such Contracts), shall be paid by the Servicer and
the Servicer shall not be entitled to reimbursement hereunder, except to the
extent such reimbursement is specifically provided for in this Agreement.
Notwithstanding the foregoing, the Servicer shall be reimbursed out of the
Liquidation Proceeds of a defaulted Contract for Liquidation Expenses incurred
by it in realizing upon the related Manufactured Home and any related
Mortgaged Property, including, but not limited to: (i) costs of refurbishing
and securing such Manufactured Home; (ii) transportation expenses incurred in
moving the Manufactured Home; (iii) reasonable legal fees and expenses of
outside counsel; (iv) rental expenses (including the payment of rent not paid
by the defaulting Obligor) incurred in maintaining a leasehold interest for
the Manufactured Home; and (v) sales commissions paid to (a) Persons that are
not Affiliates of the Servicer or (b) Affiliates of the Servicer, if such
sales commission is no greater than the sales commission that would be paid to
a Person that is not an Affiliate of the Servicer. The Servicer shall not
incur the foregoing Liquidation Expenses unless it determines in its good
faith business judgment that incurring such expenses will increase the Net
Liquidation Proceeds from such Manufactured Home.
Notwithstanding anything in this Agreement to the contrary, so long
as Vanderbilt is the Servicer, the Servicer, in its sole discretion, may, but
is not obligated to, liquidate a defaulted Contract by depositing into the
Certificate Account, as Liquidation Proceeds, an amount equal to (i) the
outstanding principal balance of such Contract plus accrued and unpaid
interest thereon to the Due Date in the Due Period in which such deposit is
made less (ii) $2,000. The Servicer shall not be reimbursed for any
Liquidation Expenses incurred in connection with such Contract and shall
retain any liquidation proceeds thereafter collected in liquidating such
Contract.
Section 5.14 Trustee to Cooperate. Upon payment in full of any
Contract, the Servicer will notify the Trustee on the next Determination Date
by a certificate of a Servicing Officer (which certification shall include a
statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the related
Certificate Account pursuant to Section 5.05 have been deposited). The
Servicer is authorized to execute an instrument in satisfaction of such
Contract and any related Mortgage and do such other acts and execute such
other documents as the Servicer deems necessary to discharge the Obligor
thereunder and eliminate the security interest in the Manufactured Home and
any related Mortgaged Property related thereto. The Servicer shall determine
when a Contract has been paid in full; to the extent insufficient payments are
received on a Contract mistakenly determined by
59
the Servicer to be prepaid or paid in full and satisfied, the shortfall shall
be paid by the Servicer out of its own funds by deposit into the Certificate
Account. Upon request of a Servicing Officer, the Trustee shall, at the
expense of the Servicer, perform such other acts as are reasonably requested
by the Servicer (including, without limitation, the execution of documents)
and otherwise cooperate withthe Servicer in enforcement of rights and remedies
with respect to Contracts,and the Trustee shall not be liable or responsible
for the execution of any documents or performance of any acts requested by the
Servicer pursuant to this Section.
Section 5.15 Servicing and Other Compensation. The Servicer, as
compensation for its activities hereunder including, without limitation, the
payment of fees and expenses of the Trustee pursuant to Section 10.05, shall
be entitled to receive on each Remittance Date the Monthly Servicing Fee
pursuant to, and to the extent provided in, Section 6.02. In addition, the
Servicer may obtain any additional compensation permitted pursuant to this
Agreement.
Additional servicing compensation in the form of Late Payment Fees or
Extension Fees and any transfer of equity or assumption fees shall be retained
by the Servicer.
The Servicer shall not be reimbursed for its costs and expenses in
servicing the Contracts except as provided pursuant to Sections 5.06, 5.09 and
5.13.
Section 5.16 Custody of Contracts.
(a) Subject to the terms and conditions of this Section and Section
3.04(a), the Servicer shall maintain custody of the Contract Files as
custodian for the benefit of the Certificateholders and the Trustee. The
Trustee, or a custodian appointed by or on behalf of the Trustee, shall
maintain custody of the Land-and-Home Contract Files and the Mortgage Loan
Files.
(b) The Servicer agrees to maintain the related Contract Files at its
offices where they are presently maintained, or at such other offices of the
Servicer in the State of Tennessee as shall from time to time be identified to
the Trustee by ten days' prior written notice. The Servicer may temporarily
move individual Contract Files or any portion thereof without notice as
necessary to conduct collection and other servicing activities in accordance
with its customary practices and procedures.
(c) As custodian, the Servicer shall have and perform the following
powers and duties:
(i) hold the Contract Files on behalf of the Certificateholders and
the Trustee, maintain accurate records pertaining to each Contract to
enable it to comply with the terms and conditions of this Agreement,
maintain a current inventory thereof;
(ii) implement policies and procedures in writing and signed by a
Servicing Officer, with respect to persons authorized to have access to
the Contract Files on the Servicer's premises and the receipting for
Contract Files taken from their storage area by an employee of the
Servicer for purposes of servicing or any other purposes; and
60
(iii) attend to all details in connection with maintaining custody
of the Contract Files on behalf of the Certificateholders and the
Trustee.
(d) In performing its duties under this Section, the Servicer agrees
to act with reasonable care, using that degree of skill and care that it
exercises with respect to similar contracts owned and/or serviced by it, but
in no event using a degree of skill and care that is lower than that used
generally in the servicing industry for such contracts. The Servicer shall
promptly report to the Trustee any failure by it to hold the Contract Files as
herein provided and shall promptly take appropriate action to remedy any such
failure. In acting as custodian of the Contract Files, the Servicer agrees
further not to assert any beneficial ownership interests in the Contracts or
the Contract Files. The Servicer agrees to indemnify the Certificateholders
and the Trustee for any and all liabilities, obligations, losses, damages,
payments, costs or expenses of any kind whatsoever which may be imposed on,
incurred or asserted against the Certificateholders or the Trustee as the
result of any act or omission by the Servicer relating to the maintenance and
custody of the Contract Files; provided, however, that the Servicer will not
be liable to the Certificateholders for any portion of any such amount
resulting from the negligence or willful misconduct of any Certificateholder
or the Trustee and will not be liable to the Trustee for any portion of such
amount resulting from the negligence or willful misconduct of the Trustee. The
agreement of the Servicer to indemnify the Trustee shall survive the
resignation or removal of the Trustee and the termination of this Agreement.
Section 5.17 REMIC Compliance. The parties intend that the Trust Fund
formed hereunder shall constitute, and that the affairs of the Trust Fund
shall be conducted so as to qualify it as, a "real estate mortgage investment
conduit" as defined in and in accordance with the REMIC Provisions. In
furtherance of such intention, the Servicer shall, to the extent permitted by
applicable law, act as agent, and is hereby appointed to act as agent, of the
Trust Fund and shall on behalf of the Trust Fund: (a) prepare, file and
present to the Trustee to sign, or cause to be prepared, filed and presented
to the Trustee to be signed, all required federal tax returns for the Trust
Fund, including, but not limited to, Form 1066 using a calendar year as the
taxable year for the Trust Fund when and as required by the REMIC Provisions
and other applicable federal income tax laws; (b) make an election, on behalf
of the Trust Fund, to be treated as a REMIC on the Form 1066 for its first
taxable year, in accordance with the REMIC Provisions; (c) prepare and
forward, or cause to be prepared and forwarded, to the Certificateholders all
information reports as and when required to be provided to them in accordance
with the REMIC Provisions; (d) take such other actions as are necessary or
appropriate to maintain the status of the Trust Fund as a REMIC; and (e) serve
as tax matters person for the Trust Fund pursuant to Treasury Regulations
Section 1.860F-4(d) or serve as attorney-in-fact and agent for any Person that
is the tax matters person. Neither the Trustee nor the Servicer shall take any
action or omit to take any action if such action or omission (as the case may
be) would cause the termination of the REMIC status of the Trust Fund;
provided, however, that neither the Trustee nor the Servicer shall be required
to take any action if a Responsible Officer of the Trustee or the Servicer, as
applicable, in good faith believes such action or omission to be inconsistent
with any other provision of this Agreement. Vanderbilt and the Servicer shall
cooperate with the Servicer or its agent for such purpose in supplying any
information within their control that is necessary to enable the Servicer to
perform its duties under this Section. The Holder of the Class R Certificate,
by purchasing such Class R Certificate, (a) shall be deemed to consent to the
appointment of the Servicer as (i) the tax
61
matters person for the Trust Fund and (ii) the attorney-in-fact and
agent for any person that is the tax matters person if the Servicer is unable
to serve as the tax matters person and (b) agrees to execute any documents
required to give effect to clause (a) of this sentence.
The Holder of the Class R Certificate, by purchasing such Class R
Certificate, agrees to give the Servicer written notice that it is a
"pass-through interest holder" within the meaning of Temporary Treasury
Regulations section 1.67-3T(a)(2)(i)(A) immediately upon becoming the Holder
of the Class R Certificate, if it is, or is holding the Class R Certificate on
behalf of, a "pass-through interest holder."
In the event that any tax, including interest, penalties, additional
amounts or additions to tax (a "Tax"), is imposed on the Trust Fund, such tax
shall be charged against amounts otherwise required to be distributed on the
Class R Certificate. The Servicer shall notify the Trustee if any Tax is
imposed on the Trust Fund and the amount of any such Tax. The Trustee is
hereby authorized to retain, or cause the Paying Agent to retain, from amounts
otherwise required to be distributed on the Class R Certificate, sufficient
funds to pay or provide for the payment of, and to actually pay, or cause the
Paying Agent to pay, such Tax as is legally owed by the Trust Fund (but such
authorization shall not prevent the Trustee from contesting any such Tax in
appropriate proceedings, and withholding payment of such Tax, if permitted by
law, pending the outcome of such proceedings). To the extent that sufficient
amounts cannot be so retained to pay or provide for the payment of any tax
imposed on gain realized from any prohibited transaction (as defined in the
REMIC Provisions), the Trustee is hereby authorized to and, upon the receipt
of written notice of the existence of any tax liability, shall segregate, into
a separate non-interest-bearing account, the net income from such prohibited
transactions and pay, or cause the Paying Agent to pay, such Tax. In the event
any (i) amounts initially retained from amounts required to be distributed on
the Class R Certificate and (ii) income so segregated and applied towards the
payment of such Tax shall not be sufficient to pay such Tax in its entirety,
the amount of the shortfall shall be paid from funds in each Certificate
Account after distributions of principal and interest to the related
Certificateholders pursuant to Section 6.01 in respect of the related
Remittance Date notwithstanding anything to the contrary contained herein. To
the extent any such segregated income or funds from the Certificate Account
are paid to the Internal Revenue Service, the Trustee shall retain, or cause
to be retained, an amount equal to the amount of such income or funds so paid
from future amounts otherwise required to be distributed on the Class R
Certificate and shall deposit such retained amounts in the Certificate Account
for distribution to the Holders of Certificates other than the Class R
Certificate.
Except as provided in Section 3.05 and except in connection with REO
Property, the Trustee shall not sell any Contract or any other asset of the
Trust Fund unless either (i) it has received an Opinion of Counsel to the
effect that such sale will not result in the imposition of taxes on
"prohibited transactions" on the Trust Fund as defined in Section 860F of the
Code, or (ii) the proceeds of such sale, net of any related taxes on
"prohibited transactions" on the Trust Fund as defined in Section 860F of the
Code, will at least equal the Repurchase Price of such Contract.
In the event that any Manufactured Home is acquired in a repossession
or foreclosure (an "REO Property"), the Servicer shall sell any REO Property
within 3 years of its acquisition by the Trust Fund, unless, at the request
and expense of the Servicer, the Servicer seeks, and
62
subsequently receives, an Opinion of Counsel, addressed to the Trustee and the
Servicer, to the effect that the holding by the Trust Fund of such REO
Property subsequent to 3 years after its acquisition will not result in the
imposition of taxes on "prohibited transactions" of the Trust Fund as defined
in Section 860F of the Code or cause the Trust Fund to fail to qualify as a
REMIC at any time that any Certificates are outstanding. The Servicer shall
manage, conserve, protect and operate each REO Property solely for the purpose
of its prompt disposition and sale in a manner that does not cause any such
REO Property to fail to qualify as "foreclosure property" within the meaning
of Section 860G(a)(8) or result in the receipt by the REMIC of any "income
from non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the
Code or any "net income from foreclosure property" which is subject to
taxation under the REMIC Provisions. Pursuant to its efforts to sell such REO
Property, the Servicer shall either itself or through an agent selected by the
Servicer protect and conserve such REO Property in the same manner and to such
extent as is customary in the locality where such REO Property is located and
may, incident to its conservation and protection of the interests of the
Certificateholders, rent the same, or any part thereof, as the Servicer deems
to be in the best interest of the Servicer and the Certificateholders for the
period prior to the sale of such REO Property.
The Servicer shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and
apart from its own funds and general assets and shall establish and maintain
with respect to each REO Property an account held in trust for the Trustee for
the benefit of the Certificateholders (each, an "REO Account"), which shall be
an Eligible Account. The Servicer shall be entitled to retain or withdraw any
interest income paid on funds deposited in each REO Account by the depository.
The Servicer shall deposit, or cause to be deposited, within two
Business Days after receipt on a daily basis in each REO Account all revenues
received with respect to the related REO Property and shall withdraw therefrom
funds necessary for the proper operation, management and maintenance of the
REO Property. On or before each Determination Date, the Servicer shall
withdraw from each REO Account and deliver to the Trustee for deposit into the
Certificate Account the income from the REO Property on deposit in the REO
Account, net of its reasonable fees and expenses.
The disposition of REO Property shall be carried out by the Servicer
at such price and upon such terms and conditions as the Servicer shall deem
necessary or advisable, as shall be normal and usual in its general servicing
activities.
The proceeds from the REO disposition, net of any reimbursement to
the Servicer as provided above, shall be deposited in the REO Account and
shall be deposited in the Certificate Account when the related Contract
becomes a Liquidated Contract.
Section 5.18 Establishment of and Deposits in the Distribution
Account. On or before the Closing Date, the Trustee shall have established,
and thereafter shall maintain, a Distribution Account which is an Eligible
Account, in the form of one or more separate custodial accounts, titled
"Manufactured Housing Contract Senior/Subordinate Pass-Through Certificates,
Series 2001-C (Vanderbilt Mortgage and Finance, Inc., Seller), in trust for
the Trustee." The monies in the Distribution Account shall not be invested.
One Business Day prior to each
63
Remittance Date, the Trustee shall deposit in the Distribution Account the
Available Distribution Amount.
[End of Article V]
64
Article VI
PAYMENTS TO THE CERTIFICATEHOLDERS; WITHDRAWALS FROM
CERTIFICATE ACCOUNT
Section 6.01 Monthly Payments.
(a) On each Remittance Date the Trustee shall, based upon the
information set forth in the Monthly Report for such Remittance Date, withdraw
from the Distribution Account an amount equal to the Available Distribution
Amount for such Remittance Date and apply such amount as set forth below:
A. On each Remittance Date on which the Class M-1 and Class B
Principal Distribution Test is not met, the Available Distribution Amount will
be distributed in the following amounts in the following order of priority:
(i) interest accrued during the related Interest Period on the Class
A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates and
Class A-4 Certificates, at their respective Remittance Rates on the
outstanding Class A-1 Principal Balance, Class A-2 Principal Balance,
Class A-3 Principal Balance and Class A-4 Principal Balance,
respectively, together with any previously undistributed shortfalls in
interest due on the Class A-1 Certificates, Class A-2 Certificates, Class
A-3 Certificates and Class A-4 Certificates, respectively, in respect of
prior Remittance Dates; if the Available Distribution Amount is not
sufficient to distribute the full amount of interest due on the Class A-1
Certificates, Class A-2 Certificates, Class A-3 Certificates and Class
A-4 Certificates, the Available Distribution Amount will be distributed
on such Classes of Certificates pro rata on the basis of the interest due
thereon;
(ii) the Formula Principal Distribution Amount in the following
order of priority:
(a) to the Class A-1 Certificates until the Class A-1 Principal Balance is
reduced to zero;
(b) to the Class A-2 Certificates until the Class A-2 Principal Balance is
reduced to zero;
(c) to the Class A-3 Certificates until the Class A-3 Principal Balance is
reduced to zero;
(d) to the Class A-4 Certificates until the Class A-4 Principal Balance is
reduced to zero;
(iii) interest accrued during the related Interest Period at the
Class A-5 Remittance Rate on the Class A-5 Principal Balance to the Class
A-5 Certificates, together with any previously undistributed shortfalls
in interest due on the Class A-5 Certificates in respect of prior
Remittance Dates;
(iv) the remainder of the Formula Principal Distribution Amount, if
any, to the Class A-5 Certificates until the Class A-5 Principal Balance
is reduced to zero;
65
(v) interest accrued during the related Interest Period at the Class
M-1 Remittance Rate on the Class M-1 Principal Balance to the Class M-1
Certificates, together with any previously undistributed shortfalls in
interest due on the Class M-1 Certificates in respect of prior Remittance
Dates;
(vi) the remainder of the Formula Principal Distribution Amount, if
any, to the Class M-1 Certificates until the Class M-1 Principal Balance
is reduced to zero;
(vii) interest accrued during the related Interest Period at the
Class B-1 Remittance Rate on the Class B-1 Principal Balance to the Class
B-1 Certificates, together with any previously undistributed shortfalls
in interest due on the Class B-1 Certificates in respect of prior
Remittance Dates;
(viii) the remainder of the Formula Principal Distribution Amount,
if any, to the Class B-1 Certificates until the Class B-1 Principal
Balance is reduced to zero;
(ix) interest accrued during the related Interest Period at the
Class B-2 Remittance Rate on the Class B-2 Principal Balance to the Class
B-2 Certificates, together with any previously undistributed shortfalls
in interest due on the Class B-2 Certificates in respect of prior
Remittance Dates;
(x) the remainder of the Formula Principal Distribution Amount, if
any, to the Class B-2 Certificates until the Class B-2 Principal Balance
is reduced to zero;
(xi) any remaining amount, to pay Xxxxxxx the Guarantee
Reimbursement Amount, if any, with respect to the Class B-2 Certificates;
(xii) any remaining amount, to pay the Monthly Servicing Fee, to the
Servicer, if Vanderbilt is the Servicer;
(xiii) any remaining amount, to the holder of the Class R
Certificate;
B. On each Remittance Date on which the Class M-1 and Class B
Principal Distribution Test is met, the Available Distribution Amount will be
distributed in the following amounts in the following order of priority:
(i) interest accrued during the related Interest Period on the Class
A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates and
Class A-4 Certificates, at their respective Remittance Rates on the
outstanding Class A-1 Principal Balance, Class A-2 Principal Balance,
Class A-3 Principal Balance and Class A-4 Principal Balance,
respectively, together with any previously undistributed shortfalls in
interest due on the Class A-1 Certificates, Class A-2 Certificates, Class
A-3 Certificates and Class A-4 Certificates, respectively, in respect of
prior Remittance Dates; if the Available Distribution Amount is not
sufficient to distribute the full amount of interest due on the Class A-1
Certificates, Class A-2 Certificates, Class A-3 Certificates and Class
A-4 Certificates, the Available Distribution Amount will be distributed
on such Classes of Certificates pro rata on the basis of the interest due
thereon;
66
(ii) the Class A Percentage of the Formula Principal Distribution
Amount in the following order of priority:
(a) to the Class A-1 Certificates until the Class A-1 Principal Balance is
reduced to zero;
(b) to the Class A-2 Certificates until the Class A-2 Principal
Balance is reduced to zero;
(c) to the Class A-3 Certificates until the Class A-3 Principal
Balance is reduced to zero; and
(d) to the Class A-4 Certificates until the Class A-4 Principal
Balance is reduced to zero;
(iii) interest accrued during the related Interest Period at the
Class A-5 Remittance Rate on the Class A-5 Principal Balance to the Class
A-5 Certificates, together with any previously undistributed shortfalls
in interest due on the Class A-5 Certificates in respect of prior
Remittance Dates;
(iv) the remainder of the Class A Percentage of the Formula
Principal Distribution Amount, if any, to the Class A-5 Certificates
until the Class A-5 Principal Balance is reduced to zero;
(v) interest accrued during the related Interest Period at the Class
M-1 Remittance Rate on the Class M-1 Principal Balance to the Class M-1
Certificates, together with any previously undistributed shortfalls in
interest due on the Class M-1 Certificates in respect of prior Remittance
Dates;
(vi) the Class M-1 Percentage of the Formula Principal Distribution
Amount, if any, to the Class M-1 Certificates until the Class M-1
Principal Balance is reduced to zero;
(vii) interest accrued during the related Interest Period at the
Class B-1 Remittance Rate on the Class B-1 Principal Balance to the Class
B-1 Certificates, together with any previously undistributed shortfalls
in interest due on the Class B-1 Certificates in respect of prior
Remittance Dates;
(viii) the Class B Percentage of the Formula Principal Distribution
Amount to the Class B-1 Certificates until the Class B-1 Principal
Balance is reduced to zero;
(ix) interest accrued during the related Interest Period at the
Class B-2 Remittance Rate on the Class B-2 Principal Balance to the Class
B-2 Certificates, together with any previously undistributed shortfalls
in interest due on the Class B-2 Certificates in respect of prior
Remittance Dates;
(x) the remainder of the Formula Principal Distribution Amount to
the Class B-2 Certificates until the Class B-2 Principal Balance is
reduced to zero; provided,
67
however, if the Principal Balance of the Class A-1 Certificates,
Class A-2 Certificates, Class A-3 Certificates, Class A-4
Certificates, Class A-5 Certificates and Class M-1 Certificates have
not been reduced to zero on or before a Remittance Date, to the extent
that allocations in respect of principal to the Class B-2 Certificates
would reduce the Class B-2 Principal Balance below the Class B-2 Floor
Amount, then the amount of such excess principal will instead by
distributed, pro rata, to the Class A Certificates and the Class M-1
Certificates based on the respective Principal Balances of such
Certificates prior to distributions pursuant to clauses B(ii), (iv) and
(vi) above with respect to such Remittance Date. The allocations in
respect of such excess principal to the Class A Certificates will be in
the order of priority set forth in clauses (B)(ii) and (iv) above;
(xi) any remaining amounts, to pay Xxxxxxx the Guarantee
Reimbursement Amount, if any, with respect to the Class B-2 Certificates;
(xii) any remaining amounts, to pay the Monthly Servicing Fee, to
the Servicer, if Vanderbilt is the Servicer; and
(xiii) any remaining amounts, to the holder of the Class R
Certificate.
Notwithstanding the prioritization of the distribution of the Formula
Principal Distribution Amount among the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates and Class A-4 Certificates pursuant to
clauses A(ii) and B(ii) above, on each Remittance Date on and after the
Remittance Date, if any, on which a Deficiency Event occurs, the Available
Distribution Amount remaining after making the distributions of interest on
the Senior Certificates required by clauses A(i) and B(i) above will be
applied to distribute the Formula Principal Distribution Amount on each Class
of Class A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates and
Class A-4 Certificates pro rata in accordance with the outstanding Principal
Balance of each such Class of Certificates; provided, further, that (I) the
aggregate amounts distributed on the Certificates on account of principal
shall not exceed their respective Original Principal Balances.
The distributions on the Certificates on each Remittance Date shall
be made such that the Trustee shall distribute (x) to the holder of each Class
A Certificate as of the preceding Record Date an amount equal to the product
of (1) the aggregate Percentage Interest evidenced by such Class A Certificate
and (2) as applicable, the Class A-1 Distribution Amount, Class A-2
Distribution Amount, Class A-3 Distribution Amount, Class A-4 Distribution
Amount, Class A-5 Distribution Amount for such Remittance Date, (y) to the
holder of each Class M-1 Certificate as of the preceding Record Date an amount
equal to the product of (1) the aggregate Percentage Interest evidenced by
such Class M-1 Certificates and (2) the Class M-1 Distribution Amount for such
Remittance Date, and (z) to the holder of each Class B Certificate as of the
preceding Record Date an amount equal to the product of (1) the aggregate
Percentage Interest evidenced by such Class B Certificates and (2) as
applicable, the Class B-1 Distribution Amount or Class B-2 Distribution Amount
for such Remittance Date.
The Trustee shall pay each Certificateholder of record by check
mailed to such Certificateholder at the address for such Certificateholder
appearing on the Certificate Register; provided that if such Certificateholder
holds Certificates with original denominations aggregating at least $5,000,000
and has given the Trustee appropriate written instructions at least
68
5 Business Days prior to the related Record Date (which instructions, until
revised, shall remain operative for all Remittance Dates thereafter), the
Trustee shall pay such Certificateholder by wire transfer of funds. If on any
Determination Date the Servicer determines that there are no Contracts
outstanding and no other funds or assets in the Trust Fund other than the funds
in the Certificate Account, the Servicer promptly shall instruct the Trustee to
send the final distribution notice to each Certificateholder and make provision
for the final distribution in accordance with Section 11.01(b). Final payment
of any Certificate shall be made only upon presentation of such Certificate at
the office or agency of the Certificate Registrar.
(b) On each Remittance Date for which the applicable Monthly Report
indicates that one or more Interest Deficiency Withdrawals is required, after
making the withdrawals and applications described in Section 6.01(a), the
Trustee shall, based upon the information set forth in the related Monthly
Report:
(A) withdraw from the Distribution Account an amount equal to
the Interest Deficiency Withdrawal with respect to such Remittance
Date and apply such amount to payment of the Interest Deficiency
Amount in the following order of priority:
(ii) to the Class A-5 Certificates, the Class A-5 Interest
Deficiency Withdrawal, if any;
(iii) the Class M-1 Certificates, the Class M-1 Interest Deficiency
Withdrawal, if any; and
(iv) to the Class B-1 Certificates, the Class B-1 Interest
Deficiency Withdrawal, if any.
(c) On each Remittance Date, the Trustee shall, based upon the
information set forth in the Monthly Report for such Remittance Date, withdraw
from the Distribution Account (solely out of the Available Distribution Amount
for such Remittance Date after giving effect to the distributions made on the
Certificates (other than the Class R Certificate) pursuant to Section 6.01(a)
on such Remittance Date) and distribute to the Holder of the Class R
Certificate the Class R Distribution Amount for such Remittance Date. Such
distribution shall be made by a means that is mutually acceptable to the
Trustee and the Holder of the Class R Certificate.
(d) Each distribution with respect to a Book-Entry Certificate shall
be paid to the Depository, which shall credit the amount of such distribution
to the accounts of its Depository Participants in accordance with its normal
procedures. Each Depository Participant shall be responsible for disbursing
such distribution to the Certificate Owners that it represents and to each
indirect participating brokerage firm (a "brokerage firm" or "indirect
participating firm") for which it acts as agent. Each brokerage firm shall be
responsible for disbursing funds to the Certificate Owners that it represents.
All such credits and disbursements with respect to a Book-Entry Certificate
are to be made by the Depository and the Depository Participants in accordance
with the provisions of the Certificates. None of the Trustee, the Certificate
Registrar, Vanderbilt and the Servicer shall have any responsibility therefor
except as otherwise provided by applicable law.
69
(e) On each Remittance Date the Trustee shall withdraw from the
Certificate Account an amount equal to the related Guarantee Payment for such
Remittance Date received by it from Xxxxxxx pursuant to Section 6.05 and
distribute such amount to the Class B-2 Certificateholders.
Section 6.02 Permitted Withdrawals from the Certificate Account. The
Servicer may, and in the case of clause (vii) below shall, from time to time
as provided herein, make or cause withdrawals from the Certificate Account of
amounts deposited therein pursuant to Section 5.05 for the following purposes:
(i) to pay to Vanderbilt with respect to each Contract or property
acquired in respect thereof that has been purchased or replaced pursuant
to Section 3.05 all amounts received thereon that are specified in such
Section to be property of Vanderbilt;
(ii) to reimburse itself for the payment of taxes out of Liquidation
Proceeds relating to a Contract (to the extent not previously retained
from such Liquidation Proceeds prior to their deposit) or out of payments
expressly made by the related Obligor to reimburse the Servicer for such
taxes, as permitted by Section 5.06;
(iii) if neither Vanderbilt nor a wholly owned subsidiary of
Vanderbilt is the Servicer, to pay to itself the Monthly Servicing Fee;
(iv) to reimburse itself or a previous Servicer out of Liquidation
Proceeds (to the extent not previously retained from Liquidation Proceeds
prior to their deposit in the Certificate Account) in respect of a
Manufactured Home and out of payments by the related Obligor (to the
extent of payments expressly made by the Obligor to reimburse the
Servicer for insurance premiums) for expenses incurred by it in respect
of such Manufactured Home that are specified as being reimbursable to it
pursuant to Section 5.07, 5.09 or 5.13 or to a previous Servicer under
Section 8.08;
(v) to reimburse itself for any Nonrecoverable Advance or Monthly
Advances with respect to the Contracts in accordance with Section 6.04(c)
and for advances in respect of Liquidated Contracts in accordance with
Section 6.04(c);
(vi) to reimburse the Servicer for expenses incurred with respect to
the Contracts and reimbursable to the Servicer pursuant to Section 8.06
(such reimbursement to be made only from funds that would otherwise be
distributed on the Class R Certificate pursuant to Section 6.01(a)A(xiii)
or 6.01 (a)B(xiii));
(vii) to withdraw any amount deposited in the Certificate Account
that was not required to be deposited therein (including any collections
on the Contracts that, pursuant to Section 2.01(a), are not part of the
Trust Fund);
(viii) withdraw all amounts on deposit in the Certificate Account
which are to be deposited in the Distribution Account in respect of the
Available Distribution Amount;
(ix) withdraw amounts on deposit in the Certificate Account which
are to be deposited in the Distribution Account in respect of the
Interest Deficiency Withdrawal, if any; and
70
(x) withdraw any amounts necessary to pay any Taxes pursuant to
Section 5.17.
Since, in connection with withdrawals pursuant to clauses (i), (ii)
and (iv), the Servicer's entitlement thereto is limited to collections or
other recoveries on the related Contract, the Servicer shall keep and maintain
separate accounting, on a Contract by Contract basis, for the purpose of
justifying any withdrawal from the Certificate Account pursuant to such
clauses.
The Servicer shall report withdrawals with respect to each Due Period
pursuant to this Section 6.02 in the related Monthly Report.
Section 6.03 [Reserved]
Section 6.04 Monthly Advances by the Servicer.
(a) By the close of business on each Determination Date the Servicer
shall deposit in the Certificate Account, out of its own funds, the related
Monthly Advance; provided, however, that any such deposit out of the
Servicer's own funds shall be made only to the extent necessary to cause the
Available Distribution Amount to be large enough to permit the distribution on
the related Remittance Date of the amounts computed as set forth in clauses
A(i) through (x) or B(i) through (x), inclusive, as applicable, of Section
6.01(a).
(b) On each Remittance Date, the Servicer shall reimburse itself for
the Outstanding Amount Advanced to the extent of actual collections of late
scheduled payments on the related Contracts.
(c) If the Servicer determines that any advance made pursuant to
Section 6.04(a) has become a Nonrecoverable Advance and at the time of such
determination there exists an Outstanding Amount Advanced, then the Servicer
shall reimburse itself out of funds in the related Certificate Account for the
amount of such Nonrecoverable Advance, but only to the extent of such
Outstanding Amount Advanced.
Section 6.05 Limited Guarantee.
(a) No later than the third Business Day prior to each Remittance
Date, the Servicer (if other than Xxxxxxx) shall notify Xxxxxxx of the amount
of any Guarantee Payment for such Remittance Date. Not later than the Business
Day preceding each Remittance Date, Xxxxxxx shall deposit any such Guarantee
Payment for such Remittance Date into the related Certificate Account.
(b) The obligations of Xxxxxxx under this Agreement shall not
terminate upon or otherwise be affected by an Event of Default pursuant to
Article IX of this Agreement.
(c) The obligation of Xxxxxxx to provide the Limited Guarantee under
this Agreement shall terminate on the Final Remittance Date.
(d) The obligation of Xxxxxxx to make the Guarantee Payments
described in subsection (a) above shall be unconditional and irrevocable and
shall constitute an unsecured
71
obligation of Xxxxxxx and will rank on a parity with all other unsecured and
unsubordinated indebtedness of Xxxxxxx. Xxxxxxx acknowledges that its
obligation to make the Guarantee Payments described in subsection (a) above
shall be deemed a guarantee by Xxxxxxx of indebtedness of the Trust Fund for
money borrowed from the Class B-2 Certificateholders, and Xxxxxxx acknowledges
and agrees that it has no right of reimbursement, indemnity, exoneration,
contribution or other similar right of recovery arising from amounts expended
pursuant to its obligations under this Agreement, other than the right to
receive distributions, to the extent available, from the Trust Fund as
provided in this Agreement. In no event shall the amount paid on the Class B-2
Certificates in respect of principal pursuant to the Limited Guarantee exceed
the Original Class B-2 Principal Balance.
(e) If Xxxxxxx fails to make a Guarantee Payment in whole or in part,
Xxxxxxx shall promptly notify the Trustee, and the Trustee shall promptly
notify the Rating Agencies. Xxxxxxx shall promptly notify the Rating Agencies
in the event of any termination of the Limited Guarantee or any change of the
Person providing the Limited Guarantee, including but not limited to a change
by merger.
Section 6.06 Alternate Credit Enhancement. Xxxxxxx, at its option and
upon prior written notice to the Rating Agencies, may substitute an alternate
form of credit enhancement in place of the Limited Guarantee, provided that
(i) the Rating Agencies shall notify Clayton, Vanderbilt, the Servicer and the
Trustee in writing that such alternate form of credit enhancement shall not
result in a reduction in the then current ratings of the Certificates and (ii)
Xxxxxxx shall cause to be delivered to the Trustee an Opinion of Counsel to
the effect that such substitution of credit enhancement shall not adversely
affect the status of the Trust Fund as a REMIC. Such alternate form of credit
enhancement can be in the form of cash or securities deposited by Xxxxxxx or
any other Person in a segregated escrow, trust or collateral account or a
letter of credit, certificate insurance policy or surety bond provided by a
third party.
Section 6.07 Calculation of the Remittance Rates with respect to the
Floating Rate Certificates. On the second LIBOR Business Day immediately
preceding each Remittance Date, the Trustee shall determine LIBOR for the
Interest Period commencing on such Remittance Date and inform the Servicer (at
the facsimile number given to the Trustee in writing) of such rates. On each
Determination Date, the Servicer shall determine the Class A-1 Remittance Rate
for the related Remittance Date.
[End of Article VI]
72
Article VII
REPORTS
Section 7.01 Monthly Reports. Within two Business Days following each
Determination Date, the Servicer shall cause the Trustee to receive, a report
(the "Monthly Report"), which shall include the following information with
respect to the immediately following Remittance Date:
(a) the Class A-1 Distribution Amount, the Class A-2
Distribution Amount, the Class A-3 Distribution Amount, the Class
A-4 Distribution Amount, the Class A-5 Distribution Amount, the
Class M-1 Distribution Amount, the Class B-1 Distribution Amount and
the Class B-2 Distribution Amount for such Remittance Date;
(b) the amount of principal to be distributed on each Class of
the Class A-1 Certificates, Class A-2 Certificates, Class A-3
Certificates, Class A-4 Certificates, Class A-5 Certificates, Class
M-1 Certificates, Class B-1 Certificates and Class B-2 Certificates
on such Remittance Date, separately stating the amounts specified in
clauses (a) through (f) of the Formula Principal Distribution Amount
definition;
(c) the amount of interest to be distributed on each Class of
the Class A-1 Certificates, Class A-2 Certificates, Class A-3
Certificates, Class A-4 Certificates, Class A-5 Certificates, Class
M-1 Certificates, Class B-1 Certificates and Class B-2 Certificates
on such Remittance Date (separately identifying any Class A-1 Unpaid
Interest Shortfall, Class A-2 Unpaid Interest Shortfall, Class A-3
Unpaid Interest Shortfall, Class A-4 Unpaid Interest Shortfall,
Class A-5 Unpaid Interest Shortfall, Class M-1 Unpaid Interest
Shortfall, Class B-1 Unpaid Interest Shortfall and Class B-2 Unpaid
Interest Shortfall included in such distribution) and the Remittance
Rate for each such Class of Certificates for such Remittance Date;
(d) the remaining Class A-1 Principal Balance, Class A-2
Principal Balance, Class A-3 Principal Balance, Class A-4 Principal
Balance, Class A-5 Principal Balance, Class M-1 Principal Balance,
Class B-1 Principal Balance and Class B-2 Principal Balance after
giving effect to the payment of principal to be made on such
Remittance Date (on which interest will be calculated on the next
succeeding Remittance Date);
(e) the total amount of fees payable on such Remittance Date,
separately identifying the Monthly Servicing Fee, any related
reimbursement to Vanderbilt pursuant to Section 6.04, and any
related Late Payment Fees, Extension Fees and assumption fees paid
during the prior Due Period;
(f) the number and aggregate unpaid principal balance of the
Contracts with payments delinquent 31 to 59, 60 to 89, and 90 or
more days, respectively;
(g) the number of Contracts that were repurchased by Vanderbilt
in accordance with Section 3.05 during the prior Due Period,
identifying such Contracts and the Repurchase Price of such
Contracts;
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(h) the Pool Factor for the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates, Class
A-5 Certificates, Class M-1 Certificates, Class B-1 Certificates and
Class B-2 Certificates after giving effect to the payment of
principal to be made on such Remittance Date;
(i) the Class R Distribution Amount, if any, for such
Remittance Date, separately stating any Repossession Profits;
(j) the aggregate principal balances of all Contracts that are
not Liquidated Contracts and in respect of which the related
Manufactured Homes have been repossessed or foreclosed upon;
(k) the Aggregate Net Liquidation Losses through the Due Period
immediately preceding such Remittance Date;
(l) the amount, if any, by which the Class B-2 Formula
Distribution Amount exceeds the Remaining Amount Available for such
Remittance Date;
(m) the Class B-2 Principal Liquidation Loss Amount, if any,
for such Remittance Date;
(n) the Guarantee Payment with respect to the Class B-2
Certificates, if any, for such Remittance Date;
(o) the amount of any related unadvanced shortfalls for the
prior Due Period;
(p) the number and dollar amount of units repossessed during
the prior Due Period;
(q) the amount of any Principal Prepayments paid with respect
to the Contracts during the prior Due Period;
(r) the amount of any Scheduled Principal Payments to be made
with respect to the Contracts on such Remittance Date;
(s) the weighted average annual percentage rate of interest for
the Contracts remaining in the Contract Pool on such Remittance
Date;
(t) the Interest Deficiency Amount and Interest Deficiency
Withdrawal, if any, for each of the Class A-5, Class M-1 and Class
B-1 Certificates with respect to such Remittance Date; and
(u) a summary of withdrawals from the Certificate Account
pursuant to Section 6.02 of this Agreement.
The Trustee shall send copies of all Monthly Reports to the Rating
Agencies. The Trustee shall have no duty to recalculate or verify the
information provided to it by the Servicer.
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Section 7.02 Certificate of Servicing Officer. Each Monthly Report
pursuant to Section 7.01 shall be accompanied by a certificate of a Servicing
Officer substantially in the form of Exhibit G, certifying the accuracy of the
Monthly Report and that no Event of Default or event that with notice or lapse
of time or both would become an Event of Default has occurred, or if such
event has occurred and is continuing, specifying the event and its status.
Section 7.03 Other Data. In addition, the Servicer on request of the
Trustee shall furnish the Trustee such underlying data as may reasonably be
requested.
Section 7.04 Annual Statement as to Compliance. The Servicer will
deliver to Vanderbilt, the Trustee and the Rating Agencies on or before the
first day of the fifth month following the end of the Servicer's fiscal year,
initially November 1, 2002, an Officer's Certificate stating, as to each
signer thereof, that (i) a review of the activities of the Servicer during
such preceding fiscal year and of performance under this Agreement has been
made under such officer's supervision and (ii) to the best of such officer's
knowledge, based on such review, the Servicer has fulfilled all its
obligations under this Agreement throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and status thereof. The Servicer
shall notify the Trustee in the event of a change in the Servicer's fiscal
year.
Section 7.05 Annual Independent Public Accountants' Servicing Report.
On or before November 1 of each year, beginning with November 1, 2002, the
Servicer, at its expense, shall cause a firm of independent public accountants
which is a member of the American Institute of Certified Public Accountants to
furnish a statement to Vanderbilt, the Trustee and the Rating Agencies to the
effect that such firm has examined certain documents and records relating to
the servicing of the Contracts under this Agreement and, at the option of the
Servicer, manufactured housing installment sale contracts under pooling and
servicing agreements substantially similar to this Agreement with regard to
servicing procedures (such statement to have attached thereto a schedule
setting forth the pooling and servicing agreements covered thereby, including
this Agreement) and that, on the basis of such examination conducted
substantially in compliance with this Agreement or such agreements, as the
case may be, and generally accepted auditing standards, such servicing has
been conducted in compliance with this Agreement or such pooling and servicing
agreements, as the case may be, except for (i) such exceptions as such firm
believes to be immaterial and (ii) such other exceptions that, in the opinion
of such firm, generally accepted auditing standards require it to report. For
purposes of such statement, such firm may assume conclusively that all pooling
and servicing agreements among Vanderbilt, the Servicer and the Trustee
relating to certificates evidencing an interest in manufactured housing
contracts are substantially similar to one another except for any such pooling
and servicing agreement which by its terms specifically states otherwise.
Section 7.06 Statements to Certificateholders.
(a) Concurrently with each distribution to Certificateholders
pursuant to Article VI, the Trustee shall mail, or cause the Paying Agent to
mail, to the Certificateholders, at the addresses appearing on the Certificate
Register, a statement as of the related Remittance Date prepared by the
Servicer setting forth:
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(1) the Class A-1 Distribution Amount, the Class A-2 Distribution
Amount, the Class A-3 Distribution Amount, the Class A-4 Distribution
Amount, the Class A-5 Distribution Amount, the Class M-1 Distribution
Amount, the Class B-1 Distribution Amount, the Class B-2 Distribution
Amount and the Class R Distribution Amount for such Remittance Date;
(2) the amount of principal to be distributed on each Class of the
Class A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates,
Class A-4 Certificates, Class A-5 Certificates, Class M-1 Certificates,
Class B-1 Certificates and Class B-2 Certificates on such Remittance
Date, separately stating the amounts specified in clauses (a) through (f)
of the Formula Principal Distribution Amount definition;
(3) the amount of interest to be distributed on each Class of the
Class A-1 Certificates, Class A-2 Certificates, Class A-3 Certificates,
Class A-4 Certificates, Class A-5 Certificates, Class M-1 Certificates,
Class B-1 Certificates and Class B-2 Certificates on such Remittance Date
(separately identifying any Class A-1 Unpaid Interest Shortfall, Class
A-2 Unpaid Interest Shortfall, Class A-3 Unpaid Interest Shortfall, Class
A-4 Unpaid Interest Shortfall, Class A-5 Unpaid Interest Shortfall, Class
M-1 Unpaid Interest Shortfall, Class B-1 Unpaid Interest Shortfall or
Class B-2 Unpaid Interest Shortfall included in such distribution) and
the related Remittance Rate for each such Class for such Remittance Date;
(4) the remaining Class A-1 Principal Balance, Class A-2 Principal
Balance, Class A-3 Principal Balance, Class A-4 Principal Balance, Class
A-5 Principal Balance, Class M-1 Principal Balance, Class B-1 Principal
Balance and Class B-2 Principal Balance after giving effect to the
payment of principal to be made on such Remittance Date (on which
interest will be calculated on the next succeeding Remittance Date);
(5) the number and aggregate unpaid principal amount of Contracts
that are delinquent 31 to 59 days, 60 to 89 days, and 90 or more days,
respectively;
(6) the total amount of fees payable out of the Trust Fund for such
Due Period;
(7) the Pool Factor for each Class of Certificates after giving
effect to the distribution on such Remittance Date;
(8) such other customary factual information available to the
Servicer as the Servicer deems necessary and can obtain reasonably from
its existing data base to enable the Certificateholders to prepare their
tax returns;
(9) the amount, if any, by which the Class B-2 Formula Distribution
Amount exceeds the Remaining Amount Available for such Remittance Date;
(10) the Class B-2 Principal Liquidation Loss Amount, if any, for
such Remittance Date; and
(11) the Guarantee Payment, if any, for such Remittance Date.
In the case of information furnished pursuant to clauses (1) through
(4) above, the amounts shall be expressed as a dollar amount per Certificate
with a $1,000 denomination.
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Within a reasonable period of time after the end of each calendar
year, subject to the next sentence, but in no event later than 90 days after
the end of such year, the Servicer shall prepare and furnish to the Trustee,
and the Trustee, promptly upon receipt, shall furnish to each Person who at
any time during the calendar year was the Holder of a Certificate, a statement
containing the information set forth in clauses (2) and (3) above, aggregated
for such calendar year or applicable portion thereof during which such Person
was a Certificateholder. Such obligation of the Servicer shall be deemed to
have been satisfied to the extent that substantially comparable information
shall be provided by the Servicer pursuant to any requirements of the Code as
from time to time in force.
On each Remittance Date, if the Servicer is not the Holder of the
Class R Certificate, the Servicer shall forward or cause to be forwarded by
mail to the Holder of the Class R Certificate a copy of the report forwarded
to the Holders of Certificates on such Remittance Date. If the Servicer is not
the Holder of the Class R Certificate, the Servicer shall also forward or
cause to be forwarded by mail to the Holder of the Class R Certificate a
statement setting forth the amount of the distribution to the Holder of the
Class R Certificate, together with such other information as the Servicer
deems necessary or appropriate.
Within a reasonable period of time after the end of each calendar
year, the Servicer shall furnish or cause to be furnished to each Person who
at any time during the calendar year was the holder of the Residual Interest a
statement containing the applicable distribution information provided pursuant
to this Section aggregated for such calendar year or applicable portion
thereof during which such Person was the Holder of the Class R Certificate.
Such obligation of the Servicer shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Servicer pursuant to any requirements of the Code as from time to time
enforced.
A Certificateholder holding Certificates of a Class representing in
the aggregate at least 5% of the Percentage Interest of such Class shall, upon
written request to the Trustee, be entitled to receive copies of all reports
provided to the Trustee.
The Servicer shall send copies of all reports provided to the Trustee
for the Certificateholders to each of the Underwriters.
[End of Article VII]
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Article VIII
INDEMNITIES; VANDERBILT AND THE SERVICER
Section 8.01 Liabilities to Obligors. No liability to any Obligor
under any of the Contracts arising out of any act or omission to act of the
Servicer in servicing the Contracts prior to the Closing Date is intended to
be assumed by the Trustee or the Certificateholders under or as a result of
this Agreement and the transactions contemplated hereby and, to the maximum
extent permitted and valid under mandatory provisions of law, the Trustee and
the Certificateholders expressly disclaim such assumption.
Section 8.02 Tax Indemnification. Vanderbilt agrees to pay, and to
indemnify, defend and hold harmless the Trust or any separate trustee, the
Trustee, the Certificate Registrar, each Paying Agent and the
Certificateholders from any taxes and related penalties which may at any time
be asserted with respect to, and as of the date of, the transfer of the
Contracts from Vanderbilt to the Trust or any separate trustee, including,
without limitation, any sales, gross receipts, general corporation, personal
property, privilege or license taxes (but not including any income or
franchise taxes or federal, state or other taxes arising out of the creation
of the Trust Fund and the issuance of the Certificates or distributions with
respect thereto) or tax due under Tenn. Code Xxx. ss.67-4-409(b) or any
successor provision and, in each such case, costs, expenses and reasonable
counsel fees in defending against the same. The Servicer shall promptly notify
the Trustee and the Rating Agencies, and the Trustee shall promptly notify the
Rating Agencies, in the event that either such party becomes aware of the
assertion of a claim or imposition of a lien by the Tennessee Department of
Revenue arising out of any characterization by such Department of the transfer
of the Contracts to the Trustee or any separate trustee as a secured financing
rather than a sale for purposes of the Tennessee indebtedness tax.
Section 8.03 Servicer's Indemnities. The Servicer shall defend and
indemnify the Trust Fund, the Trustee, the Certificate Registrar, each Paying
Agent, Vanderbilt and the Certificateholders against any and all costs,
expenses, losses, damages, claims and liabilities, including reasonable fees
and expenses of counsel and expenses of litigation, arising from third party
claims or actions in respect of any action taken or failed to be taken by the
Servicer or a prior owner of Acquired Contracts or servicer on behalf of such
owner with respect to any Contract or Manufactured Home and any failure by the
Servicer to perform its obligations in compliance with the standard of care
set forth in this Agreement. This indemnity shall survive any Event of Default
(but a Servicer's obligations under this Section 8.03 shall not relate to any
actions of any subsequent Servicer after an Event of Default) and any payment
of the amount owing under, or any repurchase by Vanderbilt of, any such
Contract.
Section 8.04 Operation of Indemnities. Indemnification under this
Article shall include, without limitation, reasonable fees and expenses of
counsel and expenses of litigation. If Vanderbilt or the Servicer has made any
indemnity payments to the Trustee pursuant to this Article and the Trustee
thereafter collects any of such amounts from others, the Trustee will repay
such amounts collected to Vanderbilt or the Servicer, as the case may be,
together with any interest collected thereon, but reduced by interest on
amounts paid by the Trustee through the date of reimbursement. The indemnities
under this Article shall survive the termination of this Agreement and any
resignation or removal of the Trustee.
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Section 8.05 Merger or Consolidation of Vanderbilt or the Servicer.
Vanderbilt and the Servicer will each keep in full effect its existence,
rights and franchises as a corporation or association, as the case may be, and
will obtain and preserve its qualification to do business as a foreign
corporation in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Agreement, the
Certificates or any of the Contracts and to perform its duties under this
Agreement.
Any Person into which Vanderbilt or the Servicer may be merged or
consolidated, or any Person resulting from any merger, conversion or
consolidation to which Vanderbilt or the Servicer shall be a party, or any
Person succeeding to the business of Vanderbilt or the Servicer, shall be the
successor of Vanderbilt or the Servicer hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding; provided, however,
that the successor or surviving Person to the Servicer shall satisfy the
requirements of Section 8.08 with respect to the qualifications of a successor
to the Servicer. Each of Vanderbilt and the Servicer shall promptly notify the
Trustee and the Rating Agencies of any such merger to which it is a party.
Section 8.06 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors, officers, employees or agents
of the Servicer shall be under any liability to the Trustee or the
Certificateholders for any action taken or for refraining from the taking of
any action in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the
Servicer or any such person against any liability that would otherwise be
imposed by reason of the failure to perform its obligations in strict
compliance with the standard of care set forth in this Agreement. The Servicer
and any director, officer, employee or agent of the Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted
by any Person respecting any matters arising hereunder. The Servicer shall not
be under any obligation to appear in, prosecute or defend any legal action
which arises under this Agreement and which in its opinion may involve it in
any expenses or liability; provided, however, that the Servicer may in its
discretion undertake any such action which it may deem necessary or desirable
in respect to this Agreement and the rights and duties of the parties hereto.
In such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities payable from the
related Certificate Account and the Servicer shall be entitled to be
reimbursed therefor out of such Certificate Account as provided by Section
6.02; provided that such reimbursement shall be made, from time to time on one
or more Remittance Dates, only out of the Available Distribution Amount for
such Remittance Date that remains after the distributions on the Class A
Certificates, Class M-1 Certificates and Class B Certificates for such
Remittance Date have been made.
Section 8.07 Assignment by Servicer. The Servicer may, with the prior
written consent of Vanderbilt, assign its rights and delegate its duties and
obligations under this Agreement; provided that the Person accepting such
assignment or delegation shall be a Person which is satisfactory to the
Trustee, in its sole judgment, and executes and delivers to Vanderbilt and the
Trustee an agreement, in form and substance reasonably satisfactory to
Vanderbilt and the Trustee, which contains an assumption by such Person of the
due and punctual performance and observance of each covenant and condition to
be performed or observed by the Servicer under this Agreement; provided
further that the Rating Agencies' rating of the Class A Certificates, Class
M-1 Certificates and Class B Certificates in effect immediately prior to such
assignment
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and delegation will not be withdrawn or reduced as a result of such
assignment and delegation, as evidenced by a letter from the Rating Agencies.
In the case of any such assignment and delegation, the Servicer shall be
released from its obligations under this Agreement, except that the Servicer
shall remain liable for all liabilities and obligations incurred by it as
Servicer hereunder prior to the satisfaction of the conditions to such
assignment and delegation set forth in the next preceding sentence.
Section 8.08 Successor to the Servicer. In connection with the
termination of the Servicer's responsibilities and duties under this Agreement
pursuant to Section 9.01, the Trustee shall (i) succeed to and assume all of
the Servicer's responsibilities, rights, duties and obligations under this
Agreement (except the duty to pay and indemnify the Trustee pursuant to
Section 10.05 hereof, which duty shall remain the obligation of the initial
Servicer), or (ii) appoint a successor acceptable to Vanderbilt, which shall
have a net worth of not less than $10,000,000 and shall have serviced for at
least one year prior to such appointment a portfolio of not less than
$100,000,000 principal amount of manufactured housing installment sale
contracts or installment loans and which shall succeed to all rights and
assume all of the responsibilities, duties and liabilities of the Servicer
under this Agreement prior to the termination of the Servicer's
responsibilities, duties and liabilities under this Agreement (except that the
duty to pay and indemnify the Trustee pursuant to Section 10.05 hereof shall
be subject to negotiation at the time of such appointment). If the Trustee has
become the successor to the Servicer in accordance with this Section, the
Trustee may, if it shall be unwilling to continue to so act, or shall, if it
is unable to so act, appoint or petition a court of competent jurisdiction to
appoint, a successor satisfying the requirements set out in clause (ii) above.
In connection with any appointment of a successor Servicer, the Trustee may
make such arrangements for the compensation of such successor out of payments
on Contracts as it and such successor shall agree or such court shall
determine; provided, however, that no such compensation shall be in excess of
a monthly amount equal to 1/12 of the product of 1.25% and the Pool Scheduled
Principal Balance for the Remittance Date in respect of which such
compensation is being paid without the consent of all of the
Certificateholders and notice to the Rating Agencies. If the Servicer's
duties, responsibilities and liabilities under this Agreement should be
terminated pursuant to Sections 8.07 or 9.01, the Servicer shall discharge
such duties and responsibilities during the period from the date it acquires
knowledge of such termination until the effective date thereof with the same
degree of diligence and prudence which it is obligated to exercise under this
Agreement, shall cooperate with the Trustee and any successor Servicer in
effecting the termination of the Servicer's responsibilities and rights
hereunder, and shall take no action whatsoever that might impair or prejudice
the rights or financial condition of its successor. The assignment by a
Servicer pursuant to Section 8.07 or removal of Servicer pursuant to Section
9.01 shall not become effective until a successor shall be appointed pursuant
to this Section and shall in no event relieve Vanderbilt of liability pursuant
to Section 3.05 for breach of the representations and warranties made pursuant
to Section 3.02 or 3.03.
Any successor appointed as provided herein shall execute, acknowledge
and deliver to the Servicer and to the Trustee an instrument accepting such
appointment, whereupon such successor shall become fully vested with all the
rights, powers, duties, responsibilities, obligations and liabilities of the
Servicer, with like effect as if originally named as a party to this Agreement
and the Certificates. Any assignment by or termination of the Servicer
pursuant to Section 8.07 or 9.01 or the termination of this Agreement pursuant
to Section 11.01 shall not
80
affect any claims that the Trustee may have against the Servicer arising prior
to any such termination or resignation.
The Servicer shall, at its expense, timely deliver to the successor,
or shall cause such delivery of, the funds in the Certificate Account and all
Contract Files and related documents and statements held by it hereunder and
the Servicer shall account for all funds and shall execute and deliver such
instruments and do such other things as reasonably may be required to more
fully and definitely vest and confirm in the successor all such rights,
powers, duties, responsibilities, obligations and liabilities of the Servicer.
Without limitation, the Trustee is authorized and empowered to execute and
deliver on behalf of the Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments (including, without limitation, transfer
instruments in respect of certificates of title and financing statements
relating to the Manufactured Homes), and to do any and all acts or things
necessary or appropriate to effect the purposes of such notice of termination.
Upon a successor's acceptance of appointment as such, the Trustee
shall notify in writing the Certificateholders of such appointment.
[End of Article VIII]
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Article IX
DEFAULT
Section 9.01 Events of Default. In case one or more of the following
Events of Default shall occur and be continuing:
(a) any failure by the Servicer to make any deposit or
payment, or to remit to the Trustee any payment, required to be made
under the terms of this Agreement which continues unremedied for a
period of five days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to
the Servicer by the Trustee or Vanderbilt (which shall also give such
notice to the Trustee) or to the Servicer, the Trustee and Vanderbilt
by the Holders of Certificates evidencing not less than 25% of the
Trust Fund; or
(b) failure on the part of the Servicer duly to observe or
perform in any material respect any other of the covenants or
agreements on the part of the Servicer set forth in this Agreement
which continues unremedied for a period of 30 days after the date on
which written notice of such failure, requiring the same to be
remedied, shall have been given to the Servicer by the Trustee or
Vanderbilt (which shall also give such notice to the Trustee), or to
the Servicer, the Trustee and Vanderbilt by the Holders of
Certificates evidencing not less than 25% of the Trust Fund; or
(c) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case
under any present or future federal or state bankruptcy, insolvency
or similar law or appointing a conservator or receiver or liquidator
in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the
Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or
(d) the Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to the Servicer or of or relating to all or
substantially all of the Servicer's property; or
(e) the Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take
advantage of any applicable insolvency or reorganization statute,
make an assignment for the benefit of its creditors, or voluntarily
suspend payment of its obligations or take any corporate action in
furtherance of the foregoing;
then, and in each and every such case, so long as such Event of Default shall
not have been remedied, the Trustee may, and at the written direction of the
Holders of the Certificates evidencing not less than 25% of the Trust Fund, by
notice in writing to the Servicer shall, terminate all the rights and
obligations of the Servicer under this Agreement and in and to the Contracts
and the proceeds thereof. The Trustee shall send a copy of any such notice to
the
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Rating Agencies. On or after the receipt by the Servicer of such written
notice, all authority and power of the Servicer under this Agreement, whether
with respect to the Contracts or otherwise, shall pass to and be vested in the
successor appointed pursuant to Section 8.08. Upon the occurrence of an Event
of Default which shall not have been remedied, the Trustee may also pursue
whatever rights it may have at law or in equity to damages, including
injunctive relief and specific performance. The Trustee will have no
obligation to take any action or institute, conduct or defend any litigation
under this Agreement at the request, order or direction of any of the Holders
of Certificates unless such Certificateholders have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which the Trustee may incur.
Section 9.02 Waiver of Defaults. The Trustee may waive any default by
the Servicer in the performance of its obligations hereunder and its
consequences, except that a default in the making of any required remittance
to the Trustee for distribution on any of the Certificates may be waived only
by the affected Certificateholders. Upon any such waiver of a past default,
such default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been remedied for every purpose of this Agreement. No
such waiver shall extend to any subsequent or other default or impair any
right consequent thereon except to the extent expressly so waived.
Section 9.03 Trustee to Act; Appointment of Successor. On and after
the time the Servicer receives a notice of termination pursuant to Section
9.01, the Trustee or its appointed agent shall be the successor in all
respects to the Servicer as provided in Section 8.08 hereof.
Section 9.04 Notification to Certificateholders.
(a) Upon any such termination pursuant to Section 9.01, the Trustee
shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register and to the Rating
Agencies.
(b) Within 60 days after the occurrence of any Event of Default known
to a Responsible Officer of the Trustee, the Trustee shall transmit by mail to
all Holders of Certificates, notice of each such Event of Default hereunder
known to the Trustee, unless such Event of Default shall have been cured or
waived.
Section 9.05 Effect of Transfer.
(a) After a transfer of servicing duties to a successor Servicer
pursuant to Section 8.05, 8.07, 8.08 or 9.01, the Trustee or new Servicer may
notify Obligors to make payments that are due under the Contracts after the
effective date of the transfer of servicing duties directly to the new
Servicer.
(b) After the transfer of servicing duties to a successor Servicer
pursuant to Section 8.05, 8.07, 8.08 or 9.01, the replaced Servicer shall have
no further obligations with respect to the management, administration,
servicing or collection of the Contracts, but in the case of a transfer
pursuant to Section 8.08 or 9.01 shall remain liable for any liability of the
Servicer hereunder and shall remain entitled to any compensation due the
Servicer that had already accrued prior to such transfer.
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(c) A transfer of servicing duties to a successor Servicer shall not
affect the rights and duties of the parties hereunder (including but not
limited to the indemnities of the Servicer pursuant to Article VIII) other
than those relating to the management, administration, servicing or collection
of the Contracts.
Section 9.06 Transfer of the Accounts. Notwithstanding the provisions
of Section 9.01, if the Certificate Account shall be maintained with the
Servicer or an Affiliate of the Servicer and an Event of Default shall occur
and be continuing, the Servicer, after five days' written notice from the
Trustee, or in any event within ten days after the occurrence of the Event of
Default, shall establish a new account or accounts, which shall be Eligible
Accounts, conforming with the requirements of this Agreement at the trust
department of the Trustee or with a depository institution other than the
Servicer or an Affiliate of the Servicer and promptly transfer all funds in
the Certificate Account to such new Certificate Account, which shall
thereafter be deemed the Certificate Account for the purposes hereof.
[End of Article IX]
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Article X
CONCERNING THE TRUSTEE
Section 10.01 Duties of Trustee. The Trustee, prior to the occurrence
of an Event of Default and after the curing of all Events of Default which may
have occurred, undertakes to perform such duties and only such duties as are
set forth specifically in this Agreement. In case an Event of Default of which
a Responsible Officer of the Trustee shall have actual knowledge has occurred
(which has not been cured or waived), the Trustee shall exercise such of the
rights and powers vested in it by this Agreement and use the same degree of
care and skill in their exercise as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee which are required specifically to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they conform to the requirements of this Agreement.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) Prior to the occurrence of an Event of Default of which a
Responsible Officer of the Trustee shall have actual knowledge, and after
the curing or waiver of all such Events of Default which may have
occurred, the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, the Trustee shall not
be liable except for the performance of such duties and obligations as
are specifically set forth in this Agreement, no implied covenants or
obligations shall be read into this Agreement against the Trustee and, in
the absence of bad faith on the part of the Trustee, the Trustee may rely
conclusively, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and, if specifically required to be furnished
pursuant to any provision of this Agreement, conforming to the
requirements of this Agreement;
(ii) The Trustee shall not be liable personally for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(iii) The Trustee shall not be liable personally with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of Certificates evidencing not
less than 25% of the Trust Fund as to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Agreement.
None of the provisions contained in this Agreement shall require the
Trustee to perform, or be responsible for the manner of performance of, any of
the obligations of the Servicer under this Agreement, except during such time,
if any, as the Trustee shall be the successor to, and be
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vested with the rights, duties, powers and privileges of, the Servicer in
accordance with the terms of this Agreement.
Section 10.02 Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 10.01:
(a) The Trustee may rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officers'
Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond or other paper or document believed by it to
be genuine and to have been signed or presented by the proper party
or parties;
(b) The Trustee may consult with counsel and any Opinion of
Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in
good faith and in accordance with such Opinion of Counsel;
(c) The Trustee shall be under no obligation to exercise any
of the trusts or powers vested in it by this Agreement or to
institute, conduct or defend any litigation hereunder or in relation
hereto at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this Agreement,
unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity satisfactory to it against the
costs, expenses and liabilities which may be incurred therein or
thereby; nothing contained herein shall, however, relieve the Trustee
of the obligation, upon the occurrence of an Event of Default (which
has not been cured), to exercise such of the rights and powers vested
in it by this Agreement, and to use the same degree of care and skill
in their exercise as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs;
(d) The Trustee shall not be liable personally for any
action taken, suffered or omitted by it in good faith and believed by
it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(e) Prior to the occurrence of an Event of Default of which
a Responsible Officer of the Trustee has actual knowledge hereunder
and after the curing or waiver of all Events of Default which may
have occurred, the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, bond or other paper or document, unless
requested in writing so to do by the Holders of Certificates
evidencing Fractional Interests aggregating not less than 25%;
provided, however, that if the payment within a reasonable time to
the Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion
of the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Agreement, the Trustee may
require reasonable indemnity against such expense or liability as a
condition to such proceeding. The reasonable expense of every such
examination shall be paid by the Servicer, if an Event of Default
shall have occurred and is continuing, and otherwise by the
Certificateholders requesting the investigation;
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(f) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents (including appointing a custodian to maintain custody
of the Land-and-Home Contract Files and the Mortgage Loan Files) or
attorneys and the Trustee shall not be liable or responsible for the
misconduct or negligence of any such agent or attorney appointed with
due care; provided, however, that any Affiliate of Vanderbilt may
only perform ministerial or custodial duties hereunder as agent for
the Trustee; and
(g) The right of the Trustee to perform any discretionary
act enumerated in this Agreement shall not be construed as a duty,
and the Trustee shall not be answerable for other than its negligence
or willful misconduct in the performance of any such act.
Section 10.03 Trustee Not Liable for Certificates or Contracts. The
recitals contained herein and in the Certificates (other than the
countersignature of the Certificates) shall be taken as the statements of
Vanderbilt or the Servicer, as the case may be, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations or
warranties as to the validity or sufficiency of this Agreement, of the
Certificates (except that the Certificates shall be duly and validly
countersigned by it), of any Contract or related document or the conveyance of
the Contracts and any related Mortgages or documents. The Trustee shall not be
accountable for the use or application by Vanderbilt of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to Vanderbilt or the Servicer in respect of the
Contracts or deposited in or withdrawn from the Certificate Account by
Vanderbilt or the Servicer. The Trustee shall have no responsibility for
filing any financing or continuation statement in any public office at any
time or to otherwise perfect or maintain the perfection of any security
interest or lien granted to it hereunder (unless the Trustee shall have become
the successor Servicer) or to prepare or file any Securities and Exchange
Commission filing for the trust created hereby or to record this Agreement.
Section 10.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of
Certificates, and may deal with Xxxxxxxxxx, Xxxxxxx and the Servicer in
banking transactions, with the same rights it would have if it were not
Trustee.
Section 10.05 Servicer to Pay Fees and Expenses of Trustee. The
Servicer covenants and agrees to pay, from its own funds, to the Trustee from
time to time, and the Trustee shall be entitled to, reasonable compensation
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) for all services rendered by it
in the execution of the trust hereby created and in the exercise and
performance of any of the powers and duties hereunder of the Trustee. The
Servicer will pay (out of its own funds) or reimburse the Trustee, to the
extent requested by the Trustee, for all reasonable expenses, disbursements
and advances incurred or made by the Trustee, in accordance with any of the
provisions of this Agreement and the reasonable compensation and the expenses
and disbursements of its counsel and of all Persons not regularly in its
employ (including any custodian), and the expenses incurred by the Trustee in
connection with the appointment of an office or agency pursuant to Section
10.11 except any such expense, disbursement or advance as may arise from its
negligence or bad faith. The Servicer also covenants and agrees to indemnify
(out of its own funds) the Trustee for, and to hold it harmless against, any
loss, liability or expense arising out of
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or in connection with the acceptance or administration of this trust and its
duties hereunder, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of any
of its powers or duties hereunder, except any such loss, liability or expense
arising from any negligence or bad faith on the part of the Trustee. The
covenants in this Section 10.05 shall be for the benefit of the Trustee in its
capacities as Trustee, Paying Agent and Certificate Registrar hereunder, and
shall survive the termination of this Agreement.
Section 10.06 Eligibility Requirements for Trustee. There shall at
all times be a Trustee hereunder which shall be either (a) JPMorgan Chase Bank
or any other Person into which JPMorgan Chase Bank is merged or consolidated
or to which substantially all of the properties and assets of JPMorgan Chase
Bank are transferred as an entirety, and provided, further, that such entity
is authorized to exercise corporate trust powers under the laws of the United
States of America, any state thereof or the District of Columbia and has all
necessary trust powers to perform its obligations hereunder, or (b) a
corporation or banking association organized and doing business under the laws
of the United States of America, any state thereof or the District of
Columbia, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by Federal or state authority and with a long-term
debt rating of at least Baa3 or a short-term debt rating of at least Prime-3.
If the corporation or banking association referred to in clause (b) of the
previous sentence publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
corporation or banking association shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published.
If at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
Section 10.07 Resignation and Removal of the Trustee. The Trustee at
any time may resign and be discharged from the trusts hereby created by giving
written notice thereof to Vanderbilt, the Servicer and the Rating Agencies.
Upon receiving such notice of resignation, Vanderbilt promptly shall appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and
have accepted appointment within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 10.06 and shall fail to resign after written
request therefor by Vanderbilt, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or a receiver
of the Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then Vanderbilt
may remove the Trustee and appoint a successor trustee by written instrument,
in duplicate, one copy of which instrument shall be delivered to the Trustee
so removed and one copy to the successor trustee.
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The Holders of Certificates evidencing more than 50% of the Trust
Fund may remove the Trustee at any time and appoint a successor trustee by
written instrument or instruments, in triplicate, signed by such
Certificateholders or their attorneys-in-fact duly authorized, one complete
set of which instruments shall be delivered to Vanderbilt, one complete set to
the Trustee so removed and one complete set to the successor so appointed.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 10.08.
Section 10.08 Successor Trustee. Any successor trustee appointed as
provided in Section 10.07 shall execute, acknowledge and deliver to Vanderbilt
and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
shall become effective and such successor trustee shall become effective and
such successor trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as trustee
herein. The predecessor trustee shall execute and deliver such instruments and
do such other things as reasonably may be required for more fully and
certainly vesting and confirming in the successor trustee all such rights,
powers, duties and obligations.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 10.06.
Upon acceptance of appointment by a successor trustee as provided in
this Section, Vanderbilt shall mail notice of the succession of such trustee
hereunder to all Certificateholders at their addresses as shown in the
Certificate Register, to the Servicer and to the Rating Agencies. If
Vanderbilt fails to mail such notice within 10 days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of Vanderbilt.
Section 10.09 Merger or Consolidation of Trustee. Any corporation
into which the Trustee may be merged or converted or with which it may be
consolidated or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the business of the Trustee, shall
be the successor of the Trustee hereunder, provided such corporation shall be
eligible under the provisions of Section 10.06, without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, anything herein to the contrary notwithstanding.
Section 10.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, at any time, for the purpose of
(i) meeting any legal requirements of any jurisdiction in which any part of
the Trust Fund or property securing the same may be located at the time or
(ii) meeting any legal requirements with respect to the holding of the
Contracts, the Servicer and the Trustee acting jointly shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of
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the Trust Fund, and to vest in such Person or Persons, in such capacity, such
title to the Trust Fund, or any part thereof, and, subject to the other
provisions of this Section 10.10, such powers, duties, obligations, rights and
trusts as the Servicer and the Trustee may consider necessary or desirable. If
the Servicer shall not have joined in such appointment within 15 days after
the receipt by it of a request so to do, or in case an Event of Default shall
have occurred and be continuing, the Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
10.06 hereunder and no notice to Certificateholders of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 10.08
hereof. The Servicer shall be responsible for the fees and expenses of any
co-trustee or separate trustee appointed hereunder to the extent and in the
manner set forth for the Trustee in Section 10.05.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 10.10, all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed or any regulation applicable to
any of the Contracts (whether as Trustee hereunder or as successor to the
Servicer hereunder), the Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust Fund or any portion
thereof in any such jurisdiction) shall be exercised and performed by such
separate trustee or co-trustee at the direction of the Trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article X. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Every such instrument shall be filed with the
Trustee.
Any separate trustee or co-trustee may, at any time, appoint the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its
estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Nothing in this Section shall relieve the Trustee of its duties,
obligations or liabilities under this Agreement.
Section 10.11 Appointment of Office or Agency. The Trustee will
appoint an office or agency in The City of New York where Certificates may be
surrendered for registration of transfer or exchange. The Trustee initially
designates its offices at 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000 for such purposes. The Certificate Register may be kept in
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an electronic form capable of printing out a hard copy of the
Certificate Register. The Trustee will maintain an office at the address
stated in Section 12.10 hereof where notices and demands to or upon the
Trustee in respect of the Certificates may be served. The Trustee will give
prompt written notice to Certificateholders of any change in the location of
the Certificate Register or any such office or agency.
Section 10.12 Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto. Any such proceeding instituted by the Trustee
shall be brought in its own name or in its capacity as Trustee. Any recovery
of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Certificateholders in respect
of which such judgment has been recovered.
Section 10.13 Suits for Enforcement. In case an Event of Default or
other default by the Servicer or of Vanderbilt shall occur and be continuing,
the Trustee, in its discretion may proceed to protect and enforce its rights
and the rights of the Certificateholders under this Agreement by a suit,
action or proceeding in equity or at law or otherwise, whether for the
specific performance of any covenant or agreement contained in this Agreement
or in aid of the execution of any power granted in this Agreement or for the
enforcement of any other legal, equitable or other remedy, as the Trustee,
being advised by counsel, shall deem most effectual to protect and enforce any
of the rights of the Trustee or the Certificateholders.
[End of Article X]
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Article XI
TERMINATION
Section 11.01 Termination.
(a) The respective obligations and responsibilities of Vanderbilt,
the Servicer (except as to Section 10.05) and the Trustee shall terminate
upon: (i) the later of the final payment or other liquidation (or any advance
with respect thereto) of the last Contract or the disposition of all property
acquired upon repossession of any Contract and the remittance of all funds due
hereunder; or (ii) at the option of Vanderbilt (if Vanderbilt is not the
Servicer) or the Servicer, on any Remittance Date after the first Remittance
Date on which the Scheduled Principal Balance is less than 10% of the Pool
Original Principal Balance, upon the purchase of the Contracts at a price
equal to the greater of (a) the sum of (x) 100% of the principal balance of
each Contract (other than any Contract as to which the related Manufactured
Home has been repossessed and not yet disposed of and whose fair market value
is included pursuant to clause (y) below) as of the final Remittance Date, and
(y) the fair market value of such acquired property (as determined by
Vanderbilt or the Servicer, as the case may be, as of the close of business on
the third Business Day next preceding the date upon which notice of any such
termination is furnished to Certificateholders pursuant to this Section), and
(b) the aggregate fair market value (as determined by Vanderbilt or the
Servicer, as the case may be, as of the close of business on such third
Business Day) of all of the assets of the Trust Fund, plus, in the case of
both (a) and (b), any Class A-1 Unpaid Interest Shortfall, any Class A-2
Unpaid Interest Shortfall, any Class A-3 Unpaid Interest Shortfall, any Class
A-4 Unpaid Interest Shortfall, any Class A-5 Unpaid Interest Shortfall, any
Class M-1 Unpaid Interest Shortfall, any Class B-1 Unpaid Interest Shortfall
and any Class B-2 Unpaid Interest Shortfall, as well as one month's interest
at the applicable APR on the Scheduled Principal Balance of each Contract
(including any Contract as to which the related Manufactured Home has been
repossessed or foreclosed upon and not yet disposed of); provided, however,
that in no event shall the trust created hereby continue beyond the expiration
of 21 years from the death of the last survivor of the descendants of Xxxxxx
X. Xxxxxxx, the late ambassador of the United States to the Court of St.
James's, living on the date hereof. Notwithstanding the foregoing, the option
specified in clause (ii) of this Section 11.01(a) shall not be exercisable if
there will not be distributed on the Class A-1 Certificates, Class A-2
Certificates, Class A-3 Certificates, Class A-4 Certificates, Class A-5
Certificates, Class M-1 Certificates, Class B-1 Certificates and Class B-2
Certificates an amount equal to the Class A-1 Principal Balance, Class A-2
Principal Balance, Class A-3 Principal Balance, Class A-4 Principal Balance,
Class A-5 Principal Balance, Class M-1 Principal Balance, Class B-1 Principal
Balance and Class B-2 Principal Balance, respectively, together with the Class
A-1 Unpaid Interest Shortfall, Class A-2 Unpaid Interest Shortfall, Class A-3
Unpaid Interest Shortfall, Class A-4 Unpaid Interest Shortfall, Class A-5
Unpaid Interest Shortfall, Class M-1 Unpaid Interest Shortfall, Class B-1
Unpaid Interest Shortfall and Class B-2 Unpaid Interest Shortfall,
respectively, and interest accrued during the related Interest Period on the
Principal Balance of each such Class of Certificates at the related Remittance
Rate. If Vanderbilt and the Servicer both desire to exercise the option in
clause (ii) of this paragraph on any Remittance Date after the first
Remittance Date on which the Scheduled Principal Balance is less than 10% of
the Original Principal Balance, the Servicer shall have the prior right to
exercise such option.
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(b) Notice of any termination, specifying the Remittance Date upon
which all Certificateholders may surrender their Certificates to the Trustee
for payment and cancellation, shall be given promptly by the Servicer (if
Vanderbilt is exercising the option given it in Section 11.01(a), upon
direction by Vanderbilt given 10 days prior to the date such notice is to be
mailed) by letter to Certificateholders, the Trustee and the Rating Agencies
mailed no later than the 15th day of the month preceding the month of such
final distribution specifying (i) the Remittance Date upon which final payment
on the Certificates will be made upon presentation and surrender of
Certificates at the office or agency of the Trustee therein designated, (ii)
the amount of any such final payment and (iii) that the Record Date otherwise
applicable to such Remittance Date is not applicable, payments being made only
upon presentation and surrender of the Certificates at the office or agency of
the Trustee therein specified. After giving such notice, the Trustee shall not
register the transfer of or exchange any Certificates. If such notice is given
in connection with Vanderbilt's or the Servicer's election to purchase,
Vanderbilt or the Servicer shall deposit in the Certificate Account on the
Business Day prior to the applicable Remittance Date the amount described in
Section 11.01(a)(ii). Upon presentation and surrender of the Class A
Certificates, Class M-1 Certificates and Class B Certificates, the Trustee
shall cause to be distributed to Certificateholders, from funds in the
Certificate Account, in proportion to such Certificateholders' respective
Percentage Interests, the following amounts (to the extent of available funds)
in the following order of priority: (i) to the Class A-1 Certificateholders,
the Class A-1 Principal Balance plus the interest due thereon; (ii) to the
Class A-2 Certificateholders, the Class A-2 Principal Balance plus the
interest due thereon; (iii) to the Class A-3 Certificateholders, the Class A-3
Principal Balance plus the interest due thereon; (iv) to the Class A-4
Certificateholders, the Class A-4 Principal Balance plus the interest due
thereon; (v) to the Class A-5 Certificateholders, the Class A-5 Principal
Balance plus the interest due thereon; (vi) to the Class M-1
Certificateholders, the Class M-1 Principal Balance plus the interest due
thereon; (vii) to the Class B-1 Certificateholders, the Class B-1 Principal
Balance plus the interest due thereon; and (viii) to the Class B-2
Certificateholders, the Class B-2 Principal Balance plus the interest due
thereon; provided that if a Deficiency Event has occurred, the distribution
pursuant to clause (i) , (ii), (iii), (iv) and (v) shall be pro rata among
such Classes on the basis of the amounts specified in such clauses. Upon such
termination, any amounts remaining in the Certificate Account (other than
amounts retained to meet claims) shall be paid to the Holder of the Class R
Certificate. Following such final deposit, the Trustee shall execute all
assignments, endorsements and other instruments necessary to effectuate such
transfer. The distribution on the final Remittance Date shall be in lieu of
the distribution otherwise required to be made on such Remittance Date in
respect of the Certificates. Any amounts retained in the Certificate Account
that are owed to Certificateholders which have not surrendered their
Certificates as of the final Remittance Date shall be withdrawn from the
Certificate Account and held in an escrow account with the Trustee pending
distribution pursuant to Section 11.01(c).
(c) If all of the Certificateholders shall not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If
within two years after the second notice all the Certificates shall not have
been surrendered for cancellation, the Trustee shall so notify Vanderbilt,
deliver any amounts held by it to Vanderbilt and Vanderbilt may take
appropriate steps, or may appoint an agent to take appropriate and reasonable
steps, to contact the remaining Certificateholders concerning surrender of
their
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Certificates, and the cost thereof shall be paid out of, and only to the
extent of, the funds and other assets which remain in trust hereunder.
Upon any termination pursuant to the exercise of the purchase option
contained in Section 11.01(a)(ii) or otherwise, the Trust Fund shall be
terminated in accordance with the following additional requirements, unless
the Trustee has received an Opinion of Counsel to the effect that the failure
of the Trust Fund to comply with the requirements of this Section will not (i)
result in the imposition of taxes on "prohibited transactions" of the Trust
Fund as described in Section 860F of the Code, or (ii) cause the Trust Fund to
fail to qualify as a REMIC at any time that any Certificates are outstanding:
(i) Within 90 days prior to the final Remittance Date set forth in
the notice given by the Servicer or the Trustee under this Section, the
Holder of the Class R Certificate shall adopt a plan of complete
liquidation of the Trust Fund; and
(ii) At or after the time of adoption of such a plan of complete
liquidation and at or prior to the final Remittance Date, the Servicer
shall sell all of the assets of the Trust Fund to Vanderbilt or the
Servicer, as the case may be, for cash.
By its acceptance of the Class R Certificate, the Holder thereof
hereby agrees to adopt such a plan of complete liquidation upon the written
request of the Servicer or Vanderbilt and to take such other action in
connection therewith as may be reasonably requested by Vanderbilt.
[End of Article XI]
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Article XII
MISCELLANEOUS PROVISIONS
Section 12.01 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be held
invalid for any reason whatsoever, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and in no way shall affect the validity
or enforceability of the other provisions of this Agreement.
Section 12.02 Limitation on Rights of Certificateholders. The death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No Certificateholder shall have any right to vote (except as
expressly provided herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to constitute the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision
hereof.
No Certificateholder shall have any right by virtue of any provision
of this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, unless such Holder
previously shall have given to the Trustee a written notice of default and of
the continuance thereof, as hereinbefore provided, and unless also the Holders
of Certificates evidencing not less than 25% of the Trust Fund shall have made
written request upon the Trustee to institute such action, suit or proceeding
in its own name as Trustee hereunder and shall have offered to the Trustee
such reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding; it
being understood and intended, and being covenanted expressly by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Holders of Certificates shall have any right in any manner
whatever by virtue of any provision of this Agreement to affect, disturb or
prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
or to enforce any right under this Agreement. For the protection and
enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 12.03 Acts of Certificateholders.
(a) Except as otherwise specifically provided herein, whenever
Certificateholder approval, authorization, direction, notice, consent, waiver
or other action is required hereunder,
95
such approval, authorization, direction, notice, consent, waiver or
other action shall be deemed to have been given or taken on behalf of, and
shall be binding upon, all Certificateholders if agreed to by Holders of
Certificates of the specified Class or Classes evidencing, as to each such
Class, Percentage Interests aggregating 51% or more.
(b) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or
by agent duly appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where required, to the Servicer.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Agreement and conclusive in
favor of the Trustee, the Servicer and Vanderbilt if made in the manner
provided in this Section.
(c) The fact and date of the execution by any Certificateholder of
any such instrument or writing may be proved in any reasonable manner which
the Trustee deems sufficient.
(d) The ownership of Certificates shall be proved by the Certificate
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder shall bind every Holder of every
Certificate issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, or omitted to be
done by the Trustee or the Servicer in reliance thereon, whether or not
notation of such action is made upon such security.
(f) The Trustee may require such additional proof of any matter
referred to in this Section as it shall deem necessary.
Section 12.04 [Reserved]
Section 12.05 Amendment. This Agreement may be amended from time to
time by Vanderbilt, the Servicer, and the Trustee, but without the consent of
any of the Certificateholders, (a) to cure any ambiguity, mistake or error or
to correct or supplement any provisions herein which may be inconsistent with
any other provisions herein, (b) to add to the duties or obligations of the
Servicer hereunder, (c) to obtain a rating by a nationally recognized rating
agency or to maintain or improve the rating of the Certificates then given by
a rating agency (it being understood that, after obtaining the rating of any
Certificates at the Closing Date, none of the Trustee, Vanderbilt or the
Servicer is obligated to obtain, maintain or improve any rating of the
Certificates), (d) to facilitate the operation of a guarantee of the Class B-2
Certificates by any Person (it being understood that the creation of any such
guarantee is solely at the option of Vanderbilt and that such guarantee will
not benefit in any way or result in any payments on any other Class of
Certificates) or (e) to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be materially
inconsistent with the provisions of this Agreement, including without
limitation provisions relating to the issuance of definitive Certificates to
Certificate Owners provided that book-entry registration of the Certificates
is no longer permitted; provided, however, that such action shall not, as
evidenced
96
by an Opinion of Counsel, adversely affect in any material respect
the interests of any Certificateholder (including, without limitation, the
maintenance of the status of the Trust Fund as a REMIC under the Code).
This Agreement may also be amended from time to time by Vanderbilt,
the Servicer and the Trustee, without consent of the Certificateholders, to
modify, eliminate or add to the provisions of this Agreement to such extent as
shall be necessary to (i) maintain the qualification of the Trust Fund as a
REMIC under the Code or avoid, or minimize the risk of, the imposition of any
tax on the Trust Fund under the Code that would be a claim against the Trust
Fund's assets, provided that there shall have been delivered an Opinion of
Counsel addressed to the Trustee to the effect that (a) such action is
necessary or appropriate to maintain such qualification or avoid any such tax
or minimize the risk of its imposition, and (b) such amendment shall not
adversely affect in any material respect the interests of any
Certificateholder or (ii) prevent the Trust Fund from entering into any
"prohibited transaction" as defined in Section 860F of the Code provided that
there shall have been delivered an Opinion of Counsel addressed to the Trustee
to the effect that (a) such action is necessary or appropriate to prevent the
Trust Fund from entering into such prohibited transaction, and (b) such
amendment shall not adversely affect in any material respect the interests of
any Certificateholder.
This Agreement also may be amended from time to time by Vanderbilt,
the Servicer and the Trustee, with the consent of the Holders of Certificates
evidencing not less than 51% of the Trust Fund, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in
any manner the amount of, or delay the timing of, distributions which are
required to be made on any Certificate without the consent of the Holder of
such Certificate; (ii) reduce the aforesaid percentage of Certificates, the
Holders of which are required to consent to any such amendment, without the
consent of the Holders of all such Certificates then outstanding or (iii)
adversely affect the status of the Trust Fund as a REMIC or cause a tax to be
imposed on the Trust Fund under the REMIC Provisions.
Promptly after the execution of any such amendment the Trustee shall
furnish written notification of the substance of such amendment to each
Certificateholder and the Rating Agencies.
It shall not be necessary for the consent of Certificateholders under
this Section 12.05 to approve the particular form of any proposed amendment
but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject
to such reasonable regulations as the Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by
this Agreement and that all conditions precedent to such execution and
delivery have been satisfied. The Trustee may, but shall not be obligated to,
enter into any such amendment which affects the Trustee's own rights, duties
or immunities under this Agreement.
97
Section 12.06 Recordation of Agreement. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other
comparable jurisdictions in which any or all of the properties subject to the
Contracts are situated, and in any other appropriate public recording office
or elsewhere, such recordation to be effected by the Servicer at the
Servicer's expense accompanied by an Opinion of Counsel to the effect that
such recordation materially and beneficially affects the interests of the
Certificateholders or is necessary for the administration or servicing of the
Contracts.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one
and the same instrument.
Section 12.07 Contribution of Assets. Except as provided in Section
3.05(b) and so much of Section 3.05(a) as does not relate to a deposit in lieu
of repurchase of a Contract the principal balance of which is incorrectly set
forth on the Contract Schedule, following the Closing Date, the Trustee shall
not accept any contribution of additional assets to the Trust Fund unless
Vanderbilt has delivered an Opinion of Counsel addressed to the Trustee to the
effect that (i) the contribution of such assets into the Trust Fund will not
cause the Trust Fund to fail to qualify as a REMIC so long as any Certificate
is outstanding and (ii) such contribution will not cause the imposition of tax
on contributions to the Trust Fund after the "start-up day" (as defined in
Section 860G of the Code) with respect thereto.
Section 12.08 Duration of Agreement. This Agreement shall continue in
existence and effect until terminated as herein provided.
Section 12.09 Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
Section 12.10 Notices. All demands, notices and communications
hereunder shall be in writing and (a) shall be deemed to have been duly given
if personally delivered at, or telecopied (with transmission confirmed by
telephone) to, or (b) shall be deemed to have been given when received if sent
by overnight courier to or mailed by first class or registered mail, postage
prepaid, to (i) in the case of Vanderbilt, 000 Xxxxx Xxxxx, Xxxxxxxxx, XX
00000, Attention: President; (ii) in the case of the Trustee, JPMorgan Chase
Bank, 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Structured Finance Surveillance Group (MBS); (iii) in the case of Moody's, 00
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage Backed Securities
Unit; or (iv) in the case of S&P, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Residential Mortgage-Backed Securities Group.
Section 12.11 Merger and Integration of Documents. Except as
specifically stated otherwise herein, this Agreement sets forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement. This
Agreement may not be modified, amended, waived, or supplemented except as
provided herein.
98
Section 12.12 Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
Section 12.13 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be an original, but all of which
together shall constitute one and the same instrument.
[End of Article XII]
99
IN WITNESS WHEREOF, Vanderbilt, as Seller and Servicer, Xxxxxxx and
the Trustee have caused their names to be signed hereto by their respective
officers thereunto duly authorized as of the day and year first above written.
VANDERBILT MORTGAGE AND FINANCE,
INC., as Seller and Servicer
By: /s/ Xxxxx Xxxxxx
---------------------------------------------
Name: Xxxxx Xxxxxx
Title: Secretary
JPMORGAN CHASE BANK,
as Trustee
By: /s/ Xxxxxxxx X. X. Xxxxx
----------------------------------------------
Name: Xxxxxxxx X. X. Xxxxx
Title: Vice President
XXXXXXX HOMES, INC., as Provider
of the Limited Guarantee
By: /s/ Xxxx Xxxxx
-----------------------------------------------
Name: Xxxx Xxxxx
Title: Senior Vice President
STATE OF TENNESSEE )
)ss.:
COUNTY OF XXXXXX )
On the ____ day of November, 2001, before me, a notary public in and
for said State, personally appeared Xxxxx Xxxxxx, known to me to be the
Secretary of Vanderbilt Mortgage and Finance, Inc., one of the corporations
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxxxxx
-------------------------------
Notary Public
[Notarial Seal]
STATE OF TENNESSEE )
)ss.:
COUNTY OF XXXXXX )
On the ____ day of November, 2001 before me, a notary public in and
for said State, personally appeared Xxxxx Xxxxxxx, known to me to be the
President of Xxxxxxx Homes, Inc., one of the corporations that executed the
within instrument, and also known to me to be the person who executed it on
behalf of said corporation, and acknowledged to me that such corporation
executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx X. Xxxxxxxxx
------------------------------
Notary Public
[Notarial Seal]
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the ____ day of November, 2001 before me, a notary public in and
for said State, personally appeared _______________, known to me to be a
_______________ of JPMorgan Chase Bank, a New York banking corporation that
executed the within instrument, and also known to be the person who executed
it on behalf of said banking corporation and acknowledged to me that such
banking corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxxxx X. Ravens
------------------------------
Notary Public
[Notarial Seal]
EXHIBIT A-1
CONTRACT SCHEDULE
(On file with the Trustee and Sidley Xxxxxx Xxxxx & Xxxx LLP)
A1-1
EXHIBIT A-2
FORM OF CUSTODIAL AGREEMENT
Dated as of November 29, 2001
JPMORGAN CHASE BANK, a New York banking corporation, as trustee (the
"Trustee"), SOUTHTRUST BANK, NATIONAL ASSOCIATION, a national banking
association, or its successors in interest (the "Custodian" or "SouthTrust"),
and VANDERBILT MORTGAGE AND FINANCE, INC., a Tennessee corporation, or its
successors in interest, individually and as Servicer (individually,
"Vanderbilt" or, in its capacity as servicer, the "Servicer"), agree as
follows:
WHEREAS, the Trustee, Vanderbilt and Xxxxxxx Homes, Inc. have entered
into a Pooling and Servicing Agreement, dated as of October 25, 2001 (the
"Pooling Agreement"; terms used but not defined herein shall have the meanings
assigned to them in Section 1.01 of the Pooling Agreement attached hereto at
Appendix A) relating to the Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificates, Series 2001-C (the "Certificates");
WHEREAS, pursuant to Section 2.04 and 5.20 of the Pooling Agreement,
Vanderbilt shall deliver each Delivered Land-and-Home Contract File and each
Delivered Mortgage Loan File, if any, to the Trustee or a custodian on its
behalf and the Trustee may appoint a custodian with respect to such Delivered
Land-and-Home Contract Files and the Delivered Mortgage Loan Files, if any
(collectively, the "Files");
WHEREAS, the Trustee wishes to appoint SouthTrust as custodian with
respect to the Files; and
WHEREAS, SouthTrust is willing to act as custodian of the Files and
perform its services in accordance with the terms and conditions hereof;
WITNESSETH THAT:
In consideration of the premises and of the mutual agreements herein
contained, the Trustee, the Custodian and Vanderbilt agree as follows:
1. Appointment as the Custodian. Subject to the terms and conditions
herein, the Trustee hereby appoints the Custodian, and the Custodian hereby
accepts such appointment, to maintain custody of the Files relating to the
Land-and-Home Contracts and Mortgage Loans, if any, listed on Schedule I
hereto (the "Schedule"). The Custodian shall have no duties or obligations
except those expressly stated in this Agreement, and such duties or
obligations shall be determined solely by the express provisions of this
Agreement.
2. Charges and Expenses. The Custodian will charge for its services
under this Agreement as set forth in a separate agreement between the
Custodian and Vanderbilt, the payment of which shall be the obligation of
Vanderbilt. The Trustee shall not be responsible for the fees or expenses of
the Custodian.
A2-1
3. Initial Delivery of Files. Within 30 days of the applicable
Transfer Date, the Servicer shall deliver the following items to the
Custodian:
(1) with respect to each Land-and-Home Contract,
(a) the original of the Land-and-Home Contract, and, in the case
of each Bi-weekly Contract, the original of the bi-weekly rider for
such Contract, and, in the case of each Equity Builder Contract, the
original of the graduated payment rider for such Contract;
(b) the original related Mortgage with evidence of recording
thereon and any title document for the related Manufactured
Home;
(c) with respect to any Land-and-Home Contract not originated by
Vanderbilt, the assignment of the Land-and-Home Contract from
the originator to Vanderbilt with evidence of recording
thereon;
(d) with respect to any Land-and-Home Contract originated by
Vanderbilt, an endorsement of such Land-and-Home Contract by
Vanderbilt without recourse;
(e) with respect to the Land-and-Home Contracts located in the ten
states with the highest concentration of Land-and-Home
Contracts (listed on Exhibit D hereto), an Opinion of Counsel
to the effect that Vanderbilt need not cause to be recorded any
assignment which relates to Land-and-Home Contracts in such
states to protect the Trustee's and the Certificateholders'
interest in such Land-and-Home Contracts; provided, however, if
Vanderbilt fails to deliver such an Opinion of Counsel for any
of the states listed on Exhibit D, with respect to the
Land-and-Home Contracts located in those states, Vanderbilt
shall provide an original executed assignment of the Mortgage,
with evidence of recording thereon, showing the assignment from
Vanderbilt to the Trustee or to the separate trustee, as
applicable; and
(f) any extension, waiver or modification agreement(s) for each
Land-and-Home Contract on the Schedule; and
(2) with respect to each Mortgage Loan, if any,
(a) the original related Mortgage, with evidence of recording
indicated thereon, and the original related mortgage note, if
any;
(b) the original assignment and any intervening assignments of the
Mortgage, with evidence of recording thereon, showing a complete
chain of assignment of the Mortgage Loan from origination of the
Mortgage Loan to Vanderbilt;
(c) an original assignment, with evidence of recording thereon,
showing the assignment from Vanderbilt to the Trustee or to the
separate trustee, as applicable; and
(d) any extension, modification or waiver agreement(s) for each
Mortgage Loan on the Schedule.
A2-2
In lieu of the items to be recorded and delivered pursuant to
Sections 3(1)(b), 3(1)(c), 3(1)(e), 3(2)(a), 3(2)(b) and 3(2)(c) above (the
"Recorded Documents"), if the original Mortgage or assignment has not been
returned by the applicable recording office or is not otherwise available,
Vanderbilt shall provide the Custodian with a copy thereof together with an
Officer's Certificate (which may be a blanket Officer's Certificate of
Vanderbilt covering all such Mortgages and assignments) certifying that the
copy is a true and correct copy of the original Mortgage or original
assignment, as applicable, submitted for recording, which will be (1) replaced
by the original Mortgage or original assignment when it is so returned or (2)
if the recording office in the applicable jurisdiction retains the original
Mortgage or original assignment or the original Mortgage or original
assignment has been lost, a copy of such item certified by the applicable
recording office.
All of the items with respect to a Land-and-Home Contract which are
delivered to and held by the Custodian are referred to herein as the
"Delivered Land-and-Home Contract File." All of the items with respect to a
Mortgage Loan which are delivered to and held by the Custodian are referred to
herein as the "Delivered Mortgage Loan File."
Such delivery shall be accompanied by a Certificate of Delivery (the
"Certificate of Delivery") of Vanderbilt substantially in the form of Exhibit
A hereto.
4. Subsequent Delivery of Documents. Vanderbilt shall deliver each
Recorded Document (or if the recording office in the applicable jurisdiction
retains the original Mortgage or original assignment or the original Mortgage
or original assignment has been lost, a copy of such item certified by the
applicable recording office) to the Custodian no later than the earlier of (1)
five Business Days after receipt thereof and (ii) within 180 days of the
Transfer Date. In addition, within that same time period, Vanderbilt shall
deliver to the Custodian any other original documents constituting a part of
the Files.
5. Maintenance of Office. The Custodian agrees to maintain the
Delivered Land-and-Home Contract Files for each Land-and-Home Contract and the
Delivered Mortgage Loan Files for each Mortgage Loan, if any, identified in
the Schedule at the office of the Custodian located at 000 Xxxxxx Xxxx Xxxxx,
Xxxxxxxxxx, Xxxxxxx or at such other offices of the Custodian in the State of
Alabama as the Custodian shall designate from time to time after giving the
Servicer and the Trustee at least 10 days' prior written notice.
6. Standard of Care and Limitation on Liability of the Custodian. The
Custodian shall not be subject to liability for any loss with respect to the
Files; provided, however, that the Custodian shall use its best judgment and
perform its duties under this Agreement in good faith and in accordance with
customary standards for such custody; and provided, however, that the
provisions of this paragraph shall not be construed to relieve the Custodian
from liability from its own gross negligence, or its own willful misconduct or
any breach by the Custodian of any of its obligations hereunder.
7. Duties of the Custodian. The Custodian shall have the following
rights and obligations and shall perform the following duties with respect to
the Files in its possession:
A2-3
(a) Safekeeping. To segregate the Files from all other mortgages and
mortgage notes and similar records in its possession, to maintain the
Files in secure, fireproof facilities, to identify the Files as being
held and to hold the Files for and on behalf of the Trustee for the
benefit of all present and future Certificateholders, and to conduct
periodic physical inspections of the Files held by it under this
Agreement in such a manner as shall enable the Custodian to verify
the physical possession thereof. The Custodian will promptly report
to the Servicer and the Trustee any failure on its part to hold the
Files as herein provided and promptly take appropriate action to
remedy any such failure.
(b) Certification as to File Contents.
(i) Within 45 days after the Custodian has received from (or on
behalf of) the Servicer actual possession of each File, the Custodian
shall (a) verify that, with respect to each File, all documents listed
on the Certificate of Delivery have been executed, received and
recorded, if applicable, except as noted on the list of exceptions
attached thereto, and (b) deliver to the Servicer and the Trustee an
Initial Certificate of Receipt, substantially in the form of Exhibit
B-1 attached hereto, which ascertains that all required documents
have been executed, received and recorded, if applicable. After the
delivery of the Initial Certificate of Receipt, the Custodian shall
provide to Vanderbilt and the Trustee, no less frequently than
quarterly, updated certifications, in the form of Exhibit B-2,
indicating the current status of exceptions until all such
exceptions have been eliminated.
(ii) In making such a review, the Custodian makes no representation and
has no responsibilities as to the authenticity of such documents or
their compliance with applicable law, including but not limited to
their compliance with the requirements for recordation, the
correctness of the legal description contained in any document or the
collectibility of any of the loan amounts from any borrower. In
making such verification, the Custodian may rely conclusively on the
Schedule attached hereto and the Certificate of Delivery, and the
Custodian shall have no obligation to independently verify the
correctness of the Schedule or the Certificate of Delivery.
(iii) If (a) any discrepancy exists between the Files in the
possession of the Custodian and the Schedule or (b) any document or
documents constituting a part of a File (the contents of which are
indicated in the Certificate of Delivery) has been omitted or is
defective in any material respect, the Custodian shall promptly notify
the Servicer and the Trustee and deliver an exceptions report (the
"Exceptions Report") as promptly as possible but in any event within
45 days of the date of receipt of the Files. Except as specifically
provided above, the Custodian shall be under no duty to review,
inspect or examine such documents to determine that any of them are
enforceable or appropriate for their prescribed purpose.
(c) Administration; Reports. The Custodian shall, at the expense of
the Servicer and any subservicer, assist the Servicer and any
subservicer (as may be reasonably requested in writing) generally in
the preparation of reports to Certificateholders or to regulatory
bodies to the extent necessitated by the Custodian's custody of the
Files.
A2-4
(d) Release of Documents. Upon receipt of a Request for Release (a
"Request for Release") (substantially in the form attached hereto as
Exhibit C), to release all or a portion of any File to the Servicer,
the Trustee, or the designee of either the Servicer or the Trustee,
in accordance with the instructions furnished by the Servicer, and to
cooperate on behalf of the Trustee in such release of Files. All
documents so released to the Servicer, the Trustee or their
respective designees shall be held by such entity in trust for the
benefit of the Certificateholders. Unless such Land-and-Home Contract
or Mortgage Loan has been liquidated, the Servicer, the Trustee or
their respective designees shall return to the Custodian such
released documents when such documents are no longer needed for the
purpose set forth in the Request for Release.
8. Access to Records. The Custodian shall permit the Trustee, Chase
Manhattan Bank USA, National Association (the "Separate Trustee"), the
Servicer and any subservicer appointed by the Servicer and identified by the
Trustee to the Custodian, or their duly authorized representatives, attorneys
or auditors to inspect the Files and the books and records maintained by the
Custodian at such time as the Trustee, the Separate Trustee, the Servicer or
any subservicer may reasonably request, subject only to compliance by the
Trustee, the Separate Trustee, the Servicer or any subservicer with the
security procedures of the Custodian applied by the Custodian to its own
employees having access to these and similar records.
9. Instructions; Authority to Act. The Custodian shall be deemed to
have received proper instructions with respect to the Files upon receipt of
written notice, request, consent, certificate, order, affidavit, letter,
telegram or other document reasonably believed by it to be genuine and to have
been signed or sent by the proper party or parties and may be considered as in
full force and effect until receipt of written notice to the contrary by the
Custodian from the Trustee, the Separate Trustee, the Servicer or any
subservicer; provided, however, that the provision of this paragraph shall not
be construed to relieve the Custodian, its officers, directors, employees,
agents or other representatives from liability from its own gross negligence
or its own willful misconduct.
10. Indemnification of the Custodian. Vanderbilt agrees to indemnify
the Custodian for any and all liabilities, obligations, losses, damages,
payments, costs or expenses of any kind whatsoever (including reasonable
attorneys fees) which may be imposed on, incurred or asserted against the
Custodian as the result of any act or omission in any way relating to the
maintenance and custody by the Custodian of the Files; provided, however, that
Vanderbilt shall not be liable for any portion of any such amount resulting
from the gross negligence or wilful misconduct of the Custodian.
11. Indemnification of the Trustee. Vanderbilt agrees to indemnify
the Trustee for any and all liabilities, obligations, losses, damages,
payments, costs or expenses of any kind whatsoever (including reasonable
attorneys fees) which may be imposed on, incurred or asserted against the
Trustee as the result of any act or omission in any way relating to or arising
out of the maintenance and custody by the Custodian of the Files or the
performance by the Custodian, Vanderbilt or any Servicer of their respective
duties hereunder; provided, however, that Vanderbilt shall not be liable for
any portion of any such amount resulting from the gross negligence or wilful
misconduct of the Trustee.
A2-5
12. Advice of Counsel. The Custodian shall be entitled to rely and
act upon written advice of counsel with respect to its performance hereunder
as custodian and shall be without liability for any action reasonably taken
pursuant to such advice, provided that such action is not in violation of
applicable Federal or State law and Vanderbilt shall reimburse the Custodian
for the reasonable attorneys' fees of the Custodian.
13. SouthTrust Not to Resign. SouthTrust shall not resign from its
obligations and duties as Custodian hereby imposed on it except (a) upon
determination that the performance of its obligations or duties hereunder are
no longer permissible under applicable law or are in material conflict by
reason of applicable law with any other activities carried on by it or its
subsidiaries or affiliates, the other activities of SouthTrust so causing such
a conflict being of a type and nature carried on by SouthTrust or its
subsidiaries or affiliates at the date of this Agreement or (b) upon
satisfaction of the following conditions: (i) SouthTrust has proposed a
successor custodian to the Trustee in writing and such proposed successor is
reasonably acceptable to the Trustee; and (ii) Xxxxx'x Investors Service, Inc.
("Moody's") or its successor in interest and Standard & Poor's, a division of
The XxXxxx-Xxxx Companies, Inc. ("S&P") or its successor in interest shall
have delivered a letter to the Trustee prior to the appointment of the
successor stating that the proposed appointment of such successor of
SouthTrust hereunder will not result in the reduction or withdrawal of the
then current rating of the Certificates; provided, however, that no such
resignation by SouthTrust shall become effective until its successor or, in
the case of (a) above, the Trustee or a custodian appointed by the Trustee and
acceptable to Moody's and Fitch shall have assumed SouthTrust's
responsibilities and obligations hereunder. Any such determination permitting
the resignation of SouthTrust pursuant to clause (a) above shall be evidenced
by an opinion of counsel to such effect reasonably satisfactory to the Trustee
and delivered to Vanderbilt and the Trustee concurrently with the delivery of
any notice of resignation.
14. Effective Period, Termination and Amendment. This Agreement shall
become effective as of the date hereof and shall continue in full force and
effect until terminated as hereinafter provided, and may be amended at any
time by mutual agreement of the parties hereto. This Agreement may be
terminated by the Trustee with or without cause in a writing delivered or
mailed, postage prepaid, to the other parties, such termination to take effect
no sooner than sixty (60) days after the date of such delivery or mailing.
Concurrently with, or as soon as practicable after, the termination of this
Agreement, the Custodian shall redeliver the Files to the Trustee or a person
designated by the Trustee at such place as the Trustee or the person
designated by the Trustee may reasonably designate.
15. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York.
16. Notices. All demands, notices and communications hereunder shall
be in writing and shall be delivered or mailed, postage prepaid, to the
Trustee at 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Services (MBS); to the Custodian at X.X. Xxx
0000, Xxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxx Xxxxxxxxx, Document Custody;
to the Servicer or Vanderbilt at 000 Xxxxx Xxxxx, Xxxxxxxxx, XX 00000,
Attention: President; or to such other address as the Trustee, the Custodian,
the Servicer or
A2-6
Vanderbilt may hereafter specify in writing. Notices or other
writings shall be effective only upon actual receipt by the parties.
17. Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the Trustee, the Custodian, Vanderbilt, in its
individual capacity, the Servicer and their respective successors and assigns.
Concurrently with the appointment of a successor trustee as provided in the
Pooling Agreement, the parties hereto shall amend this Agreement to make said
successor trustee the successor to the Trustee hereunder.
18. Counterparts. This Agreement may be signed in any number of
counterparts each of which will be deemed an original, which taken together
shall constitute one and the same instrument.
19. Obligations of the Trustee. Nothing in this Agreement shall be
deemed to release the Trustee from any of its obligations under the Pooling
Agreement.
20. Definitions. Terms capitalized herein and not defined herein
shall have their respective meanings as set forth in the Pooling Agreement.
A2-7
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed in its name and on its behalf by a duly authorized
officer as of the day and year first above written.
JPMORGAN CHASE BANK,
as Trustee
By: ____________________________
Name:
Title:
SOUTHTRUST BANK, NATIONAL ASSOCIATION,
as Custodian
By: _____________________________
Name:
Title:
VANDERBILT MORTGAGE AND
FINANCE, INC.
individually and as Servicer
By: _____________________________
Name:
Title:
X0-0
XXXXXXXX X
(Xxxxxx 0000-X Xxxxxxx and Servicing Agreement)
A2-9
SCHEDULE I
(Schedule of Land-and-Home Contracts and Mortgage Loans)
A2-10
EXHIBIT A
CERTIFICATE OF DELIVERY
The undersigned hereby certifies that the documents listed below,
except as noted on the list of exceptions attached hereto, are included in the
Delivered Land-and-Home Contract Files and the Delivered Mortgage Loan Files,
if any, delivered to the Custodian pursuant to the terms of the Custodial
Agreement, dated as of November 29, 2001 (the "Custodial Agreement"), among
JPMorgan Chase Bank, as trustee (the "Trustee"), SouthTrust Bank, National
Association, as custodian (the "Custodian") and Vanderbilt Mortgage and
Finance, Inc. ("Vanderbilt") for each contract on the Schedule:
(1) with respect to each Land-and-Home Contract,
(a) the original of the Land-and-Home Contract, and, in the case of
each Bi-weekly Contract, the original of the bi-weekly rider for such
Contract, and, in the case of each Equity Builder Contract, the
original of the graduated payment rider for such Contract;
(b) the original related Mortgage with evidence of recording thereon \
and any title document for the related Manufactured Home;
(c) with respect to any Land-and-Home Contract not originated by
Vanderbilt, the assignment of the Land-and-Home Contract from the
originator to Vanderbilt with evidence of recording thereon;
(d) with respect to any Land-and-Home Contract originated by
Vanderbilt, an endorsement of such Land-and-Home Contract
by Vanderbilt without recourse;
(e) with respect to the Land-and-Home Contracts located in the ten
states listed on Exhibit D to the Custodial Agreement, the Opinion of
Counsel specified in Section 3(1)(e) of the Custodial Agreement;
provided, however, if Vanderbilt failed to deliver such an Opinion of
Counsel for any of the states listed on Exhibit D to the Custodial
Agreement, with respect to the Land-and-Home Contracts located in
those states, the original executed assignment of the Mortgage, with
evidence of recording thereon, showing the assignment from Vanderbilt
to the Trustee or to the separate trustee, as applicable; and
(f) any extension, waiver or modification agreement(s) for each Land-
and-Home Contract on the Schedule.
(2) with respect to each Mortgage Loan, if any,
(a) the original related Mortgage, with evidence of recording
indicated thereon or the original related mortgage note, if any;
(b) the original assignment and any intervening assignments of the
Mortgage, with evidence of recording thereon, showing a complete
chain of assignment of the Mortgage Loan from origination of the
Mortgage Loan to Vanderbilt;
A2-11
(c) the original assignment, with evidence of recording thereon,
showing the assignment from Vanderbilt to the Trustee or to the
separate trustee, as applicable; and
(d) any extension, modification or waiver agreement(s) for each
Mortgage Loan on the Schedule.
In lieu of the items to be recorded and delivered pursuant to Sections (1)(b),
(1)(c), (1)(e), (2)(a), (2)(b) and (2)(c) above (the "Recorded Documents"), if
the original Mortgage or assignment has not been returned by the applicable
recording office or is not otherwise available, Vanderbilt has provided the
Custodian with a copy thereof together with an Officer's Certificate (which
may be a blanket Officer's Certificate of Vanderbilt covering all such
Mortgages and assignments) certifying that the copy is a true and correct copy
of the original Mortgage or original assignment, as applicable, submitted for
recording, which will be (1) replaced by the original Mortgage or original
assignment when it is so returned or (2) if the recording office in the
applicable jurisdiction retains the original Mortgage or original assignment
or the original Mortgage or original assignment has been lost, a copy of such
item certified by the applicable recording office.
In accordance with Section 4 of the Custodial Agreement, Vanderbilt
shall deliver to the Custodian any additional items required pursuant to
Custodial Agreement within the time period specified therein.
Capitalized terms not otherwise defined herein shall have the meaning
set forth in the Custodial Agreement.
Dated: VANDERBILT MORTGAGE AND FINANCE, INC.,
as Servicer
By:__________________________________
Name:
Title:
X0-00
XXXXXXX X-0 TO THE CUSTODIAL AGREEMENT
INITIAL CERTIFICATE OF RECEIPT
JPMorgan Chase Bank,
as Trustee
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Services (MBS)
Vanderbilt Mortgage and Finance, Inc.
000 Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Re: Custodial Agreement, dated as of November 29, 2001, among
JPMorgan Chase Bank, SouthTrust Bank, National Association
and Vanderbilt Mortgage and Finance, Inc.
----------------------------------------------------------
Ladies and Gentlemen:
The undersigned hereby acknowledges receipt on this ___ day of
__________ 2001 of the Certificate of Delivery and the Delivered Land-and-Home
Contract Files and the Delivered Mortgage Loan Files, if any. Subject to the
Custodial Agreement, dated as of November 29, 2001, among JPMorgan Chase Bank,
as trustee (the "Trustee"), SouthTrust Bank, National Association, as
custodian (the "Custodian") and Vanderbilt Mortgage and Finance, Inc.
("Vanderbilt" or in its capacity as servicer, the "Servicer") (the "Custodial
Agreement"), the undersigned hereby certifies that it has reviewed each of the
Files listed on the Schedule and that it is holding, on behalf of the Trustee
and for the benefit of the Certificateholders, the following items (except as
noted on the list of exceptions attached hereto):
(1) with respect to each Land-and-Home Contract,
(a) the original of the Land-and-Home Contract, and, in the case of
each Bi-weekly Contract, the original of the bi-weekly rider for such
Contract, and, in the case of each Equity Builder Contract, the
original of the graduated payment rider for such Contract;
(b) the original related Mortgage with evidence of recording thereon
and any title document for the related Manufactured Home;
(c) with respect to any Land-and-Home Contract not originated by
Vanderbilt, the assignment of the Land-and-Home Contract from
the originator to Vanderbilt with evidence of recording thereon;
(d) with respect to any Land-and-Home Contract originated by
Vanderbilt, an endorsement of such Land-and-Home Contract by
Vanderbilt without recourse;
A2-13
(e) (1) with respect to the Land-and-Home Contracts located in the ten
states with the highest concentration of Land-and-Home Contracts
(listed on Exhibit D to the Custodial Agreement), an Opinion of
Counsel to the effect that Vanderbilt need not cause to be recorded
any assignment which relates to Land-and-Home Contracts in such
states to protect the Trustee's and the Certificateholders' interest
in such Land-and-Home Contracts; or
(2) if the above-referenced Opinion of Counsel is not
delivered with respect to any of the ten states listed on Exhibit D
to the Custodial Agreement, with respect to the Land-and-Home
Contracts located in those states, an original executed assignment of
the Mortgage, with evidence of recording thereon, showing the
assignment from Vanderbilt to the Trustee or to the Separate Trustee,
as applicable; and
(f) any extension, waiver or modification agreement(s) of which the
Custodian is aware for each Land-and-Home Contract on the Schedule.
(2) with respect to each Mortgage Loan, if any,
(a) the original related Mortgage, with evidence of recording
indicated thereon, and the original related mortgage, if any;
(b) the original assignment and any intervening assignments of the
Mortgage, with evidence of recording thereon, showing a complete
chain of assignment of the Mortgage Loan from origination of the
Mortgage Loan to Vanderbilt;
(c) the original assignment, with evidence of recording thereon,
showing the assignment from Vanderbilt to the Trustee or to the
Separate Trustee, as applicable; and
(d) any extension, modification or waiver agreement(s) of which the
Custodian is aware for each Mortgage Loan on the Schedule.
In lieu of the items to be recorded and delivered pursuant to
Sections (1)(b), (1)(c), (1)(e), (2)(a), (2)(b) and (2)(c) above (the
"Recorded Documents"), if the original Mortgage or assignment has not been
returned by the applicable recording office or is not otherwise available, the
Custodian has received a copy thereof together with an Officer's Certificate
certifying that the copy is a true and correct copy of the original Mortgage
or original assignment, as applicable, submitted for recording, which will be
(1) replaced by the original Mortgage or original assignment when it is so
returned or (2) if the recording office in the applicable jurisdiction retains
the original Mortgage or original assignment or the original Mortgage or
original assignment has been lost, a copy of such item certified by the
applicable recording office.
Pursuant to Section 7(b) of the Custodial Agreement, the Custodian
will provide an updated certification to Vanderbilt and the Trustee, no less
frequently than quarterly, indicating the current status of exceptions until
all such exceptions have been eliminated.
A2-14
The undersigned agrees to hold the Files strictly in accordance with
the Custodial Agreement and shall perform its duties as explicitly set forth
thereunder, and shall have no other duties thereunder. Terms not otherwise
defined herein shall have the meaning set forth in the Custodial Agreement.
SOUTHTRUST BANK, NATIONAL ASSOCIATION
By:
-------------------------------------
Name:
Title:
X0-00
XXXXXXX X-0 TO THE CUSTODIAL AGREEMENT
FORM OF UPDATED CERTIFICATION
JPMorgan Chase Bank,
as Trustee
000 Xxxx 00xx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Finance Services (MBS)
Vanderbilt Mortgage and Finance, Inc.
000 Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Re: Custodial Agreement, dated as of November 29, 2001, among
JPMorgan Chase Bank, SouthTrust Bank, National Association
and Vanderbilt Mortgage and Finance, Inc.
----------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 7 of the above-referenced Custodial
Agreement, the undersigned, as Custodian, hereby sets forth an updated
exception report from the previous Custodian's Certificate issued [INSERT
DATE].
The undersigned agrees to hold the Files strictly in accordance with
the Custodial Agreement and shall perform its duties as explicitly set forth
thereunder, and shall have no other duties thereunder. Terms not otherwise
defined herein shall have the meaning set forth in the Custodial Agreement.
SOUTHTRUST BANK, NATIONAL ASSOCIATION
By:
--------------------------------------------
Name:
Title:
A2-16
EXHIBIT C TO THE CUSTODIAL AGREEMENT
REQUEST FOR RELEASE OF DOCUMENTS
TO: SOUTHTRUST BANK, NATIONAL ASSOCIATION DATE:
__________________________
__________________________
__________________________
__________________________
FROM:
__________________________
__________________________
__________________________
__________________________
RE: Custodial Agreement, dated as of November 29, 2001 (the
"Custodial Agreement"), among JPMorgan Chase Bank, as trustee,
SouthTrust Bank, National Association, as custodian and
Vanderbilt Mortgage and Finance, Inc., individually and as
Servicer.
----------------------------------------------------------------
------------------------------------------------------------------------------
IN CONNECTION WITH THE ADMINISTRATION OF THE FILES HELD BY YOU IN CUSTODY FOR
JPMORGAN CHASE BANK AND PURSUANT TO THE CUSTODIAL AGREEMENT, THE UNDERSIGNED
REQUESTS THE RELEASE OF THE DOCUMENTS DESCRIBED BELOW FOR THE REASON
INDICATED.
------------------------------------------------------------------------------
OBLIGOR'S NAME, ADDRESS AND ZIP CODE LOAN NO.
POOL ID
------------------------------------------------------------------------------
------------------------------------------------------------------------------
ORIGINAL CONTRACT AMOUNT........................ $____________
DATE OF ORIGINAL CONTRACT....................... ____________
---------------------
PAID THROUGH DATE............................... ____________
------------------------------------------------------------------------------
REASON FOR REQUESTING DOCUMENTS AMOUNT SETTLEMENT DATE
[ ] CONTRACT PAID IN FULL $__________ ________________
[ ] FORECLOSURE $__________ ________________
[ ] EXHIBITS ATTACHED FOR SUBSTITUTION $__________ ________________
[ ] OTHER (explain)____________________ $__________ ________________
A2-17
WE CERTIFY THAT ALL AMOUNTS RECEIVED OR TO BE RECEIVED IN CONNECTION WITH SUCH
PAYMENT WHICH ARE REQUIRED TO BE CREDITED TO THE PROTECTED ACCOUNT OR
DEPOSITED TO THE CERTIFICATE ACCOUNT HAVE BEEN OR, WITHIN TWO BUSINESS DAYS,
RECEIPT OF SUCH PAYMENT WILL BE CREDITED OR DEPOSITED.
_______________________________________________________________________________
SIGNATURE DATE
_______________________________________________________________________________
PARTICIPANT AUTHORIZED SIGNATURE
_______________________________________________________________________________
[CUSTODIAN'S] RELEASE AUTHORIZATION
NAME AND TITLE SIGNATURE DATE
------------------------------------------------------------------------------
TO CUSTODIAN: PLEASE ACKNOWLEDGE BELOW BY YOUR SIGNATURE THE EXECUTION OF THE
ABOVE REQUEST. YOU MUST RETAIN THIS FORM FOR YOUR FILES.
DOCUMENT RETURNED TO CUSTODY:
----------------------------- -------------
SIGNATURE DATE
A2-18
EXHIBIT D TO THE CUSTODIAL AGREEMENT
LIST OF TEN STATES WITH HIGHEST CONCENTRATION
OF LAND-AND-HOME CONTRACT FILES
A2-19
EXHIBIT B-1
FORM OF FACE OF CLASS [A-1][A-2][A-3]
[A-4][A-5] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS
CERTIFICATE IS A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY
AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.
[FOR CLASS A-5 ONLY: THIS CERTIFICATE IS SUBORDINATED IN
RIGHT OF PAYMENT TO THE CLASS A-1 CERTIFICATES, CLASS A-2
CERTIFICATES, CLASS A-3 CERTIFICATES AND CLASS A-4
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.]
Number
--------------
Date of Pooling and Original Denomination
Servicing Agreement and $__________________________
Cut-off Date:
October 25, 2001 Original Class [A-1][A-2]
[A-3][A-4][A-5]
Principal Balance:
Class [A-1][A-2][A-3] $[__________]
[A-4][A-5] $[__________]
Remittance Rate: As specified $[__________]
in the Pooling and Servicing $[__________]
Agreement referred to herein $[__________]
$[__________]
Remittance Date after
Latest Due Date: ___ __, __
First Remittance Date: CUSIP _______________
December 7, 2001
B1-1
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
SERIES 2001-C, CLASS [A-1][A-2][A-3][A-4][A-5]
[(SENIOR)][(SUBORDINATE)]
evidencing a percentage interest in any
distributions allocable to the Class
[A-1][A-2][A-3][A-4] [A-5] Certificates with
respect to a pool of fixed and adjustable rate
conventional manufactured housing contracts formed
and sold by
VANDERBILT MORTGAGE AND FINANCE, INC.
which manufactured housing contracts either were originated or acquired by
Vanderbilt Mortgage and Finance, Inc. (hereinafter called the "Company," which
term includes any successor entity under the Agreement referred to below) and
are initially serviced by Vanderbilt Mortgage and Finance, Inc. (in such
capacity, the "Servicer", which term includes any entity under the Agreement
referred to below).
This Certificate does not represent an obligation of or interest in
the Company, the Servicer or the Trustee referred to below or any of their
Affiliates. Neither this Certificate nor the underlying manufactured housing
contracts are guaranteed or insured by Vanderbilt Mortgage and Finance, Inc.,
the Servicer or by any governmental agency or instrumentality.
THE PORTION OF THE ORIGINAL CLASS [A-1][A-2][A-3] [A-4][A-5]
PRINCIPAL BALANCE EVIDENCED BY THIS CERTIFICATE ("CERTIFICATE BALANCE") WILL
BE REDUCED BY DISTRIBUTIONS ON THIS CERTIFICATE THAT ARE ALLOCABLE TO
PRINCIPAL. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES,
THE CERTIFICATE BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE
ORIGINAL DENOMINATION SHOWN ABOVE. ANYONE ACQUIRING THIS CERTIFICATE MAY
ASCERTAIN ITS CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE PAYING AGENT. On
the date of the initial issuance of the Certificates, the Paying Agent is the
Trustee.
This certifies that CEDE & CO. is the registered owner of an
undivided interest in certain monthly distributions with respect to a pool
(the "Contract Pool") of conventional manufactured housing installment sales
contracts, installment loan agreements and mortgage loans (collectively, the
"Contracts") formed and sold by the Company and certain other property
(collectively, the "Trust Fund"). The Contracts either were originated or
acquired by and are serviced by the Servicer and are secured by Manufactured
Homes or Mortgage Properties, as applicable. The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as specified above (the
"Agreement"), by and among the Company, as servicer, Xxxxxxx Homes, Inc., as
provider of the Limited Guarantee and JPMorgan Chase Bank, as trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2001-C (the "Certificates"), and is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
B1-2
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
On each Remittance Date, the Trustee will cause to be distributed
from funds in the Certificate Account to each Class [A-1][A-2][A-3][A-4][A-5]
Certificateholder an amount equal to the product of the Percentage Interest
evidenced by such Class [A-1][A-2][A-3][A-4][A-5] Certificateholder's
Certificate and the Class [A-1][A-2][A-3][A-4][A-5] Distribution Amount.
Distributions on this Certificate will be made by check mailed to the
address of the Person entitled thereto, as such name and address shall appear
on the Certificate Register or by wire transfer to Holders of Class
[A-1][A-2][A-3][A-4][A-5] Certificates with original denominations aggregating
at least $5 million who have given the Trustee written instructions at least
five Business Days prior to the related Record Date. Notwithstanding the
above, the final distribution on this Certificate will be made after due
notice by the Trustee of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose and specified in such notice of
final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth hereafter, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless this Certificate has been countersigned by or on behalf of the
Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
B1-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate
to be duly executed.
Dated:
JPMORGAN CHASE BANK,
as Trustee
By
---------------------------------------
Authorized Officer
[Form of Certificate of
Countersignature]
This is one of the Certificates
referred to in the within-
mentioned Agreement.
By By ,
-------------------------- -----------------------------------------
OR
Authenticating Agent Trustee
---------------------------- -----------------------------------------
Authorized Signatory Authorized Signatory
[Signature page to Class [A-1][A-2][A-3][A-4][A-5] Certificate, Manufactured
Housing Contract Senior/Subordinate Pass-Through Certificates, Series 2001-C]
B1-4
EXHIBIT B-2
FORM OF FACE OF CLASS M-1 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS
CERTIFICATE IS A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY
AND ANY PAYMENT IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
CLASS A CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
Number
--------------
Date of Pooling and Original Denomination
Servicing Agreement and $______________________
Cut-off Date:
October 25, 2001 Original Class M-1
Principal Balance:
Class M-1 $[__________]
Remittance Rate: As specified
in the Pooling and Servicing
Agreement referred to herein
Remittance Date after
Latest Due Date: ___ __, ___
First Remittance Date: CUSIP _______________
December 7, 2001
B2-1
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
SERIES 2001-C, CLASS M-1
(SUBORDINATE)
evidencing a percentage interest in any
distributions allocable to the Class M-1
Certificates with respect to a pool of fixed and
adjustable rate conventional manufactured housing
contracts formed and sold by
VANDERBILT MORTGAGE AND FINANCE, INC.
which manufactured housing contracts either were originated or acquired by
Vanderbilt Mortgage and Finance, Inc. (hereinafter called the "Company," which
term includes any successor entity under the Agreement referred to below) and
are initially serviced by Vanderbilt Mortgage and Finance, Inc. (in such
capacity, the "Servicer", which term includes any entity under the Agreement
referred to below).
This Certificate does not represent an obligation of or interest in
the Company, the Servicer or the Trustee referred to below or any of their
Affiliates. Neither this Certificate nor the underlying manufactured housing
contracts are guaranteed or insured by Vanderbilt Mortgage and Finance, Inc.,
the Servicer or by any governmental agency or instrumentality.
THE PORTION OF THE ORIGINAL CLASS M-1 PRINCIPAL BALANCE EVIDENCED BY
THIS CERTIFICATE ("CERTIFICATE BALANCE") WILL BE REDUCED BY DISTRIBUTIONS ON
THIS CERTIFICATE THAT ARE ALLOCABLE TO PRINCIPAL. ACCORDINGLY, FOLLOWING THE
INITIAL ISSUANCE OF THE CERTIFICATES, THE CERTIFICATE BALANCE OF THIS
CERTIFICATE WILL BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN ABOVE.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT CERTIFICATE
BALANCE BY INQUIRY OF THE PAYING AGENT. On the date of the initial issuance of
the Certificates, the Paying Agent is the Trustee.
This certifies that CEDE & CO. is the registered owner of an
undivided interest in certain monthly distributions with respect to a pool
(the "Contract Pool") of conventional manufactured housing installment sales
contracts, installment loan agreements and mortgage loans (collectively, the
"Contracts") formed and sold by the Company and certain other property
(collectively, the "Trust Fund"). The Contracts either were originated or
acquired by and are serviced by the Servicer and are secured by Manufactured
Homes. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement dated as specified above (the "Agreement"), by and among the
Company, as servicer, Xxxxxxx Homes, Inc., as provider of the Limited
Guarantee and JPMorgan Chase Bank, as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2001-C (the "Certificates"), and is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
On each Remittance Date, the Trustee will cause to be distributed
from funds in the Certificate Account to each Class M-1 Certificateholder an
amount equal to the product of (i) the Percentage
B2-2
Interest evidenced by such Class M-1 Certificateholder's Certificate
and (ii) subject to the prior rights of Holders of Class A Certificates as
specified in the Agreement, the Class M-1 Distribution Amount.
Distributions on this Certificate will be made by check mailed to the
address of the Person entitled thereto, as such name and address shall appear
on the Certificate Register or by wire transfer to Holders of Class M-1
Certificates with original denominations aggregating at least $5 million who
have given the Trustee written instructions at least five Business Days prior
to the related Record Date. Notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Trustee of the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Trustee for that purpose
and specified in such notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth hereafter, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless this Certificate has been countersigned by or on behalf of the
Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
B2-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
JPMORGAN CHASE BANK,
as Trustee
By
-------------------------------------
Authorized Officer
[Form of Certificate of
Countersignature]
This is one of the Certificates
referred to in the within-
mentioned Agreement.
By By ,
----------------------------- ---------------------------------------
OR
Authenticating Agent Trustee
------------------------------- ----------------------------------------
Authorized Signatory Authorized Signatory
[Signature page to Class M-1 Certificate, Manufactured Housing Contract
Senior/Subordinate Pass-Through Certificates, Series 2001-C]
B2-4
EXHIBIT C
FORM OF FACE OF CLASS [B-1][B-2] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS
CERTIFICATE IS A "REGULAR INTEREST" IN A "REAL
ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE TRUSTEE OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
[FOR CLASS B-1 CERTIFICATES ONLY] THIS CERTIFICATE
IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
AND CLASS M-1 CERTIFICATES AS DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
[FOR CLASS B-2 CERTIFICATES ONLY] THIS CERTIFICATE
IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, CLASS M-1 CERTIFICATES AND CLASS B-1
CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
C-1
[FOR CLASS B-2 CERTIFICATES ONLY: TO THE LIMITED
EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT THIS CERTIFICATE IS ENTITLED TO THE
BENEFITS OF THE LIMITED GUARANTEE OF XXXXXXX HOMES,
INC. AS SET FORTH IN SECTION 6.05 THEREOF.]
Number
-------------
Date of Pooling and Original Denomination
Servicing Agreement and $__________________________
Cut-off Date:
October 25, 2001 Original Class [B-1][B-2]
Principal Balance:
Class [B-1] [B-2] Remittance
Rate: As specified in the $[_________] $[____________]
Pooling and Servicing Agreement
referred to herein.
Remittance Date after
Latest Due Date: ____ __, ____
First Remittance Date:
December 7, 2001
CUSIP ______________
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
Series 2001-C CLASS [B-1][B-2] (SUBORDINATE)
evidencing a percentage interest in any
distributions allocable to the Class [B-1][B-2]
Certificates with respect to a pool of fixed and
adjustable rate conventional manufactured housing
contracts formed and sold by
VANDERBILT MORTGAGE AND FINANCE, INC.
which manufactured housing contracts either were originated or acquired by
Vanderbilt Mortgage and Finance, Inc. (hereinafter called the "Company," which
term includes any successor entity under the Agreement referred to below) and
are initially serviced by Vanderbilt Mortgage and Finance, Inc. (in such
capacity, the "Servicer", which term includes any entity under the Agreement
referred to below).
Except as set forth in the Pooling and Servicing Agreement, this
Certificate does not represent an obligation of or interest in the Company,
the Servicer or the Trustee referred to
C-2
below or any of their Affiliates. Neither this Certificate nor the underlying
manufactured housing contracts are guaranteed or insured by Vanderbilt Mortgage
and Finance, Inc., the Servicer or by any governmental agency or
instrumentality.
THE PORTION OF THE ORIGINAL CLASS [B-1][B-2] PRINCIPAL BALANCE
EVIDENCED BY THIS CERTIFICATE ("CERTIFICATE BALANCE") WILL BE REDUCED BY
DISTRIBUTIONS ON THIS CERTIFICATE THAT ARE ALLOCABLE TO PRINCIPAL.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE
CERTIFICATE BALANCE OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE ORIGINAL
DENOMINATION SHOWN ABOVE. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS
CURRENT CERTIFICATE BALANCE BY INQUIRY OF THE PAYING AGENT. On the date of the
initial issuance of the Certificates, the Paying Agent is the Trustee.
This certifies that CEDE & CO. is the registered owner of an
undivided interest in certain monthly distributions with respect to a pool
(the "Contract Pool") of conventional manufactured housing installment sales
contracts, installment loan agreements and mortgage loans (collectively, the
"Contracts") formed and sold by the Company and certain other property
(collectively, the "Trust Fund"). The Contracts either were originated or
acquired by and are serviced by the Servicer and are secured by Manufactured
Homes. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement dated as specified above (the "Agreement"), by and among the
Company, as seller and servicer, Xxxxxxx Homes, Inc., as provider of the
Limited Guarantee, and JPMorgan Chase Bank, as trustee (the "Trustee"), a
summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2001-C (the "Certificates"), and is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
On each Remittance Date, the Trustee will cause to be distributed to
each Class [B-1] [B-2] Certificateholder an amount equal to the product of (i)
the Percentage Interest evidenced by such Class [B-1][B-2] Certificateholder's
Certificate and (ii) subject to the prior rights of Holders of Class A, Class
M-1 [and Class B-1] Certificates as specified in the Agreement, the Class
[B-1][B-2] Distribution Amount.
Distributions on this Certificate will be made by check mailed to the
address of the Person entitled thereto, as such name and address shall appear
on the Certificate Register or by wire transfer to Holders of Class [B-1]
[B-2] Certificates with original denominations aggregating at least $5 million
who have given the Trustee written instructions at least five Business Days
prior to the related Record Date. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee
of the pendency of such distribution and only upon presentation and surrender
of this Certificate at the office or agency appointed by the Trustee for that
purpose and specified in such notice of final distribution.
C-3
Reference is hereby made to the further provisions of this
Certificate set forth hereafter, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless this Certificate has been countersigned by or on behalf of the
Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
C-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
JPMORGAN CHASE BANK,
as Trustee
By
----------------------------------------
Authorized Officer
[Form of Certificate of
Countersignature]
This is one of the Certificates
referred to in the within-
mentioned Agreement.
By By ,
--------------------- ------------------------------------------
OR
Authenticating Agent Trustee
--------------------- ------------------------------------
Authorized Signatory Authorized Signatory
[Signature page to Class [B-1][B-2]
Certificate, Manufactured Housing
Contract Senior/Subordinate
Pass-Through Certificates,
Series 2001-C]
C-5
EXHIBIT D
FORM OF FACE OF CLASS R CERTIFICATE
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE
RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED
PURSUANT TO SUCH ACT OR LAWS OR IS SOLD OR
TRANSFERRED IN TRANSACTIONS WHICH ARE EXEMPT FROM
REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE
STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 4.02 AND SECTION 4.08 OF THE
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF
PAYMENT TO THE CLASS A, CLASS M-1 AND CLASS B
CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS
CERTIFICATE IS A "RESIDUAL INTEREST" IN A "REAL
ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE TERMS
ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE.
NEITHER THIS CERTIFICATE NOR ANY BENEFICIAL
INTEREST HEREIN MAY BE, DIRECTLY OR INDIRECTLY,
TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE ASSIGNED WITHOUT THE EXPRESS WRITTEN
CONSENT OF THE SERVICER, ACTING ON BEHALF OF THE
TRUST FUND, AND ANY TRANSFER IN VIOLATION OF THIS
RESTRICTION SHALL BE ABSOLUTELY NULL AND VOID AND
SHALL VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE,
AND SHALL SUBJECT THE HOLDER HEREOF TO
D-1
LIABILITY FOR ANY TAX IMPOSED (AND RELATED EXPENSES,
IF ANY) WITH RESPECT TO SUCH ATTEMPTED TRANSFER.
Number Percentage Interest: 100%
-----------
Date of Pooling and
Servicing Agreement and
Cut-off Date:
October 25, 2001
Remittance Date after
Latest Due Date: ____ __, ____
First Remittance Date:
December 7, 2001
MANUFACTURED HOUSING CONTRACT SENIOR/SUBORDINATE
PASS-THROUGH CERTIFICATE
Series 2001-C Class R (SUBORDINATE)
evidencing the entire percentage interest in any
distributions allocable to the Class R Certificate
with respect to a pool of fixed rate and a pool of
adjustable rate conventional manufactured housing
contracts, in each case formed and sold by
VANDERBILT MORTGAGE AND FINANCE, INC.
which manufactured housing contracts either were originated or acquired by
Vanderbilt Mortgage and Finance, Inc. (hereinafter called the "Company," which
term includes any successor entity under the Agreement referred to below) and
are initially serviced by Vanderbilt Mortgage and Finance, Inc. (in such
capacity, the "Servicer", which term includes any entity under the Agreement
referred to below).
This Certificate does not represent an obligation of or interest in
the Company, the Servicer or the Trustee referred to below or any of their
Affiliates. Neither this Certificate nor the underlying manufactured housing
contracts are guaranteed or insured by Vanderbilt Mortgage and Finance, Inc.
or the Servicer or by any governmental agency or instrumentality.
This certifies that Vanderbilt SPC, Inc. is the registered owner of
an undivided interest in certain monthly distributions with respect to a pool
(the "Contract Pool") of conventional manufactured housing installment sales
contracts, installment loan agreements and mortgage loans (collectively, the
"Contracts") formed and sold by the Company and certain other property
(collectively, the "Trust Fund"). The Contracts either were originated or
acquired by and are serviced by Vanderbilt Mortgage and Finance, Inc. (the
"Servicer") and are secured by Manufactured Homes. The Trust Fund was created
pursuant to a Pooling and Servicing Agreement dated as specified above (the
"Agreement"), by and among the Company, as seller
D-2
and servicer, Xxxxxxx Homes, Inc., as provider of the Limited Guarantee, and
JPMorgan Chase Bank, as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not
defined herein, the capitalized terms used herein have the meanings assigned
in the Agreement.
This Certificate is one of a duly authorized issue of Certificates,
designated as Manufactured Housing Contract Senior/Subordinate Pass-Through
Certificates, Series 2001-C (the "Certificates"), and is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
On each Remittance Date, the Trustee will cause to be distributed to
the Class R Certificateholder an amount equal to the Class R Distribution
Amount.
Distributions on this Certificate will be made by check mailed to the
address of the Person entitled thereto, as such name and address shall appear
on the Certificate Register or by wire transfer if the Holder has given the
Trustee written instructions at least five Business Days prior to the related
Record Date. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose and
specified in such notice of final distribution.
No transfer of the Class R Certificate will be made unless such
transfer is exempt from the registration requirements of the Securities Act of
1933, as amended, and any applicable state securities laws or is made pursuant
to an effective registration statement under said Act or laws. The Trustee or
the Company may require an Opinion of Counsel acceptable to and in form and
substance satisfactory to the Company that such transfer is exempt (describing
the applicable exemption and the basis therefor) from the registration
requirements of the Securities Act of 1933, as amended, and from any
applicable securities statute of any state, and the transferee shall execute
an investment letter in the form described by the Agreement.
Reference is hereby made to the further provisions of this
Certificate set forth hereafter, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless this Certificate has been countersigned by or on behalf of the
Trustee, by manual signature, this Certificate shall not be entitled to any
benefit under the Agreement or be valid for any purpose.
D-3
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
JPMORGAN CHASE BANK,
as Trustee
By
--------------------------------------
Authorized Officer
[Form of Certificate of
Countersignature]
This is one of the Certificates
referred to in the within-
mentioned Agreement.
By By ,
----------------------------- ----------------------------------------
OR
Authenticating Agent Trustee
------------------------------- --------------------------------------
Authorized Signatory Authorized Signatory
[Signature page to Class R Certificate,
Manufactured Housing Contract
Senior/Subordinate Pass-Through
Certificates, Series 2001-C]
D-4
EXHIBIT E
[FORM OF REVERSE OF CLASS A CERTIFICATES, CLASS M-1 CERTIFICATES, CLASS
B CERTIFICATES AND CLASS R CERTIFICATE]
As provided in the Agreement, deductions and withdrawals from the
Certificate Account will be made from time to time for purposes other than
distributions to Certificateholders, such purposes including payment of the
Monthly Servicing Fee, reimbursement to the Servicer for certain expenses
incurred by it, and reimbursement to the Servicer for previous advances with
respect to delinquent payments on the Contracts.
The Trustee will cause to be kept at its Corporate Trust Office in
New York City, or at the office of its designated agent, a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee will provide for the registration of Certificates and of transfers
and exchanges of Certificates. Upon surrender for registration of transfer of
any Certificate at any office or agency of the Trustee maintained for such
purpose, the Trustee will, subject to the limitations set forth in the
Agreement, countersign and deliver, in the name of the designated transferee
or transferees, a Certificate dated the date of countersignature by the
Trustee.
No service charge will be made to the Holder for any registration of
transfer or exchange of this Certificate, but the Trustee may require payment
of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any registration of transfer or exchange of the
Certificate. Prior to due presentation of a Certificate for registration of
transfer, the Company, the Servicer and the Trustee may treat the Person in
whose name any Certificate is registered as the owner of such Certificate and
the Percentage Interest in the Trust Fund evidenced thereby for the purpose of
receiving distributions pursuant to the Agreement and for all other purposes
whatsoever, and neither the Company, the Servicer nor the Trustee will be
affected by notice to the contrary.
The Agreement may be amended from time to time by the Company, the
Servicer and the Trustee, without the consent of any of the
Certificateholders, (i) to cure any ambiguity, error or mistake or to correct
or supplement any provisions therein which may be inconsistent with any other
provisions therein, (ii) to add to the duties or obligations of the Servicer
under the Agreement, (iii) to obtain a rating by a nationally recognized
rating agency or to maintain or improve the rating of the Certificates then
given by a rating agency (it being understood that, after obtaining the rating
of any Certificates at the Closing Date, none of the Trustee, the Company or
the Servicer is obligated to obtain, maintain or improve any rating of the
Certificates), (iv) to facilitate the operation of a guarantee of the Class
B-2 Certificates by any Person (it being understood that the creation of any
such guarantee is solely at the option of the Company and that such guarantee
will not benefit in any way or result in any payments on any other Class of
Certificates) or (v) to make any other provisions with respect to matters or
questions arising under the Agreement which are not materially inconsistent
with the provisions of the Agreement, including without limitation provisions
relating to the issuance of definitive Certificates to Certificate Owners
provided that book-entry registration of the Certificates is no longer
permitted, provided that such action does not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Certificateholder (including, without
E-1
limitation, the maintenance of the status of the Trust Fund as a REMIC under
the Code). The Agreement may also be amended from time to time by the Company,
the Servicer and the Trustee, without consent of the Certificateholders, to
modify, eliminate or add to the provisions of the Agreement to such extent as
shall be necessary to maintain the qualification of the Trust Fund as a REMIC
under the Code or avoid, or minimize the risk of, the imposition of any tax on
the Trust Fund or to prevent the Trust Fund from entering into certain
prohibited transactions under the Code, provided that such amendment shall not
adversely affect in any material respect the interests of any Certificateholder
and there shall have been delivered to the Trustee an Opinion of Counsel to
the effect that such action is necessary or appropriate for such purposes.
The Agreement may also be amended from time to time by the Company,
the Servicer and the Trustee with the consent of the Holders of Certificates
evidencing not less than 51% of the Trust Fund, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of the Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment may (i) reduce in any
manner the amount of, or delay the timing of, distributions which are required
to be made on any Certificate without the consent of the Holder of such
Certificate or (ii) reduce the aforesaid percentage of Certificates, the
Holders of which are required to consent to any such amendment, without the
consent of the Holders of all Certificates of such Class then outstanding or
(iii) adversely affect the status of the Trust Fund as a REMIC or cause a tax
to be imposed on the Trust Fund under the REMIC provisions.
The respective obligations and responsibilities of the Company, the
Servicer and the Trustee under the Agreement will terminate upon: (i) the
later of the final payment or other liquidation (or any advance with respect
thereto) of the last Contract or the disposition of all property acquired upon
repossession of any Contract and the remittance of all funds due thereunder;
or (ii) at the option of the Company or the Servicer, on any Remittance Date
after the first Remittance Date on which the sum of the Pool Scheduled
Principal Balances is less than 10% of the sum of the Pool Original Principal
Balances, so long as the Company or the Servicer, as the case may be, deposits
in the Certificate Accounts the repurchase price specified in the Agreement.
E-2
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF
ASSIGNEE) (*This information, which is voluntary, is being requested to ensure
that the assignee will not be subject to backup withholding under Section 3406
of the Code.)
-----------------------
-----------------------
------------------------------------------------------------------------------
(Please Print or Typewrite Name and Address of Assignee)
------------------------------------------------------------------------------
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
-------------------------------------------------------------------- Attorney
to transfer the within Certificate on the books kept for the registration
thereof, with full power of substitution in the premises.
Dated:
(Signature guaranty) ____________________________________
NOTICE: The signature to this
assignment must correspond with the
name as it appears upon the face of the
within Certificate in every particular,
without alteration or enlargement or
any change whatever.
E-3
EXHIBIT F
[SERVICER]
CERTIFICATE REGARDING SUBSTITUTION OF ELIGIBLE
SUBSTITUTE CONTRACT
The undersigned certify that they are [title] and [title],
respectively, of Vanderbilt Mortgage and Finance, Inc. ("Vanderbilt"), and
that as such they are duly authorized to execute and deliver this certificate
on behalf of Vanderbilt pursuant to Section 3.05(b) of the Pooling and
Servicing Agreement (the "Agreement"), dated as of October 25, 2001, among
Vanderbilt, as Seller and Servicer, and JPMorgan Chase Bank, as Trustee (all
capitalized terms used herein without definition having the respective
meanings specified in the Agreement), and further certify that:
1. The Contracts on the attached schedule are to be
substituted on the date hereof pursuant to Section 3.05(b) of the Agreement
and each such Contract is an Eligible Substitute Contract [description, as to
each Contract, as to how it satisfies the definition of "Eligible Substitute
Contract"].
2. The Contract File for each such Contract being
substituted for a Replaced Contract is in the custody of the Servicer and each
such Contract has been stamped in accordance with Section 3.02(y) of the
Agreement.
3. The UCC-1 financing statement in respect of the Contracts
to be substituted, in the form required by Section 3.05(b)(ii) of the
Agreement, has been filed with the appropriate office in Tennessee.
4. There has been deposited in the appropriate Certificate
Account the amounts listed on the schedule attached hereto as the amount by
which the Scheduled Principal Balance of each Replaced Contract exceeds the
Scheduled Principal Balance of each Contract being substituted therefor.
F-1
IN WITNESS WHEREOF, I have affixed hereunto my signature this ____
day of ________, 20__.
[SERVICER]
By
----------------------------------------
[Name]
[Title]
F-2
EXHIBIT G
[SERVICER]
CERTIFICATE OF SERVICING OFFICER
The undersigned certifies that he is a [title] of [Servicer], a [ ]
corporation (the "Servicer"), and that as such he is duly authorized to
execute and deliver this certificate on behalf of the Servicer pursuant to
Section 7.02 of the Pooling and Servicing Agreement (the "Agreement"), dated
as of October 25, 2001, by and among Vanderbilt Mortgage and Finance, Inc., as
Seller and Servicer, Xxxxxxx Homes, Inc., as provider of the Limited
Guarantee, and JPMorgan Chase Bank, as trustee (all capitalized terms used
herein without definition having the respective meanings specified in the
Agreement), and further certifies that:
1. The Monthly Report for the period from ____________ to
___________ attached to this certificate is complete and accurate in
accordance with the requirements of Sections 7.01 and 7.02 of the
Agreement; and
2. As of the date hereof, no Event of Default or event that
with notice or lapse of time or both would become an Event of Default
has occurred.
IN WITNESS WHEREOF, I have affixed hereunto my signature this __ day
of _________, ____.
[SERVICER]
By
-------------------------------------
[Name]
[Title]
X-0
XXXXXXX X
XXXXXXXX XXXXXXXXX
XXXXX OF )
: ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is an officer of ___________________
_________________, a corporation duly organized and existing under the laws of
the State of _________, the proposed transferee (the "Transferee") of the
Class R Certificate from the Manufactured Housing Contract Senior/Subordinate
Pass-Through Certificates, Series 2001-C, issued pursuant to the Pooling and
Servicing Agreement, dated as of October 25, 2001 (the "Agreement"), by and
among Vanderbilt Mortgage and Finance, Inc., as seller and servicer, Xxxxxxx
Homes, Inc., as provider of the Limited Guarantee and JPMorgan Chase Bank, as
trustee. Capitalized terms used, but not defined herein or in Exhibit 1
hereto, shall have the meanings ascribed to such terms in the Agreement. The
Transferee has authorized the undersigned to make this affidavit on behalf of
the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring the
Class R Certificate for its own account.
3. The Transferee has been advised and understands that (i) a tax
shall be imposed on Transfers of the Class R Certificate to Persons that are
not Permitted Transferees; (ii) such tax is imposed on the transferor; and
(iii) the Person otherwise liable for the tax shall be relieved of liability
for the tax if the subsequent Transferee furnished to such Person an affidavit
that such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax
shall be imposed on a "pass-through entity" holding the Class R Certificate if
at any time during the taxable year of the pass-through entity a Person that
is not a Permitted Transferee is the record holder of an interest in such
entity. The Transferee understands that no tax will be imposed for any period
for which the record holder furnishes to the pass-through entity an affidavit
stating that the record holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a
real estate investment trust or common trust fund, a partnership, trust or
estate, and certain cooperatives and, except as may be provided in Treasury
Regulations, persons holding interests in pass-through entities as a nominee
for another Person.)
5. Transferee has reviewed the provisions of Section 4.08 of the
Agreement (attached hereto as Exhibit 1 and incorporated herein by reference)
and understands the legal consequences of the acquisition of the Class R
Certificate, including, without limitation, the restrictions on subsequent
Transfers and the provisions regarding voiding the Transfer and
H-1
mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Sections 4.02 and 4.08 of the Agreement. The
Transferee understands and agrees that any breach of any of the
representations included herein shall render the Transfer to the Transferee
contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer the Class R Certificate and
the Transferee will not Transfer the Class R Certificate or cause the Class R
Certificate to be Transferred to any Person that the Transferee knows is not a
Permitted Transferee.
7. The Transferee's taxpayer identification number is
__________________.
8. The Purchaser (i) is not a Non-U.S. Person or (ii) is a Non-U.S.
Person that holds the Class R Certificate in connection with the conduct of a
trade or business in the United States and has furnished the transferor and
the Trustee with an effective Internal Revenue Service Form 4224 or successor
form at the time and in the manner required by the Code or (iii) is a Non-U.S.
Person that has delivered to both the transferor and the Trustee an opinion of
a nationally recognized tax counsel to the effect that the transfer of the
Class R Certificate to it is in accordance with the requirements of the Code
and the regulations promulgated thereunder and that such transfer of the Class
R Certificate will not be disregarded for federal income tax purposes.
"Non-U.S. Person" means an individual, corporation, partnership or other
person which is not a U.S. Person. A "U.S. Person" means (i) a citizen or
resident of the United States, (ii) a corporation, partnership or other entity
treated as a corporation or partnership for United States federal income tax
purposes organized in or under the laws of the United States or any state
thereof or the District of Columbia (other than a partnership that is not
treated as a United States person under any applicable Treasury regulations)
or (iii) an estate the income of which is includible in gross income for
United States tax purposes, regardless of its source, or (iv) a trust if a
court within the United States is able to exercise primary supervision over
the administration of the trust and one or more United States persons have
authority to control all substantial decisions of the trust. Notwithstanding
the preceding sentence, to the extent provided in regulations, certain trusts
in existence on August 20, 1996 and treated as United States persons prior to
such date that elect to continue to be treated as United States persons shall
be considered United States persons as well.
9. The Purchaser does not have the intention to impede the assessment
or collection of any federal, state or local taxes legally required to be paid
with respect to such Class R Certificate, and the Purchaser hereby
acknowledges that the Class R Certificate may generate tax liabilities in
excess of the cash flow associated with the Class R Certificate and intends to
pay such taxes associated with the Class R Certificate when they become due.
10. The Transferee has provided financial statements or other
financial information requested by the Seller of the Class R Certificates (the
"Transferor") in connection with the transfer of the Class R Certificates to
permit the Transferor to access the financial capacity of the Transferee to
pay such taxes.
H-2
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its duly authorized officer and its corporate seal to be hereunto affixed,
duly attested, this ___ day of __________, 200_.
[Name of transferee]
By:
---------------------------------------
Name:
Title:
[Corporate Seal]
ATTEST:
---------------------------
[Assistant] Secretary
Personally appeared before me the above-named __________________,
known or proved to me to be the same person who executed the foregoing
instrument and to be the President of the Transferee, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Transferee.
Subscribed and sworn before me this ____ day of ______, 2001.
--------------------------------
NOTARY PUBLIC
My commission expires the __
day of _______________, 20__.
H-3
EXHIBIT I
FORM OF INVESTMENT LETTER OF
CLASS R CERTIFICATEHOLDER
Representations of Purchaser.
----------------------------
1. The Purchaser is acquiring a Class R Certificate as
principal for its own account for the purpose of investment [neither the
Underwriters nor any of their Affiliates need represent that it is acquiring
for purposes of investment] and not with a view to or for sale in connection
with any distribution thereof, subject nevertheless to any requirement of law
that the disposition of the Purchaser's property shall at all times be and
remain within its control.
2. The Purchaser has knowledge and experience in financial
and business matters and is capable of evaluating the merits and risks of its
investment in a Class R Certificate and is able to bear the economic risk of
such investment. The Purchaser is an "accredited investor" within the meaning
of Rule 501(a) under the rules and regulations of the Securities and Exchange
Commission under the Securities Act of 1933, as amended. The Purchaser has
been given such information concerning the Class R Certificate, the underlying
Contracts and the Servicer as it has requested.
3. The Purchaser will comply with all applicable federal and
state securities laws in connection with any subsequent resale by the
Purchaser of the Class R Certificate.
4. The Purchaser understands that the Class R Certificate
has not been and will not be registered under the Securities Act of 1933, as
amended, or any state securities laws and may be resold (which resale is not
currently contemplated) only if an exemption from registration is available,
that neither the Company, the Servicer nor the Trustee is required to register
the Class R Certificate and that any transfer must comply with Sections 4.02
and 4.08 of the Pooling and Servicing Agreement. In connection with any resale
of the Class R Certificate, the Purchaser shall not make any general
solicitation or advertisement.
5. The Purchaser represents that it is not an employee
benefit plan subject to Section 406 of the Employee Retirement Income Security
Act of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986,
as amended, or a person acting on behalf of such a plan or using the assets of
such a plan to acquire the Class R Certificate.
6. The Purchaser agrees that it will obtain from any
purchaser of the Class R Certificate from it the same representations,
warranties and agreements contained in the foregoing paragraphs 1 through 5
and in this paragraph 6.
I-1
7. The Purchaser hereby directs the Trustee to register the Class R
Certificate acquired by the Purchaser in the name of its nominee as follows:
_____________.
Very truly yours,
_______________________________
NAME OF PURCHASER
By:
-----------------------------------------
Name:
----------------------------------------
Title:
--------------------------------------
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EXHIBIT J
List of Sellers and Originators of Acquired Contracts
(On file with the Trustee and Sidley Xxxxxx Xxxxx & Xxxx LLP)
J-1
EXHIBIT K
FORM OF POWER OF ATTORNEY
Vanderbilt Mortgage and Finance, Inc. as Seller and Servicer (the
"Seller") under the Pooling and Servicing Agreement dated as of October 25,
2001 (the "Agreement"), between Vanderbilt Mortgage and Finance, Inc. and
JPMorgan Chase Bank, as Trustee (the "Trustee"), hereby irrevocably
constitutes and appoints the Trustee its true and lawful attorney-in-fact and
agent, to execute, acknowledge, verify, swear to, deliver, record and file, in
its name, place and stead, all instruments, documents and certificates which
may from time to time be required in connection with the Agreement, including,
without limitation, to execute any documents required to be executed or
recorded by the Trustee pursuant to Section 2.02(a) of the Agreement. If
required, the Seller shall execute and deliver to the Trustee upon request
therefor, such further designations, powers of attorney or other instruments
as the Trustee shall reasonably deem necessary for its purposes hereof.
Capitalized terms used herein and not otherwise defined shall have
the meanings assigned to such terms in the Agreement.
VANDERBILT MORTGAGE AND FINANCE, INC.
By:
-----------------------------------------
Name:
Title:
K-1
EXHIBIT L
FORM OF LIMITED POWER OF ATTORNEY
THIS LIMITED POWER OF ATTORNEY, dated as of this ____ day of _______,
_____, is granted, for the purposes set forth herein, to Vanderbilt Mortgage
and Finance, Inc., whose address is 000 Xxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxx (the
"Vanderbilt"), by JPMORGAN CHASE BANK, as principal (in such capacity, the
"Principal"), a bank organized and existing under the laws of the State of New
York, whose address is 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Structured Finance Services, acting in its capacity as
trustee (in such capacity, the "Trustee") under that certain Pooling and
Servicing Agreement dated as of October 25, 2001 between the Trustee and the
Attorney-in-Fact (the "Pooling and Servicing Agreement"). Capitalized terms
used and not otherwise defined herein shall have the meanings set forth in the
Pooling and Servicing Agreement.
In accordance with section 5.01 of the Pooling and Servicing
Agreement, the Trustee hereby appoints the Vanderbilt, acting by and through
its officers and employees, as attorney-in-fact for the Trustee (in such
capacity, the "Attorney-in-Fact"), with full authority and power to execute
and deliver on behalf of the Trustee, with respect to the Deeds of Trust,
assignments of mortgage or deed of trust from the Trustee to the
Attorney-in-Fact for recordation.
This Limited Power of Attorney shall not be deemed to be revoked as
to any particular deed of trust unless and until an instrument containing the
revocation is recorded in the office where the deed of trust is recorded.
IN WITNESS WHEREOF, the Principal has caused this Limited Power of
Attorney to be executed as of the date first written above.
JPMORGAN CHASE BANK,
as Trustee
By:_______________________________
Name:
Title:
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On _________ __, 2001, before me, ____________________, a Notary
Public in and for said County and State. ____________________, known to me to
be the person who executed the foregoing instrument, bearing the date of
___________, 2001, as a _______________ of JPMorgan Chase Bank, acknowledged
this Limited Power of Attorney to be the act and deed of JPMorgan Chase Bank
and that she delivered the same as such before me in my jurisdiction
aforesaid.
L-1
WITNESS my hand and official seal.
-------------------------------
Notary Public
[SEAL]
My Commission Expires: ____________________
L-2
