-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GMw3TuOBP3TOPcIZeKkDit8+iGaCLNarNf+KuxxeqO/zJnjfJ+Fq2/aTCrC06Y9V PlO08cS0cBP7lqZyH9alwQ== 0000950134-96-004758.txt : 19960911 0000950134-96-004758.hdr.sgml : 19960911 ACCESSION NUMBER: 0000950134-96-004758 CONFORMED SUBMISSION TYPE: S-1/A PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 19960910 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FLEETWOOD CREDIT RECEIVABLES CORP CENTRAL INDEX KEY: 0000871663 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] IRS NUMBER: 330444724 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-1/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-10835 FILM NUMBER: 96627774 BUSINESS ADDRESS: STREET 1: 22840 SAVI RANCH PKWY STREET 2: PO BOX 87024 CITY: YORBA LINDA STATE: CA ZIP: 92613 BUSINESS PHONE: 7149213403 MAIL ADDRESS: STREET 1: 22840 SAVI RANCH PKWY STREET 2: PO BOX 87024 CITY: YORBA LINDA STATE: CA ZIP: 92613 S-1/A 1 AMENDMENT TO FORM S-1 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 10, 1996 REGISTRATION NO. 333-10835 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ FLEETWOOD CREDIT 1996-B GRANTOR TRUST (ISSUER WITH RESPECT TO THE CERTIFICATES) FLEETWOOD CREDIT RECEIVABLES CORP. (ORIGINATOR OF THE TRUST DESCRIBED HEREIN) (EXACT NAME AS SPECIFIED IN ORIGINATOR'S CHARTER) CALIFORNIA 6146 33-0444724 (STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
------------------------ 22840 SAVI RANCH PARKWAY YORBA LINDA, CALIFORNIA 92687 (714) 921-3400 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF ORIGINATOR'S PRINCIPAL EXECUTIVE OFFICES) LAWRENCE F. PITTROFF DIRECTOR AND SENIOR VICE PRESIDENT FLEETWOOD CREDIT RECEIVABLES CORP. 22840 SAVI RANCH PARKWAY YORBA LINDA, CALIFORNIA 92687 (714) 921-3400 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE WITH RESPECT TO THE REGISTRANT) ------------------------ COPIES TO: DALE W. LUM, ESQ. BROWN & WOOD LLP 555 CALIFORNIA STREET SAN FRANCISCO, CALIFORNIA 94104-1715 ------------------------ Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. / / If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / _________ If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / __________ If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / / ------------------------ CALCULATION OF REGISTRATION FEE - --------------------------------------------------------------------------------
PROPOSED PROPOSED PROPOSED TITLE OF MAXIMUM MAXIMUM EACH CLASS OF OFFERING AGGREGATE AMOUNT OF SECURITIES TO AMOUNT TO BE PRICE PER OFFERING REGISTRATION BE REGISTERED REGISTERED UNIT PRICE FEE - -------------------------------------------------------------------------------------------------------------------------- % Asset Backed Certificates, Class A $198,288,618.40 100%(1) $198,288,618.40(1) $68,375.39(2) % Asset Backed Certificates, Class B $ 7,191,815.18 100%(1) $ 7,191,815.18(1) $ 2,479.94(2) - --------------------------------------------------------------------------------------------------------------------------
(1) Estimated solely for the purpose of calculating the registration fee on the basis of the proposed maximum offering price per unit. (2) Of each amount, $344.83 has previously been paid. ------------------------ THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. ================================================================================ 2 FLEETWOOD CREDIT RECEIVABLES CORP. FLEETWOOD CREDIT 1996-B GRANTOR TRUST --------------------- CROSS REFERENCE SHEET FURNISHED PURSUANT TO RULE 501(B) OF REGULATION S-K
CAPTION OR LOCATION ITEM AND CAPTION IN FORM S-1 IN PROSPECTUS ------------------------------------------------------ --------------------------------- 1. Forepart of Registration Statement and Outside Cover Page of Prospectus.................................... Forepart of Registration Statement and Outside Front Cover Page of Prospectus 2. Inside Front and Outside Back Cover Pages of Prospectus............................................ Inside Front Cover Page and Outside Back Cover Page of Prospectus 3. Summary Information, Risk Factors and Ratio of Earnings to Fixed Charges............................. Summary; The Receivables 4. Use of Proceeds....................................... Use of Proceeds 5. Determination of Offering Price....................... * 6. Dilution.............................................. * 7. Selling Security Holders.............................. * 8. Plan of Distribution.................................. Underwriting 9. Description of Securities to be Registered............ Summary; The Receivables; The Certificates 10. Interests of Named Experts and Counsel................ Legal Opinions 11. Information With Respect to the Registrant............ The Seller 12. Disclosure of Commission Position on Indemnification for Securities Act Liabilities........................ *
- --------------- * Answer negative or item inapplicable. 3 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION PRELIMINARY PROSPECTUS DATED SEPTEMBER 10, 1996 $205,480,433.58 Fleetwood Credit 1996-B Grantor Trust $198,288,618.40 % Asset Backed Certificates, Class A $7,191,815.18 % Asset Backed Certificates, Class B Fleetwood Credit Receivables Corp. Seller Fleetwood Credit Corp., Servicer and (LOGO)! a wholly owned subsidiary of Associates First Capital Corporation
------------------ The Fleetwood Credit 1996-B Grantor Trust Asset Backed Certificates (the "Certificates") will consist of one class of senior certificates (the "Class A Certificates") and one class of subordinated certificates (the "Class B Certificates"). Principal, and interest to the extent of the Class A Pass-Through Rate of % per annum, and the Class B Pass-Through Rate of % per annum, will be distributed to the Class A Certificateholders and Class B Certificateholders, respectively, on the 15th day of each month (or, if such day is not a Business Day, on the next succeeding Business Day), beginning October 15, 1996. The Final Scheduled Distribution Date will be March 15, 2012. The Class A Certificates and the Class B Certificates will respectively evidence in the aggregate undivided ownership interests of 96.50% and 3.50% of the Fleetwood Credit 1996-B Grantor Trust (the "Trust"). The Trust will be formed pursuant to a Pooling and Servicing Agreement to be entered into among Fleetwood Credit Receivables Corp., as Seller (the "Seller"), Fleetwood Credit Corp., as Servicer ("Fleetwood Credit" or, in its capacity as Servicer, the "Servicer"), and The Chase Manhattan Bank, as Trustee. The rights of the Class B Certificateholders to receive distributions of interest and principal will be subordinated to the rights of the Class A Certificateholders to the limited extent described herein. The property of the Trust will primarily include a pool of simple interest retail installment sale contracts (the "Receivables") secured by new and used recreational vehicles (the "Financed Vehicles"), certain monies due under the Receivables on and after September 1, 1996, security interests in the Financed Vehicles and certain other property, as more fully described herein. The Receivables, including the security interests in the Financed Vehicles, will be purchased by the Seller from Fleetwood Credit concurrently with their conveyance to the Trust. See "Property of the Trust." ------------------ There currently is no secondary market for either Class of Certificates and there is no assurance that one will develop. The Underwriters expect, but are not obligated, to make a market in each Class of Certificates. There is no assurance that any such market will develop, or if one does develop, that it will continue or that it will provide sufficient liquidity. ------------------ THE CERTIFICATES WILL REPRESENT INTERESTS IN THE TRUST AND WILL NOT REPRESENT INTERESTS IN OR OBLIGATIONS OF FLEETWOOD CREDIT RECEIVABLES CORP., FLEETWOOD CREDIT CORP., ASSOCIATES FIRST CAPITAL CORPORATION OR ANY OF THEIR RESPECTIVE AFFILIATES. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR AD- EQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. Underwriting Price to Discounts and Proceeds to the Public(1) Commission Seller(1)(2) -------------------------------------------------------- Per Class A Certificate.......................... % % % Per Class B Certificate.......................... % % % Total............................................ $ $ $
(1) Plus accrued interest from September 1, 1996. (2) Before deduction of expenses payable by the Seller estimated at $275,000.00. ------------------ The Certificates are offered by the several Underwriters when, as and if issued and accepted by them, and subject to their right to reject orders in whole or in part. It is expected that delivery of the Certificates, in book-entry form, will be made through the facilities of The Depository Trust Company on or about September , 1996, against payment in immediately available funds. CS FIRST BOSTON UBS SECURITIES The date of this Prospectus is September , 1996. 4 IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF EITHER CLASS OF CERTIFICATES AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. ------------------ AVAILABLE INFORMATION The Seller has filed with the Securities and Exchange Commission (the "Commission") on behalf of the Trust a Registration Statement on Form S-1 (together with all amendments and exhibits thereto, the "Registration Statement"), of which this Prospectus is a part, under the Securities Act of 1933, as amended, with respect to the Certificates being offered hereby. This Prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which have been omitted in accordance with the rules and regulations of the Commission. For further information, reference is made to the Registration Statement which is available for inspection without charge at the public reference facilities of the Commission at Judiciary Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and the regional offices of the Commission at Citicorp Center, Suite 1400, 500 West Madison Street, Chicago, Illinois 60661-2511, and Suite 1300, Seven World Trade Center, New York, New York 10048. Copies of such information can be obtained from the Public Reference Section of the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Servicer, on behalf of the Trust, will also file or cause to be filed with the Commission such periodic reports as are required under the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder. REPORTS TO CERTIFICATEHOLDERS BY THE TRUSTEE The Chase Manhattan Bank, as Trustee, will provide to Certificateholders (which shall be Cede & Co. as the nominee of The Depository Trust Company unless Definitive Certificates are issued under the limited circumstances described herein) unaudited monthly and annual reports concerning the Receivables. See "The Certificates -- Statements to Certificateholders" and "-- Evidence as to Compliance." 2 5 SUMMARY This Summary is qualified in its entirety by reference to the detailed information appearing elsewhere in this Prospectus. Certain capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto elsewhere in this Prospectus. See the Glossary of Terms for the location herein of certain capitalized terms. Trust..................... Fleetwood Credit 1996-B Grantor Trust. Seller.................... Fleetwood Credit Receivables Corp. (the "Seller"), a wholly owned, limited purpose subsidiary of Fleetwood Credit Corp. Servicer.................. Fleetwood Credit Corp. ("Fleetwood Credit" or, in its capacity as Servicer, the "Servicer"), a wholly owned subsidiary of Associates First Capital Corporation, which acquired Fleetwood Credit from Fleetwood Enterprises, Inc., in May, 1996. See "The Servicer." Securities Offered........ The Fleetwood Credit 1996-B Grantor Trust Asset Backed Certificates (the "Certificates") will consist of one class of senior certificates (the "Class A Certificates") and one class of subordinated certificates (the "Class B Certificates"). Each Certificate will represent a fractional undivided interest in the Trust. The property of the Trust will primarily include a pool of simple interest retail installment sale contracts (the "Receivables") secured by the new and used recreational vehicles financed thereby (the "Financed Vehicles"), certain monies due under the Receivables on and after September 1, 1996 (the "Cutoff Date"), security interests in the Financed Vehicles, an interest bearing account initially established with the Trustee (the "Certificate Account") and the proceeds thereof, proceeds from claims under certain insurance policies in respect of individual Financed Vehicles or the related Obligors, certain rights under the Pooling and Servicing Agreement to be dated as of September 1, 1996 (the "Agreement"), among the Seller, the Servicer and The Chase Manhattan Bank, as trustee (the "Trustee"). See "Property of the Trust." The Class A Certificates will evidence in the aggregate an undivided ownership interest (the "Class A Percentage") of 96.50% of the Trust (initially representing $198,288,618.40) and the Class B Certificates will evidence in the aggregate an undivided ownership interest (the "Class B Percentage") of 3.50% of the Trust (initially representing $7,191,815.18). The Class B Certificates will be subordinated to the Class A Certificates to the limited extent described herein. The Certificates will be issued pursuant to the Agreement in denominations of $1,000 and integral multiples thereof. Registration of the Certificates............ Each Class of Certificates will initially be represented by one or more certificates registered in the name of Cede & Co. ("Cede"), as the nominee of The Depository Trust Company ("DTC"). No person acquiring an interest in the Class A Certificates (each, a "Class A Certificate Owner") or the Class B Certificates (each, a "Class B Certificate Owner" and, together with the Class A Certificate Owners, the "Certificate Owners") will be entitled to receive a definitive certificate representing such person's interest, except in the event that Definitive Certificates of the related Class are issued under the limited circumstances described herein. Unless and until Certificates of a 3 6 Class are issued in definitive form, all references herein to distributions, notices, reports and statements to and to actions by and effects upon the related Certificateholders will refer to the same actions and effects with respect to DTC or Cede, as the case may be, for the benefit of the related Certificate Owners in accordance with DTC procedures. See "The Certificates -- General," "-- Book-Entry Registration" and "-- Definitive Certificates." Class A Pass-Through Rate...................... % per annum, calculated on the basis of a 360-day year consisting of twelve 30-day months (the "Class A Pass-Through Rate"), payable monthly. Class B Pass-Through Rate...................... % per annum, calculated on the basis of a 360-day year consisting of twelve 30-day months (the "Class B Pass-Through Rate"), payable monthly. The Receivables........... The Receivables arise from simple interest retail installment sale contracts originated by dealers in new and used recreational vehicles (the "Dealers") which are purchased by Fleetwood Credit. All of the Receivables will be selected from the contracts owned by Fleetwood Credit based upon the criteria described under "The Receivables" and "The Certificates -- Sale and Assignment of the Receivables." On or before the date of initial issuance of the Certificates (the "Closing Date"), Fleetwood Credit will sell the Receivables to the Seller pursuant to a receivables purchase agreement to be dated as of September 1, 1996 (the "Receivables Purchase Agreement"), between the Seller and Fleetwood Credit. The Seller will, in turn, sell the Receivables to the Trust pursuant to the Agreement. As of the Cutoff Date, the Receivables had an aggregate principal balance of $205,480,433.58, a weighted average annual percentage rate (the "APR") of 9.59%, a weighted average original maturity of 152.2 months and a weighted average remaining maturity of 150.2 months. Interest.................. On each Distribution Date, the Trustee will distribute (i) to holders of the Class A Certificates (the "Class A Certificateholders") of record as of the last day of the immediately preceding calendar month (the "Record Date") interest in an amount equal to one-twelfth of the product of the Class A Pass-Through Rate and the Class A Certificate Balance as of the first day of the immediately preceding Collection Period (after giving effect to distributions of principal to be made on the Distribution Date occurring in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class A Certificate Balance and (ii) to holders of the Class B Certificates (the "Class B Certificateholders" and, together with the Class A Certificateholders, the "Certificateholders") of record as of the related Record Date interest in an amount equal to one-twelfth of the product of the Class B Pass-Through Rate and the Class B Certificate Balance as of the first day of the immediately preceding Collection Period (after giving effect to distributions of principal to be made on the Distribution Date occurring in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class B Certificate Balance. The rights of the Class B Certificateholders to receive distributions of interest, to the extent of collections on or in respect of the Receivables allocable to interest and certain available amounts on deposit in the Reserve Fund, 4 7 will be subordinated to the rights of Class A Certificateholders to receive distributions of interest, but will not be subordinated to the rights of Class A Certificateholders to receive distributions of principal, as described herein. The "Class A Certificate Balance" will initially equal $198,288,618.40 (the "Original Class A Certificate Balance") and on any Distribution Date will equal the Original Class A Certificate Balance, reduced by all distributions actually made on or prior to such Distribution Date to Class A Certificateholders allocable to principal. The "Class B Certificate Balance" will initially equal $7,191,815.18 (the "Original Class B Certificate Balance") and on any Distribution Date will equal the Original Class B Certificate Balance, reduced by (i) all distributions actually made on or prior to such Distribution Date to Class B Certificateholders allocable to principal and (ii) Realized Losses allocable to the Class B Certificates. See "The Certificates -- Distributions on the Certificates." Principal................. On each Distribution Date, the Trustee will distribute pro rata (i) to Class A Certificateholders of record as of the related Record Date an amount equal to the Class A Percentage of all payments received by the Servicer during the immediately preceding calendar month (each, a "Collection Period") allocable to principal on or in respect of the Receivables and (ii) to Class B Certificateholders of record as of the related Record Date an amount equal to the Class B Percentage of all payments received by the Servicer during the related Collection Period allocable to principal on or in respect of the Receivables. The rights of the Class B Certificateholders to receive distributions of principal will be subordinated to the rights of the Class A Certificateholders to receive distributions of interest and principal to the limited extent described herein. Distribution Dates........ The 15th day of each month (or, if such day is not a Business Day, the next succeeding Business Day), beginning October 15, 1996. The final scheduled Distribution Date (the "Final Scheduled Distribution Date") will be March 15, 2012, the Distribution Date that is six months after the month in which the Receivable with the latest maturity is scheduled to mature. Subordination of the Class B Certificates; Reserve Fund............ The rights of the Class B Certificateholders to receive distributions with respect to the Receivables will be subordinated to the rights of the Class A Certificateholders to the limited extent described herein. This subordination is intended to enhance the likelihood of timely receipt by Class A Certificateholders of the full amount of interest and principal required to be paid to them, and to afford such Class A Certificateholders limited protection against losses in respect of the Receivables. No distribution will be made to the Class B Certificateholders on any Distribution Date in respect of (i) interest until the full amount of interest on the Class A Certificates payable on such Distribution Date has been distributed to the Class A Certificateholders and (ii) principal until the full amount of interest on and principal of the Class A Certificates payable on such Distribution Date has been distributed to the Class A Certificateholders. Distributions of interest on the Class B 5 8 Certificates, to the extent of collections on or in respect of the Receivables allocable to interest and certain available amounts on deposit in the Reserve Fund, will not be subordinated to the payment of principal on the Class A Certificates. The protection afforded to the Class A Certificateholders by the subordination feature described above will be effected both by the preferential right of the Class A Certificateholders to receive, to the extent described herein, current distributions from collections on or in respect of the Receivables and by the establishment of a segregated trust account held by the Trustee for the benefit of the Certificateholders (the "Reserve Fund"). The Reserve Fund will not be part of the Trust. The Reserve Fund will be funded by the Seller on the Closing Date in an amount equal to $3,082,207.00. Thereafter, on each Distribution Date all Excess Amounts, if any, will be deposited from time to time in the Reserve Fund to the extent necessary to maintain the Reserve Fund at an amount to be specified in the Agreement (the "Specified Reserve Fund Balance"). "Excess Amounts" in respect of a Distribution Date will be all interest collections on or in respect of the Receivables on deposit in the Certificate Account in respect of such Distribution Date, after the Servicer has been reimbursed for any outstanding Advances and has been paid the Servicing Fee (including any unpaid Servicing Fees with respect to one or more prior Collection Periods) and after giving effect to all distributions of interest and principal required to be made to the Class A and Class B Certificateholders on such Distribution Date. The Specified Reserve Fund Balance for the first Distribution Date will be $3,082,207.00 and on any Distribution Date thereafter will be calculated as described under "The Certificates -- Subordination of the Class B Certificates; Reserve Fund." On each Distribution Date, funds will be withdrawn from the Reserve Fund for distribution, first to Class A Certificateholders to the extent of shortfalls in the amounts available to make required distributions of interest on the Class A Certificates, second to Class B Certificateholders to the extent of shortfalls in the amounts available to make required distributions of interest on the Class B Certificates, third to Class A Certificateholders to the extent of shortfalls in the amounts available to make required distributions of principal on the Class A Certificates and fourth to Class B Certificateholders to the extent of shortfalls in the amounts available to make required distributions of principal on the Class B Certificates. On each Distribution Date, after giving effect to all distributions made on such Distribution Date, any amounts in the Reserve Fund in excess of the Specified Reserve Fund Balance will be distributed to the Seller and upon such distribution the Certificateholders will have no further rights in, or claims to, such amounts. See "The Certificates -- Subordination of the Class B Certificates; Reserve Fund." Advances.................. On the Business Day immediately preceding each Distribution Date, the Servicer will advance, in respect of each Receivable, an amount equal to all accrued interest at the related APR which accrued in respect of such Receivable from the last day upon which a payment was made on such Receivable through the last day of the related Collection Period. The Servicer will be required to make an Advance only to the extent it determines such Advance will be recoverable from future payments and 6 9 collections on or in respect of the Receivables or otherwise. See "The Certificates -- Certain Payments by the Servicer." Servicing Fee............. The Servicer will receive a monthly fee, payable on each Distribution Date, equal to one-twelfth of the product of 1.0% (the "Servicing Fee Rate") and the Pool Balance as of the first day of the related Collection Period. The Servicer will be entitled to receive additional servicing compensation in the form of certain late fees, prepayment charges and other administrative fees or similar charges. See "The Certificates -- Servicing Compensation." Optional Purchase......... The Seller or Servicer, or any successor to the Servicer, may purchase all the Receivables on any Distribution Date following a Record Date as of which the Pool Balance is 10% or less of the Pool Balance as of the Cutoff Date (the "Original Pool Balance"), at a purchase price determined as described in "The Certificates -- Termination." Termination............... Within ten days following a Record Date as of which the Pool Balance is 5% or less of the Original Pool Balance, the Trustee shall solicit bids for the purchase of the Receivables remaining in the Trust. In the event that satisfactory bids are received as described in "The Certificates -- Termination," the sale proceeds will be distributed to Certificateholders on the second Distribution Date succeeding such Record Date. If satisfactory bids are not received, the Trustee shall decline to sell the Receivables and shall not be under any obligation to solicit any further bids or otherwise negotiate any further sale of the Receivables. See "The Certificates -- Termination." Ratings................... It is a condition to the issuance of the Certificates that the Class A Certificates be rated Aaa by Moody's Investors Service, Inc. ("Moody's") and AAA by Standard & Poor's Ratings Services ("Standard & Poor's" and, together with Moody's, the "Rating Agencies") and the Class B Certificates be rated A3 by Moody's and A+ by Standard & Poor's. The ratings of each Class of Certificates will be based primarily on the value of the Receivables, the terms of the Certificates and the Reserve Fund. The foregoing ratings do not address the likelihood that the Certificates will be retired following the sale of the Receivables by the Trustee as described above under "Termination." There is no assurance that any rating will not be lowered or withdrawn by the assigning Rating Agency if, in its judgment, circumstances so warrant. In the event that the rating initially assigned to the Class A Certificates or the Class B Certificates is subsequently lowered or withdrawn for any reason, no person or entity will be obligated to provide any additional credit enhancement with respect to such Certificates. There can be no assurance whether any other rating agency will rate the Class A Certificates or the Class B Certificates, or if one does, what rating would be assigned by any such other rating agency. A security rating is not a recommendation to buy, sell or hold securities. Tax Status................ In the opinion of special tax counsel to the Seller, the Trust will be treated as a grantor trust for federal income tax purposes and not as an association taxable as a corporation. For federal income tax purposes, the Certificateholders will be considered to own stripped bonds. See "Certain Federal Income Tax Consequences." Certificateholders should consult 7 10 their own tax advisors as to the proper treatment of original issue discount with respect to the Receivables and the application of the stripped bond rules. ERISA Considerations...... Subject to the conditions described herein, the Class A Certificates may be purchased by employee benefit plans that are subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Since the Class B Certificates will be subordinated to the Class A Certificates, employee benefit plans subject to ERISA will not be eligible to purchase Class B Certificates. Any benefit plan fiduciary considering purchase of the Certificates should, among other things, consult with its counsel in determining whether all required conditions have been satisfied. See "ERISA Considerations." 8 11 FORMATION OF THE TRUST The Seller will establish the Trust by selling and assigning the property of the Trust to the Trustee in exchange for the Certificates. The Servicer will service the Receivables pursuant to the Agreement and will be compensated for acting as such. To facilitate servicing and to minimize administrative burden and expense, the Servicer will be appointed custodian for the Receivables by the Trustee, but will not stamp the Receivables to reflect the sale and assignment of the Receivables to the Trust, amend the certificates of title of the Financed Vehicles or execute any transfer instrument (including, among other instruments, UCC-3 assignments) relating to any Financed Vehicles. Consequently, in some states, in the absence of such amendments and actions, the Trustee will have certain risks with respect to its security interests in the Financed Vehicles. See "Certain Legal Aspects of the Receivables." If the protection provided to (i) the Class A Certificateholders by the subordination of the Class B Certificates and by the Reserve Fund and (ii) the Class B Certificateholders by the Reserve Fund is insufficient, the Trust will look only to payments made by or on behalf of the Obligors on or in respect of the Receivables, the proceeds from the repossession and sale of Financed Vehicles securing Defaulted Receivables and the proceeds of Dealer repurchase obligations, if any, more fully described below under "Property of the Trust," to make distributions on the Certificates. In such event, certain factors, such as the failure of the Trustee to possess first perfected security interests in the Financed Vehicles, may limit the ability of the Trust to realize on the collateral securing the Receivables or may limit the amount realized to less than the amount owed by the related Obligors. Certificateholders may thus be subject to delays in payment and may incur losses on their investment in the Certificates as a result of defaults or delinquencies by Obligors and depreciation in the value of the related Financed Vehicles. The rights of the Class B Certificateholders to receive distributions of principal will be subordinated to the rights of the Class A Certificateholders to receive distributions of interest and principal to the extent described herein. See "The Certificates -- Subordination of the Class B Certificates; Reserve Fund" and "Certain Legal Aspects of the Receivables." PROPERTY OF THE TRUST Each Certificate will represent a fractional undivided interest in the Trust. The property of the Trust will include a pool of simple interest retail installment sale contracts, originated on or before August 31, 1996, between Dealers in new and used recreational vehicles, manufactured primarily by Fleetwood Enterprises, Inc. ("Fleetwood Enterprises") and retail purchasers (the "Obligors"), and certain monies due thereunder on and after the Cutoff Date. The Receivables were originated by Dealers and subsequently assigned to Fleetwood Credit. Such Receivables will be serviced by Fleetwood Credit and evidence the indirect financing made available by Fleetwood Credit to the Obligors. On or before the Closing Date, Fleetwood Credit will sell the Receivables to the Seller which will in turn sell them to the Trust. Neither the Seller nor the Servicer may substitute any other retail installment sale contract for any Receivable sold to the Trust during the term of the Agreement. The assets of the Trust will also include: (i) such amounts as from time to time may be held in the Certificate Account, an interest bearing trust account to be established and maintained by the Servicer with the Trustee pursuant to the Agreement; (ii) security interests in the Financed Vehicles and any accessions thereto; (iii) the right to proceeds from physical damage, credit life and disability insurance policies, if any, covering individual Financed Vehicles or Obligors, as the case may be; (iv) the right to receive proceeds of Dealer repurchase obligations, if any; (v) any Servicer Letter of Credit; (vi) the rights of the Seller under the Receivables Purchase Agreement; and (vii) any and all proceeds of the foregoing. The Reserve Fund will be maintained with the Trustee for the benefit of the Certificateholders, but will not be part of the Trust. The "Pool Balance" as of the first day of a Collection Period will represent the aggregate principal balance of the Receivables at the end of the immediately preceding Collection Period, after giving effect to all payments of principal received from or on behalf of Obligors and all payments of principal on Receivables to be repurchased remitted by the Seller or the Servicer, as the case may be, all for such immediately preceding Collection Period. The Pool Balance will be computed by allocating payments on or in respect of the 9 12 Receivables to principal and to interest using the simple interest method. The "Original Pool Balance" will mean the Pool Balance as of the Cutoff Date. Pursuant to agreements between Fleetwood Credit and the Dealers, each Dealer is obligated after origination to repurchase from Fleetwood Credit recreational vehicle receivables which do not meet certain representations and warranties made by such Dealer. Such representations and warranties relate primarily to the origination of the receivables and the perfection of the security interests in the related financed vehicles, and do not typically relate to the creditworthiness of the related obligors or the collectability of such receivables. Although any Dealer agreements with respect to the Receivables will not be assigned to the Trustee, the Agreement will require that any recovery by Fleetwood Credit pursuant to Dealer repurchase obligations be deposited in the Certificate Account in satisfaction of the Servicer's repurchase obligations under the Agreement. It is expected that the assignments by the Dealers of receivables to Fleetwood Credit do not generally provide for recourse to the Dealer for unpaid amounts in the event of a default by an Obligor, other than in connection with the breach of the Dealer's representations and warranties. THE RECEIVABLES The Receivables will have been purchased by Fleetwood Credit from Dealers in the ordinary course of business. The Receivables were selected from Fleetwood Credit's portfolio of recreational vehicle retail installment sale contracts by several criteria, including the following: (i) each Receivable was originated in the United States of America; (ii) each Receivable has a fixed APR equal to or greater than 8.00%; (iii) each Receivable provides for level monthly payments which provide interest at the related APR and fully amortize the amount financed over an original term of no greater than 180 months; (iv) each Receivable is not more than 30 days past due as of the Cutoff Date; and (v) in the case of Obligors in the military service (including an Obligor who is a member of the National Guard or is in the reserves) whose Receivable is subject to the Soldiers' and Sailors' Civil Relief Act of 1940, as amended (the "Soldiers' and Sailors' Relief Act"), or the California Military Reservist Relief Act of 1991 (the "Military Reservist Relief Act"), each such Obligor (each, a "Relief Act Obligor") must not have made a claim to Fleetwood Credit that (A) the amount of interest on the related Receivable should be limited to 6% pursuant to the Soldiers' and Sailors' Relief Act during the period of such Obligor's active duty status or (B) payments on such Receivable should be delayed pursuant to the Military Reservist Relief Act, in either case unless a court has ordered otherwise upon application of Fleetwood Credit. Interest in respect of the Receivables will accrue on a simple interest method (i.e., the interest portion of each monthly payment will equal the interest on the outstanding principal balance of the related Receivable for the number of days since the most recent payment made on such Receivable and the balance, if any, of such monthly payment will be applied to principal). The Financed Vehicles will consist of motor homes and travel trailers. Approximately 69% of the Receivables, by Original Pool Balance, were secured by motor homes and approximately 31% were secured by travel trailers. Approximately 81% of the Receivables, by Original Pool Balance, represented financing of new recreational vehicles and approximately 19% represented financing of used recreational vehicles. As of the Cutoff Date, the average outstanding principal balances of Receivables secured by motor homes and travel trailers were $48,085.25 and $11,458.74, respectively. A significant portion of the Receivables represent financing of recreational vehicles manufactured by Fleetwood Enterprises. Except in the case of breach of representations by the related Dealer, as described above under "Property of the Trust," it is expected that none of the Receivables provide for recourse to the Dealer who originated the related Receivable. Based upon information presented by Obligors in their Receivables applications, as of the Cutoff Date the Receivables were originated in 48 states. Based on Original Pool Balance, approximately 17% of the Receivables were originated in the State of California, approximately 10% were originated in the State of Oregon, approximately 8% were originated in the State of Texas, approximately 7% were originated in the State of Washington, approximately 6% were originated in the State of Florida and approximately 6% were originated in the State of Arizona . Each other state accounts for less than 5% of the Receivables by Original Pool Balance. As of the Cutoff Date, approximately 1.03% of the Original Pool Balance represented Paid-Ahead Receivables. 10 13 COMPOSITION OF THE RECEIVABLES Aggregate Principal Balance as of the Cutoff Date................... $205,480,433.58 Number of Receivables............................................... 8,570 Average Principal Balance as of the Cutoff Date..................... $23,976.71 Aggregate Original Amount Financed.................................. $208,303,718.46 Range of Original Amounts Financed.................................. $2,000.00 to $272,382.10 Weighted Average APR(1)............................................. 9.59% Range of APRs....................................................... 8.00% to 14.75% Weighted Average Original Term(1)................................... 152.20 months Range of Original Terms............................................. 24 to 180 months Weighted Average Remaining Term as of the Cutoff Date(1)............ 150.20 months Range of Remaining Terms as of the Cutoff Date...................... 16 to 180 months
- --------------- (1) Weighted by unpaid principal balance as of the Cutoff Date. DISTRIBUTION OF THE RECEIVABLES BY APR
PERCENTAGE PERCENTAGE OF NUMBER OF OF NUMBER CUTOFF DATE CUTOFF DATE POOL APR RANGE RECEIVABLES OF RECEIVABLES POOL BALANCE BALANCE - ----------------------------------- ----------- -------------- --------------- ---------------- 8.00% to 8.99%..................... 1,620 18.90% $ 60,540,486.76 29.46% 9.00% to 9.99%..................... 4,035 47.08 104,413,474.09 50.81 10.00% to 10.99%................... 2,348 27.40 34,749,052.27 16.91 11.00% to 11.99%................... 481 5.61 5,162,626.69 2.51 12.00% to 12.99%................... 72 0.84 543,109.93 0.26 13.00% to 13.99%................... 11 0.13 60,908.39 0.03 14.00% to 14.75%................... 3 0.04 10,775.45 0.01 ----- ------ --------------- ------ Total.................... 8,570 100.00% $205,480,433.58 100.00%(1) ===== ====== =============== ======
- --------------- (1) Percentages may not add to 100% due to rounding. MATURITY AND PREPAYMENT CONSIDERATIONS All of the Receivables are prepayable at any time without any penalty. If prepayments are received on the Receivables, the actual weighted average life of the Receivables can be shorter than the scheduled weighted average life, which is based on the assumption that payments will be made as scheduled and that no prepayments will be made. For this purpose the term "prepayments" includes, among other items, voluntary prepayments by Obligors, regular installment payments made in advance of their scheduled due dates, liquidations due to default, proceeds from physical damage, credit life and credit disability insurance policies and repurchases by the Seller or the Servicer, as the case may be, of certain Receivables as described herein. Weighted average life means the average amount of time during which each dollar of principal on a Receivable is outstanding. The rate of prepayments on the Receivables may be influenced by a variety of economic, social and other factors, including the fact that an Obligor may not sell or transfer a Financed Vehicle without the consent of the Servicer. Any reinvestment risk resulting from the rate of prepayment of the Receivables and the distribution of such prepayments to Certificateholders will be borne entirely by the Certificateholders. In addition, early retirement of the Certificates may be effected by either (i) the exercise of the option of the Seller or the Servicer, or any successor to the Servicer, to purchase all of the Receivables remaining in the Trust when the Pool Balance is 10% or less of the Original Pool Balance, or (ii) the sale by the Trustee of all of the Receivables remaining in the Trust when the Pool Balance is 5% or less of the Original Pool Balance. See "The Certificates -- Termination." No prediction can be made as to the rate of prepayments on the Receivables in either stable or changing interest rate environments. Fleetwood Credit is not aware of any publicly available industry statistics that set forth principal prepayment experience for recreational vehicle retail installment sale contracts similar to the Receivables over an extended period of time, and its experience with respect to recreational vehicle receivables 11 14 included in its portfolio is insufficient to draw any specific conclusions with respect to the expected prepayment rates on the Receivables. DELINQUENCIES, REPOSSESSIONS AND NET LOSSES Set forth below is certain information concerning Fleetwood Credit's experience with respect to its portfolio of recreational vehicle receivables similar to the Receivables. Fleetwood Credit did not acquire recreational vehicle receivables similar to the Receivables prior to July, 1986. Accordingly, Fleetwood Credit's experience with respect to such receivables is limited and only a small portion of its recreational vehicle receivables portfolio has reached maturity. There is no assurance that Fleetwood Credit's delinquency, credit loss and repossession experience with respect to recreational vehicle receivables in the future, or the experience of the Trust with respect to the Receivables, will be similar to that set forth below. Losses and delinquencies are affected by, among other things, general and regional economic conditions and the supply of and demand for recreational vehicles. DELINQUENCY EXPERIENCE
AT DECEMBER 31, AT AUGUST 31, ---------------------------------------------------------------------------- 1996 1995 1994 1993 1992 1991 ------------- ------------ ------------ ------------ ------------ ------------ Portfolio Outstanding at End of Period(1)(2)................. $892,414,366 $760,702,992 $661,517,831 $532,764,234 $479,714,355 $445,344,712 Delinquencies at End of Period(1)(3) 30-59 Days................... $ 2,029,606 $ 2,494,548 $ 1,520,815 $ 1,515,090 $ 1,791,830 $ 1,646,565 60-89 Days................... 484,991 419,116 141,132 193,591 202,035 534,754 90 Days or More.............. 66,778 169,736 81,964 324,765 146,067 248,403 ------------ ------------ ------------ ------------ ------------ ------------ Total Delinquencies............ $ 2,581,375 $ 3,083,400 $ 1,743,911 $ 2,033,446 $ 2,139,932 $ 2,429,722 ============ ============ ============ ============ ============ ============ Total Delinquencies as a Percentage of Portfolio Outstanding at End of Period....................... 0.29% 0.41% 0.26% 0.38% 0.45% 0.55%
- --------------- (1) Includes recreational vehicle receivables that have been sold but are still being serviced by the Servicer. (2) The sum of all principal amounts outstanding under the recreational vehicle receivables. (3) The period of delinquency is based on the number of days payments are contractually past due. CREDIT LOSS AND REPOSSESSION EXPERIENCE
EIGHT MONTHS CALENDAR YEAR ENDED DECEMBER 31, ENDED AUGUST ---------------------------------------------------------------------------- 31, 1996 1995 1994 1993 1992 1991 --------------- ------------ ------------ ------------ ------------ ------------ Average Portfolio Outstanding(1)(2)(3)....... $ 812,543,779 $720,418,169 $596,920,867 $512,484,430 $463,406,402 $415,064,750 Average Number of Receivables Outstanding(3)............. 35,089 30,367 25,455 22,724 20,589 17,821 Repossessions as a Percentage of Average Number of Receivables Outstanding.... 0.62%(4) 0.56% 0.50% 0.71% 0.67% 0.59% Net Losses(1)................ $ 1,440,756 $ 1,800,947 $ 1,255,618 $ 1,738,647 $ 1,495,961 $ 815,529 Net Losses as a Percentage of Average Portfolio Outstanding................ 0.27%(4) 0.25% 0.21% 0.34% 0.32% 0.20%
- --------------- (1) Includes recreational vehicle receivables that have been sold but are still being serviced by the Servicer. (2) The sum of all principal amounts outstanding under the recreational vehicle receivables. (3) Amounts represent the average of month-end figures for each month in the periods indicated. (4) Annualized. 12 15 PAID-AHEAD RECEIVABLES If an Obligor, in addition to making a regularly scheduled monthly payment, makes one or more additional monthly payments in any Collection Period (for example, because the Obligor intends to be on vacation the following month), such additional payments will be treated as a prepayment of principal and applied to reduce the principal balance of the related Receivable in such Collection Period. Unless otherwise requested by the Obligor, the Obligor will not be required to make any scheduled monthly payment in respect of such Receivable (a "Paid-Ahead Receivable") for the number of months corresponding to the number of such additional scheduled monthly payments that were made (the "Paid-Ahead Period"). During the Paid-Ahead Period, interest will continue to accrue on the principal balance of the related Receivable, as reduced by the application of such additional scheduled monthly payments made in the Collection Period in which such Receivable became a Paid-Ahead Receivable. A Paid-Ahead Receivable will not be considered delinquent during the related Paid-Ahead Period. An interest shortfall with respect to each Paid-Ahead Receivable will exist during each Collection Period during the Paid-Ahead Period and the Servicer may be required to make an Advance in respect of such shortfall, as described under "The Certificates -- Certain Payments by the Servicer." Notwithstanding the foregoing, no Advances will be made in respect of principal in respect of a Paid-Ahead Receivable. Because interest in respect of the Receivables will accrue on the simple interest method, scheduled monthly payments on a Paid-Ahead Receivable paid by an Obligor following the end of the Paid-Ahead Period may be insufficient to cover the interest that has accrued since the last payment was made prior to the Paid-Ahead Period. Notwithstanding such insufficiency, the related Receivable will be considered current. This situation will continue until sufficient payments have been made to cover all accrued interest on such Paid-Ahead Receivable since the beginning of the Paid-Ahead Period and the principal balance of such Receivable is once again being amortized. Depending on the principal balance and APR of the related Paid-Ahead Receivables, and on the number of payments that were paid-ahead, there may be extended periods of time during which Paid-Ahead Receivables that are current are not amortizing. During such periods, no distributions in respect of principal will be made to Certificateholders with respect to such Receivables. Paid-Ahead Receivables will affect the weighted average lives of the Certificates. The distribution of the paid-ahead amount on the Distribution Date following the Collection Period in which such amount was received will generally shorten the weighted average lives of the Certificates. However, depending on the length of time during which a Paid-Ahead Receivable is not amortized as described above, the weighted average lives of the Certificates may be extended. In addition, to the extent the Servicer makes Advances with respect to a Paid-Ahead Receivable which subsequently goes into default, because liquidation proceeds with respect to such Receivable will be applied first to reimburse the Servicer for such Advances, the loss with respect to such Receivable may be larger than would have been the case had such Advances not been made. As of the Cutoff Date, based on the Original Pool Balance, approximately 1.03% of the Receivables were Paid-Ahead Receivables. Fleetwood Credit's portfolio of recreational vehicle installment sale receivables has historically included receivables which have been paid-ahead by one or more scheduled monthly payments. There can be no assurance as to the number of Receivables which may become Paid-Ahead Receivables or the number or the principal amount of the scheduled payments which may be paid-ahead. RECREATIONAL VEHICLES Motor homes are recreational camping and travel vehicles built on or as an integral part of a self-propelled motor vehicle chassis. A motor home may provide kitchen, sleeping and bathroom facilities, is equipped with the ability to store and carry fresh water and sewage and may be one of the following types: Motor Home: The living unit has been entirely constructed on a bare, specially designed motor vehicle chassis. Van Camper: A panel-type truck to which the manufacturer adds any two of the following conveniences: sleeping, kitchen and toilet facilities. The manufacturer also adds 110-volt hookup, fresh water storage, city water hookup and top extension to provide more headroom. 13 16 Mini Motor Home: This unit is built on an automotive manufactured van frame with an attached cab section having a gross vehicle weight rating of 6,500 pounds or more, with an overall height of less than eight feet. The manufacturer completes the body section containing the living area and attaches it to the cab section. Compact Motor Home: This unit is built on an automotive manufactured cab and chassis having a gross vehicle weight rating of less than 6,500 pounds. It may provide any or all of the conveniences of the larger units. Travel trailers are trailers designed to be towed by a motorized vehicle (e.g., automobile, van or pickup truck) and are of such size and weight as not to require a special highway movement permit. A travel trailer is designed to provide temporary living quarters for recreational, camping or travel use, does not require permanent on-site hookup and can be one of the following types: Conventional Travel Trailer: This unit ranges typically from 12 feet to 35 feet in length, and is towed by means of a bumper or frame hitch attached to the towing vehicle. Park Trailer: These are designed for seasonal or temporary living. When set up, the unit may be connected to utilities necessary for operation of installed fixtures and appliances. The unit is built on a single chassis mounted on wheels. Park trailers are no more than 40 feet in overall body length and no more than 12 feet in overall body width when in the traveling mode. The unit is designed for set-up by persons without special skills using only hand tools which may include lifting, pulling or supporting devices. Fifth-Wheel Travel Trailer: This unit can be equipped the same as the conventional travel trailer, but is constructed with a raised forward section that allows a bi-level floor plan. This style is designed to be towed by a vehicle equipped with a device known as a fifth-wheel hitch. Folding Camping Trailer: This is a vehicular portable unit mounted on wheels and constructed with collapsible partial sidewalls which fold for towing by another vehicle and unfold at the campsite to provide temporary living quarters for recreational, camping or travel use. Slide-In Camper: This is a portable unit designed to be loaded onto and unloaded from the bed of a pickup truck, constructed to provide temporary living quarters for recreational travel or camping use. YIELD CONSIDERATIONS Interest on the Receivables will be passed through to Certificateholders on each Distribution Date to the extent of the Class A Pass-Through Rate and the Class B Pass-Through Rate applied to the Class A Certificate Balance and the Class B Certificate Balance, respectively, as of the first day of the immediately preceding Collection Period (after giving effect to distributions of principal to be made on the Distribution Date in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class A Certificate Balance or the Original Class B Certificate Balance, as the case may be. In the case of each payment of principal on a Receivable, Certificateholders will receive interest for the full month, in part from the Non-Reimbursable Payment by the Servicer. See "The Certificates -- Certain Payments by the Servicer." Although the Receivables have different APRs, each Receivable's APR exceeds the sum of (i) the weighted average of the Class A Pass-Through Rate and the Class B Pass-Through Rate and (ii) the Servicing Fee Rate. Therefore, disproportionate rates of prepayments between Receivables with higher and lower APRs should not affect the yield to Certificateholders on the principal balance of the outstanding Certificates of each Class. The effective yields to Class A Certificateholders and Class B Certificateholders will be below the yields otherwise produced by the Class A Pass-Through Rate and the Class B Pass-Through Rate, respectively, because the distribution of principal and interest paid on the underlying Receivables in respect of any Collection Period will not be made until the related Distribution Date, which will not be earlier than the fifteenth day of the following month. 14 17 The Class B Certificates will provide limited protection against losses on the Receivables. Accordingly, the yield on the Class B Certificates will be extremely sensitive to the loss experience of the Receivables and the timing of any such losses. If the actual rate and amount of losses experienced by the Receivables exceed the rate and amount of such losses assumed by an investor, the yield to maturity on the Class B Certificates may be lower than anticipated. POOL FACTORS AND TRADING INFORMATION The "Class A Pool Factor" and the "Class B Pool Factor" will be seven-digit decimal numbers which the Servicer will compute each month indicating the Class A Certificate Balance and the Class B Certificate Balance at the end of the related Collection Period as a fraction of the Original Class A Certificate Balance or Original Class B Certificate Balance, as the case may be. Each Pool Factor will be 1.0000000 as of the Cutoff Date and will thereafter decline to reflect reductions in the Class A Certificate Balance or the Class B Certificate Balance, as the case may be. The portion of the Class A Certificate Balance or the Class B Certificate Balance for a given month allocable to a Class A Certificateholder or a Class B Certificateholder, as the case may be, can be determined by multiplying the original denomination of the holder's Certificate by the related Pool Factor at the time of determination. Pursuant to the Agreement, the Certificateholders will receive monthly reports concerning the payments received on the Receivables, the Pool Balance, the Class A Pool Factor and the Class B Pool Factor and various other items of information pertaining to the Trust. Certificateholders during each calendar year will be furnished information for tax reporting purposes not later than the latest date permitted by law. See "The Certificates -- Statements to Certificateholders." USE OF PROCEEDS The net proceeds to be received by the Seller from the sale of the Certificates will be applied to the purchase of the Receivables from Fleetwood Credit pursuant to the Receivables Purchase Agreement. THE SELLER Fleetwood Credit Receivables Corp. was incorporated in the State of California on January 15, 1991 as a wholly owned, limited purpose subsidiary of Fleetwood Credit. The principal executive offices of the Seller are located at 22840 Savi Ranch Parkway, Yorba Linda, California 92687. Its telephone number is (714) 921-3400. The Seller was organized principally for the purpose of purchasing recreational vehicle retail installment sale contracts from Fleetwood Credit and transferring such retail installment sale contracts to third parties in connection with its activities as a limited purpose subsidiary of Fleetwood Credit. The Seller's Articles of Incorporation limit the activities of the Seller to the above purposes and to any activities incidental thereto. THE SERVICER GENERAL Fleetwood Credit was incorporated in the State of California on December 31, 1985, and is a wholly owned subsidiary of Associates First Capital Corporation, which acquired Fleetwood Credit from Fleetwood Enterprises, Inc., in May, 1996. Fleetwood Credit's principal activities are the financing of the acquisition by Dealers for resale of various new recreational vehicles, a significant portion of which to date have been manufactured by Fleetwood Enterprises, and used recreational vehicles acquired in the ordinary course of business and the acquisition from such Dealers of installment obligations with respect to the sale of such recreational vehicles. The principal executive offices of Fleetwood Credit are located at 22840 Savi Ranch Parkway, Yorba Linda, California 92687. Its telephone number is (714) 921-3400. 15 18 ORIGINATION AND SERVICING Fleetwood Credit purchases retail installment sale contracts secured by new and used recreational vehicles from Dealers located throughout the United States. In keeping with the practice of Fleetwood Credit, the Receivables were originated by Dealers in accordance with Fleetwood Credit's requirements under agreements with such Dealers. The Receivables were purchased in accordance with Fleetwood Credit's underwriting standards, which emphasize the prospective purchaser's ability to pay and creditworthiness, as well as the asset value of the recreational vehicle to be financed. Fleetwood Credit's standards also require physical damage insurance to be maintained on each Financed Vehicle. THE CERTIFICATES The Certificates will be issued pursuant to the Agreement. Copies of the Agreement (without exhibits) may be obtained by Certificateholders upon request in writing to the Trustee at its Corporate Trust Office. Citations to certain relevant sections of the Agreement appear below in parentheses. The following summary does not purport to be complete and is subject to and qualified in its entirety by reference to the Agreement. GENERAL The Certificates will evidence fractional undivided interests in the Trust created pursuant to the Agreement and will not represent interests in or obligations of the Seller, Fleetwood Credit, Associates First Capital Corporation or any of their respective affiliates. The Class A Certificates will evidence in the aggregate an undivided ownership interest of 96.50% of the Trust and the Class B Certificates will evidence in the aggregate an undivided ownership interest of 3.50% of the Trust. In general, it is intended that Class A Certificateholders and Class B Certificateholders receive, on each Distribution Date, the Class A Percentage and Class B Percentage, respectively, of all payments allocated to principal on or in respect of the Receivables collected by the Servicer during the related Collection Period plus a full month's interest at the Class A Pass-Through Rate on the Class A Certificate Balance or the Class B Pass-Through Rate on the Class B Certificate Balance, as the case may be, in each case as of the first day of such Collection Period (after giving effect to distributions of principal to be made on the Distribution Date occurring in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class A Certificate Balance and the Original Class B Certificate Balance, as the case may be. Interest to Certificateholders may be provided by payments made by or on behalf of Obligors on or in respect of the Receivables, payments from amounts on deposit in the Reserve Fund and Advances and Non-Reimbursable Payments made by the Servicer. (Sections 14.04, 14.05 and 14.08) See "Distributions on the Certificates." A prepayment of a Receivable may be made by or on behalf of the related Obligor, by application of certain insurance proceeds, as a result of a repurchase made by the Seller or a Dealer or a purchase by the Servicer, as the case may be, or as a result of the repossession and sale of the related Financed Vehicle or other enforcement measure taken with respect to a Defaulted Receivable. See "Sale and Assignment of the Receivables" and "Servicing Procedures." The Certificates will be offered for purchase in denominations of $1,000 and integral multiples thereof in book-entry form. Each Class of Certificates will initially be represented by one or more certificates registered in the name of Cede, the nominee of DTC. No beneficial owner of a Class A Certificate (a "Class A Certificate Owner"), or a Class B Certificate (a "Class B Certificate Owner" and, together with the Class A Certificate Owners, the "Certificate Owners"), will be entitled to receive a certificate representing such owner's interest, except as set forth below. Unless and until Certificates of a Class are issued in fully registered certificated form ("Definitive Certificates") under certain limited circumstances described below, all references herein to distributions, notices, reports and statements to the related Certificateholders will refer to the same actions made with respect to DTC or Cede, as the case may be, for the benefit of Certificate Owners in accordance with DTC procedures. (Section 16.09) See "Book-Entry Registration" and "Definitive Certificates." 16 19 BOOK-ENTRY REGISTRATION DTC, New York, New York, will act as securities depository for the Class A Certificates and the Class B Certificates. Each Class of Certificates initially will be represented by one or more certificates registered in the name of Cede, the nominee of DTC. As such, it is anticipated that the only "Certificateholder" will be Cede, as nominee of DTC. Certificate Owners will not be recognized by the Trustee as "Certificateholders," as such term will be used in the Agreement, and Certificate Owners will only be permitted to exercise the rights of holders of Certificates of the related Class indirectly through DTC and its Participants, as further described below. DTC is a limited-purpose trust company organized under the laws of the State of New York, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the Uniform Commercial Code (the "UCC") in effect in the State of New York and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934, as amended. DTC was created to hold securities for its participating members ("Participants") and to facilitate the clearance and settlement of securities transactions between Participants through electronic book-entry changes in accounts of its Participants, thereby eliminating the need for physical movement of certificates. Participants include securities brokers and dealers (including the Underwriters), banks, trust companies and clearing corporations. Indirect access to the DTC system also is available to banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Participant, either directly or indirectly (the "Indirect Participants"). The rules applicable to DTC and its Participants are on file with the Commission. Certificate Owners that are not Participants or Indirect Participants but desire to purchase, sell or otherwise transfer ownership of, or an interest in, Class A Certificates or Class B Certificates, as the case may be, may do so only through Participants and Indirect Participants. Participants will receive a credit for the Certificates on DTC's records. The ownership interest of each Certificate Owner will in turn be recorded on the Participants' and Indirect Participants' respective records. Certificate Owners will not receive written confirmation from DTC of their purchase, but Certificate Owners are expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Participant or Indirect Participant through which the Certificate Owner entered into the transaction. Transfers of ownership interests in the Certificates of a Class will be accomplished by entries made on the books of Participants acting on behalf of Certificate Owners. To facilitate subsequent transfers, all Certificates deposited by Participants with DTC will be registered in the name of Cede, the nominee of DTC. The deposit of Certificates with DTC and their registration in the name of Cede will effect no change in beneficial ownership. DTC will have no knowledge of the actual Certificate Owners and its records will reflect only the identity of the Participants to whose accounts such Certificates are credited, which may or may not be the Certificate Owners. Participants and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Participants, by Participants to Indirect Participants and by Participants and Indirect Participants to Certificate Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. DTC's practice is to credit Participants' accounts on each Distribution Date in accordance with their respective holdings shown on its records unless DTC has reason to believe that it will not receive payment on such Distribution Date. Payments by Participants and Indirect Participants to Certificate Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participants and not of DTC, the Trustee (or any Paying Agent), the Seller or the Servicer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal of and interest on each Class of Certificates to DTC will be the responsibility of the Trustee (or any Paying Agent), disbursement of such payments to Participants will be the responsibility of DTC and disbursement of such payments to the related Certificate Owners will be the responsibility of Participants and Indirect Participants. As a result, 17 20 under the book-entry format, Certificate Owners may experience some delay in their receipt of payments. DTC will forward such payments to its Participants which thereafter will forward them to Indirect Participants or Certificate Owners. Because DTC can only act on behalf of Participants, who in turn act on behalf of Indirect Participants and certain banks, the ability of a Certificate Owner to pledge Certificates to persons or entities that do not participate in the DTC system, or otherwise take actions with respect to such Certificates, may be limited due to the lack of a physical certificate for such Certificates. Neither DTC nor Cede will consent or vote with respect to the Certificates. Under its usual procedures, DTC will mail an "Omnibus Proxy" to the Trustee as soon as possible after any applicable record date for such a consent or vote. The Omnibus Proxy will assign Cede's consenting or voting rights to those Participants to whose accounts the related Certificates are credited on that record date (which record date will be identified in a listing attached to the Omnibus Proxy). Neither the Seller, the Servicer nor the Trustee (or any Paying Agent) will have any liability for any aspect of the records relating to or payments made on account of beneficial ownership interests of the Certificates held by Cede, as nominee for DTC, or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. DEFINITIVE CERTIFICATES Definitive Certificates will be issued to Certificate Owners rather than to DTC, only if (i) DTC is no longer willing or able to discharge its responsibilities as depository with respect to the Certificates, and neither the Trustee nor the Seller is able to locate a qualified successor, (ii) the Seller, at its option, elects to terminate the book-entry system through DTC or (iii) after an Event of Default, Certificate Owners representing in the aggregate not less than 51% of the voting interests of either Class of Certificates advise the Trustee through DTC and its Participants in writing that the continuation of a book-entry system for such Class of Certificates through DTC or its successor is no longer in the best interests of the related Certificate Owners. (Section 16.11) Upon the occurrence of any of the events described in the immediately preceding paragraph, the Trustee will be required to notify all Certificate Owners, through Participants, of the availability of Definitive Certificates. Upon surrender by DTC of the certificates representing all Certificates of either Class and the receipt of instructions for re-registration, the Trustee will issue Definitive Certificates to the related Certificate Owners. Distributions on the related Certificates will thereafter be made by the Trustee directly to holders of the related Definitive Certificates in accordance with the procedures set forth herein and to be set forth in the Agreement. Interest payments and any principal payments on the related Certificates on each Distribution Date will be made to holders in whose names the Definitive Certificates were registered at the close of business on the Record Date with respect to such Distribution Date. Distributions will be made by check mailed to the address of such holders as they appear on the Certificate Register. The final payment on any Certificates (whether Definitive Certificates or certificates registered in the name of Cede representing the Certificates), however, will be made only upon presentation and surrender of such Certificates or certificates at the office or agency specified in the notice of final distribution to Certificateholders. The Trustee or Paying Agent will provide such notice to registered Certificateholders not later than the twenty-fifth day of the month preceding the month in which such final distribution is expected to occur. Definitive Certificates will be transferable and exchangeable at the offices of the Trustee or the Certificate Registrar set forth in the Agreement. No service charge will be imposed for any registration of transfer or exchange, but the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge imposed in connection therewith. (Section 16.03) SALE AND ASSIGNMENT OF THE RECEIVABLES The Receivables. On or prior to the Closing Date, pursuant to the Receivables Purchase Agreement, Fleetwood Credit will sell and assign to the Seller, without recourse, its entire interest in and to the 18 21 Receivables, including its security interests in the Financed Vehicles. At the time of initial issuance of the Certificates, the Seller will sell and assign to the Trustee, without recourse, all of its right, title and interest in and to the Receivables, including its security interests in the Financed Vehicles. Each Receivable will be identified in a schedule appearing as an exhibit to each of the Receivables Purchase Agreement and the Agreement (the "Schedule of Receivables"). The Trustee will, concurrently with the sale and assignment of the Receivables to it pursuant to the Agreement, execute, authenticate and deliver the Certificates to the Seller in exchange for the Receivables. (Section 16.02) The Seller will sell the Certificates to the Underwriters. The net proceeds received by the Seller from the sale of the Certificates will be applied to the purchase of the Receivables. Representations and Warranties. In the Receivables Purchase Agreement, Fleetwood Credit will represent and warrant to the Seller, and in the Agreement, the Seller will represent and warrant to the Trustee, among other things, that, on the Closing Date (i) the information set forth in the Schedule of Receivables is correct in all material respects; (ii) the Obligor on each Receivable is required to maintain physical damage insurance covering the related Financed Vehicle in accordance with Fleetwood Credit's normal requirements; (iii) to the knowledge of Fleetwood Credit or the Seller, as the case may be, the Receivables are free and clear of all security interests, liens, charges and encumbrances and no offsets, defenses or counterclaims against Fleetwood Credit or the Seller, as the case may be, have been asserted or threatened; (iv) each Receivable is secured by a first perfected security interest in the related Financed Vehicle in favor of Fleetwood Credit; (v) each Receivable, at the time it was originated, complied and, on the Closing Date, complies, in all material respects with applicable federal and state laws, including, without limitation, consumer credit, truth in lending, equal credit opportunity and disclosure laws; and (vi) the related Obligor has not been identified by Fleetwood Credit as being a Relief Act Obligor. Repurchase of Certain Receivables by the Seller. As of the second (or, if the Seller elects, the first) Record Date following the discovery by or notice to the Seller of a breach of any such representation or warranty that materially and adversely affects the interests of the Certificateholders in a Receivable, the Seller, unless it cures the breach, will repurchase such Receivable from the Trustee and, pursuant to the Receivables Purchase Agreement, Fleetwood Credit will purchase such Receivable from the Seller, at a price equal to the unpaid principal balance owed by the Obligor plus interest thereon at a rate equal to the sum of (i) the weighted average of the Class A Pass-Through Rate and the Class B Pass-Through Rate as of the Closing Date and (ii) the Servicing Fee Rate to the last day of the month of repurchase (the "Repurchase Amount"). This repurchase obligation will constitute the sole remedy available to the Certificateholders or the Trustee for any such uncured breach. The obligation of the Seller to repurchase a Receivable will not be conditioned on performance by Fleetwood Credit of its obligation to purchase such Receivable from the Seller pursuant to the Receivables Purchase Agreement. (Sections 12.01 and 12.02) SERVICING PROCEDURES To assure uniform quality in servicing the Receivables and the Servicer's own portfolio of recreational vehicle receivables and to reduce administrative costs, the Trustee will appoint the Servicer as custodian of the Receivables. (Section 12.04) The Receivables will not be physically segregated from other recreational vehicle retail installment sale contracts of the Servicer, or those which the Servicer services for others, to reflect the transfer to the Trust. The Servicer's accounting records and computer systems will reflect the sale and assignment of the Receivables to the Trust, and UCC financing statements reflecting such sale and assignment will be filed. See "Certain Legal Aspects of the Receivables -- General." The Servicer will make reasonable efforts to collect all payments due with respect to the Receivables and, in a manner consistent with the Agreement, will continue such collection procedures as it follows with respect to comparable recreational vehicle retail installment sale contracts it services for itself and others. (Section 13.01) See "Certain Legal Aspects of the Receivables." Consistent with its normal procedures, the Servicer may, in its discretion, arrange with an Obligor to extend or modify the payment schedule on a Receivable. Notwithstanding the foregoing, the Servicer may not extend the stated maturity of a Receivable beyond the scheduled maturity of the Receivable having the latest stated maturity as of the Cutoff Date. Such arrangements may result in the Servicer being required to purchase the related Receivable for the Repurchase 19 22 Amount, while others may require the Servicer to make an Advance in respect of such Receivable, without any reimbursement therefor. (Sections 13.07 and 14.04) The Servicer will follow such normal collection practices and procedures as it deems necessary or advisable to realize upon any Receivable with respect to which it determines that eventual payment in full is unlikely. The Servicer may sell the related Financed Vehicle securing such Receivable at a public or private sale, or take any other action permitted by applicable law. (Section 13.03) COLLECTIONS The Servicer will deposit all payments on or in respect of the Receivables received from or on behalf of Obligors and all proceeds of Receivables collected during each Collection Period into the Certificate Account not later than two Business Days after receipt. Notwithstanding the foregoing, so long as no Event of Default has occurred and is continuing, the Servicer may remit such deposits and collections in respect of a Collection Period to the Certificate Account on a monthly basis not later than the Business Day immediately preceding the related Distribution Date; provided that either (i) the Servicer's short-term unsecured debt obligations are rated at least equal to Prime-1 by Moody's and A-1 by Standard & Poor's (the "Required Servicer Ratings") or (ii) the Servicer obtains a letter of credit, surety bond or insurance policy (the "Servicer Letter of Credit") as will be provided in the Agreement under which demands for payment will be made to secure timely remittance of monthly collections to the Certificate Account and the Trustee is provided with a letter from each Rating Agency to the effect that the utilization of such alternative remittance schedule will not result in a Ratings Effect. As of the date of this Prospectus, the Servicer will be permitted to remit to the Certificate Account all collections received on or in respect of the Receivables on a monthly basis by virtue of clause (i) above. In the event that the Servicer is permitted to make remittances of collections to the Certificate Account on a monthly basis pursuant to satisfaction of clause (ii) above, the Agreement will be modified, to the extent necessary, without the consent of any Certificateholder. (Sections 14.02 and 22.01) Pending deposit into the Certificate Account, collections may be invested by the Servicer at its own risk and for its own benefit and will not be segregated from its own funds. The Seller or the Servicer, as the case may be, will remit the aggregate Repurchase Amount of any Receivables to be repurchased from the Trust into the Certificate Account on or before the Business Day immediately preceding the related Distribution Date. The Certificate Account shall be maintained (i) with the Trustee so long as the short-term credit ratings of the Trustee are at least equal to Prime-1 by Moody's and A-1+ by Standard & Poor's (the "Required Deposit Ratings") or (ii) in a non-interest bearing segregated trust account for the benefit of the Certificateholders, located in the corporate trust department of a depository institution or trust company having corporate trust powers (which may include the Trustee). If the short-term unsecured debt obligations of the Trustee are not rated at least equal to the Required Deposit Rating, the Servicer will, with the Trustee's assistance as necessary, cause the Certificate Account to be moved to a bank or trust company whose short-term unsecured debt obligations are rated at least equal to the Required Deposit Ratings or moved to a non-interest bearing segregated trust account located in a corporate trust department of a depository institution or trust company as described above. (Section 14.01) For so long as the depository institution or trust company then maintaining the Certificate Account has the Required Deposit Ratings, all amounts held in the Certificate Account will, to the extent permitted by applicable law, be invested, as directed by the Servicer, in Permitted Investments. Earnings on the investment of funds in the Certificate Account will be paid to the Servicer. "Permitted Investments" will be limited to investments that will not require the Trust to register as an investment company under the Investment Company Act of 1940, as amended, and include the following obligations and securities: (i) obligations of the United States or any agency thereof, backed by the full faith and credit of the United States; (ii) general obligations of or obligations guaranteed by any State, commercial paper and certificates of deposit, demand or time deposits, federal funds or banker's acceptances issued by any depository institution or trust company incorporated under the laws of the United States or of any State and subject to supervision and examination by federal or state banking authorities, in each case rated the highest rating of each Rating Agency for such obligations, or such lower rating as will not result in the qualification, downgrading or withdrawal of the rating then assigned to either Class of Certificates by such Rating Agency (each, a "Ratings Effect"); (iii) demand or time deposits or certificates of deposit issued by any bank, trust company, savings bank or other savings 20 23 institution, which deposits are fully insured by the FDIC; (iv) guaranteed reinvestment agreements issued by any bank, insurance company or other corporation as will not result in a Ratings Effect; (v) certain specified repurchase obligations; and (vi) such other investments as will not result in a Ratings Effect. Notwithstanding the foregoing, each Permitted Investment shall mature no later than the Business Day prior to the Distribution Date immediately following the date of purchase (other than instruments of which the Trustee is the obligor, which may mature on the related Distribution Date), and shall be required to be held to such maturity. (Sections 1.01 and 11.01) CERTAIN PAYMENTS BY THE SERVICER On the Business Day immediately preceding each Distribution Date, the Servicer will be required, subject to the limitations set forth below, to advance to the Trust an amount equal to all accrued interest, if any, on the unpaid principal balance of each Receivable at the related APR since the most recent date upon which a payment was made in respect of such Receivable by or on behalf of the related Obligor through the last day of the related Collection Period (an "Advance"). The obligation of the Servicer to make an Advance will be limited to circumstances in which the Servicer determines such Advance will ultimately be reimbursable from subsequent payments made by or on behalf of the related Obligor, from insurance proceeds, from liquidation proceeds or otherwise, except in the case of the waiver by the Servicer of any scheduled interest on a Receivable, in which case the Servicer shall be required to make an Advance without the right of subsequent reimbursement. In making Advances, the Servicer will endeavor to maintain monthly payments of interest at the related Pass-Through Rate to Certificateholders, rather than to guarantee or insure against losses. Accordingly, all Advances shall be reimbursable (except as provided above with respect to waivers of scheduled interest) to the Servicer, without interest, if and when a payment relating to a Receivable with respect to which an Advance has previously been made is subsequently received. In addition, Advances in respect of a Receivable (other than a Repurchased Receivable) as to which (i) a scheduled payment is 180 days delinquent or (ii) the Servicer has determined that eventual payment in full is unlikely and has repossessed and liquidated the related Financed Vehicle within such 180-day period (each, a "Defaulted Receivable") shall also be reimbursable (except as provided above with respect to waivers of scheduled interest) to the Servicer from collections on or in respect of other Receivables to the extent that the Servicer determines that such Advance will not be recoverable from payments made on or in respect of such Defaulted Receivable. (Section 14.04) When a payment of principal is made on or in respect of a Receivable, interest is paid on the unpaid principal balance of such Receivable only to the date of such payment. In order that Certificateholders will not be adversely affected by any shortfall in interest resulting from any such payment, the Agreement will require the Servicer to deposit into the Certificate Account on the Business Day immediately preceding each Distribution Date, without the right of subsequent reimbursement, an amount, if any, as may be necessary to assure that the distributions made on the related Distribution Date in respect of such Receivable to the Servicer and Certificateholders include an amount equal to interest at a rate equal to the sum of (i) the weighted average of the Class A Pass-Through Rate and the Class B Pass-Through Rate as of the Closing Date and (ii) the Servicing Fee Rate on the amount of such principal payment from the date of payment through the last day of the related Collection Period (the "Non-Reimbursable Payment"). (Section 14.05) The Servicer will remit to the Certificate Account an amount equal to each Advance and Non-Reimbursable Payment to be made in respect of a Collection Period not later than the Business Day immediately preceding the related Distribution Date. NET DEPOSITS For administrative convenience, the Servicer will be permitted to make the deposit of collections, Advances, Non-Reimbursable Payments and Repurchase Amounts for or in respect of each Collection Period net of distributions to be made to the Servicer with respect to such Collection Period. The Servicer, however, will account to the Trustee and to the Certificateholders as if all deposits and distributions were made individually. (Sections 14.06 and 14.09) 21 24 SERVICING COMPENSATION The Servicer will be entitled to receive, out of interest collected on or in respect of the Receivables, the Servicing Fee for each Collection Period equal to the product of the Servicing Fee Rate and the Pool Balance as of the first day of such Collection Period. The Servicing Fee will be calculated and paid based upon a 360-day year consisting of twelve 30-day months. The Servicer will also collect and retain any late fees, prepayment charges and other administrative fees or similar charges allowed by applicable law with respect to the Receivables. (Section 13.08) The Servicing Fee will compensate the Servicer for performing the functions of a third party servicer of recreational vehicle receivables as an agent for the Trustee, including collecting and posting payments, responding to inquiries of Obligors on the Receivables, investigating delinquencies, sending payment statements and reporting tax information to Obligors, paying costs of disposition of Defaulted Receivables and policing the collateral. (Section 13.01) The Servicing Fee also will compensate the Servicer for administering the Receivables, including making Advances and Non-Reimbursable Payments, accounting for collections and furnishing monthly and annual statements to the Trustee with respect to distributions, generating federal income tax information and paying certain taxes, accounting fees, outside auditor fees, data processing costs and other costs incurred in connection with administering the Receivables. (Section 13.01) DISTRIBUTIONS ON THE CERTIFICATES On the eighth calendar day of each month or, if such day is not a Business Day, the immediately succeeding Business Day (the "Determination Date"), the Servicer will inform the Trustee of the amount of Available Funds collected on or in respect of the Receivables, the amount of Advances and Non-Reimbursable Payments to be made by the Servicer and the amount of the Servicing Fee and other servicing compensation payable to the Servicer, in each case with respect to the immediately preceding Collection Period. On or prior to each Determination Date, the Servicer shall also determine the Class A Distributable Amount, the Class B Distributable Amount and, based on the Available Funds and other amounts available for distribution on the related Distribution Date as described below, determine the amounts to be distributed to the Class A Certificateholders and the Class B Certificateholders. (Sections 13.09 and 14.07) The Trustee shall make distributions to the Certificateholders out of amounts on deposit in the Certificate Account. The amount of such distributions shall be determined in the manner described below. Determination of Available Funds. "Available Funds" with respect to each Distribution Date will mean the sum of (i) all cash received by the Servicer on or in respect of the Receivables during the immediately preceding Collection Period (including Non-Reimbursable Payments and Advances but other than (a) late payment and extension fees, if any, and other administrative fees and (b) recoveries collected on or in respect of all Receivables which have been previously repurchased by the Seller or purchased by the Servicer pursuant to the Agreement) and (ii) the Repurchase Amounts of all Receivables purchased or repurchased under the Agreement in respect of the immediately preceding Collection Period. With respect to each Collection Period (i) "Collected Interest" will mean the portion of all Available Funds received by the Servicer on or in respect of the Receivables during such Collection Period allocable to interest and (ii) "Collected Principal" will mean the portion of all Available Funds received by the Servicer on or in respect of the Receivables during such Collection Period allocable to principal. Calculation of Distributable Amounts. The "Class A Distributable Amount" with respect to each Distribution Date will mean the sum of (i) the "Class A Principal Distributable Amount," which will equal the Class A Percentage of the Monthly Principal Payment (but not exceeding the Class A Certificate Balance as of such Distribution Date) and (ii) the "Class A Interest Distributable Amount," which will equal one month's interest at the Class A Pass-Through Rate on the Class A Certificate Balance as of the first day of the immediately preceding Collection Period (after giving effect to distributions of principal to be made on the Distribution Date occurring in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class A Certificate Balance. In addition, with respect to the Distribution Date relating to the Collection Period in which the last Receivable in the Trust is scheduled to mature, the Class A Principal Distributable Amount will include the 22 25 portion of such amount necessary (after giving effect to the other amounts described above to be distributed to the Class A Certificateholders on such Distribution Date allocable to principal) to reduce the Class A Certificate Balance to zero. The "Class B Distributable Amount" with respect to each Distribution Date will be calculated in the same manner as the Class A Distributable Amount, appropriately modified to relate to the Class B Certificates, but will also include recoveries to the extent allocable to principal on Receivables which became Defaulted Receivables in one or more prior Collection Periods. The "Class B Principal Distributable Amount" and the "Class B Interest Distributable Amount" with respect to each Distribution Date will be calculated in the same manner as the Class A Principal Distributable Amount and the Class A Interest Distributable Amount, respectively, in each case appropriately modified to relate to the Class B Certificates. The "Monthly Principal Payment" with respect to each Distribution Date will equal (i) the Pool Balance as of the second Record Date preceding such Distribution Date (or, with respect to the first Distribution Date, the Original Pool Balance) less (ii) the Pool Balance as of the Record Date immediately preceding such Distribution Date. The "Class A Certificate Balance" will initially equal the Original Class A Certificate Balance and on any Distribution Date will equal the Original Class A Certificate Balance, reduced by all distributions actually made on or prior to such Distribution Date to Class A Certificateholders allocable to principal. The "Class B Certificate Balance" will initially equal the Original Class B Certificate Balance and on any Distribution Date will equal the Original Class B Certificate Balance, reduced by (i) all distributions actually made on or prior to such Distribution Date to Class B Certificateholders allocable to principal and (ii) Realized Losses allocable to the Class B Certificates. "Realized Losses" with respect to each Collection Period will equal the amount by which (a) the aggregate unpaid principal balance of all Receivables which became Defaulted Receivables during such Collection Period exceeds (b) the sum of (i) the aggregate liquidation proceeds recovered in respect of principal of such Defaulted Receivables during such Collection Period and (ii) recoveries in respect of all Defaulted Receivables received in such Collection Period, to the extent not otherwise included in the amount determined pursuant to clause (i) above. Payment of Distributable Amounts. Prior to each Distribution Date, the Servicer will calculate the amount to be distributed to the Certificateholders. On each Distribution Date, the Trustee will distribute to Certificateholders the following amounts in the following order of priority, to the extent of Available Funds for such Distribution Date: (i) to the Class A Certificateholders, an amount equal to the Class A Interest Distributable Amount and any unpaid Class A Interest Carryover Shortfall, such amount to be paid from Collected Interest (as Collected Interest has been reduced by reimbursing the Servicer for any outstanding Advances and paying the Servicer the Servicing Fee, including any unpaid Servicing Fees with respect to one or more prior Collection Periods); and if such Collected Interest is insufficient, the Class A Certificateholders will receive such deficiency first, from the Class B Percentage of Collected Principal and second, if such amounts are still insufficient, from monies on deposit in the Reserve Fund; (ii) to the Class B Certificateholders, an amount equal to the Class B Interest Distributable Amount and any unpaid Class B Interest Carryover Shortfall, such amount to be paid from Collected Interest (after giving effect to the reduction in Collected Interest described in clause (i) above); and if such Collected Interest is insufficient, the Class B Certificateholders will be entitled to receive such deficiency from monies on deposit in the Reserve Fund; (iii) to the Class A Certificateholders, an amount equal to the Class A Principal Distributable Amount and any unpaid Class A Principal Carryover Shortfall, such amount to be paid from Collected Principal (after giving effect to the reduction in Collected Principal described in clause (i) above); and if such Collected Principal is insufficient, the Class A Certificateholders will be entitled to receive such deficiency first, from Collected Interest (after giving effect to the reduction in Collected Interest described in clauses (i) and (ii) above) and second, if such amounts are still insufficient, from monies on deposit in the Reserve Fund; and 23 26 (iv) to the Class B Certificateholders, an amount equal to the Class B Principal Distributable Amount and any unpaid Class B Principal Carryover Shortfall, such amount to be paid from Collected Principal (after giving effect to the reduction in Collected Principal described in clauses (i) and (iii) above); and if such Collected Principal is insufficient, the Class B Certificateholders will be entitled to receive such deficiency first, from Collected Interest (after giving effect to the reduction in Collected Interest described in clauses (i), (ii) and (iii) above) and second, if such amounts are still insufficient, from monies on deposit in the Reserve Fund. (Section 14.07) The "Class A Interest Carryover Shortfall" with respect to any Distribution Date will equal the excess, if any, of the Class A Interest Distributable Amount for such Distribution Date and any outstanding Class A Interest Carryover Shortfall from the immediately preceding Distribution Date plus interest on such outstanding Class A Interest Carryover Shortfall, to the extent permitted by law, at the Class A Pass-Through Rate from such immediately preceding Distribution Date through the current Distribution Date, over the amount of interest distributed to the Class A Certificateholders on such Distribution Date. The "Class A Principal Carryover Shortfall" with respect to any Distribution Date will equal the excess of the Class A Principal Distributable Amount plus any outstanding Class A Principal Carryover Shortfall with respect to one or more prior Distribution Dates over the amount of principal that the holders of the Class A Certificates actually received on such Distribution Date. The "Class B Interest Carryover Shortfall" and the "Class B Principal Carryover Shortfall" with respect to any Distribution Date will be calculated in the same manner as the Class A Interest Carryover Shortfall and the Class A Principal Carryover Shortfall, respectively, in each case appropriately modified to relate to the Class B Certificates. Any Excess Amounts in the Certificate Account with respect to any Distribution Date, after giving effect to the distributions described in clauses (i) through (iv) of the third preceding paragraph, will be distributed in the following amounts and in the following order of priority: (i) to the Reserve Fund until the amount on deposit therein equals the Specified Reserve Fund Balance and (ii) to the Seller. SUBORDINATION OF THE CLASS B CERTIFICATES; RESERVE FUND The rights of the Class B Certificateholders to receive distributions with respect to the Receivables will be subordinated to the rights of the Servicer (to the extent that the Servicer is reimbursed for any outstanding Advances and is paid the Servicing Fee, including any unpaid Servicing Fees with respect to one or more prior Collection Periods) and Class A Certificateholders to the limited extent described below. This subordination is intended to enhance the likelihood of timely receipt by Class A Certificateholders of the full amount of interest and principal required to be paid to them, and to afford such Certificateholders limited protection against losses in respect of the Receivables. No distribution will be made to the Class B Certificateholders on any Distribution Date in respect of (i) interest until the full amount of interest on the Class A Certificates payable on such Distribution Date has been distributed to the Class A Certificateholders and (ii) principal until the full amount of interest on and principal of the Class A Certificates payable on such Distribution Date has been distributed to the Class A Certificateholders. Distributions of interest on the Class B Certificates, to the extent of Collected Interest and certain available amounts on deposit in the Reserve Fund, will not be subordinated to the payment of principal on the Class A Certificates. Because the rights of the Class B Certificateholders to receive distributions of principal will be subordinated to the rights of the Class A Certificateholders to receive distributions of interest and principal to the extent described herein, the aggregate amount of principal distributions on the Class B Certificates may be affected by the loss experience of the Receivables. If the aggregate amount of losses experienced by the Receivables exceeds the amount on deposit in the Reserve Fund, Class B Certificateholders may not recover their initial investment in the Class B Certificates. In the event of delinquencies or losses on the Receivables, the protection afforded to the Class A Certificateholders will be effected both by the application of available funds for such Distribution Date in the priorities specified under "Distributions on the Certificates -- Payment of Distributable Amounts," and the establishment of the Reserve Fund. The Reserve Fund will not be a part of or otherwise includible in the Trust 24 27 and will be a segregated trust account held by the Trustee. The Reserve Fund will be funded by the Seller on the Closing Date in an amount equal to $3,082,207.00. Thereafter, on each Distribution Date, all Excess Amounts, if any, will be deposited from time to time in the Reserve Fund to the extent necessary to maintain the amount in the Reserve Fund at the Specified Reserve Fund Balance. Any assets (and earnings thereon) in the Reserve Fund will be owned by, and taxed to, the Seller for Federal income tax purposes. The "Specified Reserve Fund Balance" with respect to the first Distribution Date will equal $3,082,207.00. On each Distribution Date thereafter, the Specified Reserve Fund Balance will equal 2.0% of the sum of the Class A Certificate Balance and the Class B Certificate Balance (after giving effect to distributions of principal to be made on such Distribution Date); provided, however, that so long as the foregoing sum of the Class A Certificate Balance and the Class B Certificate Balance exceeds $4,109,609.00, the Specified Reserve Fund Balance will not be less than $4,109,609.00. From and after the Distribution Date as of which the foregoing sum of the Class A Certificate Balance and the Class B Certificate Balance is less than $4,109,609.00, the Specified Reserve Fund Balance will equal such sum. Notwithstanding the foregoing, on each Distribution Date following any Fiscal Quarter in which losses or delinquencies in respect of the Receivables exceed the percentages to be specified in the Agreement, the Specified Reserve Fund Balance will be equal to the greater of the amount described above or an amount equal to the Pool Balance as of the immediately preceding Record Date multiplied by a percentage determined by subtracting from 18% a fraction (expressed as a percentage) equal to one minus a fraction, the numerator of which will equal the Class A Certificate Balance and the denominator of which will equal the Pool Balance, in each case as of the last day of the three related Collection Periods in such Fiscal Quarter; provided, however, that following any Fiscal Quarter thereafter in which the losses and delinquencies in respect of the Receivables are less than the percentages to be specified in the Agreement, the Specified Reserve Fund Balance shall return to the amount described in the first two sentences of this paragraph. A "Fiscal Quarter" will mean each of the following three month periods: (i) January, February and March; (ii) April, May and June; (iii) July, August and September; and (iv) October, November and December. In addition, if on any Distribution Date cumulative losses in respect of the Receivables exceed 1.5% of the Original Pool Balance, the Specified Reserve Fund Balance shall remain at the level in effect as of such date and shall not be reduced further in accordance with the first sentence of this paragraph. The Servicer may, from time to time after the date of this Prospectus, request each Rating Agency to approve a formula for determining the Specified Reserve Fund Balance that is different from that described above and would result in a decrease in the amount of the Specified Reserve Fund Balance or the manner by which it is funded. If each Rating Agency delivers a letter to the Trustee to the effect that the use of any such new formulation will not result in a Ratings Effect, then the Specified Reserve Fund Balance will be determined in accordance with such new formula. The Agreement will accordingly be amended to reflect such new calculation without the consent of any Certificateholder. On each Distribution Date, funds will be withdrawn from the Reserve Fund as described above for distribution, first to Class A Certificateholders to the extent of shortfalls in the amounts available to make required distributions of interest on the Class A Certificates, second to Class B Certificateholders to the extent of shortfalls in the amounts available to make required distributions of interest on the Class B Certificates, third to Class A Certificateholders to the extent of shortfalls in the amounts available to make required distributions of principal on the Class A Certificates and fourth to Class B Certificateholders to the extent of shortfalls in the amounts available to make required distributions of principal on the Class B Certificates. On each Distribution Date, the Trustee will deposit all Excess Amounts, if any, into the Reserve Fund until the amount on deposit therein equals the Specified Reserve Fund Balance. If the amount on deposit in the Reserve Fund on such Distribution Date (after giving effect to all deposits thereto or withdrawals therefrom on such Distribution Date) is greater than the Specified Reserve Fund Balance, the Trustee will release and distribute such excess, together with any Excess Amounts not required to be deposited into the Reserve Fund, to the Seller. Upon any such release of amounts from the Reserve Fund, the Certificateholders will have no further rights in, or claims to, such amounts. (Section 14.08) Amounts held from time to time in the Reserve Fund will continue to be held for the benefit of holders of the Certificates. Funds on deposit in the Reserve Fund may be invested in Permitted Investments. Investment 25 28 income on monies on deposit in the Reserve Fund will not be available for distribution to Certificateholders or otherwise subject to any claims or rights of the Certificateholders and will be paid to the Seller. (Section 14.08) If on any Distribution Date the Class B Certificate Balance equals zero and amounts on deposit in the Reserve Fund have been depleted as a result of losses in respect of the Receivables, the protection afforded to the Class A Certificateholders by the subordination of the Class B Certificates and by the Reserve Fund will be exhausted. In addition, if on any Distribution Date amounts on deposit in the Reserve Fund have been depleted, the protection afforded to the Class B Certificateholders by the Reserve Fund will be exhausted. In either of the foregoing circumstances, the Class A Certificateholders or the Class B Certificateholders, as the case may be, will bear directly the risks associated with ownership of the Receivables. Neither the Class B Certificateholders, the Seller nor the Servicer will be required to refund any amounts properly distributed or paid to them, whether or not there are sufficient funds on any subsequent Distribution Date to make full distributions to the Class A Certificateholders. EXAMPLE OF DISTRIBUTIONS The following chart sets forth an example of the application of the foregoing provisions to the first monthly distribution in respect of the Certificates: September 1........... Cutoff Date. The Original Pool Balance will equal the aggregate unpaid principal balance of the Receivables as of the opening of business on this date. September 1 - 30...... Collection Period. The Servicer will receive monthly payments, prepayments and other proceeds on or in respect of the Receivables. September 30.......... Record Date. Distributions on the Distribution Date will be made to Certificateholders of record at the close of business on this date. October 8............. Determination Date. On this date, the Servicer will notify the Trustee of, among other things, the amounts to be distributed on the Distribution Date. October 11............ The Business Day immediately preceding the Distribution Date. On or before this date, the Servicer will make or will cause to be made the required remittances to the Certificate Account. October 15............ Distribution Date. On this date, the Trustee will make the distributions described above. STATEMENTS TO CERTIFICATEHOLDERS On each Distribution Date, the Trustee will include with each distribution to each Class A Certificateholder and Class B Certificateholder of record a statement, setting forth for such Distribution Date and the related Collection Period, among other things, the following information: (i) the amount of the distribution allocable to principal on the Class A Certificates and the Class B Certificates; (ii) the amount of the distribution allocable to interest on the Class A Certificates and the Class B Certificates; (iii) the Certificateholder's pro rata portion of the Servicing Fee and any additional servicing compensation paid to the Servicer; (iv) the Pool Balance, the Class A Pool Factor and the Class B Pool Factor as of the related Record Date; (v) the aggregate amount of unreimbursed Advances and the change in such amount from the immediately preceding Collection Period; 26 29 (vi) the amount, if any, of proceeds received during the Collection Period in connection with any physical damage insurance policies covering Financed Vehicles; (vii) the amount, if any, of proceeds received during the Collection Period from Dealer repurchase obligations relating to Defaulted Receivables; (viii) the Reserve Fund balance, such amount as a percentage of the Pool Balance and, in the event the amount on deposit in the Reserve Fund has been reduced to zero, the number and aggregate dollar amount of Defaulted Receivables; (ix) the Class A Certificate Balance and the Class B Certificate Balance as of such Record Date, after giving effect to payments allocated to principal reported under (i) above; (x) the amount of Class A Principal and Interest Carryover Shortfalls and Class B Principal and Interest Carryover Shortfalls, if any, on such Distribution Date and the change in such Class A and Class B Principal and Interest Carryover Shortfalls from the immediately preceding Distribution Date; (xi) the amount of Realized Losses, if any, on such Distribution Date and the change in such amount from the immediately preceding Distribution Date; (xii) the amount otherwise distributable to the Class B Certificateholders that is being distributed to the Class A Certificateholders on such Distribution Date; and (xiii) the number and principal balance of Paid-Ahead Receivables and the change in such number and amount from the immediately preceding Collection Period. Items (i), (ii) and (iii) above will be presented on the basis of a Certificate in the denomination of $1,000. In addition, within the prescribed period of time for tax reporting purposes after the end of each calendar year during the term of the Agreement, the Trustee will mail to each Person who at any time during such calendar year shall have been a Certificateholder a statement containing the sum of the amounts described in clauses (i) through (iii) above for the purposes of such Certificateholder's preparation of federal income tax returns. (Section 14.10) See "Certain Federal Income Tax Consequences." EVIDENCE AS TO COMPLIANCE The Agreement will provide that a firm of independent public accountants will furnish to the Trustee on or before April 30 of each year, beginning April 30, 1998, a statement as to compliance by the Servicer during the preceding 12 months ended December 31 (or longer period in the case of the first such statement) with certain standards relating to the servicing of the Receivables. (Section 13.11) The Agreement will also provide for delivery to the Trustee, on or before April 30 of each year, commencing April 30, 1998, of a certificate signed by an officer of the Servicer stating that the Servicer has fulfilled its obligations under the Agreement throughout the preceding 12 months ended December 31 (or longer period in the case of the first such statement) or, if there has been a default in the fulfillment of any such obligation, describing each such default. (Section 13.10) Copies of such statements and certificates may be obtained by Certificateholders by a request in writing addressed to the Trustee. CERTAIN MATTERS REGARDING THE SERVICER The Agreement will provide that the Servicer may not resign from its obligations and duties as Servicer thereunder, except upon determination that its performance of such duties is no longer permissible under applicable law. No such resignation will become effective until the Trustee or a successor servicer has assumed the Servicer's servicing obligations and duties under the Agreement. (Section 18.05) The Agreement will further provide that neither the Servicer nor any of its directors, officers, employees and agents will be under any liability to the Trust or the Certificateholders for taking any action or for refraining from taking any action pursuant to the Agreement; provided, however, that neither the Servicer nor any such person will be protected against any liability that would otherwise be imposed by reason of willful 27 30 misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties thereunder. The Servicer will be under no obligation to appear in, prosecute or defend any legal action that is not incidental to its servicing responsibilities under the Agreement and that, in its opinion, may cause it to incur any expense or liability. (Section 18.04) Any corporation into which the Servicer may be merged or consolidated, or any corporation resulting from any merger or consolidation to which the Servicer is a party, or any corporation succeeding to all or substantially all of the business of the Servicer, which corporation assumes the obligations of the Servicer, will be the successor to the Servicer under the Agreement. (Section 18.03) EVENTS OF DEFAULT "Events of Default" under the Agreement will consist of: (i) any failure by the Servicer (or the Seller, so long as Fleetwood Credit is the Servicer) to deliver to the Trustee as required by the Agreement for distribution to the Certificateholders any required payment, or any failure by the Servicer to deliver a Servicer's Certificate with respect to a Distribution Date, which failure continues unremedied for three Business Days after discovery by an officer of the Servicer (or the Seller, so long as Fleetwood Credit is the Servicer), or written notice of such failure is given (a) to the Servicer or the Seller, as the case may be, by the Trustee or (b) to the Seller or the Servicer, as the case may be, and to the Trustee by holders of Certificates evidencing not less than 25% of the voting interests of the Class A Certificates and the Class B Certificates, voting together as a single class; (ii) any failure by the Servicer (or the Seller, so long as Fleetwood Credit is the Servicer) duly to observe or perform in any material respect any other covenant or agreement in the Agreement which failure materially and adversely affects the rights of Certificateholders and which continues unremedied for 60 days after the giving of written notice of such failure (a) to the Servicer or the Seller, as the case may be, by the Trustee or (b) to the Servicer or the Seller, as the case may be, and to the Trustee by holders of Certificates evidencing not less than 25% of the voting interests of the Class A Certificates and the Class B Certificates, voting together as a single class; and (iii) certain events of bankruptcy, insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings and certain actions by the Servicer (or the Seller, so long as Fleetwood Credit is the Servicer) indicating its insolvency, reorganization pursuant to bankruptcy proceedings or inability to pay its obligations. (Section 19.01) RIGHTS UPON EVENT OF DEFAULT As long as an Event of Default remains unremedied, the Trustee or holders of Certificates evidencing not less than 51% of the voting interests of the Class A Certificates and the Class B Certificates, voting together as a single class, may terminate all the rights and obligations of the Servicer under the Agreement, whereupon the Trustee will succeed, without further action, to all the responsibilities, duties and liabilities of the Servicer in its capacity as such under the Agreement and will be entitled to similar compensation arrangements. If, however, a bankruptcy trustee or similar official has been appointed for the Servicer, and no Event of Default other than such appointment has occurred, such trustee or official may have the power to prevent the Trustee or such Certificateholders from effecting a transfer of servicing. In the event that the Trustee is unwilling or unable so to act, it may appoint or petition a court of competent jurisdiction to appoint a successor with a net worth of at least $100,000,000 and whose regular business includes the servicing of recreational vehicle or motor vehicle receivables. The Trustee may make such arrangements for compensation to be paid, which in no event may be greater than the servicing compensation paid to the Servicer under the Agreement. (Sections 19.01 and 19.02) Notwithstanding such termination, the Servicer shall be entitled to payment of certain amounts payable to it prior to such termination, for services rendered prior to such termination. WAIVER OF PAST DEFAULTS The holders of Certificates evidencing not less than 51% of the voting interests of the Class A Certificates and the Class B Certificates, voting together as a single class, may waive any default by the Servicer in the performance of its obligations under the Agreement and its consequences, except a default in making any required deposits to or payments from the Certificate Account in accordance with the Agreement or in respect of a covenant or provision of the Agreement that cannot be modified or amended without the consent of each Certificateholder (in which event the related waiver will require the approval of holders of all of the 28 31 Certificates). No such waiver will impair the Certificateholders' rights with respect to subsequent defaults. (Section 19.05) VOTING INTERESTS For purposes of the Agreement, the "voting interests" of the (i) Class A Certificates will be allocated among the Class A Certificateholders or Class A Certificate Owners, as the case may be, in accordance with the Class A Certificate Balance represented thereby and (ii) Class B Certificates will be allocated among the Class B Certificateholders or Class B Certificate Owners, as the case may be, in accordance with the Class B Certificate Balance represented thereby; except that in certain circumstances any Class A Certificates or Class B Certificates, as the case may be, held by the Seller, the Servicer or any of their respective affiliates shall be excluded from such determination. AMENDMENT The Agreement may be amended by the Seller, the Servicer and the Trustee, without the consent of the Certificateholders, to cure any ambiguity, correct or supplement any provision therein which may be inconsistent with any other provision therein, to add any other provisions with respect to matters or questions arising under such Agreement which are not inconsistent with the provisions of the Agreement, to add or provide for any credit enhancement for the Class B Certificates or to permit certain changes with respect to the Specified Reserve Fund Balance or any Servicer Letter of Credit; provided, however, that any such action will not, in the opinion of counsel satisfactory to the Trustee, materially and adversely affect the interest of any Certificateholder, and provided, further, that in the case of a change with respect to the Specified Reserve Fund Balance or any Servicer Letter of Credit the Trustee receives a letter from each Rating Agency to the effect that such amendment will not result in a Ratings Effect. The Agreement may also be amended from time to time by the Seller, the Servicer and the Trustee with the consent of the holders of Certificates evidencing not less than 51% of the voting interests of all Certificates, voting together as a single class, 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 each Class of Certificateholders; provided, however, that no such amendment may (i) except as described above, increase or reduce in any manner the amount of or accelerate or delay the timing of collections of payments on or in respect of the Receivables or (ii) reduce the aforesaid percentage of the voting interests of which the holders of either Class of Certificates are required to consent to any such amendment, without the consent of the holders of all of the relevant Class of Certificates. (Section 22.01) LIST OF CERTIFICATEHOLDERS Upon a written request of the Servicer, the Trustee, as Certificate Registrar, will provide to the Servicer within 15 days after receipt of such request, a list of the names and addresses of all Certificateholders. In addition, three or more Certificateholders or holders of either Class of Certificates evidencing not less than 25% of the voting interests of such Class, upon compliance by such Certificateholders with certain provisions of the Agreement, may request that the Trustee, as Certificate Registrar, afford such Certificateholders access during business hours to the current list of Certificateholders for purposes of communicating with other Certificateholders with respect to their rights under the Agreement. (Section 16.06) The Agreement will not provide for the holding of any annual or other meetings of Certificateholders. TERMINATION The obligations of the Servicer, the Seller and the Trustee pursuant to the Agreement will terminate with respect to the Certificateholders upon the earliest to occur of (i) the maturity or other liquidation of the last Receivable and the disposition of any amounts received upon liquidation of any property remaining in the Trust, (ii) the payment to Certificateholders of all amounts required to be paid to them pursuant to the Agreement and (iii) the occurrence of either event described below. In order to avoid excessive administrative expenses, the Seller or the Servicer, or any successor to the Servicer, will be permitted at its option to purchase from the Trust, on any Distribution Date following a Record Date as of which the Pool Balance is 10% or less of the Original Pool Balance, all remaining 29 32 Receivables at a price equal to the aggregate Repurchase Amounts for the Receivables (including Defaulted Receivables), plus the appraised value of any other property held by the Trust (less liquidation expenses). In the event that both the Seller and the Servicer, or any successor to the Servicer, elect to purchase the Receivables, the party first notifying the Trustee (based on the Trustee's receipt of such notice) shall be permitted to purchase the Receivables. Exercise of such right will effect early retirement of the Certificates. Within ten days following a Record Date as of which the Pool Balance is 5% or less of the Original Pool Balance, the Trustee shall solicit bids for the purchase of the Receivables remaining in the Trust. In the event that satisfactory bids are received as described below, the sale proceeds will be distributed to Certificateholders on the second Distribution Date succeeding such Record Date. Any purchaser of the Receivables must agree to the continuation of Fleetwood Credit as Servicer on terms substantially similar to those in the Agreement. Any such sale will effect early retirement of the Certificates. The Trustee must receive at least two bids from prospective purchasers that are considered at the time to be competitive participants in the market for motor vehicle retail installment sale contracts. The highest bid may not be less than the fair market value of such Receivables and must equal the sum of (i) the greater of (a) the aggregate Repurchase Amounts for the Receivables (including Defaulted Receivables), plus the appraised value of any other property held by the Trust (less liquidation expenses) or (b) an amount that when added to amounts on deposit in the Certificate Account that would constitute Available Funds for such second succeeding Distribution Date would result in proceeds sufficient to distribute the sum of (1) the Class A Distributable Amount plus any unpaid Class A Principal and Interest Carryover Shortfalls and (2) the Class B Distributable Amount plus any unpaid Class B Principal and Interest Carryover Shortfalls, and (ii) the sum of (a) an amount sufficient to reimburse the Servicer for any outstanding Advances and (b) the Servicing Fee payable on such final Distribution Date, including any unpaid Servicing Fees with respect to one or more prior Collection Periods. The Trustee may consult with financial advisors, including one or both of the Underwriters, to determine if the fair market value of such Receivables has been offered. Upon the receipt of such bids, the Trustee shall sell and assign such Receivables to the highest bidder and the Certificates shall be retired on such Distribution Date. If any of the foregoing conditions are not met, the Trustee shall decline to consummate such sale and shall not be under any obligation to solicit any further bids or otherwise negotiate any further sale of Receivables remaining in the Trust. In such event, however, the Trustee may from time to time solicit bids in the future for the purchase of such Receivables upon the same terms described above. The Trustee will give written notice of termination to each Certificateholder of record. The final distribution to each Certificateholder will be made only upon surrender and cancellation of such holder's Certificates at any office or agency of the Trustee specified in the notice of termination. Any funds remaining in the Trust, after the Trustee has taken certain measures to locate a Certificateholder and such measures have failed, will be distributed to the United Way. (Sections 21.01 and 21.02) DUTIES OF THE TRUSTEE The Trustee will make no representations as to the validity or sufficiency of the Agreement, the Certificates (other than the execution and authentication thereof), or of any Receivables or related documents, and will not be accountable for the use or application by the Seller or the Servicer of any funds paid to the Seller or the Servicer in respect of the Certificates or the Receivables, or the investment of any monies by the Servicer before such monies are deposited into the Certificate Account. The Trustee will not independently verify the Receivables. If no Event of Default has occurred and is continuing, the Trustee will be required to perform only those duties specifically required of it under the Agreement. Generally those duties will be limited to the receipt of the various certificates, reports or other instruments required to be furnished to the Trustee under the Agreement, in which case it will only be required to examine them to determine whether they conform to the requirements of the Agreement. The Trustee will not be charged with knowledge of a failure by the Servicer to perform its duties under the Agreement which failure constitutes an Event of Default unless the Trustee obtains actual knowledge of such failure as specified in the Agreement. (Sections 20.01 and 20.05) 30 33 The Trustee will be under no obligation to exercise any of the rights or powers vested in it by the Agreement or to make any investigation of matters arising thereunder or to institute, conduct or defend any litigation thereunder or in relation thereto at the request, order or direction of any of the Certificateholders, unless such Certificateholders have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities that may be incurred therein or thereby. No Certificateholder will have any right under the Agreement to institute any proceeding with respect to the Agreement, unless such holder previously has given to the Trustee written notice of default and (i) the Event of Default arises from the Servicer's failure to remit payments when due or (ii) the holders of Certificates evidencing not less than 25% of the voting interests of the Class A Certificates and the Class B Certificates, voting together as a single class, have made written request upon the Trustee to institute such proceeding in its own name as the Trustee thereunder and have offered to the Trustee reasonable indemnity and the Trustee for 30 days has neglected or refused to institute any such proceedings. (Section 20.04) THE TRUSTEE The Chase Manhattan Bank will be the Trustee under the Agreement. The Trustee and any of its affiliates may hold Certificates in their own names or as pledgees. (Section 20.06) For the purpose of meeting the legal requirements of certain jurisdictions, the Servicer and the Trustee acting jointly (or in some instances, the Trustee acting alone) will have the power to appoint co-trustees or separate trustees of all or any part of the Trust. In the event of such an appointment, all rights, powers, duties and obligations conferred or imposed upon the Trustee by the Agreement will be conferred or imposed upon the Trustee and such separate trustee or co-trustee jointly, or, in any jurisdiction in which the Trustee will be incompetent or unqualified to perform certain acts, singly upon such separate trustee or co-trustee who will exercise and perform such rights, powers, duties and obligations solely at the direction of the Trustee. (Section 20.13) The Trustee may resign at any time, in which event the Servicer will be obligated to appoint a successor trustee. The Servicer may also remove the Trustee if the Trustee ceases to be eligible to continue as such under the Agreement, becomes legally unable to act or becomes insolvent. In such circumstances, the Servicer will be obligated to appoint a successor trustee. Any resignation or removal of the Trustee and appointment of a successor trustee will not become effective until acceptance of the appointment by such successor trustee. (Section 20.10) The Agreement will provide that the Servicer will pay the Trustee's fees. (Section 20.07) The Agreement will further provide that the Trustee will be entitled to indemnification by the Servicer for, and will be held harmless against, any loss, liability or expense incurred by the Trustee not resulting from its own willful misfeasance, bad faith or negligence (other than by reason of a breach of any of its representations or warranties set forth in the Agreement). (Section 18.02) The Trustee's Corporate Trust Office is located at 450 West 33rd Street, 15th Floor, New York, New York 10001, telephone (212) 946-3000. CERTAIN LEGAL ASPECTS OF THE RECEIVABLES GENERAL The transfer of the Receivables to the Trustee, the perfection of the security interest in the Receivables and the enforcement of rights to realize on the Financed Vehicles as collateral for the Receivables are subject to a number of federal and state laws, including the UCC as in effect in various states. The Servicer and the Seller will take such action as is required to perfect the rights of the Trustee in the Receivables. If, through inadvertence or otherwise, another party purchases (including the taking of a security interest in) the Receivables for new value in the ordinary course of its business, without actual knowledge of the Trust's interest, and takes possession of the Receivables, such purchaser would acquire an interest in the Receivables superior to the interest of the Trust. 31 34 SECURITY INTERESTS IN THE FINANCED VEHICLES General. Retail installment sale contracts such as the Receivables evidence the credit sale of recreational vehicles by dealers to obligors; the contracts also constitute personal property security agreements and include grants of security interests in the related recreational vehicles under the UCC. In most states (including California, the state in which the greatest number of Financed Vehicles are currently registered), perfection rules relating to security interests in recreational vehicles are generally governed under state certificate of title statutes (Alabama, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Mississippi, New Hampshire, New York, Rhode Island and Vermont have adopted the Uniform Motor Vehicle Certificate of Title and Anti-Theft Act) or by the vehicle registration laws of the state in which each recreational vehicle is located. In states which have adopted the Uniform Motor Vehicle Certificate of Title and Anti-Theft Act, security interests in recreational vehicles may be perfected either by notation of the secured party's lien on the certificate of title or by delivery of the certificate of title and payment of a fee to the state motor vehicle authority, depending on particular state law. In states that do not have a certificate of title statute or that make no provision for notation of a security interest on a certificate of title, perfection is usually accomplished by filing pursuant to the provisions of the UCC. Notwithstanding the foregoing, in certain states, folding camping trailers and/or slide-in campers are not subject to state titling and vehicle registration laws and a security interest in such recreational vehicles is perfected by filing pursuant to the provisions of the UCC. In most states, including California, a security interest in a recreational vehicle is perfected by notation of the secured party's lien on the vehicle's certificate of title. Each Receivable prohibits the sale or transfer of the related Financed Vehicle without the consent of Fleetwood Credit. All retail installment sale contracts that Fleetwood Credit originates or acquires from Dealers name Fleetwood Credit as obligee or assignee and as the secured party. Fleetwood Credit also takes all actions necessary under the laws of the state in which the related recreational vehicles are located to perfect its security interest in such recreational vehicles, including, where applicable, having a notation of its lien recorded on the related certificate of title or delivering the required documents and fees, obtaining possession of the certificate of title (if possible) or, where applicable, by perfecting its security interest in the related recreational vehicles under the UCC. Perfection. Pursuant to the Receivables Purchase Agreement, Fleetwood Credit will sell and assign its security interests in the Financed Vehicles to the Seller and, pursuant to the Agreement, the Seller will assign its security interests in the Financed Vehicles to the Trustee. However, because of the administrative burden and expense, neither Fleetwood Credit, the Seller nor the Trustee will amend any certificate of title to identify the Trustee as the new secured party on the certificates of title relating to the Financed Vehicles nor will any such entity execute any transfer instrument (including, among other instruments, UCC-3 assignments). In some states, in the absence of such an amendment or execution, the assignment to the Trustee of a security interest in Financed Vehicles registered therein may not be effective or such security interest may not be perfected. If any otherwise effectively assigned security interest in favor of the Trustee is not perfected, such assignment of the security interest to the Trustee may not be effective against creditors or a trustee in bankruptcy of Fleetwood Credit, which continues to be specified as lienholder on any certificates of title or as secured party on any UCC filing. However, UCC financing statements with respect to the transfer of Fleetwood Credit's security interest in the Financed Vehicles to the Seller and the transfer to the Trustee of the Seller's security interest in the Financed Vehicles will be filed. In addition, the Servicer will continue to hold any certificates of title relating to the Financed Vehicles in its possession as custodian for the Trustee pursuant to the Agreement. See "The Certificates -- Sale and Assignment of the Receivables." A security interest in a motor vehicle registered in the State of California (in which the greatest number of Financed Vehicles are currently registered) may be perfected only by depositing with the Department of Motor Vehicles a properly endorsed certificate of title for the vehicle showing the secured party as legal owner thereon or if the vehicle has not been previously registered, an application in usual form for an original registration together with an application for registration of the secured party as legal owner. However, under the California Vehicle Code, a transferee of a security interest in a motor vehicle is not required to reapply to the Department of Motor Vehicles for a transfer of registration when the interest of the transferee arises from the transfer of a security agreement by the legal owner to secure payment or performance of an obligation. 32 35 Accordingly, under California law, an assignment such as that under each of the Receivables Purchase Agreement and the Agreement is an effective conveyance of Fleetwood Credit's and the Seller's security interest, as the case may be, without such re-registration, and under the Receivables Purchase Agreement the Seller will succeed to Fleetwood Credit's, and under the Agreement the Trustee will succeed to the Seller's, rights as secured party. With respect to Financed Vehicles registered in other states, the Trustee may not have a first perfected security interest in such Financed Vehicles. In most states, assignments such as those under the Receivables Purchase Agreement and the Agreement are an effective conveyance of a security interest without amendment of any lien noted on a vehicle's certificate of title, and the assignee succeeds thereby to the assignor's rights as secured party. Although re-registration of the recreational vehicle is not necessary to convey a perfected security interest in the Financed Vehicles to the Trustee, because the Trustee will not be listed as legal owner on the certificates of title to the Financed Vehicles, its security interest could be defeated through fraud or negligence. However, in the absence of fraud, forgery or administrative error, the notation of Fleetwood Credit's lien on the certificates of title will be sufficient in most states to protect the Trust against the rights of subsequent purchasers of a Financed Vehicle or subsequent creditors who take a security interest in a Financed Vehicle. In the Receivables Purchase Agreement, Fleetwood Credit will represent and warrant, and in the Agreement the Seller will represent and warrant, that it has, or has taken all action necessary to obtain, a perfected security interest in each Financed Vehicle. If there are any Financed Vehicles as to which Fleetwood Credit failed to obtain a first perfected security interest, its security interest would be subordinate to, among others, subsequent purchasers of such Financed Vehicles and holders of first perfected security interests therein. Such a failure, however, would constitute a breach of Fleetwood Credit's representations and warranties under the Receivables Purchase Agreement and the Seller's representations and warranties under the Agreement, and pursuant to the Agreement, the Seller would be required to repurchase the related Receivable from the Trustee and, pursuant to the Receivables Purchase Agreement, Fleetwood Credit would be required to purchase such Receivable from the Seller, in each case unless the breach were cured. See "The Certificates -- Sale and Assignment of the Receivables." The Seller will assign its rights under the Receivables Purchase Agreement to the Trustee. Continuity of Perfection. Under the laws of most states, a perfected security interest in a recreational vehicle continues for four months after the vehicle is moved to a new state from the one in which it is initially registered and thereafter until the owner re-registers such recreational vehicle in the new state. A majority of states require surrender of a certificate of title to re-register a vehicle. In those states (including California) that call for the return of the certificate of title to the holder of the first security interest listed thereon, the secured party would learn of the re-registration through the request from the obligor under the related installment sale contract to surrender possession of the certificate of title. In the case of vehicles registered in states providing for the notation of a lien on the certificate of title but not possession by the secured party, the secured party would receive notice of surrender from the state of re-registration if the security interest is noted on the certificate of title. Thus, the secured party would have the opportunity to re-perfect its security interest in the vehicles in the state of relocation. However, these procedural safeguards will not protect the secured party if through fraud, forgery or administrative error, the debtor somehow procures a new certificate of title that does not list the secured party's lien. Additionally, in states that do not require a certificate of title for registration of a vehicle, re-registration could defeat perfection. In the ordinary course of servicing the Receivables, Fleetwood Credit will take steps to effect re-perfection upon receipt of notice of re-registration or information from the Obligor as to relocation. Similarly, when an Obligor sells a Financed Vehicle, Fleetwood Credit must surrender possession of the certificate of title or will receive notice as a result of its lien noted thereon and accordingly will have an opportunity to require satisfaction of the related Receivable before release of the lien. Under the Agreement, the Servicer will be obligated to take appropriate steps, at its own expense, to maintain perfection of a security interest in the Financed Vehicles. Priority of Certain Liens Arising by Operation of Law. Under the laws of California and of most states, liens for repairs performed on a recreational vehicle and liens for unpaid taxes take priority over even a first perfected security interest in such vehicle. The Internal Revenue Code of 1986, as amended, also grants priority to certain federal tax liens over the lien of a secured party. The laws of certain states and federal law 33 36 permit the confiscation of motor vehicles by governmental authorities under certain circumstances if used in unlawful activities, which may result in the loss of a secured party's perfected security interest in a confiscated recreational vehicle. Fleetwood Credit will represent and warrant to the Seller in the Receivables Purchase Agreement and the Seller will represent and warrant to the Trustee in the Agreement that, as of the Closing Date, the security interest in each Financed Vehicle is prior to all other present liens upon and security interests in such Financed Vehicle. However, liens for repairs or taxes could arise at any time during the term of a Receivable. No notice will be given to the Trustee or Certificateholders in the event such a lien or confiscation arises and any such lien or confiscation arising after the Closing Date would not give rise to Fleetwood Credit's repurchase obligation under the Receivables Purchase Agreement or the Seller's repurchase obligation under the Agreement. REPOSSESSION In the event of default by an obligor, the holder of the related retail installment sale contract has all the remedies of a secured party under the UCC, except where specifically limited by other state laws. The UCC remedies of a secured party include the right to repossession by self-help means, unless such means would constitute a breach of the peace. Self-help repossession is the method employed by the Servicer in most cases and is accomplished simply by taking possession of the related recreational vehicle. In cases where the obligor objects or raises a defense to repossession, or if otherwise required by applicable state law, a court order must be obtained from the appropriate state court, and the vehicle must then be recovered in accordance with that order. In some jurisdictions (not including California), the secured party is required to notify the debtor of the default and the intent to repossess the collateral and be given a time period within which to cure the default prior to repossession. In most states (including California), under certain circumstances after the vehicle has been repossessed, the obligor may reinstate the related contract by paying the delinquent installments and other amounts due. NOTICE OF SALE; REDEMPTION RIGHTS In the event of default by the obligor, some jurisdictions (not including California) require that the obligor be notified of the default and be given a time period within which to cure the default prior to repossession. Generally, this right of cure may only be exercised on a limited number of occasions during the term of the related contract. The UCC and other state laws require the secured party to provide the obligor with reasonable notice of the date, time and place of any public sale and/or the date after which any private sale of the collateral may be held. The obligor has the right to redeem the collateral prior to actual sale by paying the secured party the unpaid principal balance of the obligation, accrued interest thereon plus reasonable expenses for repossessing, holding and preparing the collateral for disposition and arranging for its sale, plus, in some jurisdictions, reasonable attorneys' fees or in some states, by payment of delinquent installments or the unpaid principal balance of the related obligation. DEFICIENCY JUDGMENTS AND EXCESS PROCEEDS The proceeds of resale of the Financed Vehicles generally will be applied first to the expenses of resale and repossession and then to the satisfaction of the related indebtedness. While some states impose prohibitions or limitations on deficiency judgments if the net proceeds from resale do not cover the full amount of the indebtedness, a deficiency judgment can be sought in California and certain other states that do not prohibit or limit such judgments. In addition to the notice requirement, the UCC requires that every aspect of the sale or other disposition, including the method, manner, time, place and terms, be "commercially reasonable." Generally, courts have held that when a sale is not "commercially reasonable," the secured party loses its right to a deficiency judgment. In addition, the UCC permits the debtor or other interested party to recover for any loss caused by noncompliance with the provisions of the UCC. Also, prior to a sale, the UCC permits the debtor or other interested person to restrain the secured party from disposing of the collateral if it is established that the secured party is not proceeding in accordance with the "default" provisions under the UCC. However, the deficiency judgment would be a personal judgment against the obligor for the shortfall, and a defaulting obligor can be expected to have very little capital or sources of income available following 34 37 repossession. Therefore, in many cases, it may not be useful to seek a deficiency judgment or, if one is obtained, it may be settled at a significant discount or be uncollectible. Occasionally, after resale of a recreational vehicle and payment of all expenses and indebtedness, there is a surplus of funds. In that case, the UCC requires the creditor to remit the surplus to any holder of a subordinate lien with respect to such vehicle or, if no such lienholder exists, to the former owner of the vehicle. CERTAIN BANKRUPTCY CONSIDERATIONS The Seller has taken steps in structuring the transactions described herein that are intended to make it unlikely that the voluntary or involuntary application for relief by Fleetwood Credit under the United States Bankruptcy Code or similar applicable state laws (collectively, "Insolvency Laws") will result in consolidation of the assets and liabilities of the Seller with those of Fleetwood Credit. These steps include the creation of the Seller as a wholly owned, limited purpose subsidiary pursuant to articles of incorporation containing certain limitations (including requiring that the Seller must have at least two "Independent Directors" and restrictions on the nature of the Seller's business and on its ability to commence a voluntary case or proceeding under any Insolvency Law without the affirmative vote of a majority of its directors, including each Independent Director). In addition, to the extent that the Seller granted a security interest in the Receivables to the Trust, and that interest was validly perfected before the bankruptcy or insolvency of Fleetwood Credit and was not taken or granted in contemplation of insolvency or with the intent to hinder, delay or defraud Fleetwood Credit or its creditors, that security interest should not be subject to avoidance, and payments to the Trust with respect to the Receivables should not be subject to recovery by a creditor or trustee in bankruptcy of Fleetwood Credit. If, notwithstanding the foregoing, (i) a court concluded that the assets and liabilities of the Seller should be consolidated with those of Fleetwood Credit in the event of the application of applicable Insolvency Laws to Fleetwood Credit or following the bankruptcy or insolvency of Fleetwood Credit the security interest in the Receivables granted by the Seller to the Trustee should be avoided; (ii) a filing were made under any Insolvency Law by or against the Seller; or (iii) an attempt were made to litigate any of the foregoing issues, delays in payments on the Certificates and possible reductions in the amount of such payments could occur. At the time of initial issuance of the Certificates, Brown & Wood LLP, special counsel to Fleetwood Credit and the Seller, will render an opinion which concludes that following the bankruptcy of Fleetwood Credit, a court, applying the principles set forth in such opinion, should not allow a creditor or trustee in bankruptcy to consolidate the assets and liabilities of Fleetwood Credit and the Seller on the basis of any applicable legal theory theretofore recognized by a court of competent jurisdiction so as to adversely affect the ultimate payment of all amounts owing under the Class A Certificates and the Class B Certificates. Fleetwood Credit and the Seller will treat the transactions described herein as a sale of the Receivables to the Seller, such that the automatic stay provisions of the United States Bankruptcy Code would not apply to the Receivables in the event that Fleetwood Credit were to become a debtor in a bankruptcy case. A case decided by the United States Court of Appeals for the Tenth Circuit in 1993 contains language to the effect that under the UCC accounts sold by a debtor would remain property of the debtor's bankruptcy estate, whether or not the sale of accounts was perfected under the UCC. UCC Article 9 applies to the sale of chattel paper as well as the sale of accounts and although the Receivables constitute chattel paper under the UCC rather than accounts, perfection of a security interest in both chattel paper and accounts may be accomplished by the filing of a UCC-1 financing statement. If, following a bankruptcy of Fleetwood Credit, a court were to follow the reasoning of the Tenth Circuit reflected in the case described above, then the Receivables would be included in the bankruptcy estate of Fleetwood Credit and delays in payments of collections on or in respect of the Receivables could occur. CONSUMER PROTECTION LAWS Numerous federal and state consumer protection laws and related regulations impose substantial requirements upon creditors and services involved in consumer finance. These laws include the Truth-in-Lending Act, the Equal Credit Opportunity Act, the Federal Trade Commission Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Magnuson-Moss Warranty Act, the Federal Reserve Board's Regulations B and Z, the Soldiers' and Sailors' Relief Act, the Military Reservist Relief Act, state adaptations of the National Consumer Act and of the Uniform Consumer Credit 35 38 Code and state motor vehicle retail installment sales acts, retail installment sales acts and other similar laws. Also, the laws of California and of certain other states impose finance charge ceilings and other restrictions on consumer transactions and require contract disclosures in addition to those required under federal law. These requirements impose specific statutory liabilities upon creditors who fail to comply with their provisions. In some cases, this liability could affect the ability of an assignee such as the Trustee to enforce consumer finance contracts such as the Receivables. The so-called "Holder-in-Due-Course Rule" of the Federal Trade Commission (the "FTC Rule"), has the effect of subjecting any assignee of the seller in a consumer credit transaction to all claims and defenses which the obligor in the transaction could assert against the seller of the goods. Liability under the FTC Rule is limited to the amounts paid by the obligor under the contract, and the holder of the contract may also be unable to collect any balance remaining due thereunder from the obligor. The FTC Rule is generally duplicated by the Uniform Consumer Credit Code, other state statutes or the common law in certain states. Most of the Receivables will be subject to the requirements of the FTC Rule. Accordingly, the Trustee, as holder of the Receivables, will be subject to any claims or defenses that the purchaser of the related Financed Vehicle may assert against the seller of the Financed Vehicle. Such claims are limited to a maximum liability equal to the amounts paid by the Obligor under the related Receivables. Under California law and most state vehicle dealer licensing laws, sellers of recreational vehicles are required to be licensed to sell vehicles at retail sale. In addition, with respect to used vehicles, the Federal Trade Commission's Rule on Sale of Used Vehicles requires that all sellers of used vehicles prepare, complete, and display a "Buyer's Guide" which explains the warranty coverage for such vehicles. Furthermore, Federal Odometer Regulations promulgated under the Motor Vehicle Information and Cost Savings Act require that all sellers of used vehicles furnish a written statement signed by the seller certifying the accuracy of the odometer reading. If a seller is not properly licensed or if either a Buyer's Guide or Odometer Disclosure Statement was not provided to the purchaser of a Financed Vehicle, the Obligor may be able to assert a defense against the seller of the Financed Vehicle. If an Obligor on a Receivable were successful in asserting any such claim or defense, the Servicer would pursue on behalf of the Trust any reasonable remedies against the seller or manufacturer of the vehicle, subject to certain limitations as to the expense of any such action specified in the Agreement. Courts have applied general equitable principles to secured parties pursuing repossession or litigation involving deficiency balances. These equitable principles may have the effect of relieving an obligor from some or all of the legal consequences of a default. In several cases, consumers have asserted that the self-help remedies of secured parties under the UCC and related laws violate the due process protections of the Fourteenth Amendment to the Constitution of the United States. Courts have generally either upheld the notice provisions of the UCC and related laws as reasonable or have found that the creditor's repossession and resale do not involve sufficient state action to afford constitutional protection to consumers. Fleetwood Credit will represent and warrant under the Receivables Purchase Agreement and the Seller will represent and warrant under the Agreement that each Receivable complies with all requirements of law in all material respects. Accordingly, if an Obligor has a claim against the Trustee for violation of any law and such claim materially and adversely affects the interests of the Certificateholders in a Receivable, such violation would constitute a breach of such representation and warranty under the Receivables Purchase Agreement and the Agreement and would create an obligation of Fleetwood Credit and the Seller to repurchase such Receivable unless the breach were cured. See "The Certificates -- Sale and Assignment of the Receivables." Any shortfall in payments on or in respect of the Receivables described under this subheading, to the extent not otherwise covered by amounts otherwise payable to the Class B Certificateholders pursuant to the subordination of the Class B Certificateholders or from amounts on deposit in the Reserve Fund, could result in losses to the Class A Certificateholders. In addition, any such shortfall, to the extent not covered by amounts on deposit in the Reserve Fund, could result in losses to the Class B Certificateholders. 36 39 OTHER LIMITATIONS In addition to the laws limiting or prohibiting deficiency judgments, numerous other statutory provisions, including federal bankruptcy laws and related state laws, may interfere with or affect the ability of a creditor to realize upon collateral or enforce a deficiency judgment. For example, in a Chapter 13 proceeding under the federal bankruptcy law, a court may prevent a creditor from repossessing a recreational vehicle, and, as part of the rehabilitation plan, reduce the amount of the secured indebtedness to the market value of the recreational vehicle at the time of bankruptcy (as determined by the court), leaving the party providing financing as a general unsecured creditor for the remainder of the indebtedness. A bankruptcy court may also reduce the monthly payments due under the related contract or change the rate of interest and time of repayment of the indebtedness. Under the terms of the Soldiers' and Sailors' Relief Act, an Obligor who enters the military service after the origination of such Obligor's Receivable (including an Obligor who is a member of the National Guard or is in reserve status at the time of the origination of the Obligor and is later called to active duty) may not be charged interest above an annual rate of 6% during the period of such Obligor's active duty status, unless a court orders otherwise upon application of the lender. In addition, pursuant to the Military Reservist Relief Act, under certain circumstances, California residents called into active duty with the reserves can delay payments on retail installment contracts, including the Receivables, for a period, not to exceed 180 days, beginning with the order to active duty and ending 30 days after release. It is possible that the foregoing could have an effect on the ability of the Servicer to collect full amounts of interest on certain of the Receivables. In addition, the Relief Acts impose limitations which would impair the ability of the Servicer to repossess an affected Receivable during the Obligor's period of active duty status. Thus, in the event that such a Receivable goes into default, there may be delays and losses occasioned by the inability to realize upon the related Financed Vehicle in a timely fashion. Any shortfall pursuant to either of the two immediately preceding paragraphs, to the extent not otherwise covered by amounts otherwise payable to the Class A Certificateholders pursuant to the subordination of the Class B Certificates or from amounts on deposit in the Reserve Fund, could result in losses to the Class A Certificateholders. In addition, any such shortfall, to the extent not covered by amounts on deposit in the Reserve Fund, could result in losses to the Class B Certificateholders. CERTAIN FEDERAL INCOME TAX CONSEQUENCES The following is a general discussion of certain federal income tax consequences of the purchase, ownership and disposition of the Certificates. This summary is based upon laws, regulations, rulings and decisions currently in effect, all of which are subject to change. The discussion does not deal with all federal tax consequences applicable to all categories of investors, some of which may be subject to special rules. In addition, this summary is generally limited to investors who will hold the Certificates as "capital assets" (generally, property held for investment) within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the "Code"). Investors should consult their own tax advisors to determine the federal, state, local and other tax consequences of the purchase, ownership and disposition of the Certificates. Prospective investors should note that no rulings have been or will be sought from the Internal Revenue Service ("IRS") with respect to any of the federal income tax consequences discussed below, and no assurance can be given that the IRS will not take contrary positions. TAX STATUS OF THE TRUST In the opinion of Brown & Wood LLP, special tax counsel to the Seller, the Trust will be classified as a grantor trust under subpart E, part I of subchapter J of the Code and not as an association taxable as a corporation for federal income tax purposes. Certificateholders will be treated as the owners of the Trust, except as described below. GENERAL For purposes of federal income tax, the Trust will be deemed to have acquired the following assets: (i) the principal portion of each Receivable plus a portion of the interest due on each Receivable (the "Trust 37 40 Stripped Bond"), (ii) a portion of the interest due on each Receivable equal to the difference between the Class B Pass-Through Rate and the Class A Pass-Through Rate which difference is then multiplied by the Class B Percentage of each Receivable (the "Trust Stripped Coupon") and (iii) the right to receive payments from the Reserve Fund. All interest due on each Receivable in excess of that portion of such interest included in either the Trust Stripped Bond or the Trust Stripped Coupon above has been retained by the Seller (the "Excess Receivable Amounts"). The Class A Certificateholders in the aggregate will own the Class A Percentage of the Trust Stripped Bond, and accordingly each Class A Certificateholder will be treated as owning its pro rata share of such asset. The Class A Certificateholders will not own any portion of the Trust Stripped Coupon. The Class B Certificateholders in the aggregate own both the Class B Percentage of the Trust Stripped Bond plus 100% of the Trust Stripped Coupon, if any, and accordingly each Class B Certificateholder will be treated as owning its pro rata share in both such assets. The Trust Stripped Bond will be treated as a "stripped bond" within the meaning of Section 1286 of the Code. The Trust Stripped Coupon will be treated as "stripped coupons" within the meaning of Section 1286 of the Code. Each Certificateholder will be required to report on its federal income tax return, in a manner consistent with its method of accounting, its pro rata share of the entire gross income of the Trust, including interest or finance charges earned on the Receivables, any payment from the Reserve Fund and any gain or loss upon collection or disposition of the Receivables. Payments from the Reserve Fund will have the same character as the amounts they replace (i.e., interest or finance charges on, or principal of, the Receivables). In computing its federal income tax liability, a Certificateholder will be entitled to deduct, consistent with its method of accounting, its pro rata share of reasonable fees payable to the Servicer that are paid or incurred by the Trust as provided in Sections 162 or 212 of the Code. If a Certificateholder is an individual, estate or trust the deduction for its pro rata share of such fees will be allowed only to the extent that all of its miscellaneous itemized deductions, including its share of such fees, exceed 2% of its adjusted gross income. In addition, Code Section 68 provides that itemized deductions otherwise allowable for a taxable year of an individual taxpayer whose adjusted gross income exceeds a specified amount will be reduced by the lesser of (i) 3% of the excess, if any, of adjusted gross income over such amount, or (ii) 80% of the amount of itemized deductions otherwise allowable for such year. As a result, such investors holding Certificates, directly or indirectly through a pass-through entity, may have aggregate taxable income in excess of the aggregate amount of cash received on such Certificates with respect to interest at the related Pass-Through Rate on such Certificates. A Certificateholder using the cash method of accounting must take into account its pro rata share of income and deductions as and when collected by or paid by the Trust. A Certificateholder using the accrual method of accounting must take into account its pro rata share of income and deductions as and when such amounts become due to or payable by the Trust. Guidance by the IRS suggests that a servicing fee in excess of reasonable servicing ("excess servicing") will cause the Receivables to be treated under the stripped bond rules promulgated by the IRS. It is expected that for federal income tax purposes, the Seller will be viewed as having retained a portion of each interest payment on each Receivable sold to the Trust. As a result, the Certificates would be treated under Code Section 1286 as "stripped bonds." For purposes of Code Section 1271 through 1288, Code Section 1286 treats a stripped bond or a stripped coupon as an obligation issued on the date that such stripped interest is created. To the extent that the Receivables are characterized as "stripped bonds," as described above, the income of the Trust allocable to Certificateholders will not include the portion of the interest on the Excess Receivable Amounts treated as a strip, and the deductions allocable to Certificateholders will be limited to their respective shares of reasonable servicing and other fees. In addition, a Certificateholder will not be subject to the market discount and premium rules discussed below with respect to the stripped Receivables, but instead will be subject to the original issue discount rules contained in the Code. A Certificateholder will be required to include any original issue discount in income as it accrues, regardless of whether cash payments are received, using a method reflecting a constant rate of interest on the Receivables. 38 41 STRIPPED BONDS AND STRIPPED COUPONS Although the tax treatment of stripped bonds is not entirely clear, based on guidance by the IRS, each purchaser of a Certificate will be treated as the purchaser of a stripped bond which generally should be treated as a single debt instrument issued on the day it is purchased for purposes of calculating any original issue discount. Generally, under Treasury regulations (the "Section 1286 Treasury Regulations"), if the discount on a stripped bond certificate is larger than a de minimis amount (as calculated for purposes of the original issue discount rules of the Code) such stripped bond certificate will be considered to have been issued with original issue discount. See "Accrual of Original Issue Discount." Based on the preamble to the Section 1286 Treasury Regulations, Brown & Wood LLP is of the opinion that, although the matter is not entirely clear, the interest income on the Class A Certificates and the Class B Certificates (less the stripped coupon amount) at the sum of the Class A Pass-Through Rate and the portion of the Servicing Fee Rate that does not constitute excess servicing will be treated as "qualified stated interest" within the meaning of the Section 1286 Treasury Regulations and such income will be so treated in the Trustee's tax information reporting. ACCRUAL OF ORIGINAL ISSUE DISCOUNT In determining whether a Certificateholder has purchased its interest in the Receivables (or any Receivable) at a discount, a portion of the purchase price for a Certificate may be allocated to the accrued interest on the Receivables at the time of purchase as though such accrued interest were a separate asset, thus, in each case, reducing the portion of the purchase price allocable to the Certificateholder's undivided interest in the Receivables (the "Purchase Price"). If the Certificates are considered to be issued with original issue discount, the rules described in this paragraph would apply. Generally, the owner of a stripped bond issued or acquired with original issue discount must include in gross income the sum of the "daily portions," as defined below, of the original issue discount on such Certificate for each day on which it owns a Certificate, including the date of purchase but excluding the date of disposition. In the case of an original Certificateholder, the daily portions of original issue discount with respect to a Certificate generally would be determined as follows. A calculation will be made of the portion of original issue discount that accrues on the Certificate during each successive monthly accrual period (or shorter period in respect of the date of original issue or the final Distribution Date). This will be done, in the case of each full monthly accrual period, by adding (i) the present value as of the close of such accrual period of all remaining payments to be received on the Certificate under the prepayment assumption used in respect of the Certificates and (ii) any payments received during such accrual period, and subtracting from that total the "adjusted issue price" of the Certificate at the beginning of such accrual period. No representation is made that the Receivables will prepay at any prepayment assumption. The "adjusted issue price" of a Certificate at the beginning of the first accrual period is its issue price (as determined for purposes of the original issue discount rules of the Code) and the "adjusted issue price" of a Certificate at the beginning of a subsequent accrual period is the "adjusted issued price" at the beginning of the immediately preceding accrual period plus the amount of original issue discount allocable to that accrual period and reduced by the amount of any payment made at the end of or during that accrual period. The original issue discount accruing during such accrual period will then be divided by the number of days in the period to determine the daily portion of original issue discount for each day in the period. With respect to an initial accrual period shorter than a full monthly accrual period, the daily portions of original issue discount must be determined according to any reasonable method set forth in the Treasury Regulations with respect to original issue discount. With respect to the Certificates, the method of calculating original issue discount as described above will cause the accrual of original issue discount to either increase or decrease (but never below zero) in any given accrual period to reflect the fact that prepayments are occurring at a faster or slower rate than the prepayment assumption used in respect of the Certificates. Subsequent purchasers that purchase Certificates at more than a de minimis discount should consult their tax advisors with respect to the proper method to accrue such original issue discount. PREMIUM The purchase of a Certificate at more than its adjusted principal amount will result in the creation of a premium with respect to the interest in the underlying Receivables represented by such Certificates. In 39 42 determining whether a Certificateholder has purchased its interest in the Receivables (or any Receivable) at a premium, a portion of the purchase price for a Certificate may be allocated to the accrued interest on the Receivables at the time of purchase as though such accrued interest were a separate asset, thus, in each case, reducing the portion of the purchase price allocable to the Certificateholder's undivided interest in the Receivables. A purchaser (who does not hold the Certificate for sale to customers or in inventory) may elect under Section 171 of the Code to amortize such premium. Under the Code, premium is allocated among the interest payments on the Receivables to which it relates and is considered as an offset against (and thus a reduction of) such interest payments. With certain exceptions, such an election would apply to all debt instruments held or subsequently acquired by the electing holder. Absent such an election, the premium (to the extent attributable to Receivables issued by individuals) will only be deductible as an ordinary loss pro rata as principal is paid on those Receivables issued by individuals. Holders of Certificates acquired at a premium are urged to consult with their own tax advisors regarding the proper treatment of the Certificates for federal income tax purposes. SALE OF A CERTIFICATE If a Certificate is sold, gain or loss will be recognized equal to the difference between the amount realized on the sale (exclusive of amounts attributable to accrued and unpaid interest, which will be treated as ordinary income) allocable to each of the Receivables and the Certificateholder's adjusted basis therein. A Certificateholder's adjusted basis will equal the Certificateholder's cost for the Certificate, increased by any discount previously included in income, and decreased (but not below zero) by any previously amortized premium and by the amount of payments previously received on the Receivables. Any gain or loss will be capital gain or loss if the Certificate was held as a capital asset, except that gain will be treated in whole or in part as ordinary interest income to the extent of the seller's interest in accrued market discount not previously taken into income on underlying Receivables having a fixed maturity date of more than one year from the date of origination. A capital gain or loss will be long-term or short-term depending on whether or not the Certificates have been owned for more than one year. CLASS B CERTIFICATEHOLDERS General. As stated above, the Class B Pass-Through Rate will be equal to the sum of (i) the Class B Percentage of the Pool Balance multiplied by the Class A Pass-Through Rate, (ii) a portion of the interest accrued on each Receivable (i.e., the Trust Stripped Coupon) and (iii) the right to receive certain payments from the Reserve Fund. Because the purchase price paid by each Class B Certificateholder will be allocated between that Certificateholder's interest in the Trust Stripped Bond and the Trust Stripped Coupon based on the relative fair market values of each asset on the date such Class B Certificate is purchased, the Trust Stripped Bond may be issued with original issue discount. Trust Stripped Bond. Except to the extent modified below, the income on the Trust Stripped Bond represented by the Certificates will be reported in the same manner as described above for holders of the Certificates. The interest income on the Class B Certificates at the Class A Pass-Through Rate and the portion of the Servicing Fee Rate that does not constitute excess servicing will be treated as qualified stated interest. Trust Stripped Coupon. The Trust Stripped Coupon will be treated as a debt instrument with original issue discount equal to the excess of the total amount payable with respect to such Trust Stripped Coupon (based on the prepayment assumption used in pricing the Certificates) over the portion of the purchase price allocated thereto. The sum of the daily portions of original issue discount on the Trust Stripped Coupon for each day during a year in which the Class B Certificateholder holds the Trust Stripped Coupon will be included in the Class B Certificateholder's income. Effect of Subordination. If the Class B Certificateholders receive distributions of less than their share of the Trust's receipts of principal or interest (the "Shortfall Amount") because of the subordination of the Class B Certificates, holders of Class B Certificates would probably be treated for federal income tax purposes as if they had (i) received as distributions their full share of such receipts, (ii) paid over to the Class A Certificateholders an amount equal to such Shortfall Amount and (iii) retained the right to reimbursement of 40 43 such amounts to the extent such amounts are otherwise available as a result of collections on the Receivables or amounts available in the Reserve Fund. Under this analysis, (a) Class B Certificateholders would be required to accrue as current income any interest or original issue discount income of the Trust that was a component of the Shortfall Amount, even though such amount was in fact paid to the Class A Certificateholders, (b) a loss would only be allowed to the Class B Certificateholders when their right to receive reimbursement of such Shortfall Amount became worthless (i.e., when it becomes clear that amount will not be available from any source to reimburse such loss) and (c) reimbursement of such Shortfall Amount prior to such a claim of worthlessness would not be taxable income to Class B Certificateholders because such amount was previously included in income. Those results should not significantly affect the inclusion of income for Class B Certificateholders on the accrual method of accounting, but could accelerate inclusion of income to Class B Certificateholders on the cash method of accounting by, in effect, placing them on the accrual method. Moreover, the character and timing of loss deductions on certificates such as the Class B Certificates is unclear. Class B Certificateholders are strongly urged to consult their own tax advisors regarding the appropriate timing, amount and character of any losses sustained with respect to the Class B Certificates, including any loss resulting from the failure to recover previously accrued interest or discount income. FOREIGN CERTIFICATEHOLDERS Interest attributable to Receivables which is received by a foreign Certificateholder will generally not be subject to the normal 30% withholding tax imposed with respect to such payments, provided that (i) the foreign Certificateholder does not own, directly or indirectly, 10% or more of, and is not a controlled foreign corporation related to, the Seller and (ii) such holder fulfills certain certification requirements. Under such requirements, the holder must certify, under penalty of perjury, that it is not a "United States person" and provide its name and address. For this purpose, "United States person" means a citizen or resident of the United States, a corporation, partnership or other entity created or organized in or under the laws of the United States or any political subdivision thereof or an estate or trust the income of which is includible in gross income for United States federal income tax purposes, regardless of its source. Gain realized upon the sale of a Certificate by a foreign Certificateholder generally will not be subject to United States withholding tax. If, however, such interest or gain is effectively connected to the conduct of a trade or business within the United States by such foreign Certificateholder, such holder will be subject to United States federal income tax thereon at regular rates. Potential investors who are not United States persons should consult their own tax advisors regarding the specific tax consequences to them of owing a Certificate. INFORMATION REPORTING AND BACKUP WITHHOLDING The Trustee will furnish or make available, within the prescribed period of time for tax reporting purposes after the end of each calendar year, to each Certificateholder or each person holding a Certificate on behalf of a Certificateholder at any time during such year, such information as the Trustee deems necessary or desirable to assist Certificateholders in preparing their federal income tax returns. Payments made on the Certificates and proceeds from the sale of the Certificates will not be subject to a "backup" withholding tax of 31% unless, in general, a Certificateholder fails to comply with certain reporting procedures and is not an exempt recipient under applicable provisions of the Code. ERISA CONSIDERATIONS Section 406 of ERISA, and Section 4975 of the Code prohibit a pension, profit sharing or other employee benefit plan from engaging in certain transactions involving "plan assets" with persons that are "parties in interest" under ERISA or "disqualified persons" under the Code with respect to the plan. ERISA also imposes certain duties on persons who are fiduciaries of plans subject to ERISA and prohibits certain transactions between a plan and parties in interest with respect to such plans. Under ERISA, any person who exercises any authority or control with respect to the management or disposition of the assets of a plan is considered to be a fiduciary of such plan (subject to certain exceptions not here relevant). A violation of these "prohibited transaction" rules may generate excise tax and other liabilities under ERISA and the Code for such persons. 41 44 Pursuant to a final regulation (the "Final Regulation") issued by the Department of Labor ("DOL") concerning the definition of what constitutes the "plan assets" of an employee benefit plan subject to ERISA or the Code, or an individual retirement account (an "IRA") (collectively referred to as "Benefit Plans"), the assets and properties of certain entities in which a Benefit Plan makes an equity investment could be deemed to be assets of the Benefit Plan in certain circumstances. Accordingly, if Benefit Plans purchase Class A Certificates, the Trust could be deemed to hold plan assets unless one of the exceptions under the Final Regulation is applicable to the Trust. The DOL has granted to CS First Boston Corporation an administrative exemption (Prohibited Transaction Exemption 89-90, as amended and as supplemented by an advisory opinion issued by the DOL to CS First Boston Corporation on November 22, 1994, in response to their Exemption Application No. D09887) (the "Exemption") from certain of the prohibited transaction rules of ERISA with respect to the initial purchase, the holding and the subsequent resale by Benefit Plans of certificates in pass-through trusts that consist of certain receivables, loans and other obligations that meet the conditions and requirements of the Exemption. The receivables covered by the Exemption include recreational vehicle installment obligations such as the Receivables. The Exemption will apply to the acquisition, holding and resale of Class A Certificates by a Benefit Plan, provided that specific conditions (certain of which are described below) are met. The Seller believes that the Exemption will apply to the acquisition, holding and disposition in the secondary markets of Class A Certificates by Benefit Plans and that all conditions of the Exemption other than those within the control of the investors have been or will be met. Among the conditions which must be satisfied for the Exemption to apply to the acquisition by a Benefit Plan of the Class A Certificates are the following (each of which the Seller believes has been or will be met in connection with the Class A Certificates): (i) The acquisition of the Class A Certificates by a Benefit Plan is on terms (including the price for the Class A Certificates) that are at least as favorable to the Benefit Plan as they would be in an arm's-length transaction with an unrelated party. (ii) The rights and interests evidenced by the Class A Certificates acquired by the Benefit Plan are not subordinated to the rights and interests evidenced by other Certificates of the Trust. (iii) The Class A Certificates acquired by the Benefit Plan have received a rating at the time of such acquisition that is in one of the three highest generic rating categories from any of Standard & Poor's, Moody's, Duff & Phelps Inc. or Fitch Investors Service, Inc. (iv) The Trustee must not be an affiliate of any other member of the Restricted Group (as defined below). (v) The sum of all payments made to the Underwriters in connection with the distribution of the Class A Certificates represents not more than reasonable compensation for underwriting the Class A Certificates. The sum of all payments made to and retained by the Seller pursuant to the sale of the Receivables to the Trust represents not more than the fair market value of such Receivables. The sum of all payments made to and retained by the Servicer represents not more than reasonable compensation for the Servicer's services under the Agreement and reimbursement of the Servicer's reasonable expenses in connection therewith. In addition, it is a condition that the Benefit Plan investing in the Class A Certificates is an "accredited investor" as defined in Rule 501(a) (1) of Regulation D of the Commission under the Securities Act of 1933, as amended. The Exemption does not apply to Benefit Plans sponsored by the Seller, the Underwriters, the Trustee, the Servicer, any Obligor with respect to the Receivables included in the Trust constituting more than 5% of the aggregate unamortized principal balance of the assets in the Trust or any affiliate of such parties (the "Restricted Group"). As of the date hereof, no Obligor with respect to the Receivables included in the Trust constitutes more than 5% of the aggregate unamortized principal balance of the Trust (i.e., the initial principal amount of the Certificates). Moreover, the Exemption provides relief from certain self-dealing/conflict of 42 45 interest prohibited transactions, only if, among other requirements (i) a Benefit Plan's investment in the Class A Certificates does not exceed 25% of all of the Class A Certificates outstanding at the time of the acquisition and (ii) immediately after the acquisition, no more than 25% of the assets of a Benefit Plan with respect to which the person who has discretionary authority or renders investment advice are invested in the Class A Certificates representing an interest in a trust containing assets sold or serviced by the same entity. The Exemption will not be available for Class B Certificates because the Class B Certificates are subordinate interests. Accordingly, no Plan will be eligible to purchase or otherwise hold Class B Certificates and no beneficial interest therein may be sold or otherwise transferred to a Plan. Due to the complexities of these rules and the penalties imposed upon persons involved in prohibited transactions, it is important that the fiduciary of an employee benefit plan considering the purchase of Class A Certificates consult with its counsel regarding the applicability of the prohibited transaction provisions of ERISA and the Code to such investment. Prohibited Transaction Class Exemption ("PTCE") 95-60 was issued by the Department of Labor on July 12, 1995 in response to the United States Supreme Court decision John Hancock Mutual Life Insurance Co. v. Harris Trust and Savings Bank, 114 S. Ct. 517 (1993), in which the Supreme Court held that assets held in an insurance company's general account may be deemed to be "plan assets" for ERISA purposes under certain circumstances. Subject to certain conditions, PTCE 95-60 provides general relief from the prohibited transaction rules that would otherwise be applicable to assets held in an insurance company's general account. Prospective insurance company purchasers should consult with their counsel to determine whether the decision in John Hancock, as modified by PTCE 95-60, affects their ability to make purchases of the Certificates. UNDERWRITING Under the terms and subject to the conditions contained in an Underwriting Agreement dated September , 1996 (the "Underwriting Agreement"), the Underwriters named below (the "Underwriters"), for whom CS First Boston Corporation is acting as representative (the "Representative") have severally but not jointly agreed to purchase from the Seller the following respective principal amounts of Class A Certificates and Class B Certificates:
PRINCIPAL PRINCIPAL AMOUNT AMOUNT OF CLASS OF CLASS B UNDERWRITERS A CERTIFICATES CERTIFICATES ----------------------------------------------------- --------------- ---------------- CS First Boston Corporation.......................... $ $ UBS Securities....................................... --------------- ------------- Total...................................... $198,288,618.40 $ 7,191,815.18 =============== =============
The Underwriting Agreement provides that the obligations of the Underwriters are subject to certain conditions precedent and that the Underwriters will be obligated to purchase all the Certificates if any are purchased. The Underwriters have advised the Seller that the Underwriters propose initially to offer the Class A Certificates and Class B Certificates to the public at the respective public offering prices set forth on the cover page of this Prospectus, and to certain dealers at such prices less a concession not in excess of % of the Class A Certificate denominations and % of the Class B Certificate denominations. The Underwriters may allow and such dealers may reallow a concession not in excess of % of the Class A Certificate denominations and % of the Class B Certificate denominations. After the initial public offering, the public offering prices and such concessions may be changed. The Underwriting Agreement provides that the Seller and Fleetwood Credit will jointly and severally indemnify the Underwriters against certain liabilities, including liabilities under applicable securities laws, or contribute to payments the Underwriters may be required to make in respect thereof. 43 46 Upon receipt of a request by an investor who has received an electronic Prospectus from an Underwriter or a request by such investor's representative within the period during which there is an obligation to deliver a Prospectus, the Seller or the Underwriters will promptly deliver, or cause to be delivered, without charge, a paper copy of the Prospectus. NOTICE TO CANADIAN RESIDENTS RESALE RESTRICTIONS The distribution of the Certificates in Canada is being made only on a private placement basis exempt from the requirement that the Seller, on behalf of the Trust, prepare and file a prospectus with the securities regulatory authorities in each province where trades of Certificates are effected. Accordingly, any resale of Certificates in Canada must be made in accordance with applicable securities laws which will vary depending on the relevant jurisdiction, and which may require resales to be made in accordance with available statutory exemptions or pursuant to a discretionary exemption granted by the applicable Canadian securities regulatory authority. Purchasers are advised to seek legal advice prior to any resale of the Certificates. REPRESENTATIONS OF PURCHASERS Each purchaser of Certificates in Canada who receives a purchase confirmation will be deemed to represent to the Seller, the Servicer, the Trustee, the Trust and the dealer from whom such purchase confirmation is received that (i) such purchaser is entitled under applicable provincial securities laws to purchase such Certificates without the benefit of a prospectus qualified under such securities laws, (ii) where required by law, that such purchaser is purchasing as principal and not as agent, and (iii) such purchaser has reviewed the text above under "Resale Restrictions." RIGHTS OF ACTION AND ENFORCEMENT The securities being offered are those of a foreign issuer and Ontario purchasers will not receive the contractual right of action prescribed by Section 32 of the Regulation under the Securities Act (Ontario). As a result, Ontario purchasers must rely on other remedies that may be available, including common law rights of action for damages or rescission or rights of action under the civil liability provisions of the U.S. federal securities laws. All of the issuer's directors and officers as well as the experts named herein may be located outside of Canada and, as a result, it may not be possible for Ontario purchasers to effect service of process within Canada upon the issuer or such persons. All or a substantial portion of the assets of the issuer and such persons may be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against the issuer or such persons in Canada or to enforce a judgment obtained in Canadian courts against such issuer or persons outside of Canada. NOTICE TO BRITISH COLUMBIA RESIDENTS A purchaser of Certificates to whom the Securities Act (British Columbia) applies is advised that such purchaser is required to file with the British Columbia Securities Commission a report within ten days of the sale of any Certificates acquired by such purchaser pursuant to this offering. Such report must be in the form attached to British Columbia Securities Commission Blanket Order BOR #88/5, a copy of which may be obtained from the Seller. Only one such report must be filed in respect of Certificates acquired on the same date and under the same prospectus exemption. 44 47 LEGAL OPINIONS Certain legal matters relating to the Certificates will be passed upon for the Seller by Timothy M. Hayes, Esq., Vice President and Assistant General Counsel to Associates First Capital Corporation, the parent company of the Servicer. Mr. Hayes owns shares of Class A Common Stock of Associates First Capital Corporation, and has options to purchase additional shares of such Class A Common Stock. Brown & Wood LLP, San Francisco, California will act as special tax counsel to the Seller and as special counsel to the Seller with respect to certain other matters relating to the Certificates. Brown & Wood LLP, San Francisco, California will act as counsel for the Underwriters. Brown & Wood LLP has from time to time represented Fleetwood Credit in certain matters not related to the offering of the Certificates. FINANCIAL INFORMATION The Seller has determined that its financial statements are not material to the offering made hereby. 45 48 GLOSSARY OF TERMS Set forth below is a list of certain of the more significant terms used in this Prospectus and the pages on which the definitions of such terms may be found herein. TERM PAGE Advance.......................................................................21 Agreement......................................................................3 APR............................................................................4 Available Funds...............................................................22 Benefit Plans.................................................................42 Cede...........................................................................3 Certificate Account............................................................3 Certificate Owner..........................................................3, 16 Certificateholders.............................................................4 Certificates................................................................1, 3 Class A Certificate.........................................................1, 3 Class A Certificate Balance................................................5, 23 Class A Certificate Owner..................................................3, 16 Class A Certificateholders.....................................................4 Class A Distributable Amount..................................................22 Class A Interest Carryover Shortfall..........................................24 Class A Interest Distributable Amount.........................................22 Class A Pass-Through Rate......................................................4 Class A Percentage.............................................................3 Class A Pool Factor...........................................................15 Class A Principal Carryover Shortfall.........................................24 Class A Principal Distributable Amount........................................22 Class B Certificate.........................................................1, 3 Class B Certificate Balance................................................5, 23 Class B Certificate Owner..................................................3, 16 Class B Certificateholders.....................................................4 Class B Distributable Amount..................................................23 Class B Interest Distributable Amount.........................................23 Class B Interest Carryover Shortfall..........................................24 Class B Pass-Through Rate......................................................4 Class B Percentage.............................................................3 Class B Principal Carryover Shortfall.........................................24 Class B Principal Distributable Amount........................................23 Class B Pool Factor...........................................................15 Closing Date...................................................................4 Code..........................................................................38 Collected Interest............................................................22 Collected Principal...........................................................22 Collection Period..............................................................5 Commission.....................................................................2 Corporate Trust Office........................................................31 Cutoff Date....................................................................3 Dealers........................................................................4 Defaulted Receivable..........................................................21 Definitive Certificates.......................................................16 Determination Date............................................................22 Distribution Dates.............................................................5 DOL...........................................................................42 DTC............................................................................3 ERISA..........................................................................8 Event of Default..............................................................28 Excess Amounts.................................................................6 46 49 TERM PAGE Final Scheduled Distribution Date..............................................5 Financed Vehicles...........................................................1, 3 Fleetwood Credit............................................................1, 3 Fleetwood Enterprises..........................................................9 IRS...........................................................................38 Military Reservist Relief Act.................................................10 Monthly Principal Payment.....................................................23 Moody's........................................................................7 Non-Reimbursable Payment......................................................21 Obligors.......................................................................9 Original Class A Certificate Balance...........................................5 Original Class B Certificate Balance...........................................5 Original Pool Balance......................................................7, 10 Paid-Ahead Period.............................................................13 Paid-Ahead Receivable.........................................................13 Permitted Investments.........................................................20 Pool Balance...................................................................9 Rating Agency..................................................................7 Ratings Effect................................................................20 Realized Losses...............................................................23 Receivables.................................................................1, 3 Receivables Purchase Agreement.................................................4 Record Date....................................................................4 Relief Act Obligor............................................................10 Repurchase Amount.............................................................19 Reserve Fund...................................................................6 Schedule of Receivables.......................................................19 Seller......................................................................1, 3 Servicer....................................................................1, 3 Servicer Letter of Credit.....................................................20 Servicing Fee Rate.............................................................7 Soldiers' and Sailors' Relief Act.............................................10 Specified Reserve Fund Balance.............................................6, 25 Standard & Poor's..............................................................7 Trust..........................................................................1 Trustee........................................................................3 UCC...........................................................................17 voting interests..............................................................29 47 50 - ------------------------------------------------------ - ------------------------------------------------------ NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN CONNECTION WITH THE OFFERING COVERED BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE SELLER, THE SERVICER OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE SELLER OR THE SERVICER SINCE SUCH DATE. ------------------ TABLE OF CONTENTS
PAGE ---- Available Information................... 2 Reports to Certificateholders by the Trustee............................... 2 Summary................................. 3 Formation of the Trust.................. 9 Property of the Trust................... 9 The Receivables......................... 10 Yield Considerations.................... 14 Pool Factors and Trading Information.... 15 Use of Proceeds......................... 15 The Seller.............................. 15 The Servicer............................ 15 The Certificates........................ 16 Certain Legal Aspects of the Receivables........................... 31 Certain Federal Income Tax Consequences.......................... 37 ERISA Considerations.................... 41 Underwriting............................ 43 Notice to Canadian Residents............ 44 Legal Opinions.......................... 45 Financial Information................... 45 Glossary of Terms....................... 46
------------------ UNTIL DECEMBER , 1996, ALL DEALERS EFFECTING TRANSACTIONS IN THE CERTIFICATES, WHETHER OR NOT PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS. UPON RECEIPT OF A REQUEST BY AN INVESTOR, OR SUCH INVESTOR'S REPRESENTATIVE, WITHIN THE PERIOD DURING WHICH THERE IS A PROSPECTUS DELIVERY OBLIGATION, THE SELLER OR THE UNDERWRITERS WILL PROMPTLY DELIVER, OR CAUSE TO BE DELIVERED, WITHOUT CHARGE AND IN ADDITION TO SUCH DELIVERY REQUIREMENTS, A PAPER COPY OF THE PROSPECTUS OR A PROSPECTUS ENCODED IN AN ELECTRONIC FORMAT. - ------------------------------------------------------ - ------------------------------------------------------ - ------------------------------------------------------ - ------------------------------------------------------ $205,480,433.58 Fleetwood Credit 1996-B Grantor Trust $198,288,618.40 % Asset Backed Certificates, Class A $7,191,815.18 % Asset Backed Certificates, Class B Fleetwood Credit Receivables Corp. Seller Fleetwood Credit Corp., Servicer and a wholly owned subsidiary of Associates First Capital Corporation PROSPECTUS CS FIRST BOSTON UBS SECURITIES September , 1996 - ------------------------------------------------------ - ------------------------------------------------------ 51 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. Expenses in connection with the offering of the Certificates being registered herein are estimated as follows: SEC registration fee.................................................... $ 70,855.33 Legal fees and expenses................................................. 50,000.00 Accounting fees and expenses............................................ 15,000.00 Blue sky fees and expenses.............................................. 12,500.00 Rating agency fees...................................................... 80,000.00 Trustee's fees and expenses............................................. 8,000.00 Printing................................................................ 35,000.00 Miscellaneous........................................................... 3,644.67 ----------- Total......................................................... $275,000.00 ==========
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 317(b) of the California Corporations Code (the "Corporations Code") provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any "proceeding" (as defined in Section 317(a) of the Corporations Code), other than an action by or in the right of the corporation to procure a judgment in its favor, by reason of the fact that such person is or was a director, officer, employee or other agent of the corporation (collectively, an "Agent"), against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with such proceeding if the Agent acted in good faith and in a manner the Agent reasonably believed to be in the best interest of the corporation and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct was unlawful. Section 317(c) of the Corporations Code provides that a corporation shall have power to indemnify any Agent who was or is a party or is threatened to be made a party to any threatened, pending or completed action by or in the right of the corporation to procure a judgment in its favor by reason of the fact that such person is or was an Agent, against expenses actually and reasonably incurred by the Agent in connection with the defense or settlement of such action if the Agent acted in good faith and in a manner such Agent believed to be in the best interest of the corporation and its shareholders. Section 317(c) further provides that no indemnification may be made thereunder for any of the following: (i) in respect of any claim, issue or matter as to which the Agent shall have been adjudged to be liable to the corporation, unless and only to the extent that the court in which such proceeding is or was pending shall determine that such Agent is fairly and reasonably entitled to indemnity for expenses, (ii) of amounts paid in settling or otherwise disposing of a pending action without court approval and (iii) of expenses incurred in defending a pending action which is settled or otherwise disposed of without court approval. Section 317(d) of the Corporations Code requires that an Agent be indemnified against expenses actually and reasonably incurred to the extent the Agent has been successful on the merits in the defense of proceedings referred to in subdivisions (b) or (c) of Section 317. Except as provided in Section 317(d), and pursuant to Section 317(e), indemnification under Section 317 shall be made by the corporation only if specifically authorized and upon a determination that indemnification is proper in the circumstances because the Agent has met the applicable standard of conduct set forth in Section 317(b) or (c), by any of the following: (i) a majority vote of a quorum consisting of directors who are not parties to the proceeding, (ii) if such a quorum of directors is not obtainable, by independent legal counsel in a written opinion, (iii) approval of the shareholders, provided that any shares owned by the Agent may not vote thereon, or (iv) the court in which such proceeding is or was pending. II-1 52 Pursuant to Section 317(f) of the Corporations Code, the corporation may advance expenses incurred in defending any proceeding upon receipt of an undertaking by the Agent to repay such amount if it is ultimately determined that the Agent is not entitled to be indemnified. Section 317(h) provides, with certain exceptions, that no indemnification shall be made under Section 317 where it appears that it would be inconsistent with a provision of the corporation's articles, bylaws, a shareholder resolution or an agreement which prohibits or otherwise limits indemnification, or where it would be inconsistent with any condition expressly imposed by a court in approving a settlement. Section 317(i) authorizes a corporation to purchase and maintain insurance on behalf of an Agent for liabilities arising by reason of the Agent's status, whether or not the corporation would have the power to indemnify the Agent against such liability under the provisions of Section 317. Reference is also made to Section 7 of the Underwriting Agreement between CS First Boston Corporation and UBS Securities and the Registrant and Fleetwood Credit Corp. (see Exhibit 1.1), which provides for indemnification of the Registrant under certain circumstances. Article IX of the Articles of Incorporation of the Registrant provides for the indemnification of the officers and directors of the Registrant to the fullest extent permissible under California law. Article IV, Section 4.01 of the Bylaws of the Registrant (see Exhibit 3.2) requires that the Registrant indemnify, and, in certain instances, advance expenses to, its agents, with respect to certain costs, expenses, judgments, fines, settlements and other amounts incurred in connection with any proceeding, to the full extent permitted by applicable law. In addition, Article IV, Section 4.03 of the Bylaws of the Registrant authorizes the Registrant to purchase and maintain insurance to the extent provided by Section 3.17(i) of the Corporations Code. ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES. Not applicable. ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. A. EXHIBITS:
EXHIBIT NUMBER DESCRIPTION - -------------------- ---------------------------------------------------------------------- 1.1 Form of Underwriting Agreement 3.1 Articles of Incorporation of Fleetwood Credit Receivables Corp. 3.2 Bylaws of Fleetwood Credit Receivables Corp. 4.1 Form of Pooling and Servicing Agreement among Fleetwood Credit Receivables Corp., as Seller, Fleetwood Credit Corp., as Servicer, and The Chase Manhattan Bank, as Trustee (including forms of Class A Certificate and Class B Certificate) 4.2 Form of Standard Terms and Conditions of Pooling and Servicing Agreement 5.1 Opinion of Timothy M. Hayes, Esq. with respect to legality 8.1 Opinion of Brown & Wood LLP with respect to tax matters 10.1 Form of Receivables Purchase Agreement 23.1 Consent of Timothy M. Hayes, Esq. (included in Exhibit 5.1) 23.2 Consent of Brown & Wood LLP (included in Exhibit 8.1) 24.1* Power of Attorney (included on page II-5)
- --------------- * Previously filed. B. FINANCIAL STATEMENT SCHEDULES: Not applicable. II-2 53 ITEM 17. UNDERTAKINGS. The undersigned Registrant hereby undertakes as follows: (a) To provide to the Underwriters at the closing date specified in the Underwriting Agreement certificates in such denominations and registered in such names as required by the Underwriters to provide prompt delivery to each purchaser. (b) Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act") may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of such Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (c) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Act will be deemed to be part of this registration statement as of the time it was declared effective. (d) For purposes of determining any liability under the Act, each post-effective amendment that contains a form of prospectus will be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time will be deemed to be the initial bona fide offering thereof. II-3 54 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Irving and State of Texas, on the 6th day of September, 1996. FLEETWOOD CREDIT RECEIVABLES CORP. By /s/ MARVIN T. RUNYON, III Marvin T. Runyon, III Senior Vice President II-4 55 EXHIBIT INDEX
SEQUENTIALLY EXHIBIT NUMBERED NUMBER PAGE - ---------- ------------- 1.1 Form of Underwriting Agreement........................................ 3.1 Articles of Incorporation of Fleetwood Credit Receivables Corp........ 3.2 Bylaws of Fleetwood Credit Receivables Corp........................... 4.1 Form of Pooling and Servicing Agreement among Fleetwood Credit Receivables Corp., as Fleetwood Credit Corp., as Servicer, and The Chase Manhattan Bank, as Seller, Trustee (including forms of Class A Certificate and Class B Certificate).................................. 4.2 Form of Standard Terms and Conditions of Pooling and Servicing Agreement............................................................. 5.1 Opinion of Timothy M. Hayes, Esq. with respect to legality............ 8.1 Opinion of Brown & Wood LLP with respect to tax matters............... 10.1 Form of Receivables Purchase Agreement................................ 23.1 Consent of Timothy M. Hayes, Esq. (included in Exhibit 5.1)........... 23.2 Consent of Brown & Wood LLP (included in Exhibit 8.1)................. 24.1* Power of Attorney (included on page II-5).............................
- --------------- * Previously filed. EX-1.1 2 FORM OF UNDERWRITING AGREEMENT 1 EXHIBIT 1.1 Brown & Wood LLP Draft of 9/4/96 $ -------------------- FLEETWOOD CREDIT 1996-B GRANTOR TRUST % ASSET BACKED CERTIFICATES, CLASS A ----- % ASSET BACKED CERTIFICATES, CLASS B ----- UNDERWRITING AGREEMENT September __, 1996 [UNDERWRITERS] Dear Sirs: 1. Introductory. Fleetwood Credit Receivables Corp., a California corporation (the "Seller"), and a wholly owned subsidiary of Fleetwood Credit Corp., a California corporation ("Fleetwood Credit"), proposes to sell to __________ (the "Underwriters"), [acting severally and not jointly, for whom __________ is acting as representative (in such capacity, the "Representative"),] $__________ aggregate principal amount of _____% Asset Backed Certificates, Class A (the "Class A Certificates") and $__________ aggregate principal amount of _____% Asset Backed Certificates, Class B (the "Class B Certificates" and, together with the Class A Certificates, the "Certificates") of the Fleetwood Credit 1996-B Grantor Trust (the "Trust"). The Certificates will be issued pursuant to a pooling and servicing agreement, dated as of September 1, 1996 (the "Pooling and Servicing Agreement"), among the Seller, Fleetwood Credit, as servicer (in such capacity, the "Servicer"), and The Chase Manhattan Bank, as trustee (the "Trustee"). The Class B Certificates will be subordinated to the Class A Certificates to the limited extent described in the Pooling and Servicing Agreement. Each Certificate will represent a fractional undivided interest in the Trust. The assets of the Trust will include, among other things, a pool (the "Receivables Pool") of simple interest retail installment sale contracts (the "Receivables") secured by the new and used recreational vehicles financed thereby (the "Financed Vehicles") and certain monies due thereunder on and after September 1, 1996 (the "Cutoff Date"), in each case as more fully described in the Prospectus, as defined below. The Receivables will be sold by Fleetwood Credit to the Seller pursuant to a receivables purchase agreement, dated as of September 1, 1996 (the "Receivables Purchase Agreement"), between Fleetwood Credit and the Seller, and the Seller in turn will sell such Receivables to the Trust pursuant to the Pooling and Servicing Agreement. 2 This Underwriting Agreement shall hereinafter be referred to as "this Agreement." Capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Pooling and Servicing Agreement. 2. Representations and Warranties of the Seller and Fleetwood Credit. (a) The Seller represents and warrants to, and agrees with, each Underwriter that: (i) A registration statement on Form S-1 (No. 333-10835), including a form of prospectus, relating to the Certificates has been filed with the Securities and Exchange Commission (the "Commission") and either (1) has been declared effective under the Securities Act of 1933, as amended (the "Act"), and is not proposed to be amended or (2) is proposed to be amended by amendment or post-effective amendment. If the Seller does not propose to amend such registration statement and if any post-effective amendment to such registration statement has been filed with the Commission prior to the execution and delivery of this Agreement, the most recent such post-effective amendment has been declared effective by the Commission. For purposes of this Agreement, "Effective Time" means (1) if the Seller has advised the Underwriters that it does not propose to amend such registration statement, the date and time as of which such registration statement, or the most recent post-effective amendment thereto (if any) filed prior to the execution and delivery of this Agreement, was declared effective by the Commission or (2) if the Seller has advised the Underwriters that it proposes to file an amendment or post-effective amendment to such registration statement, the date and time as of which such registration statement, as amended by such amendment or post-effective amendment, as the case may be, is declared effective by the Commission. "Effective Date" means the date of the Effective Time. Such registration statement, as amended at the Effective Time, including all information (if any) deemed to be a part of such registration statement as of the Effective Time pursuant to Rule 430A(b) under the Act, and including the exhibits thereto, is hereinafter referred to as the "Registration Statement," and the form of prospectus relating to the Certificates, as first filed with the Commission pursuant to and in accordance with Rule 424(b) under the Act ("Rule 424(b)"), or (if no such filing is required) as included in the Registration Statement, is hereinafter referred to as the "Prospectus." (ii) If the Effective Time is prior to the execution and delivery of this Agreement: (1) on the Effective Date, the Registration Statement conformed, and on the date of this Agreement the Registration Statement will conform, in all material respects with the requirements of the Act and the rules and regulations of the Commission promulgated under the Act (the "Rules and Regulations"), and at such times did not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and (2) on the date of this Agreement, and at the time of filing of the Prospectus pursuant to Rule 424(b) and at the Closing Date, the Prospectus will conform in all material respects to the requirements of the Act and the Rules and Regulations, and does not include and will not include, any untrue statement of a 2 3 material fact and does not omit and will not omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. If the Effective Time is subsequent to the execution and delivery of this Agreement: (1) on the Effective Date, the Registration Statement and the Prospectus will conform in all material respects to the requirements of the Act and the Rules and Regulations and the Registration Statement will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, (2) at the Effective Date and at the Closing Date the Prospectus will not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and (3) the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system, except to the extent permitted by Regulation S-T. The two immediately preceding sentences do not apply to statements in or omissions from the Registration Statement or Prospectus based upon written information furnished to the Seller by the Underwriters specifically for use therein. (iii) As of the Closing Date, the representations and warranties of the Seller in the Pooling and Servicing Agreement will be true and correct. (b) Fleetwood Credit represents and warrants to, and agrees with, each Underwriter that as of the Closing Date, the representations and warranties of the Servicer in the Pooling and Servicing Agreement will be true and correct. 3. Purchase, Sale and Delivery of Certificates. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Seller agrees to sell to the Underwriters, and the Underwriters, acting severally and not jointly, agree to purchase from the Seller, the respective principal amounts of Class A Certificates and Class B Certificates set forth opposite the names of the Underwriters in Schedule A hereto. The Certificates are to be purchased at a purchase price equal to, in the case of (i) the Class A Certificates, __________% of the aggregate principal amount thereof plus accrued interest at the Class A Pass-Through Rate from (and including) the Cutoff Date to (but excluding) the Closing Date and (ii) the Class B Certificates, __________% of the aggregate principal amount thereof plus accrued interest at the Class B Pass-Through Rate from (and including) the Cutoff Date to (but excluding) the Closing Date. The Seller will deliver the Certificates to the Underwriters against payment of the respective purchase price therefor in immediately available funds to the order of the Seller at the office of Brown & Wood LLP, 555 California Street, San Francisco, California, at 10:00 A.M., New York City time, on September ___, 1996, or at such other time not later than seven (7) full Business Days thereafter as the Underwriters and the Seller determine, such time being herein referred to as the "Closing Date." Each Class of Certificates will be initially represented by one (1) certificate registered in the name of Cede & Co., the nominee of The Depository Trust Company ("DTC") (the "DTC Certificates"). The interests of 3 4 beneficial owners of the DTC Certificates will be represented by book entries on the records of DTC and participating members thereof. Definitive certificates evidencing the Class A Certificates or the Class B Certificates will be available only under the limited circumstances specified in the Pooling and Servicing Agreement. Pursuant to Rule 15c6-1(d) under the Securities Exchange Act of 1934, as amended, the Trust, the Seller and the Underwriters have agreed that the Closing Date will be not less than five (5) business days following the date hereof. 4. Offering by the Underwriters. It is understood that the Underwriters propose to offer the Certificates for sale to the public as set forth in the Prospectus. 5. Certain Agreements of the Seller and Fleetwood Credit. Each of the Seller and Fleetwood Credit, as the case may be, covenants and agrees with each Underwriter that: (a) If the Effective Time is prior to the execution and delivery of this Agreement, the Seller will file the Prospectus with the Commission pursuant to and in accordance with subparagraph (1) (or, if applicable and if consented to by the Underwriters, subparagraph (4)) of Rule 424(b) not later than the earlier of (i) the second business day following the execution and delivery of this Agreement or (ii) the fifth business day after the Effective Date. The Seller will advise the Underwriters promptly of any such filing pursuant to Rule 424(b). (b) The Seller will advise the Underwriters promptly of any proposal to amend or supplement the registration statement as filed or the related prospectus or the Registration Statement or the Prospectus and will not effect any such amendment or supplement without the consent of the Underwriters, which consent will not unreasonably be withheld; and the Seller will also advise the Underwriters promptly of the effectiveness of the Registration Statement (if the Effective Time is subsequent to the execution and delivery of this Agreement) and of any amendment or supplement of the Registration Statement or the Prospectus and of the institution by the Commission of any stop order proceedings in respect of the Registration Statement and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued. (c) If, at any time when a prospectus relating to the Certificates is required to be delivered under the Act, any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend or supplement the Prospectus to comply with the Act, the Seller promptly will prepare and file, or cause to be prepared and filed, with the Commission an amendment or supplement which will correct such statement or omission, or an amendment or supplement which will effect such compliance. Neither the consent of the Underwriters to, nor the delivery by the Underwriters of, any such 4 5 amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 6 hereof. (d) As soon as practicable, but not later than sixteen (16) months after the effective date of the Registration Statement, the Seller will cause the Trustee to make generally available to holders of the Certificates an earnings statement with respect to the Trust covering a period of at least twelve (12) months beginning after the Effective Date which will satisfy the provisions of Section 11(a) of the Act (including, at the option of the Seller, Rule 158 promulgated thereunder). (e) The Seller will furnish to the Underwriters copies of the Registration Statement (at least two (2) of which will be signed and will include all exhibits), each related preliminary prospectus, the Prospectus and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Underwriters may reasonably request. (f) The Seller will arrange for the qualification of the Certificates for sale under the laws of such jurisdictions in the United States as the Underwriters may reasonably designate and will continue such qualifications in effect so long as required for the distribution of the Certificates, provided that the Seller shall not be obligated to qualify to do business nor become subject to service of process generally, but only to the extent required for such qualification, in any jurisdiction in which it is not currently so qualified. (g) For a period from the date of this Agreement until the retirement of all of the Certificates, or until such time as the Underwriters shall cease to maintain a secondary market in either Class of Certificates, whichever occurs first, the Seller will deliver to the Underwriters the annual statements of compliance and the annual independent certified public accountants' reports furnished to the Trustee pursuant to Article Thirteen of the Pooling and Servicing Agreement, as soon as such statements and reports are furnished to the Trustee. (h) So long as any of the Certificates are outstanding, the Seller or Fleetwood Credit, as the case may be, shall furnish to the Underwriters, as soon as practicable, (i) all documents required to be distributed to holders of either Class of Certificates (or available at such holders' request) or filed with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or any order of the Commission thereunder and (ii) from time to time, any other information concerning the Seller or the Servicer filed with any government or regulatory authority which is otherwise publicly available, as the Underwriters may reasonably request. (i) Whether or not the transactions contemplated by this Agreement are consummated, the Seller and Fleetwood Credit will, subject to the provisions of Section 9 hereof, pay all expenses incident to the performance of their respective obligations under this Agreement, including without limitation, expenses incident to 5 6 the printing, reproduction and distribution of the registration statement as originally filed with the Commission and all amendments thereto, any fees charged by Moody's Investors Service, Inc. ("Moody's") and Standard & Poor's Ratings Services ("Standard & Poor's" and, together with Moody's, the "Rating Agencies") for the rating of the Class A Certificates and the Class B Certificates, the fees of DTC in connection with the book-entry registration of the Class A Certificates and the Class B Certificates and reasonable expenses incurred in distributing preliminary prospectuses and the Prospectus (including any amendments and supplements thereto) and will reimburse the Underwriters for all reasonable expenses, including fees of counsel and disbursements incurred by such counsel, incurred in connection with the initial qualification of the Certificates for sale under the laws of such jurisdictions in the United States as the Underwriters may designate. (j) On or before the Closing Date, the Seller and Fleetwood Credit shall cause their respective computer records to be marked relating to the Receivables to show the Trust's absolute ownership of the Receivables, and from and after the Closing Date, Fleetwood Credit Receivables Corp., as Seller, and Fleetwood Credit, as Servicer, shall not take any action inconsistent with the Trust's ownership of the Receivables, other than as permitted by the Pooling and Servicing Agreement. (k) To the extent, if any, that the rating provided with respect to the Class A Certificates or the Class B Certificates by either Rating Agency is conditional upon the furnishing of documents or the taking of any other actions by the Seller or the Servicer, the Seller or the Servicer, as the case may be, shall furnish such documents and take any such other actions. (l) In the event the Servicer obtains a Servicer Letter of Credit pursuant to the Pooling and Servicing Agreement, the Seller and the Servicer shall cause the Underwriters to receive: (i) A copy of the Servicer Letter of Credit. (ii) An original of the servicer letter of credit reimbursement agreement (the "Reimbursement Agreement") between the Servicer and the letter of credit bank named therein (the "Letter of Credit Bank") pursuant to which the Servicer Letter of Credit was issued. (iii) An original of any amendment to the Pooling and Servicing Agreement relating to the obtaining of the Servicer Letter of Credit. (iv) An opinion of Timothy M. Hayes, General Counsel of the Servicer, dated the date of issuance of the Servicer Letter of Credit (the "Issuance Date") and satisfactory in form and substance to the Underwriters and counsel for the Underwriters, and substantially to the effect of clauses (i), (v), (viii), (ix) and (x) of Section 6(e) hereof, appropriately modified to relate to the Reimbursement Agreement. 6 7 (v) An opinion of counsel to the Letter of Credit Bank, satisfactory in form and substance to the Underwriters and counsel for the Underwriters, dated the Issuance Date and substantially to the effect that: (A) The Letter of Credit Bank is duly organized as a corporation and is validly existing under the laws of the country of its organization, and has the full power and authority (corporate and other) to issue, and to take all action required of it under, the Servicer Letter of Credit. (B) The execution, delivery and performance by the Letter of Credit Bank of the Servicer Letter of Credit and the Reimbursement Agreement have been duly authorized by all necessary corporate action on the part of the Letter of Credit Bank. (C) The execution, delivery and performance by the Letter of Credit Bank of the Servicer Letter of Credit and the Reimbursement Agreement do not require the consent or approval of, the giving of notice to, the registration with, or the taking of any other action in respect of any state or other governmental agency or authority which has not previously been effected. (D) The Servicer Letter of Credit and the Reimbursement Agreement have been duly authorized, executed and delivered by the Letter of Credit Bank and constitute legal, valid and binding obligations of the Letter of Credit Bank, enforceable against the Letter of Credit Bank in accordance with their respective terms (subject, as to enforcement, to bankruptcy, reorganization, insolvency, moratorium and other laws affecting creditors' rights generally and to general equity principles). (E) The Servicer Letter of Credit is not required to be registered under the Act in connection with the offer and sale of the Certificates in the manner contemplated by the Prospectus. In rendering such opinion, such counsel may rely as to all matters of the law of the country of organization of the Letter of Credit Bank upon counsel satisfactory to the Underwriters and counsel for the Underwriters. (vi) A certificate, dated the Issuance Date, of the President or any Vice President of the Letter of Credit Bank to the effect that, among other things, since the date of this Agreement, there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects, of the Letter of Credit Bank. 7 8 (vii) A letter from each Rating Agency, to the extent required by the Pooling and Servicing Agreement, to the effect that the obtaining of the Servicer Letter of Credit, in and of itself, would not cause its rating of either Class of Certificates to be reduced, withdrawn or modified. 6. Conditions of the Obligations of the Underwriters. The obligation of the Underwriters to purchase and pay for the Certificates will be subject to the accuracy of the respective representations and warranties on the part of the Seller and Fleetwood Credit herein, to the accuracy of the statements of the respective officers of the Seller and Fleetwood Credit made pursuant to the provisions hereof, to the performance by the Seller and Fleetwood Credit of their respective obligations hereunder and to the following additional conditions precedent: (a) The Underwriters and the Seller shall have received from Coopers & Lybrand L.L.P. Independent Public Accountants ("Coopers & Lybrand") (i) on the date of this Agreement, a letter, dated as of such date, substantially in the form of the draft to which the Underwriters have previously agreed, and (ii) on the Closing Date, a letter, dated as of the Closing Date, updating the letter referred to in clause (i) above, which letters shall in each case be in form and substance satisfactory to the Underwriters and counsel for the Underwriters. (b) If the Effective Time is not prior to the execution and delivery of this Agreement, the Effective Time shall have occurred not later than 10:00 P.M., New York City time, on the date of this Agreement or such later date as shall have been consented to by the Underwriters. If the Effective Time is prior to the execution and delivery of this Agreement, the Prospectus shall have been filed with the Commission in accordance with the Rules and Regulations and Section 5(a) hereof. Prior to the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or, to the knowledge of the Seller or the Underwriters, shall be contemplated by the Commission. (c) The Underwriters shall have received (i) an officer's certificate signed by the President, any Vice President, the Treasurer or the Secretary of the Seller representing and warranting to the Underwriters that, as of the Closing Date, the representations and warranties of the Seller in the Pooling and Servicing Agreement are true and correct and (ii) an officer's certificate signed by the President, any Vice President or the Secretary of Fleetwood Credit representing and warranting to the Underwriters that, as of the Closing Date, the representations and warranties of Fleetwood Credit in the Pooling and Servicing Agreement are true and correct. (d) The Underwriters shall have received an opinion of Timothy M. Hayes, General Counsel of the Seller, addressed to the Underwriters, dated the Closing Date and satisfactory in form and substance to the Underwriters and counsel for the Underwriters, substantially to the effect that: 8 9 (i) The Seller has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of California with full power and authority (corporate and other), and has obtained all necessary licenses and approvals, to own its properties and conduct its business, as presently conducted by it, and to enter into and perform its obligations under the Pooling and Servicing Agreement and the Receivables Purchase Agreement (collectively, the "Basic Documents"), this Agreement and the Certificates, and had at all relevant times, and now has, the power, authority and legal right to acquire, own and sell the Receivables. (ii) The Seller has obtained all necessary licenses and approvals to conduct its business as presently conducted in California and does not currently conduct business in any other state in which a Receivable was originated and does not need any licenses or approvals from any of such other states for purposes of the transactions contemplated by the Basic Documents and this Agreement. (iii) This Agreement has been duly authorized, executed and delivered by the Seller and constitutes the legal, valid and binding agreement of the Seller, enforceable in accordance with its terms, except that (A) the enforceability hereof may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights, (B) the remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought and (C) rights to indemnity and contribution hereunder may be limited by federal or state securities laws or the public policies underlying such laws. (iv) Each Basic Document has been duly authorized, executed and delivered by the Seller and constitutes the legal, valid and binding obligation of the Seller, enforceable in accordance with its terms, except that (A) the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights and (B) the remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. (v) The Receivables constitute "chattel paper" as such term is defined in the California Uniform Commercial Code. (vi) At the time of execution and delivery of the Pooling and Servicing Agreement, the Seller had the power and authority to transfer the Receivables and such other property being transferred to the Trustee pursuant to the Pooling and Servicing Agreement and to cause the Certificates to be sold and transferred to the Underwriters. 9 10 (vii) The Registration Statement has become effective under the Act, and, to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or contemplated under the Act, and the Registration Statement and the Prospectus, and each amendment or supplement thereto, as of their respective effective or issue dates, complied as to form in all material respects with the requirements of the Act and the Rules and Regulations; such counsel has no reason to believe that either the Registration Statement, at the Effective Time, or any such amendment or supplement, as of its effective date, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus, at the date of this Agreement, or any such amendment or supplement, as of its respective date, or at the Closing Date, included or includes an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; it being understood that such counsel need express no opinion as to the financial statements or other financial or statistical data contained in the Registration Statement or the Prospectus. (viii) Neither the transfer of the Receivables to the Trustee acting on behalf of the Trust, nor the assignment of the security interest of the Seller in the Financed Vehicles, nor the issuance and delivery of the Certificates, nor the sale of the Certificates nor the execution and delivery of the Basic Documents or this Agreement, nor the consummation of any other of the transactions contemplated herein or in the Basic Documents, nor the fulfillment of the terms of the Certificates, the Basic Documents or this Agreement by the Seller will conflict with, or result in a breach, violation or acceleration of, or constitute a default under, any term or provision of the articles of incorporation or bylaws of the Seller or, to the best knowledge of such counsel, of any indenture or other agreement or instrument to which the Seller is a party or by which it is bound or any of its properties may be subject, or result in a violation of or contravene the terms of any statute, order or regulation applicable to the Seller of any court, regulatory body, administrative agency or governmental body having jurisdiction over the Seller or its properties. (ix) The Certificates have been duly and validly authorized and, when executed, authenticated and delivered to the Underwriters as specified in the Pooling and Servicing Agreement against payment of the consideration therefor determined in accordance with this Agreement, will be duly and validly issued and outstanding and will be entitled to the benefits of the Pooling and Servicing Agreement. (x) The Seller has, and pursuant to the Pooling and Servicing Agreement is transferring to the Trustee acting on behalf of the Trust, 10 11 ownership of the Receivables, in each case free and clear of any and all other assignments, encumbrances, options, rights, claims, liens or security interests that may affect the rights of the Seller or the Trustee in and to such Receivables; provided, however, that (A) such counsel need express no opinion with respect to the enforceability of any individual Receivable or the existence of any claims, rights or other matters that are not of record in favor of the related Obligor or the owner of the related Financed Vehicle, (B) such opinion may be limited to the extent that any one or more of the Receivables could be subject to claims of creditors of the dealers that may have originated certain of the Receivables to the extent such creditors can claim the benefits of a security interest in such Receivables either by reason of the filing of a financing statement with respect to chattel paper of such dealer or as proceeds from the sale of inventory in which such creditor had a security interest, (C) such opinion may be further limited to the extent that any such transfer may be subject to the rights of other persons who take, or have taken, possession of any of the Receivables without knowledge of the transfer to the Trustee, and (D) such counsel need express no opinion as to the existence of tax liens, mechanics' liens or other security interests and liens that are not of record. (xi) The Certificates, each Basic Document and this Agreement each conform in all material respects with the description thereof contained in the Registration Statement and the Prospectus. (xii) The statements in the Registration Statement and Prospectus under the heading "Certain Legal Aspects of the Receivables," to the extent that they constitute matters of law or legal conclusions with respect thereto, have been prepared or reviewed by such counsel and are correct in all material respects. (xiii) The Pooling and Servicing Agreement is not required to be qualified under the Trust Indenture Act of 1939, as amended, and the Trust created by the Pooling and Servicing Agreement is not required to be registered under the Investment Company Act of 1940, as amended. (xiv) No consent, approval, authorization or order of any court or governmental agency or body is required for the consummation by the Seller of the transactions contemplated in this Agreement or the Basic Documents except such as may be required under federal or state securities laws in connection with the purchase by the Underwriters of the Certificates, filings with respect to the transfer of the Receivables to Fleetwood Credit, filings with respect to the transfer of the Receivables by Fleetwood Credit to the Seller pursuant to the Receivables Purchase Agreement, and by the Seller to the Trustee pursuant to the Pooling and Servicing Agreement and such other approvals as have been obtained. 11 12 (xv) There are no actions, proceedings or investigations pending or, to the best knowledge of such counsel after due inquiry, threatened before any court, administrative agency or other tribunal (A) asserting the invalidity of this Agreement, any Basic Document or the Certificates, (B) seeking to prevent the issuance of the Certificates or the consummation of any of the transactions contemplated by this Agreement or the Basic Documents, (C) that might materially and adversely affect the performance by the Seller of its obligations under, or the validity or enforceability of, this Agreement, any Basic Document or the Certificates or (D) seeking to adversely affect the federal income tax attributes of the Certificates as described in the Prospectus under the heading "Certain Federal Income Tax Consequences." (e) The Underwriters shall have received an opinion of Timothy M. Hayes, General Counsel of Fleetwood Credit, addressed to the Underwriters, dated the Closing Date and satisfactory in form and substance to the Underwriters and counsel for the Underwriters, and substantially to the effect that: (i) Fleetwood Credit has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of California with full power and authority (corporate and other), and has obtained all necessary licenses and approvals, to own its properties and conduct its business as presently conducted by it, and to enter into and perform its obligations under the Basic Documents, this Agreement and the Certificates and had at all relevant times, and now has, the power, authority and legal right to acquire, own, sell and service the Receivables. (ii) Fleetwood Credit is duly qualified to do business and in good standing, and has obtained all necessary licenses and approvals to conduct its business as presently conducted in California and each other state in which a Receivable was originated. (iii) Such counsel is familiar with the standard operating procedures of Fleetwood Credit relating to the acquisition by Fleetwood Credit of a first perfected security interest in the recreational vehicles financed by the retail installment sale contracts purchased by Fleetwood Credit in the ordinary course of its business and relating to the sale to Fleetwood Credit of such contracts and such security interests in the recreational vehicles financed thereby in the ordinary course of its business. Assuming that such standard procedures have been and are followed with respect to the perfection of security interests in the Financed Vehicles (and such counsel has no reason to believe that Fleetwood Credit has not or will not continue to follow its standard procedures in connection with the perfection of first perfected security interests in the Financed Vehicles), Fleetwood Credit has acquired a first perfected security interest in the Financed Vehicles. With respect to Financed Vehicles in the State of California, no filing or other action other than the filing of a UCC financing statement naming Fleetwood Credit as transferor and the Trustee as 12 13 transferee, which filing has been completed, is necessary to perfect the transfer and assignment of Fleetwood Credit's security interest in such Financed Vehicles to the Trustee, and as a result of such transfer and assignment and filing of such financing statement, the Trustee has a first perfected security interest in such Financed Vehicles, except that so long as Fleetwood Credit is named as the legal owner and lien holder on a certificate of title, Fleetwood Credit has the ability to release the security interest in the related Financed Vehicle or to assign it to another party. (iv) At the time of the execution and delivery of the Receivables Purchase Agreement, Fleetwood Credit had the power and authority to transfer to the Seller the Receivables and other property of the Trust being transferred to the Seller. (v) Neither the transfer of the Receivables to the Seller, nor the assignment of the security interest of Fleetwood Credit in the Financed Vehicles, nor the issuance and delivery of the Certificates, nor the sale of the Certificates to the Underwriters, nor the execution and delivery of the Basic Documents or this Agreement, nor the consummation of any other of the transactions contemplated herein or in the Basic Documents, nor the fulfillment of the terms of the Certificates, the Basic Documents or this Agreement by Fleetwood Credit will conflict with, or result in a breach, violation or acceleration of, or constitute a default under, any term or provision of the articles of incorporation or bylaws of Fleetwood Credit or, to the best knowledge of such counsel, of any indenture or other agreement or instrument to which Fleetwood Credit is a party or by which it is bound or any of its properties may be subject, or result in a violation of, or contravene the terms of any statute, order or regulation, applicable to Fleetwood Credit of any court, regulatory body, administrative agency or governmental body having jurisdiction over it or its properties. (vi) Fleetwood Credit has, and is transferring to the Seller, ownership of the Receivables, in each case, free and clear of any and all other assignments, encumbrances, options, rights, claims, liens or security interests that may affect the rights of Fleetwood Credit or the Seller in and to such Receivables; provided, however, that (A) such counsel need express no opinion with respect to the enforceability of any individual Receivable or the existence of any claims, rights or other matters that are not of record in favor of the related Obligor or the owner of the related Financed Vehicle, (B) such opinion may be limited to the extent that any one or more of the Receivables could be subject to claims of creditors of the dealers that may have originated certain of the Receivables to the extent such creditors can claim the benefits of a security interest in such Receivables either by reason of the filing of a financing statement with respect to chattel paper of such dealer or as proceeds from the sale of inventory in which such creditor had a security interest, (C) such opinion may be further limited to the extent that any such transfer may be 13 14 subject to the rights of other persons who take, or have taken, possession of any of the Receivables without knowledge of the transfer to the Seller and (D) such counsel need express no opinion as to the existence of tax liens, mechanics' liens or other security interests and liens that are not of record. (vii) This Agreement has been duly authorized, executed and delivered by Fleetwood Credit, and constitutes the legal, valid and binding agreement of Fleetwood Credit, enforceable in accordance with its terms, except that (A) the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights, (B) the remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought and (C) rights to indemnity and contribution thereunder may be limited by federal or state securities laws or the public policies underlying such laws. (viii) Each Basic Document has been duly authorized, executed and delivered by Fleetwood Credit and constitutes the legal, valid and binding obligation of Fleetwood Credit, enforceable in accordance with its terms, except that (A) the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights and (B) the remedies of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. (ix) No consent, approval, authorization or order of any court or governmental agency or body is required for the consummation by Fleetwood Credit of the transactions contemplated in this Agreement or the Basic Documents except filings with respect to the transfer of the Receivables by Fleetwood Credit to the Seller pursuant to the Receivables Purchase Agreement, and such other approvals as have been obtained. (x) There are no actions, proceedings or investigations pending or, to the best of such counsel's knowledge after due inquiry, threatened before any court, administrative agency or other tribunal (A) asserting the invalidity of this Agreement, any Basic Document or the Certificates, (B) seeking to prevent the issuance of the Certificates or the consummation of any of the transactions contemplated by this Agreement or the Basic Documents, (C) that might materially and adversely affect the performance by Fleetwood Credit of its obligations under, or the validity or enforceability of, this Agreement, any Basic Document or the Certificates or (D) seeking to affect adversely the federal income tax attributes of the Certificates as described in the Prospectus under the heading "Certain Federal Income Tax Consequences." 14 15 (xi) Assuming the due authorization, execution and delivery thereof by the parties thereto, each of the Receivables in the form attached to such opinion constitutes the valid, binding and enforceable agreement of the parties thereto; such Receivables comply as to content and form with all applicable state and federal laws, including without limitation, consumer protection laws. (f) The Underwriters shall have received an opinion of Brown & Wood LLP, special counsel to the Seller, dated the Closing Date and satisfactory in form and substance to the Underwriters, to the effect that the statements in the Registration Statement and Prospectus under the headings "Certain Federal Income Tax Considerations" and "ERISA Considerations," to the extent that they constitute matters of law or legal conclusions with respect thereto, have been prepared or reviewed by such counsel and are correct in all material respects. (g) Brown & Wood LLP, special counsel to the Seller, shall also deliver to the Underwriters (i) an opinion with respect to the characterization of the transfer of the Receivables as a sale and an opinion that such transfer is not a fraudulent conveyance in substantially the forms previously discussed with the Underwriters and in any event satisfactory in form and in substance to the Underwriters, (ii) reliance letters relating to each opinion rendered to each Rating Agency in connection with the rating of the Class A Certificates and the Class B Certificates and (iii) an opinion to the effect that the Trust will not be classified as an association taxable as a corporation for federal or California income tax purposes and, instead, under subpart E, part I of subchapter J of the Internal Revenue Code of 1986, as amended, the Trust will be treated as a grantor trust. (h) The Underwriters shall have received an opinion of Brown & Wood LLP, addressed to the Underwriters and dated the Closing Date, with respect to the validity of the Certificates and such other related matters as the Underwriters shall request, and the Seller and Fleetwood Credit shall have furnished or caused to be furnished to such counsel such documents as they may reasonably request for the purpose of enabling them to pass upon such matters. (i) The Underwriters, the Seller and Fleetwood Credit shall have received an opinion, addressed to the Underwriters, the Seller and Fleetwood Credit, of counsel to the Trustee, dated the Closing Date and satisfactory in form and substance to the Underwriters and counsel for the Underwriters to the effect that: (i) The Trustee has been duly incorporated and is validly existing as a national banking association in good standing under the laws of the United States with full power and authority (corporate and other) to own its properties and conduct its business, as presently conducted by it, and to enter into and perform its obligations under the Pooling and Servicing Agreement. (ii) The Pooling and Servicing Agreement has been duly authorized, executed and delivered by the Trustee, and constitutes a legal, valid and 15 16 binding obligation of the Trustee, enforceable in accordance with its terms, except that (A) the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to creditors' rights and (B) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. (iii) The Certificates have been duly executed, authenticated and delivered by the Trustee. (iv) Neither the execution or delivery by the Trustee of the Pooling and Servicing Agreement, nor the consummation of any of the transactions by the Trustee contemplated thereby, require the consent or approval of, the giving of notice to, the registration with or the taking of any other action with respect to, any governmental authority or agency under any existing federal or state law governing the banking or trust powers of the Trustee. (j) The Underwriters shall have received a certificate dated the Closing Date of the President, any Vice President, the Treasurer or the Secretary of (i) the Seller, in which such officer shall state that, to the best of his knowledge after reasonable investigation, the representations and warranties of the Seller in this Agreement are true and correct, the Seller has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date and that no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are contemplated by the Commission, and (ii) Fleetwood Credit, in which such officer shall state that, to the best of his knowledge after reasonable investigation, the representations and warranties of Fleetwood Credit in this Agreement are true and correct and that Fleetwood Credit has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder. (k) The Class A Certificates shall be rated "Aaa" by Moody's and "AAA" by Standard & Poor's. (l) The Class B Certificates shall be rated "A3" by Moody's and "A" by Standard & Poor's. The Seller will provide or cause to be provided to the Underwriters such conformed copies of such opinions, certificates, letters and documents as the Underwriters may reasonably request. 16 17 7. Indemnification. (a) Each of the Seller and Fleetwood Credit agrees, jointly and severally, to indemnify and hold harmless each Underwriter and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act as follows: (i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the information deemed to be part of the Registration Statement pursuant to Rule 430A(b) of the Rules and Regulations, if applicable, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; (ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, if such settlement is effected with the written consent of the Seller and Fleetwood Credit; and (iii) against any and all expense whatsoever, as incurred (including, subject to Section 7(c) hereof, the fees and disbursements of counsel chosen by the Underwriters), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under clause (i) or (ii) above; provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Seller by the Underwriters expressly for use in the Registration Statement (or any amendment thereto) or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto). (b) Each Underwriter severally agrees to indemnify and hold harmless the Seller and Fleetwood Credit, each of their respective directors, each of their respective officers who signed the Registration Statement, and each person, if any, who controls either the Seller or Fleetwood Credit within the meaning of Section 15 of the Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged 17 18 untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), in reliance upon and in conformity with written information furnished to the Seller by the Underwriters expressly for use in the Registration Statement (or any amendment thereto) or such preliminary prospectus or the Prospectus (or any amendment or supplement thereto). (c) Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it with respect to which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnified party from any liability which it may have other than on account of this indemnity agreement. An indemnifying party may participate at its own expense in the defense of such action. In no event shall the indemnifying parties be liable for the fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. 8. Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnity agreement provided for in Section 7 hereof is for any reason held to be unenforceable by the indemnified parties although applicable in accordance with its terms, the Seller, Fleetwood Credit and the Underwriters shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Seller, Fleetwood Credit and the Underwriters, as incurred, in such proportions that the Underwriters are responsible for that portion represented by the percentage that the aggregate underwriting discounts appearing on the cover page of the Prospectus bears to the aggregate initial public offering prices of the Certificates appearing thereon and the Seller and Fleetwood Credit are responsible for the balance. Notwithstanding the provisions of this Section 8, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Certificates underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of any such untrue or alleged untrue statement or omission or alleged omission and no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each person, if any, who controls an Underwriter within the meaning of Section 15 of the Act shall have the same rights to contribution as such Underwriter, and each director of the Seller and Fleetwood Credit, each officer of the Seller who signed the Registration Statement and each person, if any, who controls either the Seller or Fleetwood Credit within the meaning of Section 15 of the Act shall have the same rights to contribution as the Seller or Fleetwood Credit, as the case may be. 9. Survival of Certain Representations and Obligations. The respective indemnities, agreements, representations, warranties and other statements of the Seller and Fleetwood Credit or their respective officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation 18 19 or statement as to the results thereof, made by or on behalf of any Underwriter, the Seller, Fleetwood Credit or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Certificates. If for any reason the purchase of the Certificates by the Underwriters is not consummated, the Seller and Fleetwood Credit shall remain responsible for the expenses to be paid or reimbursed by the Seller and Fleetwood Credit pursuant to Section 5(i) hereof and the respective obligations of the Seller, Fleetwood Credit and the Underwriters pursuant to Sections 7 and 8 hereof shall remain in effect. The indemnification and contribution agreements contained in Sections 7 and 8 hereof shall survive the termination and cancellation of this Agreement. If for any reason (other than solely by reason of the termination of this Agreement because of a failure to satisfy the conditions set forth in items (iii), (iv) or (v) of Section 10 hereof), the purchase of the Certificates by the Underwriters is not consummated, the Seller and Fleetwood Credit will reimburse the Underwriters for all out-of-pocket expenses (including fees and disbursements of counsel) reasonably incurred by them in connection with the offering of the Certificates. 10. Termination of Agreement. The Underwriters may terminate this Agreement, by notice to the Seller and Fleetwood Credit, at any time prior to or at the Closing Date (i) if there has been, since the date of this Agreement or since the respective dates as of which information is given in the Registration Statement, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Seller or the Servicer, whether or not arising in the ordinary course of business; (ii) if there has occurred any downgrading in the rating of the debt securities of the Seller or the Servicer by any "nationally recognized statistical rating organization" (as such term is defined for purposes of Rule 436(g) under the Act), or any public announcement that any such organization has under surveillance or review its rating of any debt securities of the Seller or the Servicer (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating); (iii) if there has occurred any material adverse change in the financial markets in the United States or any outbreak of hostilities or other calamity or crisis, the effect of which is such as to make it, in the judgment of the Underwriters, impracticable to market the Certificates or to enforce contracts for the sale of the Certificates; (iv) if trading generally on either the American Stock Exchange or the New York Stock Exchange has been suspended, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices for securities have been required, by either of said Exchanges or by order of the Commission or any other governmental authority; or (v) if a banking moratorium has been declared by federal, New York or California authorities. 11. Default By One or More of the Underwriters. If one or more of the Underwriters shall fail at the Closing Date to purchase the Certificates which it or they are obligated to purchase under this Agreement (the "Defaulted Securities"), the Representative shall have the right, but not the obligation, within 24 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth; if, however, the Representative shall not have completed such arrangements within such 24-hour period, then: 19 20 (a) if the aggregate principal amount of Defaulted Securities does not exceed 10% of the total aggregate principal amount of the Certificates, the non-defaulting Underwriters shall be obligated to purchase the full amount thereof in such proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all non-defaulting Underwriters, or (b) if the aggregate principal amount of Defaulted Securities exceeds 10% of the total aggregate principal amount of the Certificates, this Agreement shall terminate without liability on the part of any non- defaulting Underwriter. No action pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default. In the event of any such default which does not result in a termination of this Agreement, either the Representative or the Seller shall have the right to postpone the Closing Date for a period not exceeding seven days in order to effect any required changes in the Registration Statement or Prospectus or in any other documents or arrangement. 12. Notices. All communications hereunder will be in writing and, if sent to (i) the Underwriters, will be mailed, delivered or sent by facsimile and confirmed to them at ____________________, Attention: __________ (facsimile number __________); (ii) the Seller, will be mailed, delivered or sent by facsimile and confirmed to it at Fleetwood Credit Receivables Corp., [22840 SAVI RANCH PARKWAY, YORBA LINDA, CALIFORNIA 92687, ATTENTION: TREASURER (FACSIMILE NUMBER (714) 921-3490)]; or (iii) Fleetwood Credit, will be mailed, delivered or sent by facsimile and confirmed to it at Fleetwood Credit Corp., [22840 SAVI RANCH PARKWAY, YORBA LINDA, CALIFORNIA 92687, ATTENTION: VICE PRESIDENT-TREASURER (FACSIMILE NUMBER (714) 921-3490)]. 13. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers and directors and controlling persons referred to in Sections 7 and 8 hereof, and no other person will have any right or obligation hereunder. 14. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement. 15. Applicable Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California. 20 21 If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to us one of the counterparts duplicate hereof, whereupon it will become a binding agreement between the Seller and Fleetwood Credit and the Underwriters in accordance with its terms. Very truly yours, FLEETWOOD CREDIT CORP. By: -------------------------------- Marvin T. Runyon, III Senior Vice President FLEETWOOD CREDIT RECEIVABLES CORP. By: -------------------------------- Marvin T. Runyon, III Senior Vice President CONFIRMED AND ACCEPTED, as of the date first above written: [UNDERWRITERS] By: [Representative] By: ------------------------------------------ Name: Title: For itself and as Representative of the Underwriters 22 SCHEDULE A
Principal Principal Amount of Amount of Class A Class B Underwriter Certificates Certificates ----------- ------------ ------------ ____________________ . . . . . . . . . . . . . . . . $__________ $__________ ____________________ . . . . . . . . . . . . . . . . __________ __________ ____________________ . . . . . . . . . . . . . . . . __________ __________ Total $ $ ========== ==========
A-1 EX-3.1 3 ARTICLES OF INCORPORATION 1 EXHIBIT 3.1 - -------------------------------------------------------------------------------- AMENDED AND RESTATED ARTICLES OF INCORPORATION OF FLEETWOOD CREDIT RECEIVABLES CORP. (a California corporation) - -------------------------------------------------------------------------------- Amended and Restated May 12, 1995 Filed January 15, 1991 2 RESTATED ARTICLES OF INCORPORATION OF FLEETWOOD CREDIT RECEIVABLES CORP. ARTICLE I Name The name of the Corporation is Fleetwood Credit Receivables Corp. ARTICLE II Purpose (a) Subject to paragraph (b) below, the purpose of this corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of California other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code. (b) Notwithstanding paragraph (a) above, the purpose of this Corporation is limited to the following purposes, and activities incident to and necessary or convenient to accomplish the following purposes: (i) to acquire, own, hold, sell, transfer, assign, pledge, finance, refinance, and otherwise deal with, retail installment sale contracts or wholesale loans secured by new and used recreational vehicles (the "Receivables"); (ii) to authorize, issue, sell and deliver one or more series of obligations, consisting of one or more classes of certificates or other evidences of interests, or notes or other evidences of indebtedness (collectively, the "Securities") , that are collateralized by or evidence an interest in the Receivables; and (iii) to negotiate, authorize, execute, deliver and assume the obligations of any agreement relating to the activities set forth in clauses (i) and (ii) above, including but not limited to any pooling and servicing agreement, sale and servicing agreement, trust agreement, indenture, administration agreement, reimbursement agreement, credit support agreement, receivables purchase agreement, underwriting agreement or other similar agreement (each, an "Agreement"), or to engage in any lawful activity which is incidental to the activities contemplated by any such Agreement. So long as any outstanding debt of the Corporation or Securities are rated by any nationally recognized statistical rating organization, the Corporation shall not issue notes or otherwise borrow money, other than in connection with the issuance of Securities by the Corporation pursuant to one or more Agreements, unless (A) the Corporation has made a written request to the related nationally recognized statistical rating organization to issue notes or incur borrowings which notes or borrowings are rated by the related nationally recognized statistical rating organization the same as or higher than the rating afforded such rated debt or Securities or (B) such notes or borrowings (1) are fully subordinated (and which shall provide for payment only after payment in respect of all 3 outstanding rated debt and/or Securities) or are nonrecourse against any assets of the Corporation other than the assets pledged to secure such notes or borrowings, (2) do not constitute a claim against the Corporation in the event such assets are insufficient to pay such notes or borrowings, and (3) where such notes or borrowings are secured by the rated debt or Securities, are fully subordinated (and which shall provide for payment only after payment in respect of all outstanding rated debt and/or Securities) to such rated debt or Securities. ARTICLE III Capital Stock The Corporation shall have one class of stock designated as Common Stock, and the total number of shares of stock of that class that the Corporation shall have authority to issue is 1,000 shares of no par stock. No shareholder shall have any preemptive right to acquire additional shares of the Corporation. ARTICLE IV Independent Directors The Corporation shall at all times, except as noted hereafter, have at least two Directors (each, an "Independent Director") who is not (a) a director, officer or employee of any affiliate of the Corporation; (b) a person related to any officer or director of any affiliate of the Corporation; (c) a holder (directly or indirectly) of more than 10% of any voting securities of any affiliate of the Corporation; or (d) a person related to a holder (directly or indirectly) of more than 10% of any voting securities of any affiliate of the Corporation. In the event of the death, incapacity, resignation or removal of all Independent Directors, the Board of Directors shall promptly appoint an Independent Director for each Independent Director whose death, incapacity, resignation or removal caused the related vacancy on the Board of Directors; provided, however, that the Board of Directors shall not vote on any matter unless and until at least two Independent Directors have been duly appointed to serve on the Board. ARTICLE V Limitations on Certain Actions by the Corporation Notwithstanding any other provision of these Articles and any provision of law, the Corporation shall not do any of the following; (a) engage in any business or activity other than as set forth in Article II hereof; 3 4 (b) without the affirmative vote of a majority of the members of the Board of Directors of the Corporation (which must include the affirmative vote of all duly appointed Independent Directors), (i) dissolve or liquidate, in whole or in part, or institute proceedings to be adjudicated bankrupt or insolvent, (ii) consent to the institution of bankruptcy or insolvency proceedings against it, (iii) file a petition seeking or consent to reorganization or relief under any applicable federal or state law relating to bankruptcy, (iv) consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Corporation or a substantial part of its property, (v) make a general assignment for the benefit of creditors, (vi) admit in writing its inability to pay its debts generally as they become due, (vii) take any corporate action in furtherance of the actions set forth in clauses (i) through (vi) of this paragraph, provided, however, that no director may be required by any shareholder of the Corporation to consent to the institution of bankruptcy or insolvency proceedings against the Corporation so long as it is solvent; or (c) merge or consolidate with any other corporation, company or entity or sell all or substantially all of its assets or acquire all or substantially all of the assets or capital stock or other ownership interest of any other corporation, company or entity, except for the acquisition of the Receivables of Fleetwood Credit Corp. ("Fleetwood Credit") and the sale of Receivables to one or more trusts in accordance with the terms of Article II(b) hereof, on which there shall be no such restriction. ARTICLE VI Internal Affairs The Corporation shall insure at all times that (a) it maintains separate corporate records and books of account from those of Fleetwood Credit, and (b) except as permitted by contract between the Corporation and Fleetwood Credit with respect to deposits in certain accounts of collections of trade receivables of Fleetwood Credit that were not sold to the Corporation pursuant to an agreement between them, which will be promptly remitted to the owner thereof, none of the Corporation's assets will be commingled With those of Fleetwood Credit or any of their affiliates. ARTICLE VII Amendments The Corporation reserves the right to amend, alter, change or repeal any provision contained in these Articles in any manner now or hereafter provided herein or by statute; and, except as provided with respect to the indemnification of directors, all rights, preferences and privileges conferred by these Articles upon shareholders, directors or any other person are granted subject to such right; provided, however, that the Corporation shall not amend, alter, 4 5 change or repeal any provision of Articles II and IV through VII (the "Restricted Articles") without the unanimous vote of the full Board of Directors and provided, further, that the Corporation shall not amend or change any Article so as to be inconsistent with the Restricted Articles. ARTICLE VIII Liability of Directors and Officers; Indemnification (a) The liability of the members of the Board of Directors and officers of the Corporation for monetary damages shall be eliminated to the fullest extent permissible under California law. (b) The Corporation is authorized to provide indemnification of "agents", as the term "agent" is defined in Section 317 of the California Corporations Code, through Bylaw provisions, agreements with agents, vote of shareholders or disinterested directors, or otherwise, to the fullest extent permissible under California law. 5 EX-3.2 4 BYLAWS OF FLEETWOOD CREDIT 1 EXHIBIT 3.2 ---------------------------------- AMENDED AND RESTATED BYLAWS OF FLEETWOOD CREDIT RECEIVABLES CORP. (a California corporation) ---------------------------------- Amended and Restated August 15, 1996 Adopted January 17, 1991 2 AMENDED AND RESTATED BYLAWS OF FLEETWOOD CREDIT RECEIVABLES CORP. Index
Page ---- ARTICLE I Offices Section 1.01. Principal Executive Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 1.02. Other Offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE II Shareholders Section 2.01. Annual Meeting and Election of Directors . . . . . . . . . . . . . . . . . . . . . . . 1 Section 2.02. Special Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 2.03. Place of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 2.04. Notice of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2.05. Conduct of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2.06. Quorum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2.07. Action Without Meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2.08. Telephone and Similar Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2.09. Annual Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 ARTICLE III Directors Section 3.01. Number 3 Section 3.02. Qualification-Independent Director; Election; Term . . . . . . . . . . . . . . . . . . 3 Section 3.03. Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 3.04. Meetings of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Section 3.05. Action by Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 3.06. Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Section 3.07. Executive Committee of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
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Page ---- Section 3.08. Removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 3.09. Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 3.10. Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 3.11. Telephone and Similar Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 3.12. Written Action or Minutes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 ARTICLE IV Indemnification of Directors, Officers and Other Corporate Agents Section 4.01. Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Section 4.02. Right to Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 4.03. Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 ARTICLE V Officers Section 5.01. Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 5.02. Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 5.03. Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Section 5.04. President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.05. Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.06. Secretary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.07. Treasurer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.08. Controller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.09. Assistant Vice Presidents; Assistant Secretaries; Assistant Treasurers and Other Subordinate Officers . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.10. Vacancies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Section 5.11. Removal or Discharge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 ARTICLE VI Amendments Section 6.01. Bylaws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
ii 4
Page ---- ARTICLE VII General Provisions Section 7.01. Corporate Seal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 7.02. Method of Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 7.03. Waiver of Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 7.04. Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Section 7.05. Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Section 7.06. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Section 7.07. Relation to the Articles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
iii 5 AMENDED AND RESTATED BYLAWS OF FLEETWOOD CREDIT RECEIVABLES CORP. (a California corporation) ---------------------------------- ARTICLE I Offices Section 1.01. Principal Executive Office. The principal executive office of Fleetwood Credit Receivables Corp. ("Corporation") shall be at 22840 Savi Ranch Parkway, Yorba Linda, California 92687 or at such other location as the Board of Directors shall designate. Section 1.02. Other Offices. The Corporation may also have offices at such other places both within and without the State of California as the Board of Directors ("Board"), the Chief Executive Officer, the Chief Operating Officer or the President may from time to time determine or the business of the Corporation may require. ARTICLE II Shareholders Section 2.01. Annual Meeting and Election of Directors. The annual meeting of stockholders shall be held on the third Friday of February in each year. Should said day be a legal holiday, such annual meeting shall be held on the preceding regular business day. If, for any reason, the annual meeting be not held at the time aforesaid, the board of directors or the president shall fix another date for such meeting. Section 2.02. Special Meetings. Special meetings of the stockholders may be held at any time upon the call of the board of directors, or of the president, or of stockholders holding not less than one-fourth (1/4) of the outstanding shares entitled, by the Articles of Incorporation and by the General Corporation Law of the state of its incorporation, to vote on the business proposed to be transacted thereat. Section 2.03. Place of Meetings. Each Annual or Special Meeting of Shareholders shall be held at such location as may be determined by the Board, or if no such determination is made, at such place as may be determined by the Chief Executive Officer, the Chief 6 Operating Officer or the President. If no location is so determined, any Annual or Special Meeting shall be held at the principal executive office of the Corporation. Section 2.04. Notice of Meetings. Notice of each Annual or Special Meeting of Shareholders shall contain such information, and shall be given to such persons at such time, and in such manner, as the Board shall determine, or if no such determination is made, as the Chief Executive Officer, the Chief Operating Officer or the President shall determine, subject to the requirements of applicable law. Section 2.05. Conduct of Meetings. Subject to the requirements of applicable law, all Annual and Special Meetings of Shareholders shall be conducted in accordance with such rules and procedures as the Board may determine and, as to matters not governed by such rules and procedures, as the Chairman of such Meeting shall determine. Section 2.06. Quorum. The holders of a majority of the shares issued and outstanding and entitled to vote at a Meeting of the Shareholders shall be requisite and shall constitute a quorum thereat for the transaction of business except as otherwise provided by statute, by the Articles of Incorporation ("Articles") or by these Bylaws. If a quorum is not present or represented at a Meeting of the Shareholders, the shareholders entitled to vote shall have power to reschedule the Meeting from time to time, without notice other than an announcement at the Meeting, until a quorum is present or represented. At any rescheduled Meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the Meeting as originally notified. Section 2.07. Action Without Meeting. Any action required by statute to be taken at a Meeting of the Shareholders, or any action that may be taken at a Meeting of the Shareholders, may be taken without a Meeting, without prior written notice and without a vote if a consent in writing, setting forth the action, shall be signed by the holders of the outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a Meeting at which all shares entitled to vote thereon were present and voted. The signed consent or a signed copy shall be placed in the Minute Book of the Corporation and prompt notice of the taking of the corporate action shall be given to those shareholders who have not consented in writing. Section 2.08. Telephone and Similar Meetings. Shareholders may participate in and hold a Meeting by means of which all persons participating in the Meeting can hear each other. Participation in such a Meeting shall constitute presence in person at the Meeting, unless a shareholder participates in the Meeting for the express purpose of objecting to the transaction of any business on the ground that the Meeting is not lawfully called or convened. Section 2.09. Annual Report. So long as the Corporation shall have less than 100 holders of record of its shares, the requirement that an annual report complying with Section 1501 of the California General Corporation Law be sent to the shareholders shall be waived. Nothing in this Section 2.09 shall prohibit the Board from sending an annual report to the shareholders. 2 7 ARTICLE III Directors Section 3.01. Number. The authorized number of Directors on the Board shall not be less than four (4) nor more than six (6) unless changed by a Bylaw duly adopted either by the Board or the shareholders amending this Section 3.01. The exact number of Directors shall be fixed, from time to time within the limits specified, by resolution duly adopted either by the Board or the shareholders. Section 3.02. Qualification-Independent Director; Election; Term. (a) Of the authorized number of Directors provided in Section 3.01, the Corporation shall at all times, except as noted hereafter, have at least two Directors (each, an "Independent Director") who is not (i) a director, officer or employee of any affiliate of the Corporation; (ii) a person related to any officer or director of any affiliate of the Corporation; (iii) a holder (directly or indirectly) of more than 10% of any voting securities of any affiliate of the Corporation; or (iv) a person related to a holder (directly or indirectly) of more than 10% of any voting securities of any affiliate of the Corporation. In the event of the death, incapacity, resignation or removal of all Independent Directors, the Board shall promptly appoint an Independent Director for each Independent Director whose death, incapacity, resignation or removal caused the related vacancy on the Board; provided, however, that the Board shall not vote on any matter unless and until at least two Independent Directors have been duly appointed to serve on the Board. (b) Except as otherwise provided by Sections 3.08 and 3.09 of these Bylaws, the Directors shall be elected at the Annual Meeting of Shareholders. (c) Each Director elected shall hold office until the next Annual Meeting of Shareholders and until his successor has been elected and qualified or until his death, resignation, retirement, disqualification or removal. Section 3.03. Powers. Subject to limitations of the Articles, of the Bylaws, and of the California General Corporation Law relating to actions required to be approved by the shareholders or by the outstanding shares, the business and affairs of the Corporation shall be managed and all corporate powers shall be exercised by or under direction of the Board. The Board may delegate the management of the day-to-day operation of the business of the Corporation to the officers of the Corporation or other persons provided that the business and affairs of the Corporation shall be managed by and all corporate powers shall be exercised under the ultimate direction of the Board. Section 3.04. Meetings of the Board. Each Meeting of the Board shall be held at a location determined as follows. The Board may designate any place, within or without the State of California, for the holding of any Meeting. If no such designation is made, the Meeting shall be held at the Corporation's principal executive office. Subject to the requirements of applicable law, all Meetings of the Board shall be conducted in accordance 3 8 with such rules and procedures as the Board may approve and, as to matters not governed by such rules and procedures, as the Chairman of such Meeting shall determine. Section 3.05. Action by Consent. Any action required or permitted to be taken at any Meeting of the Board or of any committee thereof may be taken without a Meeting if a written consent, setting forth the action so taken, is signed by all members of the Board or of such committee, as the case may be, and such written consent is filed with the Secretary of the Corporation and placed in the Minute Book. Such consent shall have the same force and effect as a unanimous vote at a Meeting of such Board or committee. Section 3.06. Committee. The Board may, by resolution adopted by a majority of the whole Board, designate one or more committees, each committee to consist of two or more of the Directors of the Corporation. Any such committee, to the extent provided in the resolution of the Board, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it; but no such committee shall have any powers or authority in reference to: (a) the approval of any action for which the California General Corporation Law also requires shareholders' approval or approval of the outstanding shares; (b) amending the Articles; (c) approving an agreement of merger or consolidation; (d) recommending to the shareholders the sale, lease or exchange of all or substantially all of the Corporation's property and assets otherwise than in the usual and regular course of its business; (e) recommending to the shareholders a dissolution of the Corporation or a revocation thereof; (f) amending or repealing the Bylaws of the Corporation or adopting new Bylaws of the Corporation; (g) amending or repealing any resolution of the Board which by its express terms is not so amendable or repealable; (h) appointing other committees of the Board or the members thereof; (i) filling new vacancies in or removing members of the Board or on any committee appointed by the Board; (j) fixing the compensation of the Directors for serving on the Board or for serving as any member of such committee thereof; or 4 9 (k) a "distribution", as such term is defined in Section 166 of the California General Corporation Law, except at a rate, in a periodic amount or within a specific price range determined by the Board, and, unless the resolution of the Board expressly so provides, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock. Any such committee shall report on its Meetings to the Board at the next Meeting of the Board. Section 3.07. Executive Committee of the Board. Subject to the Bylaws herein, including Sections 3.04, 3.05 and 3.06, the Articles and the provisions of applicable law, the Executive Committee of the Board ("Executive Committee") is authorized by unanimous written consent of all its Executive Committee members to bind this Corporation without the consent of other members of the Board and shall have and may exercise all of the authority of the Board in the management of the business and affairs of the Corporation, including the power to authorize the seal of the Corporation to be affixed to all papers which may require it. Upon the unanimous consent of all members of the Executive Committee, the Executive Committee is also authorized by these Bylaws to authorize the future purchase and sale of Receivables as defined and provided for in the Articles. Section 3.08. Removal. (a) Subject to Article IV of the Articles, the entire Board or any individual Director may be removed from office without cause by the affirmative vote of a majority of the outstanding shares entitled to vote on such removal; provided, however, that unless the entire Board is removed, no individual Director may be removed when the votes cast against such Director's removal, or not consenting in writing to such removal, would be sufficient to elect that Director if voted cumulatively at an election at which the same total number of votes cast were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of Directors authorized at the time of such Director's most recent election were being elected. (b) Any member of the Executive Committee and other committees may be removed by the Board by the affirmative vote of a majority of the whole Board, whenever in its judgment the best interests of the Corporation will be served thereby. Section 3.09. Vacancies. (a) Subject to Article IV of the Articles, any Director may resign effective upon giving oral or written notice to the Chairman of the Board, the President, the Secretary or the Board, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation of a Director is effective at a future time, the Board may elect a successor to take office when the resignation becomes effective. Subject to Article IV of the Articles, vacancies on the Board may be filled by a majority of the remaining Directors, or if the number of Directors then in office is less than a quorum by (i) unanimous written consent of the Directors then in office, (ii) the affirmative 5 10 vote of a majority of the Directors then in office at a Meeting held pursuant to notice or waivers of notice, or (iii) a sole remaining Director; however, a vacancy created by the removal of a Director by the vote or written consent of the shareholders or by court order may be filled only by the affirmative vote of a majority of the shares represented and voting at a duly held meeting at which a quorum is present (which shares voting affirmatively also constitute at least a majority of the required quorum), or by the unanimous written consent of all shares entitled to vote thereon. Each Director so elected shall hold office until the next Annual Meeting of Shareholders and until a successor has been elected and qualified, or until his resignation or removal. Subject to Article IV of the Articles, the shareholders may elect a Director or Directors at any time to fill any vacancy or vacancies not filled by the Directors, but any such election by written consent, other than to fill a vacancy created by removal, shall require the consent of the holders of a majority of the outstanding shares entitled to vote thereon. A Director may not be elected by written consent to fill a vacancy created by removal except by unanimous consent of all shares entitled to vote for the election Directors. (b) A vacancy occurring in the Executive Committee or other committee (by death, resignation, retirement, disqualification, removal or otherwise) may be filled by the Board in the manner provided for original designation in Section 3.06 of these Bylaws. Section 3.10. Compensation. Members of the Board and the Executive Committee or other committee may, by resolution of the Board, be allowed compensation for attending Board and committee Meetings. Section 3.11. Telephone and Similar Meetings. Members of the Board and the Executive Committee or other committee may participate in and hold a Meeting by means of which all persons participating in the Meeting can hear each other. Participation in such Meeting shall constitute presence in person at the Meeting, unless a person authorized to participate in such Meeting participates in the Meeting for the express purpose of objecting to the transaction of any business on the ground that the Meeting was not lawfully called or convened. Section 3.12. Written Action or Minutes. The Board, the Executive Committee and other committees shall keep either a record of action taken or Minutes of their proceedings and, in the case of any committee, report the same to the Board of Directors when required. The Minutes of the proceedings of the Board, the Executive Committee and other committees shall be placed in the Minute Book of the Corporation. ARTICLE IV Indemnification of Directors, Officers and Other Corporate Agents Section 4.01. Indemnification. This Corporation shall indemnify and hold harmless each "agent" of the Corporation, as the term "agent" is defined in Section 317(a) of the 6 11 California General Corporation Law, as amended from time to time, from and against any "expenses" (as defined in said Section 317(a)), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any "proceeding" (as defined in said Section 317(a)) to the full extent permitted by applicable law. The Corporation shall advance to its agents expenses incurred in defending any proceeding prior to the final disposition thereof to the full extent and in the manner permitted by applicable law. Section 4.02. Right to Indemnification. This Section shall create a right of indemnification for each person referred to in Section 4.01, whether or not the proceeding to which the indemnification relates arose in whole or in part prior to adoption of such Section and in the event of death such right shall extend to such person's legal representatives. The right of indemnification hereby given shall not be exclusive of any other rights such person may have whether by law or under any agreement, insurance policy, vote of directors or shareholders, or otherwise. Section 4.03. Insurance. Subject to the requirements of applicable law, the Corporation shall have power to purchase and maintain insurance on behalf of any agent of the Corporation against any liability asserted against or incurred by the agent in such capacity or arising out of the agent's status as such whether or not the Corporation would have the power to indemnify the agent against such liability. ARTICLE V Officers Section 5.01. Officers. The officers of the company shall consist of the president, the secretary, the treasurer, the controller, and such vice presidents, assistant vice presidents, assistant secretaries, assistant treasurers and other officers as may from time to time be elected by the board of directors or appointed by the president as provided herein. Any two or more offices may be held by the same person, excepting that the duties of the president and secretary shall not be performed by one person. Section 5.02. Election. At the first meeting after their election the board of directors shall elect annually the officers enumerated in Section 1 of this Article to hold office until the regular meeting of directors following the next annual meeting of the stockholders and until others are elected and shall have qualified in their stead, excepting as in this Article otherwise provided. Section 5.03. Appointment. The president may, from time to time, designate and appoint such vice president and other officers as may be necessary or desirable and define the duties thereof. Such persons shall hold office until the regular meeting of the board of directors following the next annual meeting of the stockholders, excepting as in this Article otherwise provided. 7 12 Section 5.04. President. The president shall be a director. He shall preside at all meetings of stockholders and at all meetings of the board of directors. As chief executive officer he shall have general supervision of the affairs of the company. He is charged with the responsibility for the prudential affairs of the company and for the maintenance of harmony and accord and may at his discretion discharge any and all officers, excepting any officer who is also a director, and appoint their successors who shall hold office until the next meeting of the board of directors. He shall also perform all such other duties as are incidental to his office or properly required of him by the board of directors. Section 5.05. Vice President. Each vice president shall have general supervision of those affairs of the company designated for his attention by the president and such other officer or officers to whom he is directly responsible and may employ and discharge subordinate officers, employees, clerks and agents under his supervision. Each vice president shall perform all such duties as are incidental to his office or properly required of him by the president and such other officer or officers to whom he is directly responsible. Section 5.06. Secretary. The secretary shall keep full and accurate minutes of the meetings of the stockholders and of the board of directors in the proper record book of the company provided therefor, give due notice of all annual meetings of stockholders and of all special meetings of stockholders and the board of directors on proper call therefor being filed with him. He shall have custody of the seal of the company and shall perform all such duties as are incidental to his office or properly required of him by the president and such other officer or officers to whom he is directly responsible. Section 5.07. Treasurer. The treasurer shall perform all such duties as are incidental to his office or properly required of him by the president and such other officer or officers to whom he is directly responsible. Section 5.08. Controller. The controller shall keep and maintain the books of account of the company in such manner that they fairly present the financial condition of the company and its subsidiaries. The controller shall perform all such duties as are incidental to his office or properly required of him by the president and such other officer or officers to whom he is directly responsible. Section 5.09. Assistant Vice Presidents; Assistant Secretaries; Assistant Treasurers and Other Subordinate Officers. Each assistant vice president, assistant secretary, assistant treasurer and other subordinate officers shall perform such duties as may be incidental to his office or properly required of him by the president and such other officer or officers to whom he is directly responsible. Section 5.10. Vacancies. A vacancy in any office filled by election of the board of directors existing at the time of any meeting of the board of directors may be filled by the board of directors by the election of a new officer who shall hold office, subject to the provisions of this Article, until the regular meeting of the board of directors following the next annual meeting of stockholders and until his successor is elected and qualified. 8 13 Section 5.11. Removal or Discharge. Any officer may be removed or discharged by the president at any time, excepting an officer who is also a director. Any officer who is a director may be discharged at any time by the board of directors. The employment of all officers shall be for an indefinite time terminable at will. ARTICLE VI Amendments Section 6.01. Bylaws. Except for Section 3.02 herein, the limitations set forth in the Articles and as otherwise provided by applicable law, new Bylaws may be adopted or these Bylaws may be amended or repealed by the shareholders or, except for Section 3.01 herein, the Board. ARTICLE VII General Provisions Section 7.01. Corporate Seal. The corporate seal of the company shall be in such form as the board of directors shall from time to time prescribe. Section 7.02. Method of Notice. Whenever by statute, the Articles, these Bylaws, or otherwise, notice is required to be given to a Director, committee member or shareholder, and no provision is made as to how the notice shall be given, it shall not be construed to mean personal notice, but any such notice may be given: (a) in writing by mail, first-class postage prepaid, addressed to the Director, committee member, or shareholder at the address appearing on the books of the Corporation; (b) by facsimile transmission; or (c) in any other method permitted by law. Any notice required or permitted to be given by mail shall be deemed given at the time when the same is deposited in accordance with the terms of this Section in the United States mails. Section 7.03. Waiver of Notice. Except as otherwise provided by applicable law, whenever notice is required to be given by these Bylaws or the Articles or by law, the person entitled to said notice may waive such notice in writing, either before or after the time stated therein, and such waiver shall be deemed equivalent to notice. Section 7.04. Fiscal Year. The fiscal year of the company shall be the twelve months ending December 31 in each year. 9 14 Section 7.05. Construction. Whenever the context so requires, the masculine gender shall include the feminine and neuter genders and the singular shall include the plural, and conversely. If any portion of these Bylaws shall be invalid or inoperative, then, so far as is reasonable and possible: (a) the remainder of these Bylaws shall be considered valid and operative; and (b) effect shall be given to the intent manifested by the portion held invalid or inoperative. Section 7.06. Headings. The headings set forth in these Bylaws are for organization, convenience and clarity. In interpreting these Bylaws, they shall be subordinated in importance to other written material. Section 7.07. Relation to the Articles. These Bylaws are subject to, and governed by the Articles and any written agreement by a majority in interest of the shareholders filed with the Corporation at its principal place of business. 10 EX-4.1 5 FORM OF POOLING & SERVICING AGREEMENT 1 EXHIBIT 4.1 Brown & Wood LLP Draft of 9/4/96 ================================================================================ FLEETWOOD CREDIT RECEIVABLES CORP., as Seller FLEETWOOD CREDIT CORP., as Servicer and THE CHASE MANHATTAN BANK, as Trustee on behalf of the Certificateholders ------------------------------------------------------ POOLING AND SERVICING AGREEMENT Dated as of September 1, 1996 ------------------------------------------------------ $ --------- Fleetwood Credit 1996-B Grantor Trust Asset Backed Certificates ================================================================================ 2 TABLE OF CONTENTS Page ---- ARTICLE ONE CREATION OF TRUST Section 1.01. Creation of Trust . . . . . . . . . . . . . . . . . . . . 1 ARTICLE TWO CONVEYANCE OF RECEIVABLES Section 2.01. Conveyance of Receivables . . . . . . . . . . . . . . . . 1 ARTICLE THREE THE SERVICER LETTER OF CREDIT Section 3.01. Servicer Letter of Credit . . . . . . . . . . . . . . . . 2 ARTICLE FOUR ACCEPTANCE BY TRUSTEE Section 4.01. Acceptance by Trustee . . . . . . . . . . . . . . . . . . 2 ARTICLE FIVE INCORPORATION OF STANDARD TERMS AND CONDITIONS OF AGREEMENT Section 5.01. Incorporation of Standard Terms and Conditions of Agreement 2 ARTICLE SIX SPECIAL DEFINITIONS AND TERMS Section 6.01. Special Definitions and Terms . . . . . . . . . . . . . . 3 (i) 3 Page ---- ARTICLE SEVEN ADDITIONAL REPRESENTATIONS AND WARRANTIES OF SELLER Section 7.01. Additional Representations and Warranties of Seller . . . 5 ARTICLE EIGHT FLEETWOOD CREDIT NOT TO RESIGN AS SERVICER Section 8.01. Fleetwood Credit Not to Resign as Servicer . . . . . . . . 6 ARTICLE NINE AGENT FOR SERVICE Section 9.01. Agent for Service . . . . . . . . . . . . . . . . . . . . 6 ARTICLE TEN [Reserved] SCHEDULES Schedule A - Schedule of Receivables . . . . . . . . . . . . . . . . SA-1 Schedule B - Locations of Receivable Files . . . . . . . . . . . . . SB-1 EXHIBITS Exhibit A - Form of Class A Certificate . . . . . . . . . . . . . . A-1 Exhibit B - Form of Class B Certificate . . . . . . . . . . . . . . B-1 Exhibit C - Form of Servicer's Certificate . . . . . . . . . . . . . C-1 Exhibit D - Auction Procedures . . . . . . . . . . . . . . . . . . . D-1 (ii) 4 This Pooling and Servicing Agreement, dated as of September 1, 1996, is made with respect to the formation of the Fleetwood Credit 1996-B Grantor Trust, among Fleetwood Credit Receivables Corp., a California corporation (the "Seller"), Fleetwood Credit Corp., a California corporation (the "Servicer"), and The Chase Manhattan Bank as trustee (the "Trustee"). W I T N E S S E T H: In consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows: ARTICLE ONE CREATION OF TRUST Section 1.01. Creation of Trust. Upon the execution of this Agreement by the parties hereto, there is hereby created the Fleetwood Credit 1996-B Grantor Trust. ARTICLE TWO CONVEYANCE OF RECEIVABLES Section 2.01. Conveyance of Receivables. In consideration of the Trustee's delivery to, or upon the order of, the Seller of executed and authenticated Certificates, in authorized denominations, in an aggregate amount equal to the sum of the Original Class A Certificate Balance and the Original Class B Certificate Balance, the Seller does hereby sell, transfer, assign and otherwise convey to the Trustee, in trust for the benefit of the Certificateholders, without recourse (subject to the Seller's obligations herein): (i) all right, title and interest of the Seller in and to the Receivables listed in Schedule A hereto and all monies due thereon and paid thereon or in respect thereof (including proceeds of the repurchase of Receivables by the Seller pursuant to Section 12.02 or 21.02 of the Standard Terms and Conditions or the repurchase of Receivables by the Servicer, or any successor to the Servicer, pursuant to Section 13.07 or 21.02 of the Standard Terms and Conditions) on or after the Cutoff Date; (ii) the interest of the Seller in the security interests in the related Financed Vehicles granted by the related Obligors pursuant to the Receivables; (iii) the interest of the Seller in any Liquidation Proceeds, in any proceeds of any physical damage insurance policies covering the Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables or the related Obligors; 5 (iv) the interest of the Seller in any proceeds from Dealer repurchase obligations relating to the Receivables; (v) the interest of the Seller under the Receivables Purchase Agreement; (vi) all other assets comprising the estate of the Trust; and (vii) all proceeds of the foregoing. ARTICLE THREE THE SERVICER LETTER OF CREDIT Section 3.01. Servicer Letter of Credit. Upon the obtaining of any Servicer Letter of Credit pursuant to Section 14.02 of the Standard Terms and Conditions, the Trustee will hold the Servicer Letter of Credit and deliver demands for payment pursuant thereto in accordance with its terms and the terms of this Agreement. As of the Closing Date, there will be no Servicer Letter of Credit and the Servicer will be permitted to remit collections on or in respect of the Receivables on a monthly basis as described in Section 14.02 of the Standard Terms and Conditions. ARTICLE FOUR ACCEPTANCE BY TRUSTEE Section 4.01. Acceptance by Trustee. The Trustee does hereby accept all consideration conveyed by the Seller pursuant to Section 2.01 and declares that the Trustee shall hold such consideration upon the trusts herein set forth for the benefit of holders of the Certificates, subject to the terms and provisions of this Agreement. ARTICLE FIVE INCORPORATION OF STANDARD TERMS AND CONDITIONS OF AGREEMENT Section 5.01. Incorporation of Standard Terms and Conditions of Agreement. This Pooling and Servicing Agreement does hereby incorporate by reference the Standard Terms and Conditions of Agreement (Senior/Subordinated) for Fleetwood Credit Grantor Trusts Effective September 1, 1996 (the "Standard Terms and Conditions"), in the form attached hereto. 2 6 ARTICLE SIX SPECIAL DEFINITIONS AND TERMS Section 6.01. Special Definitions and Terms. Whenever used in the Standard Terms and Conditions and in this Agreement, the following words and phrases shall have the following meanings: "Auction Procedures" means the Auction Procedures set forth in Exhibit D hereto. "Certificate Registrar" means the Trustee unless a successor Certificate Registrar is appointed pursuant to Section 16.03 of the Standard Terms and Conditions. The Certificate Registrar initially designates its offices at ____________________, as its offices where Certificates may be surrendered for registration of transfer or exchange as described in Section 16.07 of the Standard Terms and Conditions. "Class A Pass-Through Rate" means _____% per annum. "Class A Percentage" means _____%. "Class B Pass-Through Rate" means _____% per annum. The Class B Pass-Through Rate includes the sum of (i) the Class A Pass-Through Rate multiplied by the Class B Certificate Balance and (ii) _____ basis points on the Pool Balance. In no event will the Class B Pass-Through Rate exceed _____% per annum. "Class B Percentage" means _____%. "Closing Date" means September __, 1996. "Corporate Trust Office" means, as of the date hereof, the office of the Trustee located at , Attention: Corporate Trust. "Cutoff Date" means September 1, 1996. The first "Distribution Date" shall be October 15, 1996. The "Final Scheduled Distribution Date" is __________, 20__. "Fleetwood Credit" means Fleetwood Credit Corp. "Military Reservist Relief Act" means The Military Reservist Relief Act of 1991. "Original Pool Balance" means $__________. "Original Class A Certificate Balance" means $__________. 3 7 "Original Class B Certificate Balance" means $__________. "Rating Agency" means each of Moody's and Standard & Poor's. "Receivables Purchase Agreement" means the Receivables Purchase Agreement dated as of the Cutoff Date between the Seller and Fleetwood Credit. "Relief Acts" means the Military Reservist Relief Act and the Soldier's and Sailor's Relief Act. "Required Deposit Rating" means a rating on short-term deposits of Prime-1 by Moody's and A-1+ by Standard & Poor's; and any requirement that deposits have the "Required Deposit Rating" shall mean that such deposits shall be rated at least equal to the foregoing ratings from Moody's and Standard & Poor's. "Required Long Term Debt Rating" means a rating on the long term unsecured debt obligations of the related depository institution or trust company of at least Baa3 by Moody's and, with respect to the Certificates to be issued pursuant to this Agreement, the requirement that any such long term unsecured debt obligations have the "Required Long Term Debt Rating" shall mean that such obligations have at least the foregoing rating from Moody's. "Required Rating" means a rating of Prime-1 by Moody's and A-1+ by Standard & Poor's. "Required Servicer Rating" means a rating on short-term obligations of the Servicer of Prime-1 by Moody's and A-1 by Standard & Poor's; and any requirement that the Servicer have the "Required Servicer Rating" shall mean that the short-term unsecured debt obligations shall be rated at least equal to the foregoing ratings from Moody's and Standard & Poor's. "Reserve Fund Initial Deposit" means $__________. "Servicing Fee Rate" means 1.00% per annum. "Soldier's and Sailor's Relief Act" means the Soldiers' and Sailors' Civil Relief Act of 1940, as amended. "Specified Reserve Fund Balance" means, with respect to the first Distribution Date, an amount equal to $__________. On each Distribution Date thereafter, the Specified Reserve Fund Balance will equal _____% of the sum of the Class A Certificate Balance and the Class B Certificate Balance (after giving effect to distributions of principal to be made on such Distribution Date); provided, however, that so long as the foregoing sum of the Class A Certificate Balance and the Class B Certificate Balance exceeds $__________, the Specified Reserve Fund Balance will not be less than $__________. From and after the Distribution Date as of which the foregoing sum of the Class A Certificate Balance and the Class B Certificate Balance is less than $__________, the Specified Reserve Fund Balance will equal such sum. Notwithstanding the foregoing, on each Distribution Date following any Fiscal 4 8 Quarter in which the Realized Loss Percentage or the Delinquency Percentage exceeds _____%, the Specified Reserve Fund Balance shall be equal to the greater of (a) the amount described above or (b) an amount equal to the Pool Balance as of the immediately preceding Record Date multiplied by a percentage equal to _____% minus the following fraction, expressed as a percentage: (i) one minus (ii) a fraction, the numerator of which is the Class A Certificate Balance on such Distribution Date (after giving effect to distributions of principal made on such Distribution Date) and the denominator of which is such Pool Balance, in each case as of the last day of the three related Collection Periods in such Fiscal Quarter; provided, further, that following any Fiscal Quarter thereafter in which the Realized Loss Percentage and the Delinquency Percentage are less than _____%, the Specified Reserve Fund Balance shall return to the amount described in the first clause of this definition. If on any Distribution Date cumulative losses in respect of the Receivables exceed _____% of the Original Pool Balance, the Specified Reserve Fund Balance shall remain at the level in effect as of such date and shall not be reduced further in accordance with the first sentence of this definition. ARTICLE SEVEN ADDITIONAL REPRESENTATIONS AND WARRANTIES OF SELLER Section 7.01. Additional Representations and Warranties of Seller. The Seller does hereby make the following representations and warranties on which the Trustee shall rely in accepting the Receivables in trust and authenticating the Certificates. Such representations and warranties shall speak as of the execution and delivery of this Agreement and shall survive the sale, transfer and assignment of the related Receivables to the Trustee: (i) Maturity of Receivables. Each Receivable conveyed hereby shall have an original maturity of not less than _____ months nor greater than _____ months and as of the Cutoff Date, a scheduled remaining term of not less than _____ months nor greater than _____ months and the weighted average remaining term of the Receivables shall be _____ months. (ii) APR. Each Receivable shall have an APR equal to or greater than _____% and the weighted average APR of the Receivables shall be _____%. (iii) No Overdue Payments. Each Receivable shall have no payment that is more than 30 days past due as of the Cutoff Date. (iv) Location of Receivable Files. Each Receivable File shall be kept at one of the locations listed in Schedule B hereto. (v) Obligors. In the case of any Obligor in the military service (including an Obligor who is a member of the National Guard or is in the reserves) whose Receivable is subject to either Relief Act, as of the Cutoff Date, no such Obligor has 5 9 made a claim to the Seller or the Servicer that (A) the amount of interest on the related Receivable should be limited to 6.0% during the period of such Obligor's active duty status pursuant to the Soldiers' and Sailors' Relief Act or (B) payments on such Receivable should be delayed pursuant to the Military Reservist Relief Act, in either case unless a court has ruled otherwise upon application of the Seller or the Servicer. (vi) Motor Home Financed Vehicles. Based on the Principal Balances of the Receivables as of the Cutoff Date at least _____% of the Receivables shall be secured by motor homes. ARTICLE EIGHT FLEETWOOD CREDIT NOT TO RESIGN AS SERVICER Section 8.01. Fleetwood Credit Not to Resign as Servicer. Subject to the provisions of Section 18.05 of the Standard Terms and Conditions, Fleetwood Credit shall not resign from the obligations and duties hereby imposed on it as Servicer under this Agreement except upon determination that the performance of its duties under this Agreement shall no longer be permissible under applicable law. Notice of any such determination permitting the resignation of Fleetwood Credit shall be communicated to the Trustee and the Letter of Credit Bank at the earliest practicable time (and, if such communication is not in writing, shall be confirmed in writing at the earliest practicable time) and any such determination shall be evidenced by an Opinion of Counsel to such effect delivered to the Trustee concurrently with or promptly after such notice. No such resignation shall become effective until the Trustee or a successor Servicer shall have assumed the responsibilities and obligations of Fleetwood Credit in accordance with Sections 18.05 and 19.02 of the Standard Terms and Conditions. ARTICLE NINE AGENT FOR SERVICE Section 9.01. Agent for Service. The agent for service for the Seller shall be its Treasurer, 22840 Savi Ranch Parkway, Yorba Linda, California 92687, and the agent for service for the Servicer shall be its Vice-President- Treasurer, 22840 Savi Ranch Parkway, Yorba Linda, California 92687. ARTICLE TEN [Reserved] 6 10 IN WITNESS WHEREOF, the parties have caused this Pooling and Servicing Agreement to be duly executed by their respective officers as of the day and year first above written. FLEETWOOD CREDIT RECEIVABLES CORP., as Seller By: ----------------------------------------- Marvin T. Runyon, III Senior Vice President FLEETWOOD CREDIT CORP., as Servicer By: ----------------------------------------- Marvin T. Runyon, III Senior Vice President THE CHASE MANHATTAN BANK, as Trustee By: ----------------------------------------- Name: ------------------------------------ Title: ----------------------------------- 11 SCHEDULE A SCHEDULE OF RECEIVABLES Omitted - Originals on file at the offices of the Seller, the Servicer and the Trustee. SA-1 12 SCHEDULE B LOCATIONS OF RECEIVABLE FILES Fleetwood Credit Corp. 22840 Savi Ranch Parkway Yorba Linda, California 92687 Fleetwood Credit Corp. 324 East 11th Street Tracy, California 95376 Fleetwood Credit Corp. 3200 Highlands Parkway Suite 104 Smyrna, Georgia 30082 Fleetwood Credit Corp. 501 East Monroe Suite 350 South Bend, Indiana 46601 Fleetwood Credit Corp. 110 Turnpike Road Suite 203 Westborough, Massachusetts 01581 Fleetwood Credit Corp. 100 Century Parkway Suite 150 Mt. Laurel, New Jersey 08054 Fleetwood Credit Corp. 4000 Kruse Way Place Building 2, Suite 250 Lake Oswego, Oregon 97035 Fleetwood Credit Corp. 14901 Quorum Drive Suite 750 Addison, Texas 75240 Fleetwood Credit Corp. 10895 Lowell Street Suite 280 Overland Park, Kansas 66225 SB-1 13 EXHIBIT A UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. FLEETWOOD CREDIT 1996-B GRANTOR TRUST _____% ASSET BACKED CERTIFICATE, CLASS A evidencing a fractional undivided interest in the Trust, as defined below, the property of which includes, among other things, a pool of simple interest retail installment sale contracts secured by the new and used recreational vehicles financed thereby and sold to the Trustee by Fleetwood Credit Receivables Corp. The Final Scheduled Distribution Date is __________, 20__. (This Certificate does not represent an interest in or obligation of Fleetwood Credit Receivables Corp., Fleetwood Credit Corp. or any of their respective affiliates) CUSIP --------- NUMBER RA-1 $ --------- THIS CERTIFIES THAT CEDE & CO. is the registered owner of a ____________________ Dollar ($__________) nonassessable, fully-paid, fractional undivided interest in the Fleetwood Credit 1996-B Grantor Trust (the "Trust") formed by Fleetwood Credit Receivables Corp., a California corporation (the "Seller"). The Trust was created pursuant to a Pooling and Servicing Agreement dated as of September 1, 1996 (the "Agreement") among the Seller, Fleetwood Credit Corp., as Servicer, and The Chase Manhattan Bank, as trustee (the "Trustee"), a summary of certain of the pertinent provisions of which is set forth below. To the extent not otherwise defined herein, the capitalized terms used herein have the meanings assigned to them in the Agreement. This Certificate is one of the duly authorized certificates designated as "Fleetwood Credit 1996-B Grantor Trust _____% Asset Backed Certificates, Class A" (the "Class A Certificates") issued under the Agreement. Also issued under the Agreement are certificates designated as "Fleetwood Credit 1996-B Grantor Trust _____% Asset Backed Certificates, Class B" (the "Class B Certificates"). The Class B Certificates are subordinated to the Class A Certificates to the extent described in the Agreement. The Class A Certificates and the Class B Certificates are A-1 14 herein collectively called the "Certificates". The aggregate undivided interest in the Trust evidenced by all Class A Certificates is _____%. This Class A Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Class A Certificate by virtue of the acceptance hereof assents and by which such Holder is bound. The property of the Trust includes, or will include, among other things, a pool of simple interest retail installment sale contracts (the "Receivables") for new and used recreational vehicles, certain payments due under the Receivables on and after September 1, 1996 (exclusive of Accrued Interest as of the opening of business on such date), security interests in the related Financed Vehicles, certain bank accounts and the proceeds thereof, a Servicer Letter of Credit, if any, property (including the right to receive certain Liquidation Proceeds) securing the Receivables and held by the Trustee, proceeds from claims on physical damage, credit life and disability insurance policies covering such Financed Vehicles, the Receivables or the related Obligors, an assignment of the Seller's rights under the Receivables Purchase Agreement, and the right of the Seller to receive the proceeds of Dealer repurchase obligations relating to the Receivables. Under the Agreement, there will be distributed on the fifteenth day of each month or, if such day is not a Business Day, the next succeeding Business Day (each, a "Distribution Date"), commencing on October 15, 1996, to the Person in whose name this Class A Certificate is registered at the close of business on the last day of the month immediately preceding the month of such distribution (the "Record Date"), such Class A Certificateholder's percentage interest in the Class A Distributable Amount for such Distribution Date actually distributed, together with the repayment of any outstanding Class A Interest Carryover Shortfall and Class A Principal Carryover Shortfall actually made on such Distribution Date, in each case to the extent and as more specifically set forth in the Agreement. Distributions on this Class A Certificate will be made by the Trustee by check or money order mailed to the related Class A Certificateholder of record in the Certificate Register without the presentation or surrender of this Class A Certificate or the making of any notation hereon except that with respect to Class A Certificates registered in the name of Cede & Co., the nominee for The Depository Trust Company, distributions will be made in the form of immediately available funds. Except as otherwise provided in the Agreement and notwithstanding the foregoing, the final distribution on this Class A Certificate will be made after due notice by the Trustee of the pendency of such distribution and only upon presentation and surrender of this Class A Certificate at the office or agency maintained for that purpose by the Trustee in the Borough of Manhattan, The City of New York. The Certificates do not represent an obligation of, or an interest in, the Seller, the Servicer or any of their respective affiliates. The Certificates are limited in right of payment to certain collections and recoveries respecting the Receivables and monies on deposit in the Reserve Fund, all as more specifically set forth in the Agreement. A copy of the Agreement may be examined during normal business hours at the principal office of the Trustee, and at such other places, if any, designated by the Trustee, by any Certificateholder upon request. The Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the parties thereto and the rights A-2 15 of the Certificateholders under the Agreement at any time by the Seller, the Servicer and the Trustee with the consent of the Holders of Certificates evidencing not less than 51% of the Voting Interests of all Certificates, voting together as a single class. Any such consent by the Holder of this Class A Certificate shall be conclusive and binding on such Holder and on all future Holders of this Class A Certificate and of any Class A Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent is made upon this Class A Certificate. The Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Holders of any of the Certificates. As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this Class A Certificate is registrable in the Certificate Register upon surrender of this Class A Certificate for registration of transfer at the offices or agencies maintained by the Trustee in its capacity as Certificate Registrar, or by any successor Certificate Registrar, in the Borough of Manhattan, The City of New York, accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holder's attorney duly authorized in writing, and thereupon one or more new Class A Certificates of authorized denominations evidencing the same aggregate interest in the Trust will be issued to the designated transferee. The Class A Certificates are issuable only as registered Certificates without coupons in denominations of $1,000 and integral multiples thereof. As provided in the Agreement and subject to certain limitations therein set forth, Class A Certificates are exchangeable for new Class A Certificates of authorized denominations evidencing the same aggregate denomination, as requested by the Holder surrendering the same. No service charge will be made for any such registration of transfer or exchange, but the Trustee may require payment of a sum sufficient to cover any tax or governmental charges payable in connection therewith. Prior to due presentation of this Class A Certificate for registration of transfer, the Trustee, the Certificate Registrar and any of their respective agents may treat the Person in whose name this Class A Certificate is registered as the owner hereof for all purposes, and neither the Trustee, the Certificate Registrar nor any such agent shall be affected by any notice to the contrary. The obligations and responsibilities created by the Agreement and the Trust created thereby shall terminate upon the payment to Certificateholders of all amounts required to be paid to them pursuant to the Agreement or the maturity or liquidation of the last Receivable and the disposition of all property held as part of the Trust. The Seller or the Servicer, or any successor to the Servicer, may, at its option, purchase the corpus of the Trust at a price specified in the Agreement, and such purchase of the Receivables and other property of the Trust will effect early retirement of the Certificates; however, such right of purchase is exercisable only as of a Record Date as of which the Pool Balance is 10% or less of the Original Pool Balance. In addition, the Trustee may sell all of the Receivables and other property remaining in the Trust upon the conditions and at a price specified in the Agreement, and such sale of the Receivables and other property of the Trust will effect early retirement of A-3 16 the Certificates; however, such right of sale is exercisable only as of a Record Date as of which the Pool Balance is 5% or less of the Original Pool Balance. Unless the certificate of authentication hereon shall have been executed by an authorized officer of the Trustee, by manual signature, this Class A Certificate shall not entitle the Holder hereof to any benefit under the Agreement or be valid for any purpose. A-4 17 IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its individual capacity, has caused this Class A Certificate to be duly executed. Dated: September __, 1996 FLEETWOOD CREDIT 1996-B GRANTOR TRUST The Chase Manhattan Bank, as Trustee By: --------------------------------- Authorized Officer [SEAL] ATTEST: - ------------------------------------- This is one of the Class A Certificates referred to in the within-mentioned Agreement. The Chase Manhattan Bank, as Trustee By: --------------------------------- Authorized Officer A-5 18 ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE - -------------------------------------------------------------------------------- (Please print or typewrite name and address, including postal zip code, of assignee) - -------------------------------------------------------------------------------- the within Certificate, and all rights thereunder, hereby irrevocably constituting and appointing - -------------------------------------------------------------------------------- _________________________________________ Attorney to transfer said Certificate on the books of the Certificate Registrar, with full power of substitution in the premises. Dated: ---------------------------------- Signature Guaranteed: ---------------------------------- * 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, enlargement or any change whatever. Such signature must be guaranteed by an institution which is a participant in the Securities Transfer Agent Medallion Program (STAMP) or similar program. A-6 19 EXHIBIT B THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. FLEETWOOD CREDIT 1996-B GRANTOR TRUST _____% ASSET BACKED CERTIFICATE, CLASS B evidencing a fractional undivided interest in the Trust, as defined below, the property of which includes, among other things, a pool of simple interest retail installment sale contracts secured by the new and used recreational vehicles financed thereby and sold to the Trustee by Fleetwood Credit Receivables Corp. The Final Scheduled Distribution Date is __________, 20__. (This Certificate does not represent an interest in or obligation of Fleetwood Credit Receivables Corp., Fleetwood Credit Corp. or any of their respective affiliates) NUMBER RB-1 CUSIP ----------- $ ---------- THIS CERTIFIES THAT CEDE & CO. is the registered owner of a ____________________ Dollar ($__________) nonassessable, fully-paid, fractional undivided interest in the Fleetwood Credit 1996-B Grantor Trust (the "Trust") formed by Fleetwood Credit Receivables Corp., a California corporation (the "Seller"). The Trust was created pursuant to a Pooling and Servicing Agreement dated as of September 1, 1996 (the "Agreement") among the Seller, Fleetwood Credit Corp., as Servicer, and The Chase Manhattan Bank, as trustee (the "Trustee"), a summary of certain of the pertinent provisions of which is set forth below. To the extent not otherwise defined herein, the capitalized terms used herein have the meanings assigned to them in the Agreement. This Certificate is one of the duly authorized certificates designated as "Fleetwood Credit 1996-B Grantor Trust _____% Asset Backed Certificates, Class B" (the "Class B Certificates") issued under the B-1 20 Agreement. Also issued under the Agreement are certificates designated as "Fleetwood Credit 1996-B Grantor Trust _____% Asset Backed Certificates, Class A" (the "Class A Certificates"). The Class B Certificates are subordinated to the Class A Certificates to the extent described in the Agreement. The Class A Certificates and the Class B Certificates are herein collectively called the "Certificates". The aggregate undivided interest in the Trust evidenced by all Class B Certificates is _____%. This Class B Certificate is issued under and is subject to the terms, provisions and conditions of the Agreement, to which Agreement the Holder of this Class B Certificate by virtue of the acceptance hereof assents and by which such Holder is bound. The property of the Trust includes, or will include, among other things, a pool of simple interest recreational vehicle retail installment sale contracts (the "Receivables") for new and used recreational vehicles, certain payments due under the Receivables on and after September 1, 1996 (exclusive of Accrued Interest as of the opening of business on such date), security interests in the related Financed Vehicles, certain bank accounts and the proceeds thereof, a Servicer Letter of Credit, if any, property (including the right to receive certain Liquidation Proceeds) securing the Receivables and held by the Trustee, proceeds from claims on physical damage, credit life and disability insurance policies covering such Financed Vehicles, the Receivables or the related Obligors, an assignment of the Seller's rights under the Receivables Purchase Agreement, the right of the Seller to receive the proceeds of Dealer repurchase obligations relating to the Receivables. Under the Agreement, there will be distributed on the fifteenth day of each month or, if such day is not a Business Day, the next succeeding Business Day (each, a "Distribution Date"), commencing on October 15, 1996, to the Person in whose name this Class B Certificate is registered at the close of business on the last day of the month immediately preceding the month of such distribution (the "Record Date"), such Class B Certificateholder's percentage interest in the Class B Distributable Amount for such Distribution Date actually distributed, together with the repayment of any outstanding Class B Interest Carryover Shortfall and any outstanding Class B Principal Carryover Shortfall actually made on such Distribution Date, in each case to the extent and as more specifically set forth in the Agreement. Distributions on this Class B Certificate will be made by the Trustee by check or money order mailed to the related Class B Certificateholder of record in the Certificate Register without the presentation or surrender of this Class B Certificate or the making of any notation hereon, except that with respect to Class B Certificates registered in the name of Cede & Co., the nominee for The Depository Trust Company, distributions will be made in the form of immediately available funds. Except as otherwise provided in the Agreement and notwithstanding the above, the final distribution on this Class B Certificate will be made after due notice by the Trustee of the pendency of such distribution and only upon presentation and surrender of this Class B Certificate at the office or agency maintained for that purpose by the Trustee in the Borough of Manhattan, The City of New York. The Certificates do not represent an obligation of, or an interest in, the Seller, the Servicer or any of their respective affiliates. The Certificates are limited in right of payment to certain collections and recoveries respecting the Receivables and monies on deposit in the Reserve Fund, all as more specifically set forth in the Agreement. A copy of the Agreement B-2 21 may be examined during normal business hours at the principal office of the Trustee, and at such other places, if any, designated by the Trustee, by any Certificateholder upon request. The Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the parties thereto and the rights of the Certificateholders under the Agreement at any time by the Seller, the Servicer and the Trustee with the consent of the Holders of Certificates evidencing not less than 51% of the Voting Interests of all Certificates, voting together as a single class. Any such consent by the Holder of this Class B Certificate shall be conclusive and binding on such Holder and on all future Holders of this Class B Certificate and of any Class B Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof whether or not notation of such consent is made upon this Class B Certificate. The Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Holders of any of the Certificates. As provided in the Agreement and subject to certain limitations therein set forth, the transfer of this Class B Certificate is registrable in the Certificate Register upon surrender of this Class B Certificate for registration of transfer at the offices or agencies maintained by the Trustee in its capacity as Certificate Registrar, or by any successor Certificate Registrar, in the Borough of Manhattan, The City of New York, accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holder's attorney duly authorized in writing, and thereupon one or more new Class B Certificates of authorized denominations evidencing the same aggregate interest in the Trust will be issued to the designated transferee. The Class B Certificates are issuable only as registered Certificates without coupons in denominations of $1,000 and integral multiples thereof. As provided in the Agreement and subject to certain limitations therein set forth, Class B Certificates are exchangeable for new Class B Certificates of authorized denominations evidencing the same aggregate denomination, as requested by the Holder surrendering the same. No service charge will be made for any such registration of transfer or exchange, but the Trustee may require payment of a sum sufficient to cover any tax or governmental charges payable in connection therewith. Prior to due presentation of this Class B Certificate for registration of transfer, the Trustee, the Certificate Registrar and any of their respective agents may treat the Person in whose name this Class B Certificate is registered as the owner hereof for all purposes, and neither the Trustee, the Certificate Registrar nor any such agent shall be affected by any notice to the contrary. The obligations and responsibilities created by the Agreement and the Trust created thereby shall terminate upon the payment to Certificateholders of all amounts required to be paid to them pursuant to the Agreement or the maturity or liquidation of the last Receivable and the disposition of all property held as part of the Trust. The Seller or the Servicer, or any successor to the Servicer, may, at its option, purchase the corpus of the Trust at a price specified in the Agreement, and such purchase of the Receivables and other property of the Trust will effect early retirement of the Certificates; however, such right of purchase is B-3 22 exercisable only as of a Record Date as of which the Pool Balance is 10% or less of the Original Pool Balance. In addition, the Trustee may sell all of the Receivables and other property remaining in the Trust upon the conditions and at a price specified in the Agreement, and such sale of the Receivables and other property of the Trust will effect early retirement of the Certificates; however, such right of sale is exercisable only as of a Record Date as of which the Pool Balance is 5% or less of the Original Pool Balance. Unless the certificate of authentication hereon shall have been executed by an authorized officer of the Trustee, by manual signature, this Class B Certificate shall not entitle the Holder hereof to any benefit under the Agreement or be valid for any purpose. B-4 23 IN WITNESS WHEREOF, the Trustee, on behalf of the Trust and not in its individual capacity, has caused this Class B Certificate to be duly executed. Dated: September __, 1996 FLEETWOOD CREDIT 1996-B GRANTOR TRUST The Chase Manhattan Bank, as Trustee By: ---------------------------------- Authorized Officer [SEAL] ATTEST: - --------------------------------------- This is one of the Class B Certificates referred to in the within-mentioned Agreement. The Chase Manhattan Bank, as Trustee By: -------------------------------- Authorized Officer B-5 24 ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE - -------------------------------------------------------------------------------- (Please print or typewrite name and address, including postal zip code, of assignee) - -------------------------------------------------------------------------------- the within Certificate, and all rights thereunder, hereby irrevocably constituting and appointing _________________________________________________ Attorney to transfer said Certificate on the books of the Certificate Registrar, with full power of substitution in the premises. Dated: ---------------------------------------- Signature Guaranteed: ---------------------------------------- * 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, enlargement or any change whatever. Such signature must be guaranteed by an institution which is a participant in the Securities Transfer Agent Medallion Program (STAMP) or similar program. B-6 25 EXHIBIT C FLEETWOOD CREDIT 1996-B GRANTOR TRUST Servicer's Certificate For the Month of __________, ____ Principal and Interest Collections ---------------------------------- Beginning Pool Balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1)$ ------- Beginning Pool Factor [(1)/$__________] . . . . . . . . . . . . . . . . . . . . . . . . (2) ------- Principal Collected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3)$ ------- Interest Collected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4)$ ------- Less: Accrued Interest Prior to Cutoff Date . . . . . . . . . . . . . . . . . . (5)$ ------- Less: Additional Purchased Accrued Interest . . . . . . . . . . . . . . . . . . (5a)$ ------- Plus: Purchased Accrued Interest - End of Collection Period . . . . . . . . . . (6)$ ------- Net decrease/(increase) in Purchased Accrued Interest [(5)+(5a)-(6)] . . . . . . . . . (7)$ ------- Plus: "Non-Reimbursable Interest Payment" . . . . . . . . . . . . . . . . . . . (8)$ ------- Total Interest Received [(4)-(5)+(5a)+(6)+(8)] . . . . . . . . . . . . . . . . . . . . (9)$ ------- Additional Deposits (i) Repurchase Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10)$ ------- (ii) Liquidation Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11)$ ------- Total Additional Deposits [(10)+(11)] . . . . . . . . . . . . . . . . . . . . . . . . . . . (12)$ ------- Total Available Funds [(3)+(9)+(12)] . . . . . . . . . . . . . . . . . . . . . . . . . . . (13)$ ------- Defaulted Receivable Principal Balance [(A1)] . . . . . . . . . . . . . . . . . . . . . . . (14)$ ------- Ending Pool Balance [(1)-(3)-(14)] . . . . . . . . . . . . . . . . . . . . . . . . . . . . (15)$ ------- Ending Pool Factor [(15)/$___(16)_______] . . . . . . . . . . . . . . . . . . . . . . . . . (16)$ ------- Class A Class B ------- ------- Distribution: ------------ Class Percentage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . % % ------ ------ Pool Factor (Ending Pool Balance) . . . . . . . . . . . . . . . . . . . . . . Class Coupon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . % % ------ ------ ____ Beginning Pool Balance (1) . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ ____ Ending Pool Balance (15) . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Collected Principal (3) . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------
C-1 26
Class A Class B ------- ------- Collected Interest (9) . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Other Collected Interest . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Additional Deposits (12) . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Servicing Fee [(1.0%/12)x(1)] . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Total Available Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Payment to Certificateholders ----------------------------- Principal Distributable Amount [(1)-(15)] . . . . . . . . . . . . . . . . . $ $ ------ ------ Interest Distributable Amount [(1)x(coupon/12)] . . . . . . . . . . . . . . . $ $ ------ ------ Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Payments from Reserve Fund . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Total Payments to Certificateholders . . . . . . . . . . . . . . . . . $ $ ------ ------ Reserve Fund payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Amount due Class B but paid to Class A (subordination) . . . . . . . . . . . $ $ ------ ------ Class A Interest Carryover Shortfall . . . . . . . . . . . . . . . . . . . . $ ------ Class A Principal Carryover Shortfall . . . . . . . . . . . . . . . . . . . . $ ------ Class B Interest Carryover Shortfall . . . . . . . . . . . . . . . . . . . . $ ------ Class B Principal Carryover Shortfall . . . . . . . . . . . . . . . . . . . . $ ------ Amounts Remaining in the Certificate Account to be paid to the Seller . . . . $ $ Memo: ------ ------ Principal Difference . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Interest Difference . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ ------ ------ Reconciliation of Net Payment to the Trustee -------------------------------------------- Available Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Servicing Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Total Available Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Total payments to Class A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Total payments to Class B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Reserve Fund: Excess from Seller [(57a)] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Reserve Fund Payments [(58)] . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ------- Gross payment to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ =======
C-2 27 Reconciliation of Net Payment to the Trustee -------------------------------------------- Less: Amount released from Reserve Fund in excess of $_________ [(61)] . . . . . . . $ ------- Reconciliation of Net Payment to the Trustee -------------------------------------------- Net payment to the Trustee (Equals Gross payment for first 90 days) . . . . . . . . . . . . $ ======= Account Activity ---------------- Number of Accounts - Beginning of Month . . . . . . . . . . . . . . . . . . . . . . . ------- Less: Account Paid Off / Repurchased . . . . . . . . . . . . . . . . . . . . . ------- Plus: Accounts in Collateral Addition . . . . . . . . . . . . . . . . . . . . ------- Number of Accounts - End of Month . . . . . . . . . . . . . . . . . . . . . . . . . . ------- Non-Accrual Accounts - End of Month ----------------------------------- Number of Non-Accrual Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . ------- Aggregate Principal Balance Outstanding . . . . . . . . . . . . . . . . . . . . . . . $ ------- Determination of the Servicer Letter of Credit Amount (if applicable) --------------------------------------------------------------------- Number of Contracts - End of Month (45) Original number of Contracts (46) ------- Percent of Original Contracts remaining (47) % [((45)/(46))x100] Original Servicer Letter of Credit Amount (48) $ ------- Revised Servicer Letter of Credit Amount (49) $ [Lessor of [(48)x(47) or the Beginning Pool Balance(1)] Prior Month Servicer Letter of Credit Amount (50) $ [Previous Month (49)] Servicer Letter of Credit Fee [(__)x(0.__%/12)] (51) $ Defaulted Receivables --------------------- Amount of principal and accrued interest due from Obligors on Defaulted Receivables Principal (A1) $ Interest (A2) Expense (A3) Total (A) $ Less: Liquidation Proceeds (B) $ Realized Loss [(A1)+(A2)-(B)] (C) $ Cumulative Losses (Including Expenses) (D) $
C-3 28 Cumulative Loss Percentage [(D)/$___________] % (Less than ___% ?) Reconciliation of Reserve Fund ------------------------------ Beginning Reserve Fund Balance (57) $ ------- Plus: Excess Amounts from Seller (57a) Plus: Investment Earnings (57b) Plus: Reserve Fund Payments (58) Reserve Fund prior to payments to Seller (59) $ ------- Required Reserve Fund Balance: ($2,289,000 for the first Distribution Date; thereafter, the lesser of 1 or 2) (1) 2.5% of the Class A Certificate Balance and the Class B Certificate Balance (provided that (i) so long as the sum of the Class A Certificate Balance and the Class B Certificate Balance (a) exceeds $3,050,903, the Specified Reserve Fund Balance cannot be less than $3,050,903, or (b) is less than $3,050,903, the Specified Reserve Fund Balance will equal such sum) (unless the Cumulative Loss Percentage exceeds 1.5%), or (2); (2) (18% - Subordination Fraction) x the Ending Pool Balance - ------- Required Amount (60) $ ------- Amount in Reserve Fund released [(59)-(60)] (61) $ ------- Ending Reserve Fund Balance to be Invested (62) $ ------- Reserve Fund Balance as a Percent of the Ending Pool Balance (63) ------- Interest Income on Reserve Fund for ____, 199_ from ____________________ (64) $ ------- -------
C-4 29 Delinquent Accounts ------------------- Period of Delinquency Units Amount Percent of Pool ----- ------ --------------- 30-59 days $ ERR 60-89 days ERR 90 days or more ERR ------ ---- --- Total $ ERR (A) ====== ==== === Repossession Inventory $ ERR (B) ------ ---- === Delinquency Percentage ---------------------- Quarter ___ ___ ___ Total (Avg) ---------- ---------- ----------- ----------------- 90 days or more (000) $ $ $ $ ---------- ---------- ----------- ----------------- Repossession Inventory (000) $ $ $ $ ---------- ---------- ----------- ----------------- Total $ $ $ $ (A) ========== ========== =========== ================= Ending Pool Balance (mils) $ $ $ $ (B) ---------- ---------- ----------- ----------------- Delinquency Percentage (A)/(B) ERR ----------------- Realized Loss Analysis ---------------------- Quarter ___ ___ ___ Total ---------- ---------- ----------- ----------------- Realized Losses/(Recoveries) (X) [(A1)+(A2)-(B)] (000) $ $ $ (Sum) Beginning Pool Balance (Y) $ $ $ $ (Avg) Realized Loss Percentage (Less than ___%) [((X)/(Y))*4] ERR ----------------- Realized Losses since inception (less than $_________ ) $ ----------------- Change in Realized Losses $ ----------------- Proceeds from Insurance and Dealer Repurchase --------------------------------------------- Proceeds received during the related Collection Period from $ physical damage insurance Proceeds received during the month from Dealer repurchase obligations relating to Defaulted $ Receivables
C-5 30 EXHIBIT D TERMINATION - AUCTION PROCEDURES The following sets forth the auction procedures to be followed in connection with a sale effected pursuant to Section 21.03 of the Pooling and Servicing Agreement, dated as of September 1, 1996 (the "Agreement"), among Fleetwood Credit Receivables Corp., as seller, Fleetwood Credit Corp., as servicer, and The Chase Manhattan Bank, as trustee. Capitalized terms used herein that are not otherwise defined shall have the meanings described thereto in the Agreement. I. Pre-Auction Process (a) Upon receiving notice of the Auction Date, the Advisor will initiate its general Auction procedures consisting of the following: (i) with the assistance of the Servicer, prepare a general solicitation package along with a confidentiality agreement; (ii) derive a list of qualified bidders, in a commercially reasonable manner; (iii) initiate contact with all qualified bidders; (iv) send a confidentiality agreement to all qualified bidders; (v) upon receipt of a signed confidentiality agreement, send solicitation packages to all interested bidders on behalf of the Trustee; and (vi) notify the Servicer of all potential bidders and anticipated timetable. (b) The general solicitation package will include: (i) the prospectus from the public offering of the Certificates; (ii) a copy of all monthly servicing reports or a copy of all annual servicing reports and the prior year's monthly servicing reports; (iii) a form of a Purchase and Sale Agreement and Servicing Agreement; (iv) a description of the minimum purchase price required to cause the Trustee to sell the Auction Property as set forth in Section 21.03 of the Agreement; (v) a formal bidsheet; (vi) a detailed timetable; and (vii) a preliminary data tape of the Pool Balance as of the related Distribution Date reflecting the same data attributes used to create the Cutoff Date tables for the prospectus dated September __, 1996 relating to the public offering of the Certificates. (c) The Trustee, with the assistance of the Servicer and the Advisor, will maintain an auction package beginning at the time of closing of the transaction, which will contain terms (i) through (iii) listed in the preceding paragraph. If the Advisor is unable to perform its role as advisor to the Trustee, the Servicer acting in its capacity under the Agreement will select a successor Advisor and inform the Trustee of its actions. (d) The Advisor will send solicitation packages to all bidders at least 15 business days before the Auction Date. Bidders will be required to submit any due diligence questions in writing to the Advisor for determination of their D-1 31 relevancy, no later than 10 business days before the Auction Date. The Servicer and the Advisor will be required to satisfy all relevant questions at least five Business Days prior to the Auction Date and distribute the questions and answers to all bidders. II. Auction Process (a) ____________________, in its role as Advisor to the Trustee, will be allowed to bid in the Auction, but will not be required to do so. (b) The Servicer will also be allowed to bid in the Auction if it deems appropriate, but will not be required to do so. (c) On the Auction Date, all bids will be due by facsimile to the offices of the Trustee by 1:00 p.m., New York City time, with the winning bidder to be notified by 2:00 p.m., New York City time. All acceptable bids (as described in Section 21.03 of the Agreement) will be due on a conforming basis on the bid sheet contained in the solicitation package. (d) If the Trustee receives fewer than two market value bids from participants in the market for motor vehicle retail installment sale contracts willing and able to purchase the Auction Property, the Trustee shall decline to consummate the sale. (e) Upon notification to the winning bidder, a good faith deposit equal to one percent (1%) of the Pool Balance will be required to be wired to the Trustee upon acceptance of the bid. This deposit, along with any interest income attributable to it, will be credited to the purchase price but will not be refundable. The Trustee will establish a separate account for the acceptance of the good faith deposit, until such time as the account is fully funded and all monies are transferred into the Certificate Account, such time not to exceed one Business Day before the related Distribution Date (as described above). (f) The winning bidder will receive on the Auction Date a copy of the draft Purchase and Sale Agreement, Servicing Agreement and Servicer's Representations and Warranties (which shall be substantially identical to the representations and warranties set forth in Section 18.01 of the Agreement. (g) __________, in its capacity as Advisor to the Trustee, will provide to the Trustee a letter concluding whether or not the winning bid is a fair market value bid. __________ will also provide this letter if it is the winning bidder. In the case where __________ or the Servicer is the winning bidder it will in its letter provide for market comparables and valuations. D-2 32 (h) The Auction will stipulate that the Servicer be retained to service the Receivables sold pursuant to the terms of the Purchase and Sale Agreement and Servicing Agreement. D-3 EX-4.2 6 FORM OF POOLING & SERVICING AGREEMENT 1 EXHIBIT 4.2 Brown & Wood LLP Draft of 9/4/96 ================================================================================ FLEETWOOD CREDIT CORP., Servicer FLEETWOOD CREDIT RECEIVABLES CORP., Seller Fleetwood Credit Grantor Trust Standard Terms and Conditions of Agreement (Senior/Subordinated) Effective September 1, 1996 ================================================================================ 2 TABLE OF CONTENTS
Page ---- ARTICLES ONE - TEN [Reserved] ARTICLE ELEVEN DEFINITIONS Section 11.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 11.02. Usage of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Section 11.03. Cutoff Date and Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Section 11.04. Section References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Section 11.05. Separate Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 ARTICLE TWELVE THE RECEIVABLES Section 12.01. Representations and Warranties of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Section 12.02. Repurchase Upon Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Section 12.03. Conveyance of Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Section 12.04. Custody of Receivable Files . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Section 12.05. Duties of Servicer as Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Section 12.06. Instructions; Authority to Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Section 12.07. Indemnification by Servicer as Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Section 12.08. Effective Period and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 ARTICLE THIRTEEN ADMINISTRATION AND SERVICING OF RECEIVABLES Section 13.01. Duties of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 13.02. Collection of Receivable Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Section 13.03. Realization Upon Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 13.04. Physical Damage Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 Section 13.05. Maintenance of Security Interests in Financed Vehicles . . . . . . . . . . . . . . . . . . . . . . . 23 Section 13.06. Covenants of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 13.07. Purchase of Receivables Upon Breach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Section 13.08. Servicing Fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 13.09. Servicer's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 Section 13.10. Annual Statement as to Compliance; Notice of Default; Opinion as to Interest of the Trustee in the Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
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Page ---- Section 13.11. Annual Independent Certified Public Accountant's Report . . . . . . . . . . . . . . . . . . . . . . . 25 Section 13.12. Access to Certain Documentation and Information Regarding Receivables . . . . . . . . . . . . . . . . 25 Section 13.13. Reports to Certificateholders and Each Rating Agency . . . . . . . . . . . . . . . . . . . . . . . . 26 ARTICLE FOURTEEN DISTRIBUTIONS; RESERVE FUND; STATEMENTS TO CERTIFICATEHOLDERS Section 14.01. Certificate Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Section 14.02. Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Section 14.03. Application of Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Section 14.04. Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Section 14.05. Non-Reimbursable Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Section 14.06. Additional Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 Section 14.07. Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Section 14.08. Subordination; Reserve Fund; Priority of Distributions . . . . . . . . . . . . . . . . . . . . . . . 32 Section 14.09. Net Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Section 14.10. Statements to Certificateholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 ARTICLE FIFTEEN THE SERVICER LETTER OF CREDIT Section 15.01. Servicer Letter of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 ARTICLE SIXTEEN THE CERTIFICATES Section 16.01. The Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 Section 16.02. Execution, Authentication and Delivery of Certificates . . . . . . . . . . . . . . . . . . . . . . . 39 Section 16.03. Registration of Transfer and Exchange of Certificates . . . . . . . . . . . . . . . . . . . . . . . . 39 Section 16.04. Mutilated, Destroyed, Lost or Stolen Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Section 16.05. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Section 16.06. Access to List of Certificateholder Names and Addresses . . . . . . . . . . . . . . . . . . . . . . . 40 Section 16.07. Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Section 16.08. Temporary Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Section 16.09. Book-Entry Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 Section 16.10. Notices to Clearing Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Section 16.11. Definitive Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
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Page ---- ARTICLE SEVENTEEN THE SELLER Section 17.01. Representations of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Section 17.02. Liability of Seller; Indemnities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Section 17.03. Merger or Consolidation of, or Assumption of the Obligations of, Seller; Certain Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 Section 17.04. Limitation on Liability of Seller and Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Section 17.05. Seller May Own Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 Section 17.06. No Transfer of Excess Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 ARTICLE EIGHTEEN THE SERVICER Section 18.01. Representations of Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 Section 18.02. Liability of Servicer; Indemnities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 Section 18.03. Merger or Consolidation of, or Assumption of the Obligations of, Servicer . . . . . . . . . . . . . . 50 Section 18.04. Limitation on Liability of Servicer and Others . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 Section 18.05. Servicer Not to Resign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 ARTICLE NINETEEN EVENTS OF DEFAULT Section 19.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 Section 19.02. Trustee to Act; Appointment of Successor Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . 53 Section 19.03. Reimbursement for Advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 Section 19.04. Notification of Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 Section 19.05. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 ARTICLE TWENTY THE TRUSTEE Section 20.01. Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55 Section 20.02. Trustee's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Section 20.03. Trustee's Assignment of Repurchased and Removed Receivables . . . . . . . . . . . . . . . . . . . . . 56 Section 20.04. Certain Matters Affecting Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 Section 20.05. Trustee Not Liable for Certificates or Receivables . . . . . . . . . . . . . . . . . . . . . . . . . 58 Section 20.06. Trustee May Own Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 Section 20.07. Trustee's Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
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Page ---- Section 20.08. Indemnity of Trustee and Successor Servicer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59 Section 20.09. Eligibility Requirements for Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Section 20.10. Resignation or Removal of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60 Section 20.11. Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Section 20.12. Merger or Consolidation of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Section 20.13. Appointment of Co-Trustee or Separate Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 Section 20.14. Representations and Warranties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63 ARTICLE TWENTY ONE TERMINATION Section 21.01. Termination of the Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64 Section 21.02. Optional Purchase of All Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 Section 21.03. Sale of All Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65 ARTICLE TWENTY TWO MISCELLANEOUS PROVISIONS Section 22.01. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 Section 22.02. Protection of Title to Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68 Section 22.03. Limitation on Certificateholder Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69 Section 22.04. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 Section 22.05. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 Section 22.06. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 Section 22.07. Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 Section 22.08. Certificates Nonassessable and Fully Paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 Section 22.09. No Petition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
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Page ---- EXHIBITS Exhibit A - Servicer Letter of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1 Exhibit B - Trustee's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
(v) 7 FLEETWOOD CREDIT GRANTOR TRUST STANDARD TERMS AND CONDITIONS OF AGREEMENT (SENIOR/SUBORDINATED) EFFECTIVE SEPTEMBER 1, 1996 for Fleetwood Credit Grantor Trusts formed subsequent to the date specified above INTRODUCTION These Standard Terms and Conditions of Agreement (Senior/Subordinated) Effective September 1, 1996 (the "Standard Terms and Conditions") shall be applicable to Fleetwood Credit Grantor Trusts formed on or after the date hereof, with respect to which a Pooling and Servicing Agreement incorporating by reference these Standard Terms and Conditions shall have been executed. ARTICLE ELEVEN DEFINITIONS Section 11.01. Definitions. Whenever used in the Agreement, the following words and phrases, unless the context otherwise requires, shall have the following meanings: "Accrued Interest" on a Receivable, as of any Distribution Date, means that amount of interest, if any, accrued on the Principal Balance of such Receivable at the related APR since the most recent date upon which a payment was made by or on behalf of the related Obligor in respect of such Receivable through the end of the Collection Period immediately preceding the Collection Period in which such Distribution Date occurs. "Advance" shall have the meaning specified in Section 14.04. "Advisor" shall have the meaning specified in Section 21.03. "Agreement" means the Pooling and Servicing Agreement executed by the Seller, the Servicer and the Trustee as of the Cutoff Date, into which these Standard Terms and Conditions shall be incorporated by reference, and all amendments and supplements thereto. "Amount Financed" in respect of a Receivable means the amount advanced under such Receivable toward the purchase price of the related Financed Vehicle and any related costs. "Annual Percentage Rate" or "APR" of a Receivable means the annual rate of interest stated in such Receivable. "Auction" shall have the meaning specified in Section 21.03. 8 "Auction Procedures" shall have the meaning specified in Section 21.03. "Auction Property" shall have the meaning specified in Section 21.03. "Authorized Officer" means an officer of the Trustee assigned to the Corporate Trust Office, including any Vice President, any trust officer or any other officer performing functions similar to those performed by the persons who at the time shall be such officers, and any other officer of the Trustee to whom a matter is referred because of his knowledge of and familiarity with the particular subject. "Available Funds" means, with respect to any Distribution Date, the sum of (i) all cash received by the Servicer in respect of the Receivables under the Agreement during the related Collection Period (including Non-Reimbursable Payments and Advances but other than (a) late payment and extension fees and administrative charges, if any, and (b) recoveries by the Servicer of amounts on the Receivables that were repurchased by the Seller or purchased by the Servicer prior to the related Collection Period), and (ii) the Repurchase Amounts of all Receivables purchased or to be purchased under the Agreement in respect of the related Collection Period. "Book-Entry Certificates" means a beneficial interest in the Class A Certificates or Class B Certificates, as the case may be, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in Section 16.09. "Business Day" means a day on which the Trustee and banks located in New York, New York, Los Angeles, California and the city in which the Corporate Trust Office is located are open for the purpose of conducting a commercial banking business. "Certificate Account" means the account designated as such and established and maintained pursuant to Section 14.01. "Certificate Owner" means, with respect to a Book-Entry Certificate, the Person who is the owner of such Book-Entry Certificate, as reflected on the books of the Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency (directly or as an indirect participant, in accordance with the rules of such Clearing Agency) and shall mean, with respect to a Definitive Certificate, the related Certificateholder. "Certificate Register" and "Certificate Registrar" mean the register maintained and the registrar (or any successor thereto) appointed pursuant to Section 16.03. "Certificateholder" or "Holder" means the Person in whose name a Certificate shall be registered in the Certificate Register, except that, solely for the purposes of giving any consent, waiver, request or demand pursuant to the Agreement, the interest evidenced by any Certificate registered in the name of the Seller or the Servicer, or any Person controlling, controlled by or under common control with the Seller or the Servicer, or evidenced by a Book-Entry Certificate of which the Seller, the Servicer or any such Person is the Certificate 2 9 Owner, shall not be taken into account in determining whether the requisite percentage necessary to effect any such consent, waiver, request or demand shall have been obtained. "Certificates" means the Class A Certificates and the Class B Certificates. "Class" means all Certificates whose form is identical except for variation in denomination, principal amount, owner or designation of class. "Class A Certificate" means any one of the Class A Certificates executed and authenticated by the Trustee in substantially the form set forth as an Exhibit to the Agreement. "Class A Certificate Balance" shall equal, initially, the Original Class A Certificate Balance and, thereafter, shall equal the Original Class A Certificate Balance, reduced by all amounts previously distributed on the Class A Certificates and allocable to principal. "Class A Distributable Amount" means, with respect to any Distribution Date, the sum of the Class A Principal Distributable Amount and the Class A Interest Distributable Amount. "Class A Interest Carryover Shortfall" means, with respect to any Distribution Date, the excess, if any, of (a) the Class A Interest Distributable Amount for such Distribution Date and any outstanding Class A Interest Carryover Shortfall from the immediately preceding Distribution Date plus interest on such outstanding Class A Interest Carryover Shortfall, to the extent permitted by law, at the Class A Pass-Through Rate from such immediately preceding Distribution Date through the current Distribution Date, over (b) the amount of interest distributed to the Class A Certificateholders on such current Distribution Date. "Class A Interest Distributable Amount" means, with respect to any Distribution Date, the product of one-twelfth of the Class A Pass-Through Rate and the Class A Certificate Balance as of the first day of the immediately preceding Collection Period (after giving effect to distributions of principal to be made on the Distribution Date occurring in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class A Certificate Balance. "Class A Pass-Through Rate" shall have the meaning specified in the Agreement. "Class A Percentage" shall have the meaning specified in the Agreement. "Class A Pool Factor" means, with respect to any Record Date, a seven-digit decimal figure equal to the Class A Certificate Balance as of such Record Date divided by the Original Class A Certificate Balance. "Class A Principal Carryover Shortfall" means, with respect to any Distribution Date, the excess, if any, of the Class A Principal Distributable Amount plus any outstanding Class A Principal Carryover Shortfall with respect to one or more prior Distribution Dates over the 3 10 amount of principal that the Holders of the Class A Certificates actually received on such current Distribution Date. "Class A Principal Distributable Amount" means, with respect to any Distribution Date, the Class A Percentage of the Monthly Principal Payment (but not exceeding the Class A Certificate Balance as of such Distribution Date). In addition, with respect to the Distribution Date relating to the Collection Period in which the last Receivable in the Trust is scheduled to mature or the Distribution Date relating to the Record Date as of which all remaining Receivables are to be purchased pursuant to Section 21.02 or 21.03, the Class A Principal Distributable Amount will include the portion of such amount necessary (after giving effect to the other amounts to be distributed to the Class A Certificateholders on such Distribution Date and allocable to principal) to reduce the Class A Certificate Balance to zero. "Class B Certificate" means any one of the Class B Certificates executed and authenticated by the Trustee in substantially the form set forth as an Exhibit to the Agreement. "Class B Certificate Balance" shall equal, initially, the Original Class B Certificate Balance and, thereafter, shall equal the Original Class B Certificate Balance, reduced by (a) all amounts previously distributed on the Class B Certificates and allocable to principal and (b) Realized Losses allocable to the Class B Certificates. "Class B Distributable Amount" means, with respect to any Distribution Date, the sum of (a) the Class B Principal Distributable Amount, (b) the Class B Interest Distributable Amount and (c) recoveries to the extent allocable to principal on Receivables which became Defaulted Receivables in one or more prior Collection Periods. "Class B Interest Carryover Shortfall" means, with respect to any Distribution Date, the excess, if any, of (a) the Class B Interest Distributable Amount for such Distribution Date and any outstanding Class B Interest Carryover Shortfall from the immediately preceding Distribution Date plus interest on such outstanding Class B Interest Carryover Shortfall, to the extent permitted by law, at the Class B Pass-Through Rate from such immediately preceding Distribution Date through the current Distribution Date, over (b) the amount of interest distributed to the Class B Certificateholders on such current Distribution Date. "Class B Interest Distributable Amount" means, with respect to any Distribution Date, the product of one-twelfth of the Class B Pass-Through Rate and the Class B Certificate Balance as of the first day of the immediately preceding Collection Period (after giving effect to distributions of principal made on the Distribution Date occurring in such immediately preceding Collection Period) or, in the case of the first Distribution Date, the Original Class B Certificate Balance. "Class B Pass-Through Rate" shall have the meaning specified in the Agreement. "Class B Percentage" shall have the meaning specified in the Agreement. 4 11 "Class B Pool Factor" means, with respect to any Record Date, a seven-digit decimal equal to the Class B Certificate Balance as of such Record Date divided by the Original Class B Certificate Balance. "Class B Principal Carryover Shortfall" means, with respect to any Distribution Date, the excess, if any, of the Class B Principal Distributable Amount plus any outstanding Class B Principal Carryover Shortfall with respect to one or more prior Distribution Dates over the amount of principal that the Holders of the Class B Certificates actually received on such current Distribution Date. "Class B Principal Distributable Amount" means, with respect to any Distribution Date, the Class B Percentage of the Monthly Principal Payment (but not exceeding the Class B Certificate Balance as of such Distribution Date). "Class Percentage" means the Class A Percentage or the Class B Percentage, as the case may be. "Clearing Agency" means an organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act. "Clearing Agency Participant" means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency. "Closing Date" shall have the meaning specified in the Agreement. "Code" means the Internal Revenue Code of 1986, as amended. "Collected Interest" means, with respect to each Collection Period, the portion of all Available Funds received by the Servicer on or in respect of the Receivables during such Collection Period allocable to interest. "Collected Principal" means, with respect to each Collection Period, the portion of all Available Funds received by the Servicer on or in respect of the Receivables during such Collection Period allocable to principal. "Collection Period" means, as to any Distribution Date and the related Record Date, the calendar month ending immediately prior to such Distribution Date. "Commission" means the Securities and Exchange Commission, and any successor thereto. "Corporate Trust Office" means the office of the Trustee at which its corporate trust business shall be administered, which office shall be specified in the Agreement, or such office at some other address as the Trustee may designate from time to time by notice to the Certificateholders, the Seller, the Servicer and the Letter of Credit Bank, if any. 5 12 "Cutoff Date" shall have the meaning specified in the Agreement. "Dealer" means the dealer who sold a Financed Vehicle and who originated and assigned the Receivable relating to such Financed Vehicle to Fleetwood Credit under an agreement with Fleetwood Credit. "Defaulted Receivable" means a Receivable (other than a Repurchased Receivable) as to which (i) all or any part of a scheduled payment is 180 days delinquent or (ii) the Servicer has determined, in accordance with its customary servicing procedures, that eventual payment in full is unlikely and has repossessed and liquidated the related Financed Vehicle within such 180 day period. "Definitive Certificates" shall have the meaning specified in Section 16.09. "Delinquency Percentage" for any Fiscal Quarter means a percentage equal to the average of the month end percentages, the numerator of which is the aggregate principal balance of the Receivables (excluding Defaulted Receivables) that are 90 days or more past due (which amount shall include Receivables in respect of Financed Vehicles that have been repossessed but not yet sold or otherwise liquidated) and the denominator of which is the Pool Balance, in each case calculated on the last day of the three related Collection Periods in such Fiscal Quarter. "Delivery" when used with respect to Reserve Fund Property means: (a) with respect to certificated securities, bankers' acceptances, commercial paper, negotiable certificates of deposit and other obligations that constitute "instruments" within the meaning of Section 9-105(1)(i) of the UCC and are susceptible of physical delivery (collectively, "Physical Property"), transfer thereof to the Trustee or its Financial Intermediary in accordance with Section 8-313(1)(a), Section 8-313(1)(d)(i) or Section 8-313(1)(g) of the UCC, and that any such Physical Property that is in a registerable form has been registered in the name of the Trustee, its Financial Intermediary, its custodian or its nominee, as collateral agent; (b) with respect to any Reserve Fund Property that is a book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations, the following procedures, all in accordance with applicable law, including applicable federal regulations and Articles 8 and 9 of the UCC: (i) book-entry registration of such property to an appropriate book-entry account maintained with a Federal Reserve Bank by the Trustee or by a custodian, as collateral agent, and issuance to the Trustee or to such custodian, as the case may be, as collateral agent, of a deposit advice or other written confirmation of such book-entry registration; (ii) the making by any such custodian of entries in its books and records identifying such book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations as belonging to the Trustee, and indicating that such custodian holds such Reserve Fund Property solely as agent for the Trustee, and the making by the Trustee of entries in its books and records establishing that it holds such Reserve Fund Property solely as 6 13 collateral agent, and the making by the Trustee of entries in its books and records establishing that it holds such Reserve Fund Property solely as Trustee pursuant to Section 14.08 and (iii) such additional or alternative procedures as may hereafter become appropriate to effect complete transfer of ownership of any such Reserve Fund Property to the Trustee, acting solely as collateral agent, consistent with changes in applicable law or regulations or the interpretation thereof; and (c) with respect to any Reserve Fund Property that is an uncertificated security under Article 8 of the UCC and that is not governed by clause (b) above, registration of the transfer to and ownership of such Reserve Fund Property by the Trustee, its Financial Intermediary, its custodian or its nominee, acting solely as collateral agent, by the issuer of such Reserve Fund Property. "Determination Date" means, as to any Distribution Date, the eighth calendar day of the month in which such Distribution Date occurs or, if such day is not a Business Day, the immediately succeeding Business Day. "Distribution Date" means, for each Collection Period, the fifteenth day of the following month, or if such day is not a Business Day, the immediately succeeding Business Day, commencing with the date specified in the Agreement. "DTC" means The Depository Trust Company, and any successor thereto. "Duff & Phelps" means Duff & Phelps Inc., and any successor thereto. "Event of Default" shall have the meaning specified in Section 19.01. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Excess Amounts" shall have the meaning set forth in Section 14.07(b). "FDIC" means the Federal Deposit Insurance Corporation, and its successors. "FHLMC" means the Federal Home Loan Mortgage Corporation, and its successors. "FNMA" means the Federal National Mortgage Association, and its successors. "Final Scheduled Distribution Date" shall have the meaning specified in the Agreement. "Financed Vehicle" with respect to a Receivable means the recreational vehicle, together with all accessions thereto, securing the related Obligor's indebtedness under such Receivable. "Financial Intermediary" shall have the meaning specified in Section 8-313(4) of the UCC. 7 14 "Fiscal Quarters" means each of the following three-month periods: (i) January, February and March; (ii) April, May and June; (iii) July, August and September; and (iv) October, November and December. "Fleetwood Credit" means Fleetwood Credit Corp. "Independent Director" means a director of the Seller who is not (a) a director, officer or employee of any affiliate of the Seller; (b) a person related to any officer or director of any affiliate of the Seller; (c) a holder (directly or indirectly) of more than 10% of any voting securities of any affiliate of the Seller; or (d) a person related to a holder (directly or indirectly) of more than 10% of any voting securities of any affiliate of the Seller. "Initial Servicer Letter of Credit Amount" shall have the meaning specified in the Servicer Letter of Credit, if any. "Letter of Credit Bank" means any Person which has provided a Servicer Letter of Credit in accordance with Section 15.01. "Letter of Representations" means the agreement among the Seller, the Trustee and the initial Clearing Agency, dated as of the Closing Date, substantially in the form attached as an Exhibit to the Agreement. "Lien" means a security interest, lien, charge, pledge, equity or encumbrance of any kind other than tax liens, mechanics' liens and any liens which attach to a Receivable or any property, as the context may require, by operation of law. "Liquidation Proceeds" means monies collected (from whatever source) during a Collection Period on or in respect of a Defaulted Receivable, net of all amounts (i) expended by the Servicer in effecting such collections and (ii) required by law to be remitted to the related Obligor. "Monthly Principal Payment" means, as of any Distribution Date, an amount equal to (i) the Pool Balance as of the second Record Date preceding such Distribution Date (or, with respect to the first Distribution Date, the Original Pool Balance) less (ii) the Pool Balance as of the Record Date immediately preceding such Distribution Date. "Moody's" means Moody's Investors Service, Inc., and any successor thereto. "Non-Reimbursable Payment" means, as of any Record Date, the payment required to be made by the Servicer pursuant to Section 14.05. "Obligor" on a Receivable means the purchaser or co-purchasers of the related Financed Vehicle purchased in part or in whole by the execution and delivery of such Receivable or any other Person who owes or may be liable for payments under such Receivable. 8 15 "Offered Securities" shall have the meaning specified in Section 17.03. "Officer's Certificate" means a certificate signed by the President, any Vice President, the Treasurer, the Secretary or any Assistant Secretary of the Seller or the Servicer, as the case may be, and delivered to the Trustee. "Opinion of Counsel" means a written opinion of counsel (who may be an employee of or outside counsel to the Seller or the Servicer), which counsel shall be acceptable to the Trustee. "Optional Purchase Percentage" shall have the meaning specified in the Agreement. "Original Class A Certificate Balance" shall have the meaning specified in the Agreement. "Original Class B Certificate Balance" shall have the meaning specified in the Agreement. "Original Pool Balance" shall have the meaning specified in the Agreement. "Paid-Ahead Receivables" means Receivables the Principal Balance of which have been reduced by one or more scheduled monthly payments made in advance by the related Obligor. "Permitted Investments" means, at any time, any one or more of the following obligations and securities: (i) obligations of the United States or any agency thereof, provided such obligations are backed by the full faith and credit of the United States; (ii) general obligations of or obligations guaranteed by any State then rated the highest rating of each Rating Agency for such obligations, or such lower rating (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the rating then assigned to the Rated Certificates by such Rating Agency; (iii) commercial paper which is then rated the highest commercial paper rating of each Rating Agency for such obligations, or such lower rating (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the rating then assigned to the Rated Certificates by such Rating Agency; (iv) certificates of deposit, demand or time deposits, federal funds or banker's acceptances issued by any depository institution or trust company incorporated under the laws of the United States or of any State and subject to supervision and examination by federal or state banking authorities, provided that the 9 16 commercial paper of such depository institution or trust company is then rated the highest rating of each Rating Agency for such obligations, or such lower rating (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the rating then assigned to the Rated Certificates by such Rating Agency; (v) demand or time deposits or certificates of deposit issued by any bank, trust company, savings bank or other savings institution, which deposits are fully insured by the FDIC; (vi) guaranteed reinvestment agreements issued by any bank, insurance company or other corporation (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the rating then assigned to the Rated Certificates by each Rating Agency; (vii) repurchase obligations with respect to any security described in clauses (i), (ii) or (viii) hereof or any other security issued or guaranteed by the FHLMC, FNMA or any other agency or instrumentality of the United States which is backed by the full faith and credit of the United States, in either case entered into with a federal agency or a depository institution or trust company (acting as principal) described in clause (iv) above; and (viii) such other investments acceptable to each Rating Agency (as approved in writing by each Rating Agency) as will not result in the qualification, downgrading or withdrawal of the rating then assigned to the Rated Certificates by such Rating Agency; provided that each of the foregoing investments shall mature no later than the Business Day prior to the Distribution Date immediately following the date of purchase (other than instruments of which the Trustee is the obligor, which may mature on the related Distribution Date), and shall be required to be held to such maturity. "Person" means any individual, corporation, estate, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Physical Property" shall have the meaning specified in the definition of the term "Delivery." "Pool Balance" as of any Record Date, means the aggregate Principal Balance of the Receivables (excluding all Repurchased Receivables and Defaulted Receivables) as of the close of business on such Record Date. "Principal Balance" of a Receivable as of any date, means the Amount Financed, without regard to any offsets or judicial reductions thereof, minus the sum of (i) that portion of all payments received on or prior to such date by the Servicer and allocable as a payment 10 17 of principal pursuant to Section 14.03, (ii) any refunded portion of extended warranty protection plan costs, or of physical damage, credit life or disability insurance premiums included in the Amount Financed unless such refund must be paid to the related Obligor and (iii) any payment of the Repurchase Amount allocable to principal with respect to each Receivable which became a Defaulted Receivable or Repurchased Receivable during or prior to the related Collection Period. "Rated Certificates" means each Class of Certificates that has been rated by a Rating Agency at the request of the Seller. "Rating Agency" means each nationally recognized rating agency specified in the Agreement as from time to time shall be rating the Rated Certificates. "Realized Loss Percentage" for any Fiscal Quarter means a percentage with respect to the three Collection Periods that fell in such Fiscal Quarter equal to (a) the aggregate Repurchase Amount for all Receivables that become Defaulted Receivables during such Fiscal Quarter, minus (b) the sum of (i) the aggregate Liquidation Proceeds received by the Servicer during such Fiscal Quarter with respect to all Receivables that became Defaulted Receivables during such Fiscal Quarter and (ii) all recoveries in respect of Defaulted Receivables received during such Fiscal Quarter, to the extent not otherwise covered in clause (i) above, which amount is then divided by the mean of the three Pool Balances calculated as of the Record Date immediately preceding the first day of each Collection Period that fell in such Fiscal Quarter; such quotient is then multiplied by four to arrive at an annualized percentage. "Realized Losses" with respect to each Collection Period will equal the amount by which (a) the aggregate Principal Balance of all Receivables which became Defaulted Receivables during such Collection Period exceeds (b) the sum of (i) the aggregate Liquidation Proceeds recovered in respect of principal of such Defaulted Receivables during such Collection Period and (ii) recoveries in respect of all Defaulted Receivables received in such Collection Period, to the extent not otherwise covered in clause (i) above. "Receivable" means any retail installment sale contract executed by an Obligor in respect of a Financed Vehicle which is transferred by the Seller to the Trust pursuant to the Agreement on the Closing Date, and all proceeds thereof and payments thereunder, which Receivable shall be identified on the Schedule of Receivables. "Receivable Files" means the documents specified in Section 12.04. "Receivables Pool" means the pool of Receivables included in the Trust. "Receivables Purchase Agreement" shall have the meaning specified in the Agreement. "Record Date" means, in respect of each Collection Period, the close of business on the last day of the related calendar month. Any amount stated "as of a Record Date" or "on a Record Date" shall give effect to (i) all applications of collections and (ii) all distributions to 11 18 any party under the Agreement or the related Obligor, as the case may be, in each case as determined as of the Record Date. "Recreational Vehicle Receivables" shall have the meaning specified in Section 17.03. "Repurchase Amount" as of any date, means the amount required to prepay in full the Principal Balance of a Receivable plus interest thereon at a rate equal to the sum of (i) the weighted average of the Class A Pass-Through Rate and the Class B Pass-Through Rate and (ii) the Servicing Fee Rate to the last day of the month in which such date occurs. "Repurchased Receivable" means a Receivable purchased as of a Record Date by the Servicer (or a successor to the Servicer) pursuant to Section 13.07 or 21.02 or by the Seller pursuant to Section 12.02 or 21.02. "Required Deposit Rating" means the rating or ratings specified in the Agreement. "Required Long Term Debt Rating" means the rating or ratings, if applicable, specified in the Agreement. "Required Rating" means the rating or ratings specified in the Agreement. "Required Servicer Rating" means the rating or ratings specified in the Agreement. "Reserve Fund" means the account established and maintained pursuant to Section 14.08. "Reserve Fund Initial Deposit" shall have the meaning specified in the Agreement. "Reserve Fund Property" shall have the meaning specified in Section 14.08(a)(ii). "Reset Percentage" shall have the meaning specified in the Servicer Letter of Credit, if any. "Residual Certificate" shall have the meaning specified in Section 16.01. "Schedule of Receivables" means the schedule of receivables attached as Schedule A to the Agreement, as it may be amended or supplemented from time to time. "Securities Act" shall mean the Securities Act of 1933, as amended. "Securitization Agreement" shall have the meaning specified in Section 17.03. "Seller" means Fleetwood Credit Receivables Corp., in its capacity as seller of the Receivables under the Agreement, and each successor to Fleetwood Credit Receivables Corp. (in the same capacity) pursuant to Section 17.03. 12 19 "Servicer" means Fleetwood Credit, in its capacity as servicer of the Receivables, and each successor to Fleetwood Credit (in the same capacity) pursuant to Section 18.03 or 19.02. "Servicer Letter of Credit" means, if the Servicer desires to remit collections on or in respect of the Receivables to the Certificate Account on a monthly basis but the conditions of clause (a) of Section 14.02 are not otherwise satisfied, an irrevocable letter of credit, issued by the Letter of Credit Bank and naming the Trustee as beneficiary, substantially in, except as otherwise provided in the Agreement, the form attached hereto as Exhibit A. "Servicer Letter of Credit Amount" means the amount determined pursuant to Section 15.01(a). "Servicer Letter of Credit Percentage" shall have the meaning specified in the Servicer Letter of Credit, if any. "Servicer's Certificate" means an Officer's Certificate of the Servicer completed and executed pursuant to Section 13.09, substantially in the form attached as an Exhibit to the Agreement. "Servicing Fee" means the fee payable to the Servicer for services rendered during each Collection Period, determined pursuant to Section 13.08. "Servicing Fee Rate" shall have the meaning specified in the Agreement. "Specified Reserve Fund Balance" shall have the meaning specified in the Agreement. "Standard & Poor's" means Standard & Poor's Ratings Services, a division of McGraw-Hill, Inc., and any successor thereto. "State" means any state of the United States or the District of Columbia. "Successor Servicer" shall have the meaning specified in Section 20.08. "Trust" means the trust created by the Agreement, the estate of which shall consist of (i) the Receivables (other than Repurchased Receivables) and all payments due thereunder on and after the Cutoff Date, other than Accrued Interest as of the opening of business on the Cutoff Date; (ii) security interests in the Financed Vehicles; (iii) funds deposited in the Certificate Account and proceeds thereof; (iv) the Servicer Letter of Credit, if any; (v) the right to realize upon any property (including the right to receive future Liquidation Proceeds) that shall have secured a Receivable and have been repossessed by or on behalf of the Trustee; (vi) proceeds from claims on any physical damage, credit life or disability insurance policies covering the Financed Vehicles or Obligors; (vii) the Seller's rights under the Receivables Purchase Agreement; (viii) the right of the Seller to receive payments pursuant to repurchase obligations of Dealers relating to the Receivables; and (ix) all proceeds of the foregoing. The Reserve Fund shall not be a part of or otherwise includable in the Trust. 13 20 "Trustee" means the Person acting as Trustee under the Agreement, its successor in interest, and any successor trustee pursuant to Section 20.11. "Trustee's Certificate" means a certificate completed and executed by the Trustee by an Authorized Officer pursuant to Section 20.02 or 20.03, substantially in the form attached hereto as, in the case of assignment to the Seller, Exhibit B-1, and in the case of an assignment to the Servicer, Exhibit B-2. "UCC" means the Uniform Commercial Code as in effect in the respective jurisdiction or, with respect to Louisiana, the equivalent body of statutory and commercial law. "United States" means the United States of America. "Vice President" of any Person means any vice president of such Person, whether or not designated by a number or words before or after the title "Vice President." "Voting Interests" means the aggregate voting strength evidenced by the Class A Certificates or the Class B Certificates, as the case may be; provided, however, that where the Voting Interests are relevant in determining whether the vote of the requisite percentage of Class A Certificateholders or Class B Certificateholders, as the case may be, necessary to effect any consent, waiver, request or demand shall have been obtained, the Voting Interests shall be deemed to be reduced by the amount equal to the Voting Interests (without giving effect to this provision) represented by the interests evidenced by any such Certificate registered in the name of the Seller, the Servicer or any Person controlling, controlled by or under common control with the Seller or the Servicer. Section 11.02. Usage of Terms. With respect to all terms in the Agreement, the singular includes the plural and the plural the singular; words importing any gender include the other genders; references to "writing" include printing, typing, lithography and other means of reproducing words in a visible form; references to agreements and other contractual instruments include all subsequent amendments thereto or changes therein entered into in accordance with their respective terms and not prohibited by the Agreement; references to Persons include their permitted successors and assigns; and the term "including" means "including without limitation." Section 11.03. Cutoff Date and Record Date. All references to the Record Date prior to the first Record Date in the life of the Trust shall be to the Cutoff Date. Section 11.04. Section References. All section references shall be to Sections in these Standard Terms and Conditions. Section 11.05. Separate Agreements. Each Agreement which shall incorporate by reference these Standard Terms and Conditions shall be separate and distinct from each other such Agreement, no provision of any such Agreement shall be applicable to any other such Agreement, and all references to "the Agreement" and to provisions thereof shall be references to a particular Agreement which incorporates these Standards Terms and Conditions. 14 21 ARTICLE TWELVE THE RECEIVABLES Section 12.01. Representations and Warranties of Seller. The Seller shall make the following representations and warranties as to the Receivables on which the Trustee shall rely in accepting the Receivables in trust and executing and authenticating the Certificates. Such representations and warranties shall speak as of the execution and delivery of the Agreement but shall survive the sale, transfer and assignment of the Receivables to the Trustee and any subsequent assignment or transfer pursuant to Article Fifteen. (i) Characteristics of Receivables. Each Receivable (a) shall have been originated in the United States by a Dealer for the retail sale of the related Financed Vehicle in the ordinary course of such Dealer's business, shall have been fully and properly executed by the parties thereto, shall have been purchased by Fleetwood Credit from such Dealer under an agreement with Fleetwood Credit and shall have been validly assigned by such Dealer to Fleetwood Credit in accordance with its terms and shall have been subsequently sold by Fleetwood Credit to the Seller, (b) shall have created or shall create a valid, subsisting and enforceable first priority security interest in favor of Fleetwood Credit in the related Financed Vehicle, which security interest has been assigned by Fleetwood Credit to the Seller and shall be assignable, and shall be so assigned, by the Seller to the Trustee, (c) shall contain customary and enforceable provisions such that the rights and remedies of the holder thereof shall be adequate for realization against the collateral of the benefits of the security, (d) shall provide for level monthly payments (provided that the payment in the first or last month in the life of the Receivable may be minimally different from the level payment) that fully amortize the Amount Financed by maturity and provide for a finance charge or yield interest at its APR, and (e) shall provide for, in the event that such Receivable is prepaid in full, a payment that fully pays the Principal Balance and includes accrued but unpaid interest at least through the date of prepayment in an amount at least equal to its APR. (ii) Schedule of Receivables. The information set forth in the Schedule of Receivables shall be true and correct in all material respects as of the opening of business on the Cutoff Date, and no selection procedures adverse to the Certificateholders shall have been utilized in selecting the Receivables from those Receivables of Fleetwood Credit which met the selection criteria set forth in this Section. (iii) Compliance with Law. Each Receivable and each sale of the related Financed Vehicle shall have complied at the time it was originated or made, and shall comply at the time of execution of the Agreement in all material respects with all requirements of applicable federal, state and local laws, and regulations thereunder, including usury laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the Magnuson-Moss 15 22 Warranty Act, Federal Reserve Board Regulations B and Z, state adaptations of the National Consumer Act and of the Uniform Consumer Credit Code and other consumer credit, equal credit opportunity and disclosure laws. (iv) Binding Obligation. Each Receivable shall constitute the genuine, legal, valid and binding payment obligation in writing of the related Obligor, enforceable by the holder thereof in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation and other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (v) No Government Obligor. None of the Receivables shall be due from the United States or any state or local government thereof or from any agency, department or instrumentality of the United States or any state or local government. (vi) Security Interest in Financed Vehicle. Immediately prior to the sale, assignment and transfer thereof, each Receivable shall be secured by a validly perfected first security interest in the related Financed Vehicle in favor of Fleetwood Credit as secured party or all necessary and appropriate action with respect to such Receivable shall have been taken to perfect a first priority security interest in such Financed Vehicle in favor of Fleetwood Credit as secured party. (vii) Receivables in Force. No Receivable shall have been satisfied, subordinated or rescinded, nor shall any Financed Vehicle have been released from the lien granted by the related Receivable in whole or in part. (viii) No Waiver. No provision of a Receivable shall have been waived in such a manner that such Receivable fails to meet all of the other representations and warranties made by the Seller herein with respect thereto. (ix) No Amendments. No Receivable shall have been amended in such a manner that such Receivable fails to meet all of the other representations and warranties made by the Seller herein with respect thereto. (x) No Defenses. No facts shall be known to the Seller which would give rise to any right of rescission, setoff, counterclaim or defense, nor shall the same have been asserted or threatened, with respect to any Receivable. (xi) No Liens. To the knowledge of the Seller, no liens or claims shall have been filed, including liens for work, labor or materials relating to a Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the security interest in such Financed Vehicle granted by the related Receivable. (xii) No Default. Except for payment defaults continuing for a period of not more than 30 days as of the Cutoff Date, no default, breach, violation or event 16 23 permitting acceleration under the terms of any Receivable shall have occurred; no continuing condition that with notice or the lapse of time would constitute a default, breach, violation or event permitting acceleration under the terms of any Receivable shall have arisen; and the Seller shall not have waived any of the foregoing. (xiii) Insurance. Fleetwood Credit, in accordance with its customary servicing procedures, shall have determined that each Obligor has obtained physical damage insurance covering the related Financed Vehicle. (xiv) Good Title. It is the intention of the Seller that the transfer and assignment herein contemplated, taken as a whole, constitute a sale of the Receivables from the Seller to the Trust and that the beneficial interest in and title to the Receivables not be part of the debtor's estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. No Receivable has been sold, transferred, assigned or pledged by the Seller to any Person other than the Trustee, and no provision of a Receivable shall have been waived, except as provided in clause (viii) above; immediately prior to the transfer and assignment herein contemplated, the Seller had good and marketable title to each Receivable free and clear of all Liens and rights of others; immediately upon the transfer and assignment thereof, the Trustee, for the benefit of the Certificateholders, shall have good and marketable title to each Receivable, free and clear of all Liens and rights of others; and the transfer and assignment herein contemplated has been perfected under the UCC. (xv) Lawful Assignment. No Receivable shall have been originated in, or shall be subject to the laws of, any jurisdiction under which the sale, transfer and assignment of such Receivable under the Agreement or pursuant to transfers of the Certificates shall be unlawful, void or voidable. (xvi) All Filings Made. All filings (including UCC filings) necessary in any jurisdiction to give the Trustee a first perfected ownership interest in the Receivables shall have been made. (xvii) One Original. There shall be only one original executed copy of each Receivable. (xviii) Agreement. The additional representations and warranties as to the Receivables in the Agreement shall be true and correct. Section 12.02. Repurchase Upon Breach. The Seller, the Servicer or the Trustee, as the case may be, shall inform the other parties promptly, in writing, upon the discovery of any breach of the Seller's representations and warranties set forth in Article Seven of the Agreement or Section 12.01 hereof which materially and adversely affects any Receivable. Unless the breach shall have been cured by the second Record Date following the discovery (or, at the Seller's option, the first Record Date following the discovery), the Seller shall repurchase any Receivable materially and adversely affected by the breach, as of such Record 17 24 Date. If necessary, the Seller shall enforce the obligation of Fleetwood Credit under the Receivables Purchase Agreement to repurchase such Receivable from the Seller. In consideration of the purchase of any such Receivable, the Seller shall remit the Repurchase Amount of such Receivable (less the amount of any Liquidation Proceeds with respect to such Receivable deposited, or to be deposited, by the Servicer in the Certificate Account pursuant to Section 13.03) to the Certificate Account in the manner specified in Section 14.06(a)(i). In the event that, as of the date of execution and delivery of the Agreement, any Liens or claims shall have been filed, including Liens for work, labor or materials relating to a Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the lien granted by the related Receivable (whether or not the Seller has knowledge thereof), and such breach materially and adversely affects the interests of the Trust in such Receivable, the Seller shall repurchase such Receivable on the terms and in the manner specified above. The sole remedy of the Trustee, the Trust or the Certificateholders with respect to a breach of the Seller's representations and warranties set forth in Article Seven of the Agreement or Section 12.01 hereof or with respect to the existence of any such Liens or claims shall be to require the Seller to repurchase Receivables pursuant to this Section and to enforce Fleetwood Credit's obligation to the Seller to repurchase such Receivables from the Seller pursuant to the Receivables Purchase Agreement. Section 12.03. Conveyance of Receivables. The Seller, pursuant to the mutually agreed upon terms contained in the Agreement, shall sell, transfer, assign and otherwise convey to the Trustee, without recourse (but subject to the Seller's obligations in the Agreement), all of its right, title and interest in and to the Receivables and any proceeds related thereto, including any other items as shall be specified in the Agreement. It is the intention of the Seller and the Certificateholders (as evidenced by the acceptance of their Certificates) that the transfer and assignment contemplated by the Agreement shall constitute a sale of the Receivables from the Seller to the Trust and the beneficial interest in and title to the Receivables shall not be part of the Seller's estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law. The Seller agrees to execute and file all filings (including filings under the UCC) necessary in any jurisdiction to provide third parties with notice of the sale of the Receivables and to perfect such sale under the UCC. In the event the transfer and assignment contemplated by the Agreement is deemed to be other than a sale, the parties intend that all filings described in the foregoing paragraph shall give the Trustee on behalf of the Trust a first priority perfected security interest in, to and under the related Receivables, and other property conveyed hereunder and all proceeds of any of the foregoing. The Agreement shall be deemed to be the grant of a security interest from the Seller to the Trustee on behalf of the Trust, and the Trustee on behalf of the Trust shall have all the rights, powers and privileges of a secured party under the UCC. In such event, the Seller agrees to take such action and execute such documents as the Trustee shall request in order fully to realize the benefits of such secured party status, including, without limitation, powers of attorneys, financing statements, notices of lien or other instruments or documents. 18 25 Section 12.04. Custody of Receivable Files. To assure uniform quality in servicing the Receivables and to reduce administrative costs, the Trustee, upon the execution and delivery of the Agreement, revocably appoints the Servicer, and the Servicer accepts such appointment, to act as the agent of the Trustee as custodian of the following documents or instruments which are hereby constructively delivered to the Trustee with respect to each Receivable on or prior to the Closing Date: (i) the original of the Receivable; (ii) all documents evidencing the existence of physical damage insurance covering the related Financed Vehicle; (iii) the original credit application fully executed by the Obligor; (iv) the original certificate of title or such documents that the Servicer or the Seller shall keep on file, in accordance with its customary procedures, evidencing the security interest in the related Financed Vehicle; and (v) any and all other documents that the Seller or the Servicer, as the case may be, shall keep on file, in accordance with its customary procedures, relating to such Receivable or the related Obligor or Financed Vehicle. Section 12.05. Duties of Servicer as Custodian. (a) Safekeeping. The Servicer, in its capacity as custodian, shall hold the Receivable Files on behalf of the Trustee for the use and benefit of all present and future Certificateholders, and maintain such accurate and complete accounts, records and computer systems pertaining to each Receivable File as shall enable the Trustee to comply with the Agreement. In performing its duties as custodian, the Servicer shall act with reasonable care, using that degree of skill and attention that it exercises with respect to the receivable files of comparable recreational vehicle receivables that the Servicer services for itself or others. The Servicer shall conduct, or cause to be conducted, periodic reviews of the files of all receivables owned or serviced by it which shall include the Receivable Files held by it under the Agreement, and of the related accounts, records and computer systems, in such a manner as shall enable the Trustee to verify the accuracy of the Servicer's record keeping. The Servicer shall promptly report to the Trustee any failure on its part to hold the Receivable Files and maintain its accounts, records and computer systems as herein provided and promptly take appropriate action to remedy any such failure. (b) Maintenance of and Access to Records. The Servicer shall maintain each Receivable File at one of its offices specified in Schedule B to the Agreement, or at such other office as shall be specified to the Trustee by 30 days' prior written notice. The Servicer shall make available to the Trustee or its duly authorized representatives, attorneys or auditors the Receivable Files and the related accounts, records and computer systems maintained by the Servicer at such times as the Trustee may reasonably request. 19 26 (c) Release of Documents. Upon instruction from the Trustee, the Servicer shall release any document in the Receivable Files to the Trustee or its agent or designee, as the case may be, at such place or places as the Trustee may designate, as soon as practicable. The Servicer shall not be responsible for any loss occasioned by the failure of the Trustee to return any document or any delay in doing so. Section 12.06. Instructions; Authority to Act. The Servicer shall be deemed to have received proper instructions with respect to the Receivable Files upon its receipt of written instructions signed by an Authorized Officer. A certified copy of a bylaw or of a resolution of the Board of Directors of the Trustee shall constitute conclusive evidence of the authority of any such Authorized Officer to act and shall be considered in full force and effect until receipt by the Servicer of written notice to the contrary given by the Trustee. Section 12.07. Indemnification by Servicer as Custodian. The Servicer, as custodian, shall indemnify the Trustee for any and all liabilities, obligations, losses, compensatory damages, payments, costs or expenses of any kind whatsoever that may be imposed on, incurred or asserted against the Trustee as the result of any improper act or omission in any way relating to the maintenance and custody by the Servicer, as custodian, of the Receivable Files; provided, however, that the Servicer shall not be liable for any portion of any such amount resulting from the willful misfeasance, bad faith or negligence of the Trustee. Section 12.08. Effective Period and Termination. The Servicer's appointment as custodian shall become effective as of the Cutoff Date and shall continue in full force and effect until terminated pursuant to this Section. If the Servicer shall resign as Servicer pursuant to Section 18.05 or if all of the rights and obligations of the Servicer may have been terminated pursuant to Section 19.01, the appointment of the Servicer as custodian shall be terminated by the Trustee, or by the Holders of Certificates evidencing not less than 51% of the Voting Interests of the Class A Certificates and Class B Certificates, voting together as a single class, in the same manner as the Trustee or such Holders may terminate the rights and obligations of the Servicer under Section 19.01. The Trustee may terminate the Servicer's appointment as custodian, with cause at any time upon written notification to the Servicer, and without cause upon 30 days' prior written notification to the Servicer. As soon as practicable after any termination of such appointment, the Servicer shall deliver the Receivable Files to the Trustee or its agent at such place or places as the Trustee may reasonably designate. Notwithstanding the termination of the Servicer as custodian, the Trustee agrees that upon any such termination, the Trustee shall provide, or cause its agent to provide, access to the Receivable Files to the Servicer for the purpose of carrying out its duties and responsibilities with respect to the servicing of the Receivables hereunder. 20 27 ARTICLE THIRTEEN ADMINISTRATION AND SERVICING OF RECEIVABLES Section 13.01. Duties of Servicer. The Servicer, as agent for the Trustee, shall administer the Receivables with reasonable care, using that degree of skill and attention that the Servicer exercises with respect to all comparable recreational vehicle receivables that it services for itself or others. The Servicer's duties shall include collecting and posting of all payments, responding to inquiries of Obligors or by federal, state or local government authorities with respect to the Receivables, investigating delinquencies, reporting tax information to Obligors in accordance with its customary practices and accounting for collections and furnishing monthly and annual statements to the Trustee with respect to distributions, making Advances pursuant to Section 14.04 and making Non-Reimbursable Payments pursuant to Section 14.05. The Servicer shall follow its customary standards, policies and procedures in performing its duties as Servicer. Without limiting the generality of the foregoing, the Servicer shall be authorized and empowered by the Trustee to execute and deliver, on behalf of itself, the Trust, the Trustee or the Certificateholders 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 Receivables or the related Financed Vehicles. If the Servicer shall commence a legal proceeding to enforce a Receivable, including a Defaulted Receivable, the Trustee shall thereupon be deemed to have automatically assigned, solely for the purpose of collection on behalf of the party retaining an interest in such Receivable, such Receivable and the other property conveyed to the Trust pursuant to Section 2.01 with respect to such Receivable to the Servicer for the purposes of participating in such proceeding. If in any enforcement suit or legal proceeding it shall be held that the Servicer may not enforce a Receivable on the grounds that it shall not be a real party in interest or a holder entitled to enforce the Receivable, the Trustee shall, at the Servicer's expense and direction, take steps to enforce the Receivable, including bringing suit in its name or the name of the Certificateholders. The Trustee shall furnish the Servicer with any powers of attorney and other documents necessary or appropriate to enable the Servicer to carry out its servicing and administrative duties hereunder. Section 13.02. Collection of Receivable Payments. The Servicer shall make reasonable efforts to collect all payments called for under the terms and provisions of the Receivables as and when the same shall become due and shall follow such collection procedures as it follows with respect to all comparable recreational vehicle receivables that it services for itself or others. If, as a result of extending of payments (including any increase in the number of payments) in the ordinary course of the Servicer's collection procedures, any Receivable will be outstanding on the Final Scheduled Distribution Date, then the Servicer shall repurchase such Receivable pursuant to Section 13.07 or Section 21.02. In addition, in the event that any such rescheduling or extension of a Receivable modifies the terms of such Receivable in such a manner as to constitute a cancellation of such Receivable and the creation of a new receivable, the Servicer shall purchase such Receivable pursuant to Section 13.07, and the receivable created shall not be included in the Trust. For the purpose of such repurchases pursuant to Section 13.07, notice shall be deemed to have been received by the Servicer at such time as shall make repurchase mandatory as of the related Record Date. 21 28 Notwithstanding the foregoing, extensions or modifications of the payment schedule of a Receivable cannot be made unless the related Receivable is in default or a default thereunder is imminent or if such extension or modification is required by law. The Servicer may, in accordance with its customary standards, policies and procedures, in its discretion (i) waive any late payment charge or any other fees that may be collected in the ordinary course of servicing a Receivable and (ii) waive the payment by the related Obligor of Accrued Interest on any Receivable; provided that, in connection with any such waiver of Accrued Interest, the Servicer shall make an Advance in respect of any Accrued Interest so waived in accordance with Section 14.04, it being understood and agreed that, notwithstanding anything to the contrary contained in the Agreement, the obligation of the Servicer hereunder shall be absolute and shall be performed regardless of whether the Servicer determines that such Advance shall be recoverable and that the Servicer shall have no right of reimbursement therefor. Section 13.03. Realization Upon Receivables. On behalf of the Trust, the Servicer shall use its best efforts, consistent with its customary servicing procedures, to repossess or otherwise take possession of the Financed Vehicle securing any Receivable which the Servicer shall have determined to be or that the Servicer believes will become a Defaulted Receivable (and shall specify such Receivables to the Trustee no later than the Determination Date following the end of the Collection Period in which the Servicer shall have made such determination). The Servicer shall follow such customary and usual practices and procedures as it shall deem necessary or advisable in its servicing of recreational vehicle receivables, which may include reasonable efforts to realize upon any recourse to Dealers, consigning a Financed Vehicle to a dealer for resale and selling a Financed Vehicle at public or private sale. The Servicer shall be entitled to recover all reasonable out-of-pocket expenses incurred by it in the course of converting a Financed Vehicle into cash proceeds. The Liquidation Proceeds realized in connection with any such action with respect to a Receivable shall be deposited by the Servicer in the Certificate Account in the manner specified in Section 14.06(a)(ii) and shall be applied to reduce (or to satisfy, as the case may be) the Repurchase Amount of the Receivable, if such Receivable is to be repurchased by the Seller pursuant to Section 12.02 or by the Servicer pursuant to Section 13.07; provided, however, that if such Liquidation Proceeds are recovered subsequent to the purchase of a Receivable by the Seller such Liquidation Proceeds shall be paid to the Seller within two Business Days of receipt or, if received with respect to a Receivable purchased by the Servicer, may be retained by the Servicer or deposited in the Certificate Account in satisfaction of other obligations of the Servicer hereunder. The foregoing shall be subject to the proviso that, in any case in which a Financed Vehicle shall have suffered damage, the Servicer shall not expend funds in connection with the repair or the repossession of such Financed Vehicle unless it shall determine in its discretion that such repair and/or repossession will increase the Liquidation Proceeds of the related Receivable by an amount equal to or greater than the amount of such expenses. Section 13.04. Physical Damage Insurance. The Servicer, in accordance with its customary servicing procedures and underwriting standards, shall require that each Obligor shall have obtained and maintained physical damage insurance covering each Financed Vehicle as of the date of execution of the related Receivable. 22 29 Section 13.05. Maintenance of Security Interests in Financed Vehicles. The Servicer, in accordance with its customary servicing procedures, shall take such steps as are necessary to maintain perfection of the security interest created by each Receivable in the related Financed Vehicle including the filing of financing statements and continuation statements with respect to the transfer of the security interest in such Financed Vehicle to the Trust. The Trustee hereby authorizes the Servicer, and the Servicer hereby agrees, to take such steps as are necessary to reperfect such security interest on behalf of the Trust in the event of the relocation of a Financed Vehicle or for any other reason. In the event that the assignment of a Receivable to the Trust is insufficient, without a notation on the related Financed Vehicle's certificate of title, to grant to the Trust a first perfected security interest in the related Financed Vehicle, the Servicer hereby agrees to serve as the agent of the Trust for the purpose of perfecting the security interest in such Financed Vehicle and that the Servicer's listing as the secured party on the certificate of title is in its capacity as agent of the Trust. Section 13.06. Covenants of Servicer. The Servicer shall make the following covenants on which the Trustee will rely in accepting the Receivables in trust and authenticating the Certificates: (i) Security Interest to Remain in Force. Except as contemplated by the Agreement, the Financed Vehicle securing each Receivable shall not be released by the Servicer from the security interest granted by the Receivable in whole or in part. (ii) No Impairment. The Servicer shall not impair the rights of the Certificateholders in the Receivables. (iii) Amendments. The Servicer shall not increase the number of payments under a Receivable except as permitted pursuant to Section 13.02, nor increase the Amount Financed under a Receivable. Section 13.07. Purchase of Receivables Upon Breach. The Servicer or the Trustee, as the case may be, shall inform the other party promptly, in writing, upon the discovery of any breach by the Servicer of its obligations pursuant to Section 13.06 which materially and adversely affects the interest of the Trust in any Receivable or pursuant to Section 13.02 in the case of a Receivable for which the related payment schedule has been extended or modified. Unless the breach shall have been cured by the second Record Date following the date of such discovery (or, at the Servicer's election, the first following Record Date), the Servicer shall purchase any Receivable materially and adversely affected by such breach as of such second Record Date. In consideration of the purchase of such Receivable, the Servicer shall remit the Repurchase Amount (less any Liquidation Proceeds deposited, or concurrently being deposited, in the Certificate Account with respect to such Receivable pursuant to Section 13.03) to the Certificate Account in the manner specified in Section 14.06(a)(i). The sole remedy of the Trustee, the Trust or the Certificateholders against the Servicer with respect to a breach pursuant to Section 13.02 or 13.06 shall be to require the Servicer to repurchase Receivables pursuant to this Section. 23 30 Section 13.08. Servicing Fee. The Servicing Fee for a Collection Period shall equal the product of one twelfth times the Servicing Fee Rate times the Pool Balance as of the Record Date immediately preceding the first day of such Collection Period, except that in the case of the first Collection Period, the Servicing Fee shall equal the product of one twelfth times the Servicing Fee Rate times the Original Pool Balance. The Servicing Fee for any Collection Period shall be calculated based on a 360 day year comprised of twelve 30-day months. In addition, the Servicer shall also be entitled to receive as additional servicing compensation all late payment and extension fees, and other administrative fees with respect to the Receivables, collected (from whatever source) on the Receivables; provided, however, such late payment and other fees shall not form a part of the Servicing Fee and the Servicer shall be entitled to such fees as and when collected. Section 13.09. Servicer's Certificate. On or before each Determination Date, the Servicer shall deliver to the Trustee and the Letter of Credit Bank, if any, a Servicer's Certificate containing all information necessary to make the distributions pursuant to Section 14.07 in respect of the Collection Period preceding the date of such Servicer's Certificate and all information necessary for the Trustee to send statements to Certificateholders pursuant to Section 14.10. The Servicer shall also specify to the Trustee no later than the Determination Date following the Record Date as of which the Seller shall be required to repurchase or the Servicer shall be required to purchase a Receivable, the identity of any such Receivable and the identity of any Receivable which the Servicer shall have determined to be a Defaulted Receivable during the preceding Collection Period. Receivables purchased or to be purchased by the Servicer or the Seller and Receivables as to which the Servicer has determined during the Collection Period that eventual payment in full is unlikely and with respect to which payment of the Repurchase Amount has been provided from whatever source as of any Record Date shall be identified by the Seller's account number with respect to such Receivable (as specified in the Schedule of Receivables). The Rating Agencies may request such additional information as the Servicer may be able to reasonably provide. Section 13.10. Annual Statement as to Compliance; Notice of Default; Opinion as to Interest of the Trustee in the Receivables. (a) The Servicer shall deliver to the Trustee and the Letter of Credit Bank, if any, on or before April 30 of each year, beginning with the first April 30 that occurs at least six months after the Cutoff Date, an Officer's Certificate, stating that (i) a review of the activities of the Servicer during the preceding 12-month period ending the preceding December 31 (or shorter period in the case of the first such certificate) and of its performance under the 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 the 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. (b) The Servicer shall deliver to the Trustee and the Letter of Credit Bank, if any, promptly after having obtained knowledge thereof, but in no event later than five Business 24 31 Days thereafter, an Officer's Certificate of any event which with the giving of notice or lapse of time, or both, would become an Event of Default under clause (i) or (ii) of Section 19.01. The Seller shall deliver to the Trustee and Letter of Credit Bank, if any, promptly after having obtained knowledge thereof, but in no event later than five Business Days thereafter, an Officer's Certificate of any event which with the giving of notice or lapse of time, or both, would become an Event of Default under clause (ii) of Section 19.01. (c) The Servicer shall deliver to the Trustee on or prior to April 30 of each year, commencing with the first April 30 that occurs at least six months after the Cutoff Date, an Opinion of Counsel, dated as of such date, either (A) stating that, in the opinion of such counsel, all financing statements and continuation statements have been executed and filed that are necessary fully to preserve and protect the interest of the Trustee in the Receivables, and reciting the details of such filings or referring to prior Opinions of Counsel in which such details are given or (B) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interest. Section 13.11. Annual Independent Certified Public Accountant's Report. The Servicer shall cause a firm of independent certified public accountants (who may also render other services to the Servicer or to the Seller) to deliver to the Trustee and the Letter of Credit Bank, if any, on or before April 30 of each year beginning with the first April 30 that occurs at least six months after the Cutoff Date, a report addressed to the Board of Directors of the Servicer, the Trustee and the Letter of Credit Bank, if any, to the effect that such firm has examined the financial statements of the Servicer for the fiscal year ending the preceding December 31 and issued its report thereon and that such examination (i) was made in accordance with generally accepted auditing standards, and accordingly included such tests of the accounting records and such other auditing procedures as such firm considered necessary in the circumstances, and (ii) except as described in such report, disclosed no exceptions or errors in the records relating to receivables serviced for others that, in such firm's opinion, requires such firm to report. The report shall also indicate that such firm is independent of the Servicer within the meaning of the Code of Professional Ethics of the American Institute of Certified Public Accountants. Section 13.12. Access to Certain Documentation and Information Regarding Receivables. The Servicer shall provide to the Certificateholders access to the Receivable Files in such cases where the Certificateholders shall be required by applicable statutes or regulations to review such documentation. Access shall be afforded without charge, but only upon reasonable request and during the normal business hours at the respective offices of the Servicer. Nothing in this Section shall affect the obligation of the Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors, and the failure of the Servicer to provide access to information as a result of such obligation shall not constitute a breach of this Section. 25 32 Section 13.13. Reports to Certificateholders and Each Rating Agency. (a) The Trustee shall provide to any Certificateholder or Certificate Owner who so requests in writing a copy of (i) any Servicer's Certificate, (ii) any annual statement as to compliance described in Section 13.10(a), (iii) any annual report described in Section 13.11, (iv) any statement to Certificateholders pursuant to Section 14.10 or (v) the Agreement (without Exhibits). The Trustee may require such Certificateholder or Certificate Owner to pay a reasonable sum to cover the cost of the Trustee's complying with such request. (b) The Trustee shall forward to each Rating Agency a copy of each (i) Servicer's Certificate described in Section 13.09, (ii) annual statement as to compliance described in Section 13.10(a), (iii) Officer's Certificate described in Section 13.10(b), (iv) Opinion of Counsel described in 13.10(c), (v) annual independent certified public accountants' report described in Section 13.11, (vi) statement to Certificateholders described in Section 14.10 and (vii) other report it may receive pursuant to the Agreement at its address specified in Section 22.05 or in the Agreement. 26 33 ARTICLE FOURTEEN DISTRIBUTIONS; RESERVE FUND; STATEMENTS TO CERTIFICATEHOLDERS Section 14.01. Certificate Account. (a) The Servicer shall establish the Certificate Account in the name of the Trustee for the benefit of the Certificateholders. The Certificate Account shall be a segregated trust account initially established with the Trustee and maintained (i) with the Trustee so long as the deposits of the Trustee have the Required Deposit Rating, or (ii) in a non-interest bearing segregated trust account bearing a designation clearly indicating that the funds deposited therein are held in trust for the benefit of the Certificateholders, located in the corporate trust department of a depository institution or trust company having corporate trust powers under applicable federal and state laws (which may include the Trustee) organized under the laws of the United States or any State and, if required by any Rating Agency, having the Required Long Term Debt Rating. (b) For so long as the bank or trust company then maintaining the Certificate Account has the Required Deposit Rating, all amounts held in the Certificate Account shall, to the extent permitted by applicable laws, rules and regulations, be invested, as directed by the Servicer, in Permitted Investments. In the event that the short-term unsecured debt obligations of the Trustee no longer have the Required Deposit Rating, then the Servicer shall, with the Trustee's assistance as necessary, cause the Certificate Account to be moved within 15 days of such occurrence (i) to a bank or trust company, the short-term unsecured debt obligations of which shall have the Required Deposit Rating, or (ii) to a non-interest bearing segregated trust account bearing a designation clearly indicating that the funds deposited therein are held in trust for the benefit of the Certificateholders, located in the corporate trust department of a depository institution or trust company having corporate trust powers under applicable federal and state laws (which may include the Trustee) organized under the laws of the United States or any State and, if required by any Rating Agency, having the Required Long Term Debt Rating. Earnings on investment of funds in the Certificate Account shall be paid to the Servicer. Section 14.02. Collections. The Servicer shall remit to the Certificate Account on a daily basis within two Business Days of receipt thereof, all payments by or on behalf of the Obligors (other than the amounts listed in subclauses (i)(a) and (b) of the definition of Available Funds as not constituting Available Funds) on or in respect of the Receivables (other than Repurchased Receivables) and all Liquidation Proceeds both as collected during each Collection Period. Fleetwood Credit has requested that the Servicer be permitted to make remittances of collections on a less frequent basis than that specified in the immediately preceding sentence upon the Servicer's compliance with the specific terms and conditions set forth below in this Section and for so long as such terms and conditions are fulfilled. Accordingly, notwithstanding the provisions of the first sentence of this Section, the Servicer will be 27 34 permitted to remit such collections to the Certificate Account in Automated Clearinghouse Corporation next-day funds or immediately available funds no later than 12:00 P.M., New York City time, on the Business Day immediately preceding each Distribution Date but only for so long as (a)(i) except as provided in clause (b) below, the short-term credit rating of the Servicer is at least equal to the Required Servicer Rating by each Rating Agency, and (ii) no Event of Default shall have occurred and be continuing, provided, however, that immediately following the non-compliance with clause (i) above or in the event that an event of the nature specified in clause (iii) of Section 19.01 has occurred (notwithstanding any period of grace contained in such clause), the Servicer shall remit such collections to the Certificate Account on a daily basis within two Business Days of receipt thereof, or (b)(i) if the condition specified in clause (a)(ii) above is satisfied, and (ii) the Servicer shall have obtained a Servicer Letter of Credit issued in favor of the Trustee by a depository institution or insurance company, as the case may be, having a short-term credit rating at least equal to the Required Deposit Rating and providing that the Trustee may draw thereon in the event that the Servicer fails to deposit collections into the Certificate Account on a monthly basis; provided that in connection with clause (b) above, the Servicer provides, to the Trustee, from each Rating Agency for which the Servicer's then-current short-term credit rating is not at least equal to the Required Servicer Rating for such Rating Agency, a letter to the effect that the satisfaction of the conditions in clause (b) above and allowing the Servicer to make monthly deposits will not result in a qualification, reduction or withdrawal of the then-current rating of the Rated Certificates and, if applicable, an Officer's Certificate from the Servicer to the effect that the Servicer's then-current short-term credit rating is at least equal to the Required Servicer Rating from each other Rating Agency, if any; and, provided further, that if the Servicer shall have obtained a Servicer Letter of Credit in accordance with clause (b) above, the Servicer shall be required to remit such collections in the manner provided for in Section 15.01(c) under the conditions specified in such Section. The Trustee shall not be deemed to have knowledge of any event or circumstance under clause (a)(ii) above that would require daily remittance by the Servicer to the Certificate Account unless it has received notice of such event or circumstance from the Seller or the Servicer in an Officer's Certificate or from Certificateholders as provided in Section 19.01. For purposes of this Article the phrase "payments made on behalf of Obligors" shall mean payments made by Persons other than the Seller, the Servicer or the Letter of Credit Bank, if any. Any funds held by the Servicer which it determines are to be remitted (or any of its own funds which the Seller or the Servicer determines to pay to the Letter of Credit Bank) in respect of a failure previously to remit collections which failure resulted in a payment under any Servicer Letter of Credit pursuant to Section 15.01 shall not be remitted to the Certificate Account, but shall instead be paid immediately and directly to the Letter of Credit Bank. Any such payment to the Letter of Credit Bank shall be accompanied by a copy of the Servicer's Certificate related to the previous failure to remit funds and an Officer's Certificate which includes a statement identifying, by reference to the items in such related Servicer's Certificate, each shortfall in Servicer remittances to which such payment relates. The Servicer will also provide the Trustee with copies of each such Servicer's Certificate and Officer's Certificate delivered with any such payment to the Letter of Credit Bank. 28 35 Section 14.03. Application of Collections. As of each Record Date, all collections for the related Collection Period shall be applied by the Servicer as follows: with respect to each Receivable (including a Defaulted Receivable), payments by or on behalf of an Obligor shall be applied first to late payment and extension fees, second to interest accrued on the Receivable, third to principal of the Receivable and fourth to administrative charges, if any. Any excess shall be applied to prepay the principal balance of the Receivable. Section 14.04. Advances. As of each Record Date, the Servicer shall purchase from the Trust the aggregate Accrued Interest on the Receivables (including Accrued Interest waived by the Servicer pursuant to Section 13.02) at a price equal to the face value thereof. On the Business Day immediately preceding the related Distribution Date, the Servicer shall deposit an amount equal to the Accrued Interest in respect of each Receivable (an "Advance") in the Certificate Account in Automated Clearinghouse Corporation next-day funds or immediately available funds. The Servicer shall be entitled to reimbursement for unreimbursed Advances, without interest, with respect to a Receivable from subsequent Collected Interest allocable with respect to such Receivable, Liquidation Proceeds of or the Repurchase Amount of such Receivable or as otherwise provided in Section 14.07, except as otherwise provided in Sections 13.02 and 13.07. Except as otherwise provided in Section 13.02, the Servicer shall not be required to purchase Accrued Interest and make an Advance to the extent that the Servicer, in its sole discretion, shall determine that such Advance will not be recoverable from subsequent payments by or on behalf of the related Obligor, Liquidation Proceeds or the Repurchase Amount with respect to such Receivable (whether such Receivable is purchased by the Seller or the Servicer, to the extent such right of reimbursement is not waived in connection with any such repurchase) or otherwise. Section 14.05. Non-Reimbursable Payments. As of each Record Date, the Servicer shall be required to make a payment (the "Non-Reimbursable Payment") equal to the amount of interest that accrued on the aggregate Collected Principal for the related Collection Period, at a rate equal to the sum of (i) the weighted average of the Class A Pass-Through Rate and the Class B Pass-Through Rate as of the Closing Date and (ii) the Servicing Fee Rate, from the date of collection of each payment of principal on or in respect of the Receivables comprising part of such aggregate Collected Principal through such Record Date, based on a year with the actual number of days in such year and consisting of twelve months with the actual number of days in such month. The Servicer shall not be entitled to reimbursement for any Non-Reimbursable Payment from the Trust, the Trustee, the Seller or the Letter of Credit Bank, if any. On the Business Day immediately preceding each Distribution Date, the Servicer shall deposit into the Certificate Account in Automated Clearinghouse Corporation next-day funds or immediately available funds an amount equal to the aggregate Non-Reimbursable Payments to be made in respect of the related Collection Period. Section 14.06. Additional Deposits. (a) The following additional deposits shall be made to the Certificate Account: (i) the Servicer or the Seller, as the case may be, shall remit the aggregate Repurchase Amount with respect to Repurchased Receivables pursuant to Sections 12.02, 13.07 and 21.02, (ii) the Servicer shall remit the aggregate Liquidation Proceeds received during each Collection 29 36 Period (less any Liquidation Proceeds paid to the Seller or retained by the Servicer) pursuant to Section 13.03 and (iii) the Trustee shall deposit (A) the aggregate of any amounts received from any Letter of Credit Bank pursuant to Article Fifteen or (B) from the sale of Receivables pursuant to Section 21.03, in each case on the date of receipt thereof. (b) Except as otherwise provided in Section 14.02, all deposits required to be made in respect of a Collection Period pursuant to this Section by the Seller or the Servicer may be made in the form of a single deposit by the Seller or the Servicer, as the case may be, and shall be made in Automated Clearinghouse Corporation next-day funds or immediately available funds, no later than 12:00 P.M., New York City time, on the Business Day preceding each Distribution Date. Section 14.07. Distributions. (a) The rights of the Class B Certificateholders to receive distributions in respect of the Class B Certificates shall be and hereby are subordinated to the rights of the Class A Certificateholders to receive distributions in respect of the Class A Certificates to the extent provided in this Section. On each Distribution Date, the Trustee shall cause to be made the following transfers and distributions from the Certificate Account in respect of the related Collection Period in the following order of priority and in the amounts set forth in the Servicer's Certificate for such Distribution Date: (i) to the Servicer in reimbursement of an Advance previously made in respect of a Receivable, by wire transfer of immediately available funds, from monies on deposit in the Certificate Account in respect of (A) the amount of Collected Interest collected during the related Collection Period in respect of the related Receivable, (B) the interest portion of the Repurchase Amount (to the extent that the Repurchase Amount does not consist in part of a waiver of the right to reimbursement for an Advance made in respect of such Receivable, as provided in Section 13.02) and (C) the interest portion of Liquidation Proceeds of such Receivable; provided that no repayment of an Advance made by the Servicer in respect of a Receivable pursuant to this subclause, when taken together with all previous repayments made in respect of such Advance, may exceed the actual amount of the Advance; (ii) to the Servicer, by wire transfer of immediately available funds, the aggregate payment of the Servicing Fee (including any unpaid Servicing Fees with respect to one or more prior Collection Periods); provided, however, that such fees shall be provided from Available Funds only to the extent, as determined by the Servicer pursuant to Section 14.03, such funds represent payment in respect of the Receivables allocable to interest; and (iii) to the Class A Certificateholders as of the previous Record Date from Collected Interest (after giving effect to the reduction in Collected Interest described in clauses (i) and (ii) above), an amount equal to the sum of the Class A Interest Distributable Amount and any outstanding Class A Interest Carryover Shortfall; and, if such Collected Interest is insufficient, the Class A Certificateholders will receive such 30 37 shortfall first, from the Class B Percentage of Collected Principal and second, if such amounts are still insufficient, from monies on deposit in the Reserve Fund; (iv) to the Class B Certificateholders as of the previous Record Date, from Collected Interest (after giving effect to the reduction in Collected Interest described in clauses (i), (ii) and (iii) above), an amount equal to the sum of the Class B Interest Distributable Amount and any outstanding Class B Interest Carryover Shortfall; and, if such Collected Interest is insufficient, the Class B Certificateholders will receive such shortfall from monies on deposit in the Reserve Fund; (v) to the Class A Certificateholders as of the previous Record Date, from Collected Principal (after giving effect to reduction in Collected Principal described in clause (iii) above) an amount equal to the sum of the Class A Principal Distributable Amount and any outstanding Class A Principal Carryover Shortfall; and, if such Collected Principal is insufficient, the Class A Certificateholders will receive such shortfall first, from Collected Interest (after giving effect to the reduction in Collected Interest described in clauses (i) through (iv) above) and second, if such amounts are still insufficient, from monies on deposit in the Reserve Fund; and (vi) to the Class B Certificateholders as of the previous Record Date, from Collected Principal (after giving effect to the reduction in Collected Principal described in clauses (iii) and (v) above), an amount equal to the sum of the Class B Principal Distributable Amount and any outstanding Class B Principal Carryover Shortfall; and, if such Collected Principal is insufficient, the Class B Certificateholders will receive such shortfall first, from Collected Interest (after giving effect to the reduction in Collected Interest described in clauses (i) through (v) above) and second, if such amounts are still insufficient, from monies on deposit in the Reserve Fund. (b) On each Distribution Date, the Trustee shall distribute any excess amounts remaining in the Certificate Account after making the distributions described in clauses (a)(i) through (vi) above ("Excess Amounts") in the following amounts and in the following order of priority: (i) into the Reserve Fund until the amount on deposit therein equals the Specified Reserve Fund Balance, and (ii) to the Seller. (c) Subject to Section 21.01 with respect to the final payment upon retirement of each Certificate, on each Distribution Date the Trustee shall distribute to the respective Certificateholders of record as of the previous Record Date by check mailed by the Trustee to each Certificateholder's respective address (or if DTC, its nominee or a Clearing Agency is the relevant Certificateholder, by wire transfer of immediately available funds or pursuant to other arrangements) the amount to be distributed to such Certificateholder pursuant to such Holder's Certificate. (d) In the event that the Servicer determines that the amount of an Advance previously made in respect of a Receivable which became a Defaulted Receivable is not recoverable as a result of the fact that Liquidation Proceeds of such Defaulted Receivable are insufficient to fully reimburse the Servicer for such Advance, the Servicer shall be entitled to 31 38 withdraw from the Certificate Account an amount equal to the amount that would be necessary to fully reimburse the Servicer for such Advance, and the amount available for the other distributions pursuant to this Section will be reduced accordingly. Section 14.08. Subordination; Reserve Fund; Priority of Distributions. (a) (i) In order to effectuate the subordination provided for herein and to assure that sufficient amounts to make required distributions to Certificateholders will be available, the Servicer shall establish and maintain with the Trustee a separate trust account (the "Reserve Fund") which will include the money and other property deposited and held therein pursuant to Section 14.07(b)(i) and this Section. Except as otherwise provided in the Agreement, the Reserve Fund shall (A) be a segregated trust account initially established with the Trustee and maintained with the Trustee so long as the commercial paper or other short-term unsecured debt obligations or uninsured deposits of the Trustee have the Required Rating and (B) in the event that the commercial paper or other short-term unsecured debt obligations or uninsured deposits of the Trustee no longer have the Required Rating, within ten Business Days the Servicer shall, with the assistance of the Trustee as necessary, cause the Reserve Fund to be moved to (1) a segregated deposit account in a bank or trust company the commercial paper or other short-term unsecured debt obligations of which shall have the Required Rating, or (2) segregated trust accounts bearing designations clearly indicating the funds deposited therein are held in trust for the benefit of the Certificateholders, located in the corporate trust department of a depository institution or trust company (which may include the Trustee) having a long-term deposit rating from Moody's (so long as Moody's is a Rating Agency) of at least Baa3 (or such lower rating as Moody's shall approve in writing) and corporate trust powers under applicable federal and state laws and organized under the laws of the United States, any State or the Commonwealth of Puerto Rico. On or prior to the Closing Date, the Seller shall deposit an amount equal to the Reserve Fund Initial Deposit into the Reserve Fund. The Reserve Fund shall not be part of the Trust but instead will be held for the benefit of the Holders of the Certificates. The Seller hereby acknowledges that any money and other property held in the Reserve Fund, including the Reserve Fund Initial Deposit (and any investment earnings thereon), is owned directly by it, and the Seller hereby agrees to treat the same as its assets (and earnings) for federal income tax and all other purposes. (ii) In order to give effect to the subordination provided for herein and to assure availability of the amounts maintained in the Reserve Fund, the Seller hereby sells, conveys and transfers to the Trustee, as collateral agent, and its successors and assigns, the Reserve Fund Initial Deposit and all proceeds thereof and hereby pledges to the Trustee as collateral agent, and its successors and assigns, all other amounts deposited in or credited to the Reserve Fund from time to time under the Agreement, all Permitted Investments made with amounts on deposit therein, all earnings and distributions thereon and proceeds thereof (other than proceeds constituting net investment earnings attributable to the Reserve Fund Property) subject, however, to the 32 39 limitations set forth below, and solely for the purpose of securing and providing for payment of the Class A and Class B Distributable Amounts, together with any Class A and Class B Interest Carryover Shortfalls and Class A and Class B Principal Carryover Shortfalls, in accordance with Section 14.07 and this Section (all the foregoing, subject to the limitations set forth below, being the "Reserve Fund Property"), to have and to hold all the aforesaid property, rights and privileges unto the Trustee, its successors and assigns, in trust for the uses and purposes, and subject to the terms and provisions, set forth in this Section. The Trustee hereby acknowledges such transfer and accepts the trusts hereunder and shall hold and distribute the Reserve Fund Property in accordance with the terms and provisions of this Section. (iii) Consistent with the limited purposes for which such trust is granted on each Distribution Date, the amounts on deposit in the Reserve Fund shall be available for distribution as provided in Section 14.07, in accordance with and subject to the following: if the amount on deposit in the Reserve Fund (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Reserve Fund Balance, the Trustee shall release and distribute all such amounts to the Seller. Upon any such distribution to the Seller, the Certificateholders will have no further rights in, or claims to, such amounts. (b) (i) Amounts held in the Reserve Fund shall be invested in Permitted Investments in accordance with written instructions from the Seller and such investments shall not be sold or disposed of prior to their maturity. Investment earnings attributable to the Reserve Fund Property shall not be available to satisfy the subordination provisions of the Agreement and shall not otherwise be subject to any claims or rights of the Certificateholders or the Servicer. All such investments shall be made in the name of the Trustee or its nominee, as collateral agent, and all income and gain realized thereon shall be solely for the benefit of the Seller and shall be payable by the Trustee to the Seller on each Distribution Date. Realized losses, if any, on investment of the Reserve Fund Property shall be charged first against undistributed investment earnings attributable to the Reserve Fund Property and then against the Reserve Fund Property. (ii) With respect to the Reserve Fund Property, the Seller on behalf of itself, its successors and assigns and the Trustee agree that: (A) Any Reserve Fund Property that is held in deposit accounts shall be held solely in the name of the Trustee, as collateral agent, at the Trustee (in a segregated trust account if the deposits of the Trustee do not have the Required Deposit Rating) or at one or more depository institutions which have the Required Deposit Rating. Each such deposit account shall be subject to the exclusive custody and control of the Trustee, and the Trustee shall have sole signature authority with respect thereto. (B) Any Reserve Fund Property that constitutes Physical Property shall be delivered to the Trustee, as collateral agent, in accordance with 33 40 paragraph (a) of the definition of "Delivery" and shall be held, pending maturity or disposition, solely by the Trustee, as collateral agent, or a Financial Intermediary acting solely for the Trustee, as collateral agent. (C) Any Reserve Fund Property that is a book-entry security held through the Federal Reserve System pursuant to federal book-entry regulations shall be delivered in accordance with paragraph (b) of the definition of "Delivery" and shall be maintained by the Trustee, as collateral agent, pending maturity or disposition, through continued book-entry registration of such Reserve Fund Property as described in such paragraph. (D) Any Reserve Fund Property that is an "uncertificated security" under Article 8 of the UCC and that is not governed by clause (C) above shall be delivered to the Trustee, as collateral agent, in accordance with paragraph (c) of the definition of "Delivery" and shall be maintained by the Trustee, as collateral agent, pending maturity or disposition, through continued registration of the Trustee's or its Financial Intermediary's (or its custodian's or its nominee's) ownership of such security, in its capacity as collateral agent. Effective upon Delivery of any Reserve Fund Property in the form of Physical Property, book-entry securities or uncertificated securities, the Trustee shall be deemed to have purchased such Reserve Fund Property for value, in good faith and without notice of any adverse claim thereto. (iii) Each of the Seller and the Servicer agrees to take or cause to be taken such further actions, to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments (including, without limitation, any UCC financing statements or the Agreement) as may be determined to be necessary in an Opinion of Counsel to the Seller delivered to the Trustee in order to perfect the interests created by this Section and otherwise fully to effectuate the purposes, terms and conditions of this Section. The Seller and/or the Servicer, as the case may be, shall: (A) promptly execute, deliver and file any financing statements, amendments, continuation statements, assignments, certificates and other documents with respect to such interests and perform all such other acts as may be necessary in order to perfect or to maintain the perfection of the Trustee's security interest; and (B) make the necessary filings of financing statements or amendments thereto within five days after the occurrence of any of the following: (1) any change in its corporate name or any trade name; (2) any change in the location of its chief executive office or principal place of business; and (3) any merger or consolidation or other change in its identity or corporate structure and promptly notify the Trustee of any such filings. 34 41 (iv) The Trustee shall not enter into any subordination or intercreditor agreement with respect to the Reserve Fund Property. (c) Upon termination of this Agreement in accordance with Section 21.01, any amounts on deposit in the Reserve Fund, after payment of amounts due to the Class A and Class B Certificateholders, shall be paid to the Seller. Section 14.09. Net Deposits. For so long as (i) Fleetwood Credit shall be the Servicer and (ii) the Servicer shall be entitled pursuant to Section 14.02 to remit collections on a monthly rather than daily basis, the Servicer may make the remittances pursuant to Sections 14.02, 14.04, 14.05 and 14.06 net of amounts to be distributed to the Servicer pursuant to Section 14.07. Nonetheless, the Servicer shall account for all of the above described remittances and distributions in the Servicer's Certificate as if the amounts were deposited and/or distributed separately. Section 14.10. Statements to Certificateholders. On each Distribution Date, the Trustee shall include with each distribution to each Class A Certificateholder and Class B Certificateholder of record, a statement based on information in the related Servicer's Certificate furnished pursuant to Section 13.09, setting forth for the related Collection Period the following information (stated in the case of items (i), (ii) and (iii) below, on the basis of a Certificate with a denomination of $1,000) as of the related Record Date or such Distribution Date, as the case may be: (i) the amount of the distribution allocable to principal on the Class A Certificates and the Class B Certificates; (ii) the amount of the distribution allocable to interest on the Class A Certificates and the Class B Certificates; (iii) the Certificateholder's pro rata portion of the Servicing Fee and any additional servicing compensation paid to the Servicer and the fee paid to the Letter of Credit Bank, if any; (iv) the Pool Balance, the Class A Pool Factor and the Class B Pool Factor as of the related Record Date; (v) the amount, if any, of proceeds received during the related Collection Period in connection with any physical damage insurance policies covering Financed Vehicles; (vi) the amount on deposit in the Reserve Fund, after giving effect to distributions made on such Distribution Date, such amount as a percentage of the Pool Balance and, if the amount on deposit in the Reserve Fund has been reduced to zero, the number and aggregate dollar amount of Defaulted Receivables; 35 42 (vii) the Servicer Letter of Credit Amount, if any, and such amount as a percentage of the Pool Balance; (viii) the amount, if any, of proceeds received during the related Collection Period from Dealer repurchase obligations relating to Defaulted Receivables; (ix) the number and aggregate amount of Paid-Ahead Receivables, the aggregate amount of unreimbursed Advances made with respect to such Paid-Ahead Receivables and the change in such amounts from the previous Collection Period; (x) the aggregate amount of unreimbursed Advances and the change in such amount from the previous Collection Period; (xi) the Class A Certificate Balance and the Class B Certificate Balance as of such Record Date, after giving effect to payments allocated to principal reported under (i) above; (xii) the amount of the Class A Principal and Interest Carryover Shortfalls and the Class B Principal and Interest Carryover Shortfalls, if any, on such Distribution Date and any change in such Class A and Class B Principal and Interest Carryover Shortfalls from the preceding Distribution Date; (xiii) the amount of Realized Losses, if any, on such Distribution Date and the change in such amount from the prior Distribution Date; and (xiv) the amount otherwise distributable to the Class B Certificateholders that is distributed to the Class A Certificateholders on such Distribution Date. Within a reasonable period of time after the end of each calendar year, but not later than the latest date permitted by law, the Trustee shall furnish, to each Person who at any time during such calendar year shall have been a Certificateholder, a statement containing the sum of the amounts determined in each of clauses (i) through (iii) and (xiii) above for such calendar year or, in the event such Person shall have been a Certificateholder during a portion of such calendar year, for the applicable portion of such year, for the purposes of such Certificateholder's preparation of federal income tax returns. In addition, the Servicer shall furnish to the Trustee for distribution to such Person at such time any other information necessary under applicable law for the preparation of such income tax returns. 36 43 ARTICLE FIFTEEN THE SERVICER LETTER OF CREDIT Section 15.01. Servicer Letter of Credit. (a) If the Servicer has obtained a Servicer Letter of Credit, on any Distribution Date which immediately follows a Collection Period during which the Servicer is permitted to remit collections on a monthly rather than a daily basis pursuant to Section 14.02 the Servicer shall have failed to make in full the remittances to the Certificate Account pursuant to Section 14.02 required for distribution to Certificateholders on such Distribution Date by 12:00 P.M., New York City time, on the Business Day immediately preceding such Distribution Date, the Trustee shall immediately deliver a demand for payment under the Servicer Letter of Credit to the Letter of Credit Bank requesting payment in the amount of the shortfall between the amount of funds that are required to be remitted by the Servicer to the Certificate Account as set forth in the related Servicer's Certificate and the amount of funds actually so remitted. Upon receipt of a completed demand for payment by the Trustee under the Servicer Letter of Credit, the Letter of Credit Bank shall pay or cause to be paid, at the time and in the manner provided in the Servicer Letter of Credit, an amount equal to the lesser of (i) the amount demanded by the Trustee and (ii) the amount available under the Servicer Letter of Credit (the "Servicer Letter of Credit Amount") to the Trustee for credit to the Certificate Account. Except as otherwise provided in the Servicer Letter of Credit, the Servicer Letter of Credit Amount shall equal the lesser of (x) the product of the Initial Servicer Letter of Credit Amount and the Reset Percentage, or (y) the Pool Balance as of the related Record Date. For the purpose of Section 14.07 or 19.01(i), amounts deposited by the Trustee pursuant to this Section shall be deemed to constitute Servicer remittances with respect to which the demand on the Servicer Letter of Credit was made. (b) Any Servicer Letter of Credit may be terminated by the Trustee at any time when the Servicer's short term debt obligations are rated at least equal to the Required Servicer Rating by each Rating Agency; provided, however, that prior to any such termination of the Servicer Letter of Credit, the Servicer shall furnish to the Trustee, from each Rating Agency for which the Servicer's then-current short-term credit rating is not at least as specified above, a letter to the effect that the rating then assigned to the Rated Certificates will not be qualified, reduced or withdrawn and, if applicable, an Officer's Certificate of the Servicer to the effect that the Servicer's then-current short-term credit rating is at least as specified above from each other Rating Agency, if any. Notwithstanding the foregoing, if the short term debt obligations of the Servicer are subsequently downgraded below the Required Servicer Rating by any Rating Agency, the Servicer shall be required to obtain an insurance policy, letter of credit or surety bond acceptable to each Rating Agency (as evidenced by a letter from each Rating Agency to the effect that the rating then assigned to the Rated Certificates will not be qualified, reduced or withdrawn) which insurance policy or surety bond, if it shall not replace the Servicer Letter of Credit, shall be drawn upon prior to any draws made upon the Servicer Letter of Credit pursuant to this Section, or the Servicer shall remit collections to the Certificate Account on a daily basis pursuant to Section 14.02. In addition, the Servicer may cancel the Servicer Letter of Credit for so long as the Servicer is 37 44 required to remit collections to the Certificate Account on a daily basis pursuant to Section 14.02. The Servicer shall provide notice of such cancellation of the Servicer Letter of Credit pursuant to the immediately preceding sentence to each Rating Agency. The Servicer shall also provide notice of the renewal, if any, of the Servicer Letter of Credit to each Rating Agency and the Trustee. (c) Notwithstanding the other provisions of this Section, in the event that on any day during a Collection Period during which the Servicer is permitted to remit collections on a monthly rather than a daily basis as a result of having obtained a Servicer Letter of Credit pursuant to Section 14.02 and the aggregate amount of collections described in the first sentence of Section 14.02 exceeds the product of the Servicer Letter of Credit Percentage and the Servicer Letter of Credit Amount, then the Servicer shall cause the amount of such excess to be deposited into the Certificate Account on the next succeeding Business Day. 38 45 ARTICLE SIXTEEN THE CERTIFICATES Section 16.01. The Certificates. Unless otherwise specified in the Agreement, the Certificates shall be issued in denominations of $1,000 and integral multiples thereof in registered form; provided, however, that one Class A Certificate and one Class B Certificate may be issued in a denomination that includes any remaining portion of the Original Class A Certificate Balance or the Original Class B Certificate Balance, as the case may be (each, a "Residual Certificate"). The Certificates shall be executed on behalf of the Trust by manual or facsimile signature of an Authorized Officer under the Trustee's seal imprinted thereon and attested on behalf of the Trust by the manual or facsimile signature of the Trustee. Certificates bearing the manual or facsimile signatures of individuals who were, at the time when such signatures shall have been affixed, authorized to sign on behalf of the Trust, shall be valid and binding obligations of the Trust, notwithstanding that such individuals or any of them shall have ceased to be so authorized prior to the authentication and delivery of such Certificates or did not hold such offices at the date of such Certificates. Section 16.02. Execution, Authentication and Delivery of Certificates. The Trustee shall deliver to, or upon the order of the Seller, in exchange for the Receivables and the other assets of the Trust, simultaneously with the sale, assignment and transfer to the Trustee of the Receivables, the constructive delivery to the Trustee of the Receivable Files relating thereto and the delivery to the Trustee of the other components of the Trust, Certificates duly executed by the Trustee, on behalf of the Trust, and authenticated by the Trustee in authorized denominations equaling in the aggregate the sum of the Original Class A Certificate Balance and the Original Class B Certificate Balance, and evidencing the entire ownership of the Trust. No Certificate shall entitle its holder to any benefit under the Agreement, or shall be valid for any purpose, unless there shall appear on such Certificate a certificate of authentication substantially in the form of such Certificate appearing as an Exhibit to the Agreement executed by the Trustee by manual signature; such authentication shall constitute conclusive evidence that such Certificate shall have been duly authenticated and delivered hereunder. All Certificates shall be dated the date of their authentication. Section 16.03. Registration of Transfer and Exchange of Certificates. (a) The Certificate Registrar shall maintain a Certificate Register in which, subject to such reasonable regulations as it may prescribe, the Certificate Registrar shall provide for the registration of Certificates and of transfers and exchanges of Certificates as herein provided. The Trustee is hereby initially appointed Certificate Registrar. In the event that, subsequent to the date of issuance of the Certificates, the Trustee notifies the Servicer that it is unable to act as Certificate Registrar, the Servicer shall appoint another bank or trust company, having an office or agency located in the Borough of Manhattan, The City of New York, agreeing to act in accordance with the provisions of the Agreement applicable to it, and otherwise acceptable to the Trustee, to act as successor Certificate Registrar under the Agreement. 39 46 (b) Upon surrender for registration of transfer of any Certificate at the office or agency maintained pursuant to Section 16.07, the Trustee shall execute, authenticate and deliver, in the name of the designated transferee or transferees, one or more new Certificates of the same Class, in authorized denominations of a like aggregate amount dated the date of authentication by the Trustee. At the option of a Holder, Certificates may be exchanged for other Certificates of authorized denominations of a like aggregate amount upon surrender of the Certificates to be exchanged at such office or agency. (c) Every Certificate presented or surrendered for registration of transfer or exchange shall be accompanied by a written instrument of transfer in form satisfactory to the Trustee and the Certificate Registrar duly executed by the holder or his attorney duly authorized in writing. Each Certificate surrendered for registration of transfer and exchange shall be cancelled and subsequently disposed of by the Trustee. (d) No service charge shall be made for any registration of transfer or exchange of Certificates, but the Trustee may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer or exchange of Certificates. Section 16.04. Mutilated, Destroyed, Lost or Stolen Certificates. If (i) any mutilated Certificate shall be surrendered to the Certificate Registrar, or if the Certificate Registrar and the Trustee shall receive evidence to their satisfaction of the destruction, loss or theft of any Certificate and (ii) there shall be delivered to the Certificate Registrar and the Trustee such security or indemnity as may be required to save each of them harmless, then in the absence of notice that such Certificate shall have been acquired by a bona fide purchaser, the Trustee on behalf of the Trust shall execute and the Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like tenor and denomination. In connection with 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 connection therewith. Any duplicate Certificate issued pursuant to this Section shall constitute conclusive evidence of ownership in the Trust, as if originally issued, whether or not the lost, stolen or destroyed Certificate shall be found at any time. Section 16.05. Persons Deemed Owners. Prior to due presentation of a Certificate for registration of transfer, the Trustee and the Certificate Registrar may treat the Person in whose name any Certificate shall be registered as the owner of such Certificate for the purpose of receiving distributions pursuant to Section 14.05 and for all other purposes whatsoever, and neither the Trustee nor the Certificate Registrar shall be bound by any notice to the contrary. Section 16.06. Access to List of Certificateholder Names and Addresses. The Certificate Registrar shall furnish or cause to be furnished to the Servicer, within 15 days after receipt by the Certificate Registrar of a request therefor from the Servicer in writing, a list, in such form as the Servicer may reasonably require, of the names and addresses of the Certificateholders as of the most recent Record Date. If three or more Certificateholders, or one or more Holders of Certificates of any Class aggregating not less than 25% of the Voting 40 47 Interests evidenced by such Class, apply in writing to the Trustee, and such application states that the applicants desire to communicate with other Certificateholders with respect to their rights under the Agreement or under the Certificates and such application shall be accompanied by a copy of the communication that such applicants propose to transmit, then the Trustee shall, within five Business Days after the receipt for such application, afford such applicants access during normal business hours to the current list of Certificateholders. Each Holder, by receiving and holding a Certificate, shall be deemed to have agreed to hold neither the Servicer nor the Trustee accountable by reason of the disclosure of its name and address, regardless of the source from which such information was derived. Section 16.07. Maintenance of Office or Agency. The Certificate Registrar shall maintain in the Borough of Manhattan, The City of New York, an office or offices or agency or agencies where Certificates may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Certificate Registrar in respect of the Certificates and the Agreement may be served. Unless otherwise provided in the Agreement, the Trustee shall designate its Corporate Trust Office as specified in the Agreement as its office for such purposes. The Certificate Registrar shall give prompt written notice to the Servicer and to Certificateholders of any change in the location of the Certificate Register or any such office or agency. Section 16.08. Temporary Certificates. In the event that the Agreement provides that either Class of Certificates are not to be issued in book-entry form pursuant to Section 16.09, pending the preparation of definitive Certificates of such Class, the Trustee, on behalf of the Trust, may execute and authenticate and deliver, temporary Certificates of such Class that are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Certificates in lieu of which they are issued. If temporary Certificates are issued, the Seller will cause definitive Certificates to be prepared without unreasonable delay. After the preparation of definitive Certificates, the temporary Certificates shall be exchangeable for definitive Certificates upon surrender of the temporary Certificates at the office or agency to be maintained as provided in Section 16.07, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Certificates, the Trustee shall execute and authenticate and deliver in exchange therefor a like principal amount of definitive Certificates in authorized denominations. Until so exchanged the temporary Certificates shall in all respects be entitled to the same benefits under the Agreement as definitive Certificates. Section 16.09. Book-Entry Certificates. Unless otherwise specified in the Agreement, the Class A Certificates and the Class B Certificates, upon original issuance (except for the Residual Certificates) each will be issued in the form of one or more typewritten certificates representing the Book-Entry Certificates, to be delivered to DTC, the initial Clearing Agency, by, or on behalf of, the Seller. The certificates delivered to DTC evidencing such Certificates shall initially be registered on the Certificate Register in the name of CEDE & CO., the nominee of DTC, and no Certificate Owner will receive a definitive certificate representing such Certificate Owner's interest in the Certificates, except as provided in Section 16.11. Unless otherwise specified in the Agreement, subject to Section 16.11, unless and until 41 48 definitive, fully registered Certificates (the "Definitive Certificates") have been issued to Certificate Owners pursuant to Section 16.11: (i) the provisions of this Section shall be in full force and effect; (ii) the Seller, the Servicer, the Certificate Registrar and the Trustee may deal with the Clearing Agency for all purposes (including the making of distributions on the Certificates) as the authorized representative of the Certificate Owners; (iii) to the extent that the provisions of this Section conflict with any other provisions of the Agreement, the provisions of this Section shall control; (iv) the rights of Certificate Owners shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Certificate Owners and the Clearing Agency and/or the Clearing Agency Participants and, pursuant to the related depository agreement, unless and until Definitive Certificates are issued pursuant to Section 16.11, the initial Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit distributions of principal and interest on the Certificates to such Clearing Agency Participants; and (v) whenever the Agreement requires or permits actions to be taken based upon instructions or directions of Holders of Certificates evidencing a specified percentage of the Voting Interests thereof, the Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from Certificate Owners and/or Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in Certificates and has delivered such instructions to the Trustee. Section 16.10. Notices to Clearing Agency. Whenever notice or other communication to the Certificateholders is required under the Agreement, other than to the Holder of the Residual Certificates, unless and until Definitive Certificates shall have been issued to Certificate Owners pursuant to Section 16.11, the Trustee and the Servicer shall give all such notices and communications specified herein to be given to Holders of the Certificates to the Clearing Agency. Section 16.11. Definitive Certificates. If (i)(A) the Seller advises the Trustee in writing that the Clearing Agency is no longer willing or able to properly discharge its responsibilities as described in the Letter of Representations and (B) the Trustee or the Seller is unable to locate a qualified successor, (ii) the Seller at its option, advises the Trustee in writing that it elects to terminate the book-entry system through the Clearing Agency, or (iii) after the occurrence of an Event of Default, Certificate Owners representing beneficial interests in Class A Certificates or Class B Certificates aggregating not less than 51% of the Voting Interests of the related Class, advise the Trustee and the Clearing Agency through the Clearing Agency Participants in writing that the continuation of a book-entry system through the Clearing Agency with respect to such Class is no longer in the best interests of the related 42 49 Certificate Owners, then the Trustee shall notify all such Certificate Owners, through the Clearing Agency, of the occurrence of any such event and of the availability of Definitive Certificates to such Certificate Owners requesting the same. Upon surrender to the Trustee of the related Certificates by the Clearing Agency, accompanied by registration instructions from the Clearing Agency for registration, the Trustee shall issue the Definitive Certificates and deliver such Definitive Certificates in accordance with the instructions of the Clearing Agency. Neither the Seller, the Certificate Registrar 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, the Trustee shall recognize the Holders of the Definitive Certificates as Certificateholders hereunder. The Trustee shall not be liable if the Trustee or the Seller is unable to locate a qualified successor Clearing Agency. 43 50 ARTICLE SEVENTEEN THE SELLER Section 17.01. Representations of Seller. The Seller shall make the following representations on which the Trustee shall rely in accepting the Receivables in trust and executing and authenticating the Certificates. The representations shall speak as of the execution and delivery of the Agreement and shall survive the sale of the Receivables to the Trustee. (i) Organization and Good Standing. The Seller shall have been duly organized and shall be validly existing as a corporation in good standing under the laws of the State of California, with power and authority to own its properties and to conduct its business as such properties shall be currently owned and such business is presently conducted, and had at all relevant times, and shall now have, power, authority and legal right to acquire and own the Receivables. (ii) Due Qualification. The Seller shall be duly qualified to do business as a foreign corporation in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business shall require such qualifications. (iii) Power and Authority. The Seller shall have the power and authority to execute and deliver the Agreement and to carry out its terms, the Seller shall have full power and authority to sell and assign the property to be sold and assigned to and deposited with the Trustee as part of the Trust and shall have duly authorized such sale and assignment to the Trustee by all necessary corporate action; and the execution, delivery and performance of the Agreement shall have been duly authorized by the Seller by all necessary corporate action. (iv) Valid Sale; Binding Obligations. The Agreement shall evidence a valid sale, transfer and assignment of the Receivables, enforceable against creditors of and purchasers from the Seller; and shall constitute a legal, valid and binding obligation of the Seller enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (v) No Violation. The consummation of the transactions contemplated by the Agreement and the fulfillment of the terms of the Agreement shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the articles of incorporation or bylaws of the Seller, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of time) a default under, any indenture, agreement or other instrument to which the Seller is a party or by which it shall be 44 51 bound; nor result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than the Agreement); nor violate any law or, to the best of the Seller's knowledge, any order, rule or regulation applicable to the Seller of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Seller or its properties. (vi) No Proceedings. There are no proceedings or investigations pending, or to the Seller's best knowledge, threatened, before any court, regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Seller or its properties: (a) asserting the invalidity of the Agreement or the Certificates, (b) seeking to prevent the issuance of the Certificates or the consummation of any of the transactions contemplated by the Agreement, (c) seeking any determination or ruling that might materially and adversely affect the performance by the Seller of its obligations under, or the validity or enforceability of, the Agreement or the Certificates, or (d) relating to the Seller and which might adversely affect the federal income tax attributes of the Certificates. Section 17.02. Liability of Seller; Indemnities. The Seller shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Seller in such capacity under the Agreement and shall have no other obligations or liabilities hereunder. Section 17.03. Merger or Consolidation of, or Assumption of the Obligations of, Seller; Certain Limitations. (a) Any corporation (i) into which the Seller may be merged or consolidated, (ii) which may result from any merger or consolidation to which the Seller shall be a party, or (iii) which may succeed to all or substantially all of the business of the Seller, which corporation in any of the foregoing cases executes an agreement of assumption to perform every obligation of the Seller under the Agreement, shall be the successor to the Seller hereunder without the execution or filing of any document or any further act by any of the parties to the Agreement, except that if the Seller in any of the foregoing cases is not the surviving entity, then the surviving entity shall execute an agreement of assumption to perform every obligation of the Seller hereunder. The Seller shall provide notice of any merger, consolidation or succession pursuant to this Section to each Rating Agency and shall deliver to the Trustee, a letter from each Rating Agency to the effect that such merger, consolidation or succession will not result in a qualification, reduction or withdrawal of the then-current rating of the Rated Certificates. (b) (i) Subject to paragraph (ii) below, the purpose of the Seller shall be to engage in any lawful activity for which a corporation may be organized under the General Corporation Law of California other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code. 45 52 (ii) Notwithstanding paragraph (b)(i) above, the purpose of the Seller shall be limited to the following purposes, and activities incident to and necessary or convenient to accomplish the following purposes: (A) to acquire, own, hold, sell, transfer, assign, pledge, finance, refinance and otherwise deal with, retail installment sale contracts or wholesale loans secured by new and used recreational vehicles (the "Recreational Vehicle Receivables"); (B) to authorize, issue, sell and deliver one or more series of obligations, consisting of one or more classes of certificates or notes or other evidences of indebtedness (the "Offered Securities") that are collateralized by or evidence an interest in Recreational Vehicle Receivables; and (C) to negotiate, authorize, execute, deliver and assume the obligations or any agreement relating to the activities set forth in clauses (A) and (B) above, including but not limited to any pooling and servicing agreement, indenture, reimbursement agreement, credit support agreement, receivables purchase agreement or underwriting agreement (each, a "Securitization Agreement") or to engage in any lawful activity which is incidental to the activities contemplated by any such Securitization Agreement. So long as any outstanding debt of the Seller or Offered Securities are rated by any nationally recognized statistical rating organization, the Seller shall not borrow money other than in connection with the issuance of Offered Securities by the Corporation pursuant to a Securitization Agreement unless (I) the Seller has made a written request to the related nationally recognized statistical rating organization to issue notes or incur borrowing which notes or borrowing are rated by the related nationally recognized statistical rating organization the same as or higher than the rating afforded such rated debt or Offered Securities, or (II) such notes or borrowings (X) are fully subordinated (and which shall provide for payment only after payment in respect of all outstanding rated debt and/or Offered Securities) or are nonrecourse against any assets of the Seller other than the assets pledged to secure such notes or borrowing, (Y) do not constitute a claim against the Seller in the event such assets are insufficient to pay such notes or borrowing, and (Z) where such notes or borrowing are secured by the rated debt or Offered Securities, are fully subordinated (and which shall provide for payment only after payment in respect of all outstanding rated debt and/or Offered Securities) to such rated debt or Offered Securities. (c) Notwithstanding any other provision of this Section and any provision of law, the Seller shall not do any of the following: (i) engage in any business or activity other than as set forth in clause (b) above; (ii) without the affirmative vote of a majority of the members of the Board of Directors of the Seller (which must include the affirmative vote of all duly appointed Independent Directors, as required by the articles of incorporation of the Seller), (A) dissolve or liquidate, in whole or in part, or institute proceedings to be adjudicated bankrupt or insolvent, (B) consent to the institution of bankruptcy or insolvency proceedings against it, (C) file a petition seeking or consent to reorganization or relief under any applicable federal or state law relating to bankruptcy, (D) consent to the appointment of a receiver, liquidator, assignee, trustee, 46 53 sequestrator or other similar official of the Seller or a substantial part of its property, (E) make a general assignment for the benefit of creditors, (F) admit in writing its inability to pay its debts generally as they become due, or (G) take any corporate action in furtherance of the actions set forth in clauses (A) through (F) above; provided, however, that no director may be required by any shareholder of the Seller to consent to the institution of bankruptcy or insolvency proceedings against the Seller so long as it is solvent; or (iii) merge or consolidate with any other corporation, company or entity or sell all or substantially all of its assets or acquire all or substantially all of the assets or capital stock or other ownership interest of any other corporation, company or entity, except for the acquisition of the Recreational Vehicle Receivables of Fleetwood Credit and the sale of Recreational Vehicle Receivables to one or more trusts in accordance with the terms of clause (b)(ii) above, on which there shall be no such restriction. Section 17.04. Limitation on Liability of Seller and Others. The Seller and any director or officer or employee or agent of the Seller may rely in good faith on the advice of counsel or on any document of any kind, prima facie properly executed and submitted by any Person respecting any matters arising under the Agreement. The Seller shall not be under any obligation to appear in, prosecute or defend any legal action that shall be unrelated to its obligations under the Agreement, and that in its opinion may involve it in any expense or liability. Section 17.05. Seller May Own Certificates. The Seller and any Person controlling, controlled by or under common control with the Seller may in its individual or any other capacity become the owner or pledgee of Certificates with the same rights as it would have if it were not the Seller or an affiliate thereof, except as otherwise provided in the definition of the term "Certificateholder." Certificates so owned by or pledged to the Seller or such controlling or commonly controlled Person shall have an equal and proportionate benefit under the provisions of the Agreement, without preference, priority or distinction as among all of the Certificates. Section 17.06. No Transfer of Excess Amounts. The Seller hereby covenants that, except as otherwise provided in the Agreement, it will not transfer, pledge or assign to any Person any part of its right to receive any Excess Amounts pursuant to Section 14.07(b)(ii) unless it has first delivered to the Trustee and each Rating Agency an Opinion of Counsel in form and substance satisfactory to the Trustee stating that such transfer will not (i) adversely affect the status of the Trust as a grantor trust pursuant to subpart E, part I of subchapter J of the Code and (ii) cause the Reserve Fund to be taxable as a corporation under the Code. The Seller shall give written notice to each Rating Agency of any proposed transfer, pledge or assignment to any Person of all or any part of its right to receive Excess Amounts pursuant to Section 14.07(b)(ii). 47 54 ARTICLE EIGHTEEN THE SERVICER Section 18.01. Representations of Servicer. The Servicer shall make the following representations on which the Trustee shall rely in accepting the Receivables in trust and executing and authenticating the Certificates. The representations shall speak as of the execution and delivery of the Agreement and shall survive the sale of the Receivables to the Trustee. (i) Organization and Good Standing. The Servicer shall have been duly organized and shall be validly existing as a corporation in good standing under the laws of the State of California, with power and authority to own its properties and to conduct its business as such properties shall be currently owned and such business is presently conducted, and had at all relevant times, and shall have, power, authority and legal right to acquire, own, sell and service the Receivables and to hold the Receivable Files as custodian on behalf of the Trustee. (ii) Due Qualification. The Servicer shall be duly qualified to do business as a foreign corporation in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business (including the servicing of the Receivables as required by the Agreement) shall require such qualifications. (iii) Power and Authority. The Servicer shall have the power and authority to execute and deliver the Agreement and to carry out its terms; and the execution, delivery and performance of the Agreement shall have been duly authorized by the Servicer by all necessary corporate action. (iv) Binding Obligations. The Agreement shall constitute a legal, valid and binding obligation of the Servicer enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (v) No Violation. The consummation of the transactions contemplated by the Agreement and the fulfillment of the terms of the Agreement shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the articles of incorporation or bylaws of the Servicer, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of time) a default under, any indenture, agreement or other instrument to which the Servicer is a party or by which it shall be bound; nor result in the creation or imposition of any lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than the Agreement); nor violate any law or, to the best of the Servicer's knowledge, any 48 55 order, rule or regulation applicable to the Servicer of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Servicer or its properties. (vi) No Proceedings. There are no proceedings or investigations pending, or to the Servicer's best knowledge, threatened, before any court, regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Servicer or its properties: (a) asserting the invalidity of the Agreement or the Certificates, (b) seeking to prevent the issuance of the Certificates or the consummation of any of the transactions contemplated by the Agreement, (c) seeking any determination or ruling that might materially and adversely affect the performance by the Servicer of its obligations under, or the validity or enforceability of, the Agreement or the Certificates, or (d) relating to the Servicer and which might adversely affect the federal income tax attributes of the Certificates. Section 18.02. Liability of Servicer; Indemnities. (a) The Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Servicer under the Agreement and shall have no other obligations or liabilities under the Agreement. Such obligations shall include the following: (i) The Servicer shall defend, indemnify and hold harmless the Trustee, the Trust, the Certificateholders and the Letter of Credit Bank, if any, from and against any and all costs, expenses, losses, damages, claims and liabilities, arising out of or resulting from the use, ownership or operation by the Servicer or any affiliate thereof of a Financed Vehicle. (ii) The Servicer shall indemnify, defend and hold harmless the Trustee, the Trust and the Letter of Credit Bank, if any, from and against any taxes that may at any time be asserted against the Trustee, the Trust or the Letter of Credit Bank, if any, with respect to the transactions contemplated in the Agreement, including any sales, gross receipts, general corporation, tangible or intangible personal property, privilege or license taxes (but, in the case of the Trustee or the Trust, not including any taxes asserted with respect to, and as of the date of, the sale of the Receivables to the Trustee or the issuance and original sale of the Certificates, or asserted with respect to ownership of the Receivables, or federal or other income taxes arising out of distributions on the Certificates) and costs and expenses in defending against the same. (iii) The Servicer shall indemnify, defend and hold harmless the Trustee, the Trust and the Certificateholders from and against any and all costs, expenses, losses, claims, damages and liabilities to the extent that such cost, expense, loss, claim, damage or liability arose out of, or was imposed upon the Trustee, the Trust or the Certificateholders through the willful misfeasance, negligence or bad faith of the Servicer in the performance of its duties under the Agreement. 49 56 (iv) The Servicer shall indemnify, defend and hold harmless the Trustee from and against all costs, expenses, losses, claims, damages and liabilities arising out of or incurred in connection with the acceptance or performance of the trusts and duties herein contained, except to the extent that such cost, expense, loss, claim, damage or liability: (A) shall be due to the willful misfeasance, negligence or bad faith of the Trustee; (B) relates to any tax other than the taxes with respect to which either the Seller or the Servicer shall be required to indemnify the Trustee; (C) shall arise from the breach by the Trustee of any of its representations or warranties set forth in Section 20.14; (D) shall be one as to which the Seller is required to indemnify the Trustee; or (E) shall arise out of or be incurred in connection with the performance by the Trustee of the duties of successor Servicer hereunder. (b) Indemnification under this Section shall include reasonable fees and expenses of counsel and expenses of litigation. If the Servicer shall have made any indemnity payments pursuant to this Section and the recipient thereafter collects any of such amounts from others, the recipient shall promptly repay such amounts to the Servicer, without interest. Section 18.03. Merger or Consolidation of, or Assumption of the Obligations of, Servicer. Any corporation (i) into which the Servicer may be merged or consolidated, (ii) which may result from any merger or consolidation to which the Servicer shall be a party, or (iii) which may succeed to all or substantially all of the business of the Servicer, which corporation shall execute an agreement of assumption to perform every obligation of the Servicer under the Agreement, shall be the successor to the Servicer under the Agreement without further act on the part of any of the parties to the Agreement. The Servicer shall promptly provide notice and inform the Trustee and each Rating Agency of any merger, consolidation or succession pursuant to this Section. Section 18.04. Limitation on Liability of Servicer and Others. (a) Neither the Servicer nor any of its directors, officers, employees or agents shall be under any liability to the Trust, the Trustee or the Certificateholders, except as provided in the Agreement, for any action taken or for refraining from the taking of any action pursuant to the Agreement; provided, however, that this provision shall not protect the Servicer or any such individual against any liability that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties under the 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 under the Agreement. (b) Except as provided in the Agreement, the Servicer shall not be under any obligation to appear in, prosecute, or defend any legal action that shall not be incidental to its duties to service the Receivables in accordance with the Agreement, and that in its opinion may involve it in any expense or liability; provided, however, that the Servicer may undertake any reasonable action that it may deem necessary or desirable in respect of the Agreement and 50 57 the rights and duties of the parties to the Agreement and the interests of the Certificateholders under the Agreement. (c) The Servicer and any director or officer or employee or agent of the Servicer may rely in good faith on the advice of counsel or 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, nor defend any legal action that shall not be incidental to its obligations under the Agreement, and that in its opinion may involve it in any expense or liability. Section 18.05. Servicer Not to Resign. The Servicer shall not resign from its obligations and duties under the Agreement except upon determination that the performance of its duties shall no longer be permissible under applicable law. Any such determination permitting the resignation of the Servicer shall be evidenced by an Opinion of Counsel to such effect delivered to the Trustee. No such resignation shall become effective until the Trustee or a Successor Servicer shall have assumed the responsibilities and obligations of the Servicer in accordance with Section 19.02. 51 58 ARTICLE NINETEEN EVENTS OF DEFAULT Section 19.01. Events of Default. If any one of the following events ("Events of Default") shall occur and be continuing: (i) Any failure by the Servicer to deliver to the Trustee the Servicer's Certificate for the related Collection Period, or any failure by the Servicer (or, so long as the Servicer is Fleetwood Credit, the Seller) to deliver to the Trustee, for distribution to Certificateholders, any proceeds or payment required to be so delivered under the terms of the Certificates or the Agreement, in each case that continues unremedied for a period of three Business Days after discovery by an officer of the Servicer (or, so long as the Servicer is Fleetwood Credit, the Seller) or written notice of such failure is given (1) to the Servicer or the Seller, as the case may be, by the Trustee or (2) to the Trustee and the Servicer or the Seller, as the case may be, by the Holders of Certificates evidencing not less than 25% of the Voting Interests of the Class A Certificates and the Class B Certificates, voting together as a single class; or (ii) Failure on the part of the Servicer (or so long as the Servicer is Fleetwood Credit, the Seller) duly to observe or to perform in any material respect any other covenants or agreements of the Servicer (or so long as the Servicer is Fleetwood Credit, the Seller) set forth in the Certificates or in the Agreement, which failure shall (a) materially and adversely affect the rights of the Certificateholders and (b) continue unremedied for a period of 60 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given (1) to the Servicer or the Seller, as the case may be, by the Trustee or (2) to the Trustee and the Servicer or the Seller, as the case may be, by the Holders of Certificates evidencing not less than 25% of the Voting Interests of the Class A Certificates and the Class B Certificates, voting together as a single class; or (iii) The entry of a decree or order by a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a trustee in bankruptcy, conservator, receiver or liquidator for the Servicer (or, so long as the Servicer is Fleetwood Credit, the Seller) in any bankruptcy, insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings, or for the winding up or liquidation of their respective affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days; or (iv) The consent by the Servicer (or, so long as the Servicer is Fleetwood Credit, the Seller) to the appointment of a trustee in bankruptcy, conservator or receiver or liquidator in any bankruptcy, insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to the Servicer (or, so long as the Servicer is Fleetwood Credit, the Seller) of or relating to substantially all of its property; or the Servicer (or, so long as the Servicer is Fleetwood Credit, the Seller) shall admit in writing its inability to pay its debts generally as they become due, file a 52 59 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; then, and in each and every case, so long as such Event of Default shall not have been remedied, either the Trustee, or the Holders of Certificates evidencing not less than 51% of the Voting Interests of the Class A Certificates and the Class B Certificates, voting together as a single class, by notice given in writing to the Servicer (and to the Trustee if given by Class A and Class B Certificateholders) may terminate all of the rights and obligations of the Servicer under the Agreement. On or after the receipt by the Servicer of such written notice, all authority and power of the Servicer under the Agreement, whether with respect to the Certificates, the Receivables or otherwise, shall, without further action, pass to and be vested in the Trustee or such Successor Servicer as may be appointed under Section 19.02; and, without limitation, the Trustee shall be hereby authorized and empowered to execute and deliver, on behalf of the predecessor Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such notice of termination, whether to complete the transfer and endorsement of the Receivables and related documents, or otherwise. The predecessor Servicer shall cooperate with the Successor Servicer and the Trustee in effecting the termination of the responsibilities and rights of the predecessor Servicer under the Agreement, including the transfer to the Successor Servicer for administration by it of all cash amounts that shall at the time be held by the predecessor Servicer for deposit, shall have been deposited by the predecessor Servicer in the Certificate Account or shall thereafter be received with respect to a Receivable. All reasonable costs and expenses (including attorneys' fees) incurred in connection with transferring the Receivable Files to the Successor Servicer and amending the Agreement to reflect such succession as Servicer pursuant to this Section shall be paid by the predecessor Servicer upon presentation of reasonable documentation of such costs and expenses. Section 19.02. Trustee to Act; Appointment of Successor Servicer. Upon the Servicer's receipt of notice of termination pursuant to Section 19.01 or resignation pursuant to Section 18.05, the Trustee shall be the successor in all respects to the Servicer in its capacity as Servicer under the Agreement, and shall be subject to all the responsibilities, duties and liabilities relating thereto placed on the Servicer by the terms and provisions of the Agreement. As compensation therefor, the Trustee shall be entitled to such compensation (whether payable out of the Certificate Account or otherwise) as the Servicer would have been entitled to under the Agreement if no such notice of termination or resignation had been given. Notwithstanding the foregoing, the Trustee may, if it shall be unwilling to so act, or shall, if it shall be legally unable so to act, appoint, or petition a court of competent jurisdiction to appoint, any established institution, having a net worth of not less than $100,000,000 and whose regular business shall include the servicing of recreational vehicle or motor vehicle receivables, as the successor to the Servicer under the Agreement provided that the appointment of any such Successor Servicer will not result in the qualification, reduction or withdrawal of the rating then assigned to the Rated Certificates by each Rating Agency. In connection with such appointment, the Trustee may make such arrangements for the compensation of such Successor Servicer out of payments on the Receivables as it and such 53 60 Successor Servicer shall agree; provided, however, that no such compensation shall be in excess of that permitted the Servicer under the Agreement. The Trustee and such Successor Servicer shall take such action, consistent with the Agreement, as shall be necessary to effectuate any such succession. The Trustee shall not be relieved of its duties as Successor Servicer under this Section until the newly appointed Servicer shall have assumed the responsibilities and obligations of the Servicer under the Agreement. Section 19.03. Reimbursement for Advances. If a Successor Servicer replaces the Servicer, the predecessor Servicer shall be entitled to receive reimbursement for Advances previously made by such Servicer, in the manner specified, and to the extent provided, in Section 14.04. Section 19.04. Notification of Events of Default. Upon (i) the occurrence of an Event of Default and the expiration of any cure period applicable thereto or (ii) any termination of, or appointment of a successor to, the Servicer pursuant to this Article, the Trustee shall give prompt written notice thereof to Certificateholders at their respective addresses appearing in the Certificate Register, to the Letter of Credit Bank, if any, and to each Rating Agency. Section 19.05. Waiver of Past Defaults. The Holders of Class A Certificates and Class B Certificates evidencing not less than 51% of the Voting Interests thereof, voting together as a single class, may, on behalf of all Holders of Certificates, waive any default by the Servicer in the performance of its obligations under the Agreement and its consequences, except a default in making any required deposits to or payments from the Certificate Account in accordance with the Agreement or in respect of a covenant or provision hereof that under Section 22.01 cannot be modified or amended without the consent of the Holder of each Certificate. 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 the 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. 54 61 ARTICLE TWENTY THE TRUSTEE Section 20.01. Duties of Trustee. The Trustee, both prior to and after the occurrence of an Event of Default, shall undertake to perform such duties as are specifically set forth in the Agreement. If an Event of Default shall have occurred and shall not have been cured or waived, the Trustee shall exercise such of the rights and powers vested in it by the Agreement, and shall 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; provided, however, that if the Trustee shall assume the duties of the Servicer pursuant to Section 19.02, the Trustee in performing such duties shall use the degree of skill and attention customarily exercised by a servicer with respect to recreational vehicle or motor vehicle receivables that it services for itself or others. The Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Trustee that shall be specifically required to be furnished pursuant to any provision of the Agreement, shall examine them to determine whether they conform to the requirements of the Agreement. No provision of the Agreement shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, its own bad faith or its own willful misfeasance; provided, however, that: (i) prior to the occurrence of an Event of Default, and after the curing or waiving of all such Events of Default that may have occurred, the duties and obligations of the Trustee shall be determined solely by the express provisions of the Agreement, the Trustee shall not be liable except for the performance of such duties and obligations as shall be specifically set forth in the Agreement, no implied covenants or obligations shall be read into the Agreement against the Trustee, the permissive right of the Trustee to do things enumerated in the Agreement shall not be construed as a duty and, in the absence of bad faith on the part of the Trustee, or manifest error, the Trustee may conclusively rely on the truth of the statements and the correctness of the opinions expressed upon any certificates or opinions furnished to the Trustee and conforming to the requirements of the Agreement; (ii) the Trustee shall not be personally liable for an error of judgment made in good faith by an Authorized Officer, unless it shall be proved that the Trustee shall have been negligent in performing its duties in accordance with the terms of the Agreement; and (iii) the Trustee shall not be personally liable with respect to any action taken, suffered or omitted to be taken in good faith in accordance with the direction of the Holders of Certificates evidencing not less than 25% of the Voting Interests of the Class A Certificates and the Class B Certificates, voting together as a single class, relating to the time, method and place of conducting any proceeding for any remedy 55 62 available to the Trustee, or exercising any trust or power conferred upon the Trustee, under the Agreement. The Trustee shall not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties under the Agreement, or in the exercise of any of its rights or powers, if there shall be reasonable grounds for believing that the repayment of such funds or adequate indemnity against such risk or liability shall not be reasonably assured to it, and none of the provisions contained in the Agreement shall in any event require the Trustee to perform, or be responsible for the manner of performance of, any of the obligations of the Servicer under the Agreement except during such time, if any, as the Trustee shall be the successor to, and be vested with the rights, duties, powers and privileges of, the Servicer in accordance with the terms of the Agreement. Except for actions expressly authorized by the Agreement, the Trustee shall take no action reasonably likely to impair the security interests created or existing under any Receivable or to impair the value of any Receivable. All information obtained by the Trustee regarding the Obligors and the Receivables, whether upon the exercise of its rights under the Agreement or otherwise, shall be maintained by the Trustee in confidence and shall not be disclosed to any other Person, unless such disclosure is required by any applicable law or regulation. Section 20.02. Trustee's Certificate. On or as soon as practicable after each Record Date as of which Receivables shall be assigned to the Seller or the Servicer, as applicable, pursuant to Section 20.03, the Trustee shall execute a Trustee's Certificate, based on the information contained in the Servicer's Certificate for the related Collection Period, amounts deposited to the Certificate Account and notices received pursuant to the Agreement, identifying the Receivables repurchased by the Seller pursuant to Section 12.02 or 21.02 or purchased by the Servicer pursuant to Section 13.07 or 21.02 during such Collection Period, and shall deliver such Trustee's Certificate, accompanied by a copy of the Servicer's Certificate for such Collection Period to the Seller or the Servicer, as the case may be. The Trustee's Certificate submitted with respect to such Distribution Date shall operate, as of such Distribution Date, as an assignment, without recourse, representation or warranty, to the Seller or the Servicer, as the case may be, of all the Trustee's right, title and interest in and to such Repurchased Receivable and to the other property conveyed to the Trust pursuant to Section 12.01 with respect to such Repurchased Receivable, and all security and documents relating thereto, such assignment being an assignment outright and not for security. Section 20.03. Trustee's Assignment of Repurchased and Removed Receivables. With respect to Receivables repurchased by the Seller pursuant to Section 12.02 or 21.02, purchased by the Servicer pursuant to Section 13.07 or 21.02, the Trustee shall by a Trustee's Certificate assign, without recourse, representation or warranty, to the Seller or the Servicer, as the case may be, all the Trustee's right, title and interest in and to such Receivable and the other property conveyed to the Trust pursuant to Section 2.01 with respect to such Receivable, and all security and documents relating thereto, such assignment being an assignment outright and not for security. If, in any enforcement suit or legal proceeding, it shall be held that the 56 63 Servicer may not enforce a Receivable on the ground that it shall not be a real party in interest or a holder entitled to enforce the Receivable, the Trustee shall, at the Servicer's expense, take such steps as the Trustee deems necessary to enforce the Receivable, including bringing suit in the name of the Trustee or the names of the Certificateholders. Section 20.04. Certain Matters Affecting Trustee. (a) Except as otherwise provided in Section 20.01: (i) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, 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; (ii) the Trustee may consult with counsel and any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it under the Agreement in good faith and in accordance with such Opinion of Counsel; (iii) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by the Agreement, or to institute, conduct or defend any litigation under the Agreement or in relation to the Agreement, at the request, order or direction of any of the Certificateholders pursuant to the provisions of the Agreement, unless such Certificateholders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities that may be incurred therein or thereby; however, nothing contained in the Agreement shall relieve the Trustee of its obligation, upon the occurrence of an Event of Default (that shall not have been cured or waived), to exercise such of the rights and powers vested in it by the Agreement, and to use the same degree of care and skill in their exercise as a prudent man would exercise or use under the circumstances in the conduct of his own affairs; (iv) the Trustee shall not be personally liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by the Agreement; (v) prior to the occurrence of an Event of Default and after the curing or waiving of all Events of Default that 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 Holders of Class A Certificates and Class B Certificates evidencing not less than 25% of the Voting Interests thereof, voting together as a single class; 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 shall be, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded 57 64 to it by the terms of the Agreement, the Trustee may require reasonable indemnity against such cost, expense or liability as a condition to so proceeding; the reasonable expense of every such examination shall be paid by the Seller or the Servicer, as the case may be, or, if paid by the Trustee, shall be reimbursed by the Servicer upon demand; and nothing in this clause (v) shall affect the obligation of the Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors; and (vi) the Trustee may execute any of the trusts or powers hereunder or perform any duties under the Agreement either directly or by or through agents or attorneys or a custodian. (b) No Certificateholder will have any right to institute any proceeding with respect to the Agreement, unless such Holder shall have given to the Trustee written notice of default and (i) the Event of Default arises from the Servicer's failure to remit collections or payments when due or (ii) the Holders of Class A Certificates and Class B Certificates evidencing not less than 25% of the Voting Interests thereof, voting together as a single class, have made written request upon the Trustee to institute such proceeding in its own name as Trustee thereunder, and have offered to the Trustee reasonable indemnity, and the Trustee for 30 days has neglected or refused to institute any such proceedings. Section 20.05. Trustee Not Liable for Certificates or Receivables. The Trustee shall make no representations as to the validity or sufficiency of the Agreement or of the Certificates (other than the execution by the Trustee on behalf of the Trust of, or the certificate of authentication on, the Certificates), or of any Receivable or related document. The Trustee shall have no obligation to perform any of the duties of the Seller or Servicer unless explicitly set forth in the Agreement. The Trustee shall at no time have any responsibility or liability for or with respect to the legality, validity and enforceability of any security interest in any Financed Vehicle or any Receivable, or the perfection and priority of such a security interest or the maintenance of any such perfection and priority; the efficacy of the Trust or its ability to generate the payments to be distributed to Certificateholders under the Agreement; the existence, condition, location and ownership of any Financed Vehicle; the existence and enforceability of any physical damage or credit life or credit disability insurance; the existence and contents of any Receivable or any computer or other record thereof; the validity of the assignment of any Receivable to the Trust or of any intervening assignment; the completeness of any Receivable; the performance or enforcement of any Receivable; the compliance by the Seller or the Servicer with any warranty or representation made under the Agreement or in any related document and the accuracy of any such warranty or representation prior to the Trustee's receipt of notice or other discovery of any noncompliance therewith or any breach thereof; any investment of monies by the Servicer or any loss resulting therefrom (it being understood that the Trustee shall remain responsible for any Trust property that it may hold); the acts or omissions of the Seller, the Servicer or any Obligor; any action of the Servicer taken in the name of the Trustee; or any action by the Trustee taken at the instruction of the Servicer; provided, however, that the foregoing shall not relieve the Trustee of its obligation to perform its duties under the Agreement. Except with respect to a claim based on the failure of the Trustee to perform its duties under the 58 65 Agreement or based on the Trustee's willful misconduct, bad faith or negligence no recourse shall be had for any claim based on any provision of the Agreement, the Certificates or any Receivable or assignment thereof against the Trustee in its individual capacity. The Trustee shall not have any personal obligation, liability or duty whatsoever to any Certificateholder or any other Person with respect to any such claim, and any such claim shall be asserted solely against the Trust or any indemnitor who shall furnish indemnity as provided in the Agreement. The Trustee shall not be accountable for the use or application by the Seller of any of the Certificates or of the proceeds thereof, or for the use or application of any funds paid to the Servicer in respect of the Receivables. Section 20.06. Trustee May Own Certificates. The Trustee in its individual or any other capacity may become the owner or pledgee of Certificates with the same rights as it would have if it were not Trustee. Section 20.07. Trustee's Fees and Expenses. The Servicer shall covenant and agree to pay to the Trustee, 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 connection with the execution of the trusts created by the Agreement and in the exercise and performance of any of the powers and duties under the Agreement of the Trustee, and the Servicer shall pay or reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances (including the reasonable compensation and the expenses and disbursements of its counsel and of all individuals not regularly in its employ) incurred or made by the Trustee in defense of any action brought against it in connection with the Agreement except any such expense, disbursement or advance as may arise from its negligence, willful misfeasance or bad faith or that is the responsibility of Certificateholders under the Agreement. Additionally, the Servicer, pursuant to Section 18.02, shall indemnify the Trustee with respect to certain matters, and Certificateholders, pursuant to Section 20.04 shall, upon the circumstances therein set forth, indemnify the Trustee under certain circumstances. Section 20.08. Indemnity of Trustee and Successor Servicer. Upon the appointment of a successor Servicer pursuant to Section 19.02 (a "Successor Servicer"), such Successor Servicer and the Trustee and their respective agents and employees shall be indemnified by the Trust and held harmless against any loss, liability, or expense (including reasonable attorney's fees and expenses) arising out of or incurred in connection with the acceptance of performance of the trusts and duties contained in the Agreement to the extent that (i) the Successor Servicer or the Trustee, as the case may be, shall not be indemnified for such loss, liability or expense by the Servicer pursuant to Section 18.02; (ii) such loss, liability or expense shall not have been incurred by reason of the Successor Servicer's or the Trustee's willful misfeasance, bad faith or negligence; and (iii) such loss, liability or expense shall not have been incurred by reason of the Successor Servicer's or the Trustee's breach of its respective representations and warranties pursuant to Sections 18.01 and 20.14, respectively. The Successor Servicer and/or the Trustee shall be entitled to the indemnification provided by this Section only to the extent all amounts due the Class A Certificateholders and the Class B Certificateholders with respect to any Distribution Date pursuant to Section 14.07 59 66 have been paid in full and all amounts required to be deposited in the Reserve Fund with respect to any Distribution Date pursuant to Section 14.07(b)(i) have been so deposited. Section 20.09. Eligibility Requirements for Trustee. The Trustee under the Agreement shall at all times be a corporation having its corporate trust office in the same State as the location of the Corporate Trust Office as specified in the Agreement, organized and doing business under the laws of such State or the United States, authorized under such laws to exercise corporate trust powers, have a combined capital and surplus of at least $100,000,000 and subject to supervision or examination by federal or state authorities and, if required by any Rating Agency, having the Required Long Term Debt Rating. If the Trustee shall publish reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purpose of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, the Trustee shall resign immediately in the manner and with the effect specified in Section 20.10. Section 20.10. Resignation or Removal of Trustee. The Trustee may at any time resign and be discharged from the trusts hereby created by giving written notice thereof to the Servicer. Upon receiving such notice of resignation, the Servicer shall promptly appoint a successor Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor Trustee. If no successor Trustee shall have been so appointed and have accepted appointment within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee. The appointment of any successor Trustee shall be subject to the prior approval of the Letter of Credit Bank, if any, so long as such approval shall not be unreasonably withheld. If at any time the Trustee shall cease to be eligible in accordance with the provisions of Section 20.09 and shall fail to resign after written request therefor by the Servicer, or if at any time the Trustee shall be legally unable to act, or shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then the Servicer may remove the Trustee. If it shall remove the Trustee under the authority of the immediately preceding sentence, the Servicer shall promptly appoint a successor Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor Trustee and payment of all fees owed to the outgoing Trustee. Any resignation or removal of the Trustee and appointment of a successor Trustee pursuant to any of the provisions of this Section shall not become effective until acceptance of appointment by the successor Trustee pursuant to Section 20.11. 60 67 Section 20.11. Successor Trustee. Any successor Trustee appointed pursuant to Section 20.10 shall execute, acknowledge and deliver to the Servicer and to its predecessor Trustee an instrument accepting such appointment under the Agreement, and thereupon the resignation or removal of the predecessor 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 under the Agreement, with like effect as if originally named as Trustee. The predecessor Trustee shall deliver to the successor Trustee all documents and statements and monies held by it under the Agreement; and the Servicer and the predecessor Trustee shall execute and deliver such instruments and do such other things as may reasonably be required for fully and certainly vesting and confirming in the successor Trustee all such rights, powers, duties and obligations. No successor Trustee shall accept appointment as provided in this Section unless at the time of such acceptance such successor Trustee shall be eligible pursuant to Section 20.09. Upon acceptance of appointment by a successor Trustee pursuant to this Section, the Servicer shall mail notice of the successor of such Trustee under the Agreement to all Holders of Certificates at their addresses as shown in the Certificate Register and shall give notice by mail to the Rating Agencies. If the Servicer shall fail to mail such notice within 10 days after acceptance of appointment by the successor Trustee, the successor Trustee shall cause such notice to be mailed at the expense of the Servicer. Section 20.12. Merger or Consolidation of Trustee. Any corporation (i) into which the Trustee may be merged or consolidated, (ii) which may result from any merger, conversion, or consolidation to which the Trustee shall be a party, or (iii) which may succeed to the business of the Trustee, which corporation executes an agreement of assumption to perform every obligation of the Trustee under the Agreement, shall be the successor of the Trustee hereunder, provided such corporation shall be eligible pursuant to Section 20.09, without the execution or filing of any instrument or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. Notice of any such merger shall be given by the Trustee to the Rating Agencies. Section 20.13. Appointment of Co-Trustee or Separate Trustee. Notwithstanding any other provisions of the Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Trust or any Financed Vehicle may at the time be located, the Servicer and the Trustee acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more Persons approved by the Trustee to act as co-trustee, jointly with the Trustee, or separate trustee or separate trustees, of all or any part of the Trust, and to vest in such Person, in such capacity and for the benefit of the Certificateholders, such title to the Trust, or any part thereof, and, subject to the other provisions of this Section, such powers, duties, obligations, rights and trusts as the Servicer and the Trustee may consider necessary or desirable. If the Servicer shall not have joined in such appointment within 15 days after the receipt by it of a request so to do, or in the case an Event of Default shall have occurred and be continuing, the Trustee alone shall have the power to make such appointment. No co-trustee or separate trustee under the Agreement shall be required to meet the terms of eligibility as a successor trustee pursuant to Section 20.09 61 68 and no notice of a successor trustee pursuant to Section 20.11 and no notice to Certificateholders of the appointment of any co-trustee or separate trustee shall be required pursuant to Section 20.11. Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: (i) All rights, powers, duties and obligations conferred or imposed upon the Trustee shall be conferred upon and exercised or performed by the Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed (whether as Trustee under the Agreement or as successor to the Servicer under the Agreement), 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 or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Trustee. (ii) No trustee under the Agreement shall be personally liable by reason of any act or omission of any other trustee under the Agreement. (iii) The Servicer and the Trustee acting jointly may at any time accept the resignation of or remove any separate trustee or co-trustee. Any notice, request or other writing given to the Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to the Agreement and the conditions of this Article. 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 the Agreement, specifically including every provision of the Agreement relating to the conduct of, affecting the liability of, or affording protection to, the Trustee. Each such instrument shall be filed with the Trustee and a copy thereof given to the Servicer. 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 the 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. Notwithstanding anything to the contrary in the Agreement, the appointment of any separate trustee or co-trustee shall not relieve the Trustee of its obligations and duties under the Agreement. 62 69 Section 20.14. Representations and Warranties of Trustee. The Trustee shall make the following representations and warranties on which the Seller and Certificateholders may rely: (i) Organization and Good Standing. The Trustee is a banking corporation duly organized, validly existing and in good standing under the laws of its place of incorporation. (ii) Power and Authority. The Trustee has full power, authority and legal right to execute, deliver and perform its duties and obligations under the Agreement, and shall have taken all necessary action to authorize the execution, delivery and performance by it of the Agreement. (iii) No Violation. The execution, delivery and performance by the Trustee of the Agreement (a) shall not violate any provision of any law governing the banking and trust powers of the Trustee or, to the best of the Trustee's knowledge, any order, writ, judgment, or decree of any court, arbitrator, or governmental authority applicable to the Trustee or any of its assets, (b) shall not violate any provision of the corporate charter or by-laws of the Trustee, and (c) shall not violate any provision of, constitute, with or without notice or lapse of time, a default under, or result in the creation or imposition of any Lien on any properties included in the Trust pursuant to the provisions of any mortgage, indenture, contract, agreement or other undertaking to which it is a party, which violation, default or Lien could reasonably be expected to materially and adversely affect the Trustee's performance or ability to perform its duties under the Agreement or the transactions contemplated in the Agreement. (iv) No Authorization Required. The execution, delivery and performance by the Trustee of the Agreement shall not require the authorization, consent, or approval of, the giving of notice to, the filing or registration with, or the taking of any other action in respect of, any governmental authority or agency regulating the banking and corporate trust activities of the Trustee. (v) Duly Executed. The Agreement shall have been duly executed and delivered by the Trustee and shall constitute the legal, valid, and binding agreement of the Trustee, enforceable in accordance with its terms. 63 70 ARTICLE TWENTY ONE TERMINATION Section 21.01. Termination of the Trust. The Trust and the respective obligations and responsibilities of the Seller, the Servicer, any Letter of Credit Bank and the Trustee shall terminate upon the first to occur of (i) the purchase on any Distribution Date by the Seller or the Servicer at its option, pursuant to Section 21.02, of the corpus of the Trust, (ii) the payment to Certificateholders of all amounts required to be paid to them pursuant to the Agreement, (iii) the maturity or liquidation of the last Receivable and the disposition of all property held as part of the Trust or (iv) the sale by the Trustee of all of the Receivables remaining in the Trust pursuant to Section 21.03; provided, however, that in no event shall the trust created by the Agreement continue beyond the expiration of 21 years from the death of the last survivor of the descendants of George Herbert Walker Bush of the State of Texas living on the date of the Agreement. The Servicer shall promptly notify the Trustee of any prospective termination pursuant to this Section. Notice of any termination, specifying the Distribution Date upon which Certificateholders are expected to be able to surrender their Certificates to the Trustee for payment of the final distribution and cancellation, shall be given promptly by the Trustee by letter to Certificateholders and each Rating Agency mailed not earlier than the 15th day and not later than the 25th day of the month next preceding the specified Distribution Date stating (i) the Distribution Date upon which final payment of the Certificates shall be made upon presentation and surrender of the Certificates at the office of the Trustee therein designated, (ii) the amount of any such final payment, and (iii) if applicable, that the Record Date otherwise applicable to such Distribution Date is not applicable, payments being made only upon presentation and surrender of the Certificates at the office of the Trustee therein specified. The Trustee shall give such notice to the Certificate Registrar (if other than the Trustee) and the Letter of Credit Bank, if any, at the time such notice is given to Certificateholders. Upon presentation and surrender of the Certificates, the Trustee shall cause to be distributed to Certificateholders amounts distributable on such Distribution Date pursuant to Section 14.07. In the event that all of the Certificateholders shall not surrender their Certificates for cancellation within six months after the date 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 one year after the second notice all the Certificates shall not have been surrendered for cancellation, the Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining Certificateholders concerning surrender of their Certificates, and the cost thereof shall be paid out of the funds and other assets that shall remain subject to the Agreement. Any funds remaining in the Trust after exhaustion of such remedies shall be distributed by the Trustee to the United Way. As soon as practicable after the Distribution Date specified for the final distribution or upon such other date upon which all amounts to be paid to the Certificateholders pursuant to 64 71 the Agreement have been paid, the Trustee shall surrender the Servicer Letter of Credit to the Letter of Credit Bank for cancellation. Section 21.02. Optional Purchase of All Receivables. On each Distribution Date following a Record Date as of which the Pool Balance is 10% or less of the Original Pool Balance, the Seller or the Servicer, or any successor to the Servicer, shall have the option to purchase the corpus of the Trust; provided that the option to purchase provided in this Section shall not be exercised if the final distribution to Certificateholders would be less than the aggregate outstanding principal amount of the Certificates plus the sum of (i) the Class A Interest Distributable Amount for the related Distribution Date, (ii) any outstanding Class A Interest Carryover Shortfall, (iii) the Class B Interest Distributable Amount for such Distribution Date and (iv) any outstanding Class B Interest Carryover Shortfall. To exercise such option, the Seller or the Servicer, or any successor to the Servicer, as the case may be, shall notify the Trustee in writing, no later than the tenth day of the month in which the Record Date as of which such purchase is to be effected and, if there are any Book-Entry Certificates, the Clearing Agency in accordance with the Letter of Representations, and shall deposit pursuant to Section 14.06 in the Certificate Account an amount equal to the aggregate Repurchase Amount for the Receivables (including Defaulted Receivables), plus the appraised value of any other property held by the Trust (less liquidation expenses), such value to be determined by an appraiser mutually agreed upon by the Servicer and the Trustee, and shall succeed to all interests in and to the Trust; provided, however, the Seller or the Servicer, or any successor to the Servicer, as the case may be, may not effect any such purchase if the long-term unsecured debt obligations of the related entity are rated less than Baa3, unless the Trustee shall have received an Opinion of Counsel that such purchase will not constitute a fraudulent conveyance. The payment shall be made in the manner specified in Section 14.06(a)(i), and shall be distributed pursuant to Section 14.07. In the event that both the Seller and the Servicer, or any successor to the Servicer, elect to purchase the Receivables pursuant to this Section, the party first notifying the Trustee (based on the Trustee's receipt of such notice) shall be permitted to purchase the Receivables. Section 21.03. Sale of All Receivables. In accordance with the procedures and schedule set forth as an Exhibit to the Agreement (the "Auction Procedures"), the Trustee shall conduct an auction (the "Auction") of the Receivables remaining in the Trust (such Receivables hereinafter referred to as the "Auction Property") in order to effect a termination of the Trust pursuant to clause (iv) of the first paragraph of Section 21.01 on the second Distribution Date succeeding the Record Date on which the Pool Balance is 5% or less of the Original Pool Balance. Fleetwood Credit may, but shall not be required to, bid at the Auction. The Trustee shall sell and transfer the Auction Property to the highest bidder therefor at the Auction provided that: (i) the Auction has been conducted in accordance with the Auction Procedures; (ii) the Trustee has received good faith bids for the Auction Property from at least two bidders; 65 72 (iii) one or more financial advisors, as advisor to the Trustee (each, an "Advisor"), shall have advised the Trustee in writing that at least two of such bidders (including the winning bidder) are participants in the market for motor vehicle retail installment sale contracts willing and able to purchase the Auction Property; (iv) the highest bid in respect of the Auction Property is not less than the aggregate fair market value of the Auction Property (as set forth in a written opinion of the Advisor to the Trustee); (v) any bid submitted by Fleetwood Credit or any affiliate of Fleetwood Credit shall reasonably represent the fair market value of the Auction Property, as independently verified and represented in writing by a qualified independent third party evaluator (which may include an investment banking firm), selected by the Trustee; and (vi) the highest bid would result in proceeds from the sale of the Auction Property which will be at least equal to the sum of (a) the greater of (1) the aggregate Repurchase Amounts for the Receivables (including Defaulted Receivables), plus the appraised value of any other property held by the Trust (less liquidation expenses) or (2) an amount that when added to amounts on deposit in the Certificate Account that would constitute Available Funds for such second succeeding Distribution Date would result in proceeds sufficient to distribute the sum of (A) the Class A Distributable Amount plus any unpaid Class A Interest Carryover Shortfall and any unpaid Class A Principal Carryover Shortfall with respect to one or more prior Distribution Dates, and (B) the Class B Distributable Amount plus any unpaid Class B Interest Carryover Shortfall and any unpaid Class B Principal Carryover Shortfall, and (b) the sum of (1) an amount sufficient to reimburse the Servicer for any unreimbursed Advances and (2) the Servicing Fee payable on such final Distribution Date, including any unpaid Servicing Fees with respect to one or more prior Collection Periods. Provided that all of the conditions set forth in clauses (i) through (vi) above have been met, the Trustee shall sell and transfer the Auction Property, without recourse, to such highest bidder in accordance with and upon completion of the Auction Procedures. The Trustee shall deposit the purchase price for the Auction Property in the Certificate Account at least one Business Day prior to such second succeeding Distribution Date. In addition, the Auction must stipulate that the Servicer be retained to service the Receivables on terms substantially similar to those in the Agreement. In the event that any of such conditions are not met or such highest bidder fails or refuses to comply with any of the Auction Procedures, the Trustee shall decline to consummate such sale and transfer. In the event such sale and transfer is not consummated in accordance with the foregoing, however, the Trustee may from time to time in the future, but shall not under any further obligation to, solicit bids for sale of the assets of the Trust upon the same terms and conditions as set forth above. 66 73 ARTICLE TWENTY TWO MISCELLANEOUS PROVISIONS Section 22.01. Amendment. The Agreement may be amended by the Seller, the Servicer and the Trustee, without the consent of any of the Certificateholders or the Letter of Credit Bank, if any, (a) to cure any ambiguity, to correct or supplement any provision in the Agreement which may be inconsistent with any other provision of the Agreement, to add, change or eliminate any other provision with respect to matters or questions arising under the Agreement that shall not be inconsistent with the provisions of the Agreement, (b) to change the formula for determining the Specified Reserve Fund Balance or the manner in which the Reserve Fund is funded and (c) to amend or modify any provisions in the Agreement relating to the Servicer Letter of Credit, if any, or the acquisition thereof (provided that no such amendment or modification pursuant to this clause (c) shall be made without the consent of the Letter of Credit Bank, if any, which consent shall not be unreasonably withheld); provided, however, that for all purposes of clauses (a) through (c) above, such action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect the interests of any Certificateholder and provided, further, that prior to changing the formula for determining the Specified Reserve Fund Balance or the manner in which the Reserve Fund is funded or amending or modifying any provisions relating to the Servicer Letter of Credit or the Letter of Credit Bank, if any, the Servicer shall deliver to the Trustee a letter from each Rating Agency to the effect that such revised formula will not cause the rating then assigned to the Rated Certificates to be qualified, reduced or withdrawn. The Agreement may also be amended from time to time by the Seller, the Servicer and the Trustee, with the consent of the Holders of Certificates evidencing not less than 51% of the Voting Interests of each Class of Certificates, voting together as a single class, and upon not less than two weeks' prior notice to each Rating Agency, 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 Certificateholders or the Letter of Credit Bank, if any; provided, however, that no such amendment shall (i) except as otherwise provided in the first paragraph of this Section, increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments of the Receivables, or distributions that shall be required to be made on any Certificate or to or by the Letter of Credit Bank, if any, or (ii) reduce the aforesaid percentage of the Voting Interests of the Certificates of each Class required to consent to any such amendment, without the consent of the Holders of all Certificates of such Class then outstanding. The Trustee shall furnish written notification of the substance of such amendment or consent to each Certificateholder and to the Letter of Credit Bank, if any. It shall not be necessary for the consent of Certificateholders pursuant to this Section to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents and of evidencing the authorization of the execution thereof by Certificateholders shall be subject to such reasonable requirements as the Trustee may prescribe. 67 74 Prior to the execution of any amendment to the 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 the Agreement. 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 the Agreement or otherwise. Section 22.02. Protection of Title to Trust. (a) Each of the Seller and the Servicer shall execute and file such financing statements and cause to be executed and filed such continuation statements, all in such manner and in such places as may be required by law fully to preserve, maintain and protect the interest of the Certificateholders, the Letter of Credit Bank, if any, and the Trustee in the Receivables and in the proceeds thereof. Each of the Seller and the Servicer shall deliver (or cause to be delivered) to the Trustee file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. (b) Neither the Seller nor the Servicer shall change its name, identity or corporate structure in any manner that would, could or might make any financing statement or continuation statement filed by the Servicer in accordance with paragraph (a) above seriously misleading within the meaning of Section 9-402(7) of the UCC, unless it shall have given the Trustee at least 60 days' prior written notice thereof and shall have promptly filed appropriate amendments to all previously filed financing statements or continuation statements. (c) The Seller and the Servicer shall give the Trustee at least 60 days' prior written notice of any relocation of their respective principal executive offices if, as a result of such relocation, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall promptly file any such amendment. The Servicer shall at all times maintain each office from which it shall service Receivables, and its principal executive office, within the United States. (d) The Servicer shall maintain accounts and records as to each Receivable accurately and in sufficient detail to permit (i) the reader thereof to know at any time the status of such Receivable, including payments and recoveries made and payments owing (and the nature of each) and (ii) reconciliation between payments or recoveries on (or with respect to) each Receivable and the amounts from time to time deposited in the Certificate Account in respect of such Receivable. (e) The Servicer shall maintain its computer systems so that, from and after the time of sale under the Agreement of the Receivables to the Trustee, the Servicer's master computer records (including any back-up archives) that refer to a Receivable shall indicate clearly the interest of the particular grantor trust in such Receivable and that such Receivable is owned by the Trustee. Indication of the Trustee's ownership of a Receivable shall be deleted from or modified on the Servicer's computer systems when, and only when, the Receivable shall have been paid in full, repurchased or assigned pursuant to the Agreement. 68 75 (f) If at any time the Seller or the Servicer shall propose to sell, grant a security interest in or otherwise transfer any interest in recreational vehicle receivables to any prospective purchaser, lender or other transferee, the Servicer shall give to such prospective purchaser, creditor or other transferee computer tapes, records or print-outs (including any restored from back-up archives) that, if they shall refer in any manner whatsoever to any Receivable, shall indicate clearly that such Receivable has been sold and is owned by the Trustee. (g) The Servicer shall permit the Trustee and its agents at any time during normal business hours and upon reasonable notice to inspect, audit and make copies of and abstracts from the Servicer's records regarding any Receivable. (h) Upon request, the Servicer shall furnish to the Trustee, within five Business Days, a list of all Receivables (by contract number and name of Obligor) then held as part of the Trust, together with a reconciliation of such list to the Schedule of Receivables and to each of the Servicer's Certificates furnished before such request indicating removal of Receivables from the Trust. (i) The Servicer shall deliver to the Trustee promptly after the execution and delivery of the Agreement and of each amendment thereto, an Opinion of Counsel either (A) stating that, in the opinion of such Counsel, all financing statements and continuation statements have been executed and filed that are necessary fully to preserve and protect the interest of the Trustee in the Receivables, and reciting the details of such filings or referring to prior Opinions of Counsel in which such details are given or (B) stating that, in the opinion of such Counsel, no such action shall be necessary to preserve and protect such interest. (j) The Seller shall, to the extent required by applicable law, cause the Certificates to be registered with the Commission pursuant to Section 12(b) or 12(g) of the Exchange Act within the time periods specified in such sections. (k) For the purpose of facilitating the execution of the Agreement and for other purposes, the Agreement may be executed simultaneously in any number of counterparts, each of which counterparts shall be deemed to be an original, and all of which counterparts shall constitute but one and the same instrument. Section 22.03. Limitation on Certificateholder Rights. The death or incapacity of any Certificateholder shall not operate to terminate the Agreement or the Trust, nor entitle such Certificateholder's legal representatives or heirs to claim an accounting or to take any action or commence any proceeding in any court for a partition or winding up of the Trust, nor otherwise affect the rights, obligations and liabilities of the parties to the Agreement or any of them. No Certificateholder shall have any right to vote (except as provided in Sections 19.05 and 22.01) or in any manner otherwise control the operation and management of the Trust, or the obligations of the parties to the Agreement, nor shall anything set forth in the Agreement or contained in the terms of the Certificates, be construed so as to constitute the holders from 69 76 time to time as partners or members of an association; nor shall any Certificateholder be under any liability to any third party by reason of any action taken pursuant to any provision of the Agreement. No Certificateholder shall have any right by virtue or by availing itself of any provisions of the Agreement to institute any suit, action or proceeding in equity or at law upon or under or with respect to the 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 Voting Interests of the Class A Certificates and the Class B Certificates, voting together as a single class, shall have made written request upon the Trustee to institute such action, suit or proceeding in its own name as Trustee under the Agreement 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 30 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; no one or more Holders of Certificates shall have any right in any manner whatever by virtue or by availing itself or themselves of any provisions of the Agreement to affect, disturb or prejudice the rights of the Holders of any other of the Certificates, or to obtain or seek to obtain priority over or preference to any other such Holder, or to enforce any right, under the Agreement except in the manner provided in the Agreement and for the equal, ratable and common benefit of all Certificateholders. For the protection and enforcement of the provisions of this Section, each Certificateholder and the Trustee shall be entitled to such relief as can be given either at law or in equity. Section 22.04. Governing Law. The Agreement shall be construed in accordance with the laws of the State of California and the obligations, rights and remedies of the parties under the Agreement shall be determined in accordance with such laws. Section 22.05. Notices. All demands, notices and communications under the Agreement shall be in writing, personally delivered or mailed by certified mail, return receipt requested, and shall be deemed to have been duly given upon receipt (i) in the case of the Seller or the Servicer, to the agent for service as specified in the Agreement, or at such other address as shall be designated by the Seller or the Servicer in a written notice to the Trustee; (ii) in the case of the Trustee, at the Corporate Trust Office; (iii) in the case of any Letter of Credit Bank to the address provided in the Agreement; (iv) in the case of Standard & Poor's, at 26 Broadway, 15th Floor, New York, New York 10004, Attention: Asset Backed Surveillance Department; (v) in the case of Moody's, at 99 Church Street, New York, New York 10007 Attention: ABS Monitoring Department; and (vi) in the case of Duff & Phelps, at 55 East Monroe, Chicago, Illinois 60603. Any notice required or permitted to be mailed to a Certificateholder shall be given by first class mail, postage prepaid, at the address of such Holder as shown in the Certificate Register. Any notice so mailed within the time prescribed in the Agreement shall be conclusively presumed to have been duly given, whether or not the Certificateholder shall receive such notice. Section 22.06. Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of the Agreement shall be for any reason whatsoever held 70 77 invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of the Agreement and shall in no way affect the validity or enforceability of the other provisions of the Agreement or of the Certificates or the rights of the Holders thereof. Section 22.07. Assignment. Notwithstanding anything to the contrary contained herein, except as provided in Sections 17.03 and 18.03 and as provided in the provisions of the Agreement concerning the resignation of the Servicer, the Agreement may not be assigned by the Seller or the Servicer without the prior written consent of the Trustee and the Holders of Certificates evidencing not less than 51% of the Voting Interests of the Class A Certificates and the Class B Certificates, voting together as a single class. Section 22.08. Certificates Nonassessable and Fully Paid. The interests represented by the Certificates shall be nonassessable for any losses or expenses of the Trust or for any reason whatsoever, and, upon authentication thereof by the Trustee pursuant to Section 16.02, 16.03, 16.04, 16.08, 16.09 or 16.11, each of the related Certificates shall be deemed fully paid. Section 22.09. No Petition. Each of the Servicer and the Trustee covenants and agrees that prior to the date which is one year and one day after the date upon which each Class of Certificates has been paid in full, it will not institute against, or join any other Person in instituting against the Seller any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or other proceedings under any federal or state bankruptcy or similar law. This Section shall survive the termination of the Agreement or the termination of the Servicer or the Trustee, as the case may be, under the Agreement. * * * * 71 78 EXHIBIT A SERVICER LETTER OF CREDIT ____________, _____ Credit No. ___________ __________________________________ __________________________________ __________________________________ __________________________________ Attention: Corporate Trust Office Ladies and Gentlemen: At the request and for the account of our customer, Fleetwood Credit Corp., a California corporation ("Fleetwood Credit"), we (the "Letter of Credit Bank") hereby establish in your favor this Servicer Letter of Credit, wherein you, as trustee (the "Trustee") under the Pooling and Servicing Agreement (the "Pooling and Servicing Agreement") dated as of September 1, 1996, among Fleetwood Credit Receivables Corp. ("FCRC"), Fleetwood Credit and you, pursuant to which $___________ in aggregate principal amount of Asset Backed Certificates (the "Certificates") of the Fleetwood Credit Grantor Trust (the "Trust") have been issued, are hereby irrevocably authorized to draw upon the terms and conditions hereinafter set forth, in an aggregate amount not exceeding $_______ (hereinafter, as reduced from time to time in accordance with the provisions hereof, the "Stated Amount"). This Servicer Letter of Credit is effective immediately and expires at the close of business on __________, ____ (the "Expiration Date") at the counters of the Letter of Credit Bank's _____________ Branch. Funds under this Servicer Letter of Credit are available to you against your written certificate signed by one who states therein that he is your duly authorized officer, appropriately completed, in the form of Annex 1 hereto for payment of certain amounts due from, but unpaid by, Fleetwood Credit under the Pooling and Servicing Agreement. We hereby agree that each demand made under and in compliance with the terms of this Servicer Letter of Credit will be duly honored by us upon due delivery of the certificate(s), as specified above, appropriately completed (together with such enclosures, if any, required thereby), if presented as specified on or before the expiration date hereof. If a presentation in respect of payment is made by you hereunder at or prior to 12:00 Noon, [LOS ANGELES] time, on a Business Day, and provided that the documents so presented conform to the terms and conditions hereof, payment shall be made to you of the amount specified, in immediately available funds, not later than 9:00 a.m., [LOS ANGELES] time, on the following A-1 79 Business Day. If a presentation in respect of payment is made by you hereunder after 12:00 Noon, [LOS ANGELES] time, on a Business Day, such presentation shall be deemed to have been made prior to 12:00 Noon, [LOS ANGELES] time, on the next succeeding Business Day. You agree to use your best efforts to provide us telephonic notice at the time any presentation in respect of payment is made hereunder; provided, however, that failure to provide such telephonic notice shall not affect our obligation to make payment in respect of any such presentation in respect of payment. If requested by you, payment under this Servicer Letter of Credit will be wire transferred to an account specified by the Trustee in the related certificate. As used herein, "Business Day" shall mean any day other than a Saturday, a Sunday, or a day on which the Trustee or banking institutions in New York, New York or [LOS ANGELES], California shall be authorized or obligated by law, executive order or governmental decree to be closed. If a drawing made by you hereunder does not, in any instance, conform to the terms and conditions of this Servicer Letter of Credit, we shall give you prompt notice that the purported drawing was not effected in accordance with the terms and conditions of this Servicer Letter of Credit, stating the reasons therefor and that we are holding any documents presented in connection therewith at your disposal or are returning the same to you, as we may elect. Only you, as Trustee, may make a drawing under this Servicer Letter of Credit. Upon the payment of the amount specified in the related certificate(s) presented hereunder, we shall be fully discharged of our obligation under this Servicer Letter of Credit with respect to such certificate(s) and we shall not thereafter be obligated to make any further payments under this Servicer Letter of Credit in respect of such certificate(s) to you or any other person. By paying to you an amount demanded in accordance herewith, we make no representation as to the correctness of the amount demanded. This Servicer Letter of Credit shall automatically terminate at our close of business in [LOS ANGELES], California on the first to occur of the following dates (the "Termination Date"): (i) the Expiration Date, or if said date shall not be a Business Day, on the Business Day next succeeding said date, (ii) the date of receipt by us of your written certificate signed by your authorized officer, appropriately completed, in the form of Annex 2 hereto, (iii) the payment by us of the final drawing available to be made hereunder or (iv) on the date specified in our letter to you in the form of Annex 5 hereto. If we are not then in default hereunder by reason of our having wrongfully failed to honor a demand for payment hereunder, this Servicer Letter of Credit shall be promptly surrendered to us upon the Termination Date. Drawings in respect of payments hereunder honored by us shall not, in the aggregate, exceed the Stated Amount in effect immediately prior to such drawing. Each drawing honored by us hereunder shall pro tanto reduce the Stated Amount in effect immediately prior to such drawing. The Stated Amount under the Servicer Letter of Credit shall be automatically further reduced at the close of business on the 15th day of each month, or if such day is not a A-2 80 Business Day, the next following Business Day, commencing on __________ 15, ____ (each, a "Reset Date"), so that the Stated Amount at the close of business on such Reset Date will equal the lesser of (i) the Stated Amount as theretofore in effect or (ii) the product of $_________ and the Reset Percentage; provided that the Stated Amount as of the close of business on any Reset Date shall be further reduced if the Stated Amount would otherwise exceed the Pool Balance (as defined in the Pooling and Servicing Agreement). For purposes of this Servicer Letter of Credit, the Reset Percentage on any Reset Date shall be equal to a fraction the numerator of which is the number of Receivables in the Trust at the close of business on the last day of the calendar month preceding the calendar month in which such Reset Date occurs (as evidenced by the Servicer's Certificate for such calendar month) and the denominator of which is the original number of Receivables in the Trust as of _______________. Although the adjustment on each Reset Date shall occur automatically, by acceptance of this Servicer Letter of Credit you agree on or as soon as practicable following each Reset Date on which any reduction has been effected pursuant to the preceding sentence, and in any event within one Business Day after our written request (which may be by telex or telecopier) on any subsequent date on which a drawing certificate is presented hereunder, to deliver to us your certificate in the form of Annex 3 hereto (each, a "Reduction Certificate"), appropriately completed, setting forth the calculation of the Stated Amount as so adjusted; but the failure to deliver such Reduction Certificate shall not otherwise affect the effectiveness of any such reduction. This Servicer Letter of Credit shall be governed by the internal laws of the State of California, including, without limitation, Article 5 of the Uniform Commercial Code as in effect in the State of California. This Servicer Letter of Credit shall be supplemented by the provisions (to the extent that such provisions are not inconsistent with this Servicer Letter of Credit and said Article 5) of the Uniform Customs and Practice for Documentary Credits (1993 Revision), International Chamber of Commerce, Publication No. 500, except Article 45 thereof. All documents presented to us in connection with any demand for payment hereunder, as well as all notices and other communications to us in respect of this Servicer Letter of Credit shall be in writing, or shall be transmitted by tested telex or telecopier (promptly confirmed in either case in writing), and shall be addressed to us at ______________________________, specifically referring thereon to this Servicer Letter of Credit by number. You may transfer your rights under this Servicer Letter of Credit in their entirety (but not in part) to any transferee who has succeeded you as trustee pursuant to the Pooling and Servicing Agreement and such transferred rights may be successively transferred. The transfer of your rights under this Servicer Letter of Credit to any such transferee shall be effected upon the presentation to us of this Servicer Letter of Credit accompanied by a transfer letter in the form attached hereto as Annex 4. This Servicer Letter of Credit sets forth in full our undertaking, and such undertaking shall not in any way be modified, amended, amplified or limited by reference to any document, instrument or agreement referred to herein (including, without limitation, the A-3 81 Certificates), except only Annexes 1 through 5 hereto; and any such reference shall not be deemed to incorporate herein by reference any document, instrument or agreement except as set forth above. Very truly yours, ____________________________________ By: ________________________________ Name: Title: A-4 82 ANNEX 1 TO SERVICER LETTER OF CREDIT NO. CERTIFICATE FOR "ANNEX 1 DRAWING" The undersigned, The Chase Manhattan Bank, as trustee (the "Trustee"), acting through the undersigned duly authorized officer of the Trustee, hereby certifies to _________________________________________ (the "Letter of Credit Bank"), with reference to the Bank's Servicer Letter of Credit No. __________ (the "Servicer Letter of Credit"; any capitalized terms used herein and not defined having its respective meaning as set forth in the Servicer Letter of Credit) issued in favor of the Trustee, that: (1) The Trustee is the Trustee under the Pooling and Servicing Agreement. (2) Fleetwood Credit, as servicer ("Servicer") under the Pooling and Servicing Agreement, has notified us, as Trustee under the Pooling and Servicing Agreement, pursuant to a Servicer's Certificate (as defined in the Pooling and Servicing Agreement) (a copy of which is attached hereto) furnished pursuant to Section 13.09 of the Pooling and Servicing Agreement that the following amount was required to be remitted by the Servicer to the Certificate Account (as such term is defined in the Pooling and Servicing Agreement) pursuant to Section 14.02 of the Pooling and Servicing Agreement with respect to the Distribution Date (as defined in the Pooling and Servicing Agreement) occurring on [insert applicable Distribution Date]: $[insert amount required to be remitted pursuant to Section 14.02]. (3) Fleetwood Credit has failed to deposit the following portion of amounts owed by it with respect to such Distribution Date as set forth in paragraph (2) above: $[insert amount of deficiency]. (4) The Trustee is making a drawing under the Servicer Letter of Credit in the amount of $__________ which amount equals the lesser of (a) the amount set forth in paragraph (3) and (b) the amount identified by the Servicer in the Servicer's Certificate referred to in paragraph (2) above as being available on the date hereof to be drawn under the Servicer Letter of Credit. (5) The Trustee has not received notice from Fleetwood Credit or any other person or entity contesting the accuracy of such Servicer's Certificate. (6) The account to which payment under the Servicer Letter of Credit is to be wire transferred is Account No. __________, maintained at ___________________________. A-5 83 IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate as of the _____ day of ___________. The Chase Manhattan Bank , as Trustee By: ________________________________ Name: Title: A-6 84 ANNEX 2 TO SERVICER LETTER OF CREDIT NO. CERTIFICATE FOR THE TERMINATION OF SERVICER LETTER OF CREDIT NO. The undersigned, a duly authorized officer of The Chase Manhattan Bank, as trustee (the "Trustee"), hereby certifies to ____________________ (the "Letter of Credit Bank") with reference to the Servicer Letter of Credit Bank's Irrevocable Servicer Letter of Credit No. __________ (the "Servicer Letter of Credit"; any capitalized term used herein and not defined having its respective meaning as set forth in the Servicer Letter of Credit) issued in favor of the Trustee, that [the Pooling and Servicing Agreement has been terminated in accordance with its terms and the Certificate Account defined therein contains sufficient funds to pay in full all outstanding Certificates issued thereunder] or [in accordance with Section 15.01(b) of the Pooling and Servicing Agreement, the Servicer Letter of Credit has been terminated on the date hereof] or [the Trustee has received the Letter of Credit Bank's letter in the form of Annex 5 to the Servicer Letter of Credit].* Accordingly, we herewith return to you for cancellation the Servicer Letter of Credit which is terminated, as of the date hereof, pursuant to its terms. Date: __________________ The Chase Manhattan Bank, as Trustee By: ________________________________ Authorized Officer _____________________________________ * Select appropriate alternative. A-7 85 ANNEX 3 TO SERVICER LETTER OF CREDIT NO. CERTIFICATE FOR THE REDUCTION OF THE STATED AMOUNT OF SERVICER LETTER OF CREDIT NO. The undersigned, a duly authorized officer of The Chase Manhattan Bank, as trustee (the "Trustee"), hereby certifies to _________________ (the "Letter of Credit Bank") with reference to the Letter of Credit Bank's Servicer Letter of Credit No. __________ (the "Servicer Letter of Credit"; any capitalized terms used herein and not defined having its respective meaning as set forth in the Servicer Letter of Credit) issued in favor of the Trustee, that: (1) The Trustee is the Trustee under the Pooling and Servicing Agreement. (2) On the basis of the Servicer's Certificate attached hereto, the Trustee hereby confirms that effective [insert Reset Date] the Stated Amount of the Servicer Letter of Credit has been reduced from $__________ to $__________, which amount equals the product of $__________ and the Reset Percentage; provided that if the Stated Amount would exceed the Pool Balance set forth in such certificate as of the end of last month, the Stated Amount shall be reduced to the amount of the Pool Balance. (3) This Certificate has been prepared and presented in strict compliance with the terms of the Pooling and Servicing Agreement and the Servicer Letter of Credit. IN WITNESS WHEREOF, the Trustee has executed and delivered this certificate as of the _______ day of __________, ____. The Chase Manhattan Bank, as Trustee By: ________________________________ Name: Title: A-8 86 ANNEX 4 TO SERVICER LETTER OF CREDIT NO. _____________, _____ __________________________________ __________________________________ __________________________________ __________________________________ Re: Servicer Letter of Credit No. _________ Ladies and Gentlemen: For value received, the undersigned beneficiary hereby irrevocably transfers to: _________________________________________________________ (Name and Address of Transferee) all rights of the undersigned beneficiary to draw under the above-captioned Servicer Letter of Credit (the "Servicer Letter of Credit"). The transferee has succeeded the undersigned as Trustee under the Pooling and Servicing Agreement (as defined in the Servicer Letter of Credit). By this transfer, all rights of the undersigned beneficiary in the Servicer Letter of Credit are transferred to the transferee and the transferee shall hereafter have the sole rights as beneficiary thereof; provided, however, that no rights shall be deemed to have been transferred to the transferee until such transfer complies with the requirements of the Servicer Letter of Credit pertaining to transfers. The Servicer Letter of Credit is returned herewith and in accordance therewith we ask that this transfer be effective and that you cause the transfer of the Servicer Letter of Credit to our transferee or that, if so requested by the transferee, you cause the issuance of a new A-9 87 Servicer Letter of Credit in favor of the transferee with provisions consistent with the Servicer Letter of Credit. Very truly yours, ______________________________________, as predecessor Trustee By:____________________________________ Name: Title: A-10 88 ANNEX 5 TO SERVICER LETTER OF CREDIT NO. [Letterhead of Letter of Credit Bank] ____________, ____ [Insert name of Beneficiary] [Address] Attention: _______________________ Re: Servicer Letter of Credit No. _________ of _____________________ Ladies and Gentlemen: On the date hereof we have received notice from Fleetwood Credit Corp. ("Fleetwood Credit") that its short-term credit rating has been upgraded to [the Required Servicer Rating] by [insert name of applicable Rating Agency]. [On the date hereof, as a result of such upgrading] or [At the close of business on the [immediately] [second]* succeeding Distribution Date (as defined in the Servicer Letter of Credit) following the date hereof, as a result of such downgrading]**, the Servicer Letter of Credit is hereby terminated. Please deliver the Servicer Letter of Credit to us for cancellation as soon as practicable following such date, accompanied by your certificate in the form of Annex 2 to the Servicer Letter of Credit. Very truly yours, ______________________________________, By:____________________________________ Name: Title: _____________________________ * Insert "immediately" if the date of this letter is after the 15th day of the month. Insert "second" if the date of this letter is on or prior to the 15th day of the month. ** Select appropriate alternative. A-11 89 EXHIBIT B-1 TRUSTEE'S CERTIFICATE PURSUANT TO SECTION 20.02 OR 20.03 OF THE POOLING AND SERVICING AGREEMENT The Chase Manhattan Bank, as trustee (the "Trustee") of the Fleetwood Credit 1996-B Grantor Trust created pursuant to the Pooling and Servicing Agreement (the "Agreement") dated as of September 1, 1996 among Fleetwood Credit Receivables Corp., as Seller, Fleetwood Credit Corp., as Servicer, and the Trustee, does hereby sell, transfer, assign and otherwise convey to the Seller, without recourse, representation or warranty, all of the Trustee's right, title and interest in and to all of the Receivables (as defined in the Agreement) identified in the attached Servicer's Certificate as "Repurchased Receivables," which are to be repurchased by the Seller pursuant to Section 12.02 or 21.02 of the Agreement and all security and documents relating thereto. IN WITNESS WHEREOF, I have hereunto set my hand this _th day of _________, 19__. The Chase Manhattan Bank, as Trustee By: _______________________________ Title: B-1-1 90 EXHIBIT B-2 TRUSTEE'S CERTIFICATE PURSUANT TO SECTION 20.02 OR 20.03 OF THE POOLING AND SERVICING AGREEMENT The Chase Manhattan Bank, as trustee (the "Trustee") of the Fleetwood Credit _____ Grantor Trust created pursuant to the Pooling and Servicing Agreement (the "Agreement") dated as of September 1, 1996 among Fleetwood Credit Receivables Corp., as Seller, Fleetwood Credit Corp., as Servicer (the "Servicer"), and the Trustee, does hereby sell, transfer, assign and otherwise convey to the Servicer, without recourse, representation or warranty, all of the Trustee's right, title and interest in and to all of the Receivables (as defined in the Agreement) identified in the attached Servicer's Certificate as "Repurchased Receivables," which are to be repurchased by the Servicer pursuant to Section 13.07 or 21.02, and all security and documents relating thereto. IN WITNESS WHEREOF, I have hereunto set my hand this _th day of _________, 19__. The Chase Manhattan Bank, as Trustee By: _______________________________ Title: B-2-1 EX-5.1 7 OPINION OF TIMOTHY M. HAYES 1 EXHIBIT 5.1 September __, 1996 Fleetwood Credit Receivables Corp. 22840 Savi Ranch Parkway Yorba Linda, California 92687 Re: Fleetwood Credit 1996-B Grantor Trust Asset Backed Certificates ------------------------------------- Ladies and Gentlemen: I am Vice President and Assistant General Counsel of Associates First Capital Corporation, a Delaware corporation and the parent company of Fleetwood Credit Corp. and in that capacity I have acted as counsel to Fleetwood Credit Receivables Corp., a California corporation (the "Company"), in connection with the issuance and sale by the Company of __% Asset Backed Certificates, Class A and __% Asset Backed Certificates, Class B (collectively, the "Certificates") representing undivided interests in the Fleetwood Credit 1996-B Grantor Trust. As such counsel, I have examined originals, or copies identified to my satisfaction as being true copies of originals, of the following documents and have received the following advices: 1. Articles of Incorporation of the Company, as now in effect. 2. Bylaws of the Company, as now in effect. 3. Advices of governmental authorities with respect to the corporate status of, and payment of taxes by, the Company in the State of California. 2 Fleetwood Credit Receivables Corp. September __, 1996 4. The Registration Statement on Form S-1, Registration No. 33-10835 (the "Registration Statement"), filed by the Company with the Securities and Exchange Commission (the "Commission") on August 26, 1996, as amended to date. 5. Resolutions of the Board of Directors of the Company authorizing the filing of the Registration Statement and the execution and delivery of (i) the Underwriting Agreement between _______________, as underwriters and the Company and Fleetwood Credit Corp., a form of which is being filed as Exhibit 1.1 to the Registration Statement (the "Underwriting Agreement") and (ii) the Pooling and Servicing Agreement dated as of September 1, 1996 among The Chase Manhattan Bank, as Trustee (the "Trustee"), the Company and Fleetwood Credit Corp., including the Standard Terms and Conditions of Agreement (Senior/Subordinated), effective September 1, 1996, with respect thereto (collectively, the "Agreement"). 6. The Underwriting Agreement. 7. The Agreement. 8. Such other documents and records as I have deemed necessary or advisable for the purpose of the opinion set forth below. The opinion set forth below relates solely to California and federal law, and I do not purport to be expert as to, nor do I express any opinions as to, the laws of any other jurisdiction. I have assumed the due authorization, execution and delivery by the parties other than the Company to the Underwriting Agreement and the Agreement and I have assumed the genuineness of all signatures except those of officers of the Company. My opinion expressed below is subject to the qualification that I have not examined the Certificates but rather have examined specimens thereof. In addition, in rendering my opinion expressed below, I have assumed that any state securities laws applicable to the issuance of the Certificates have been complied with. Based upon such review, and in reliance thereon, and after consideration of such other legal questions as I have deemed necessary, it is my opinion that, subject to the qualifications and assumptions referred to above, the Certificates, when issued and paid for in accordance with the Underwriting Agreement and the Agreement, will be legally issued, fully paid and non-assessable. 2 3 Fleetwood Credit Receivables Corp. September ___, 1996 I hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of my name in the Registration Statement under the caption "Legal Opinions." In giving this consent, I do not thereby admit that I am in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Commission. Respectfully submitted, Timothy M. Hayes General Counsel and Secretary 3 EX-8.1 8 OPINION OF BROWN & WOOD 1 EXHIBIT 8.1 September 9, 1996 Fleetwood Credit Receivables Corp. 22840 Savi Ranch Parkway Yorba Linda, California 92687 Re: Fleetwood Credit 1996-B Grantor Trust Asset Backed Certificates ------------------------------------- Dear Sirs: We have acted as special federal income tax counsel to Fleetwood Credit Receivables Corp. (the "Company"), a California corporation and a wholly owned subsidiary of Fleetwood Credit Corp. ("Fleetwood Credit"). You have asked our opinion in connection with certain federal income tax matters arising under the Company's Registration Statement on Form S-1 (No. 333-10835) (the "Registration Statement"), filed with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended. As such special counsel, we have examined originals or copies identified to our satisfaction as being true copies or originals of the following: 1. The Registration Statement; 2. The Articles of Incorporation and Bylaws of the Company and Fleetwood Credit, in each case as now in effect; 3. The Pooling and Servicing Agreement dated as of September 1, 1996 (the "Agreement") among the Company, as seller, Fleetwood Credit Corp, as servicer (in such capacity, the "Servicer"), and The Chase Manhattan Bank, as trustee (the "Trustee"); and 4. The Receivables Purchase Agreement dated as of September 1, 1996 (the "Receivables Purchase Agreement") between Fleetwood Credit and the Company. 2 We understand that the structure of the proposed transaction is as set forth in the Registration Statement. Pursuant to the Receivables Purchase Agreement, Fleetwood Credit will transfer certain retail installment sale contracts secured by new and used recreational vehicles (the "Receivables") generated in the ordinary course of its business to the Company. The Company will in turn transfer the Receivables to the Fleetwood Credit 1996-B Grantor Trust (the "Trust") which will be formed pursuant to the Agreement and will cause Asset Backed Certificates (the "Certificates") to be issued thereunder. The Certificates will represent undivided interests in the assets of the Trust and will consist of one class of senior certificates (the "Class A Certificates") and one class of subordinated certificates (the "Class B Certificates"). The Company will sell the Class A Certificates and the Class B Certificates to ___________. The Trustee will hold legal title to the Receivables and other assets of the Trust for the benefit of the Certificateholders, but will have no power to reinvest proceeds attributable to the Receivables or other assets of the Trust or to vary investments in the Trust in any manner. In rendering this opinion, we have relied, as to factual matters, solely upon the Registration Statement and on representations of the Servicer that, among other things, the Servicing Fee to be received by the Servicer pursuant to the Agreement will be an ordinary and customary charge for the performance of management and servicing functions described in the Agreement and that the terms of the Receivables Purchase Agreement and the Agreement are fair and arm's-length. Our opinion is subject to the qualification that facts materially different from those set forth above may affect the opinion as expressed herein or prevent us from rendering it. Capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Agreement. Our opinion is based upon our analysis of existing statutes and regulations, both promulgated and proposed, as presently interpreted by judicial and administrative bodies. Such statutes, regulations, rulings and interpretations are subject to change and such changes could result in tax consequences different than those set forth below. We note that neither Fleetwood Credit nor the Company has requested a ruling from the Internal Revenue Service as to the matters covered by our opinion. On the basis of the foregoing and in reliance thereon and our consideration of such other matters of fact and questions of law as we have deemed necessary, we are of the opinion that subject to the qualifications referred to herein, the Trust will be classified as a "grantor" trust and not as an association taxable as a corporation for federal income tax purposes. 2 3 We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the Registration Statement under the captions "Certain Legal Aspects of the Receivables -- Certain Bankruptcy Considerations", "Certain Federal Income Tax Consequences -- Tax Status of the Trust" and "-- Stripped Bonds and Stripped Coupons" and "Legal Opinions." In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Commission promulgated thereunder. Very truly yours, /s/ BROWN & WOOD LLP 3 EX-10.1 9 FORM OF RECEIVABLES PURCHASE AGREEMENT 1 EXHIBIT 10.1 Brown & Wood LLP Draft of 9/4/96 ================================================================================ FLEETWOOD CREDIT CORP., as Seller and FLEETWOOD CREDIT RECEIVABLES CORP., as Purchaser -------------------------------------------------------- RECEIVABLES PURCHASE AGREEMENT Dated as of September 1, 1996 -------------------------------------------------------- ================================================================================ 2 TABLE OF CONTENTS
Page ---- ARTICLE ONE DEFINITIONS Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Section 1.02. Other Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 ARTICLE TWO CONVEYANCE OF RECEIVABLES Section 2.01. Conveyance of Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Section 2.02. Representations and Warranties of Fleetwood Credit . . . . . . . . . . . . . . . . . . . . . . . 3 Section 2.03. Representations and Warranties of Fleetwood Credit Relating to this Agreement and the Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Section 2.04. Covenants of Fleetwood Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 ARTICLE THREE PAYMENT OF PURCHASE PRICE Section 3.01. Payment of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 ARTICLE FOUR TERMINATION Section 4.01. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 ARTICLE FIVE MISCELLANEOUS PROVISIONS Section 5.01. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Section 5.02. Protection of Right, Title and Interest to Receivables . . . . . . . . . . . . . . . . . . . . . 10 Section 5.03. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5.04. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5.05. Severability of Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5.06. Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5.07. Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5.08. No Waiver; Cumulative Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Section 5.09. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 5.10. Third-Party Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(i) 3
Page ---- Section 5.11. Merger and Integration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 5.12. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 5.13. Seller Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Section 5.14. Merger or Consolidation of, or Assumption of the Obligations of, Fleetwood Credit . . . . . . . 12 Schedule A - List of Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
(ii) 4 RECEIVABLES PURCHASE AGREEMENT, dated as of September 1, 1996, between Fleetwood Credit Corp., a California corporation, as seller, and Fleetwood Credit Receivables Corp., a California corporation, as purchaser. In consideration of the premises and mutual agreements herein contained, each party agrees as follows for the benefit of the other party and for the benefit of the Trustee: ARTICLE ONE DEFINITIONS Section 1.01. Definitions. Whenever used in this Agreement, the following words and phrases shall have the following meanings: "Agreement" means this Receivables Purchase Agreement and all amendments hereof and supplements hereto. "Closing Date" means September __, 1996. "Cutoff Date" means September 1, 1996. "Fleetwood Credit" means Fleetwood Credit Corp. and each successor to Fleetwood Credit. "Pooling and Servicing Agreement" means the Pooling and Servicing Agreement dated as of September 1, 1996, among Fleetwood Credit Receivables Corp., as seller, Fleetwood Credit, as servicer, and the Trustee. "Purchaser" means Fleetwood Credit Receivables Corp., in its capacity as purchaser of the Receivables under this Agreement and each successor to Fleetwood Credit Receivables Corp. (in the same capacity). "Repurchase Amount" as of any date, means the amount required to prepay in full the Principal Balance of a Receivable plus interest thereon at a rate equal to the sum of (i) the weighted average of the Class A Pass-Through Rate and the Class B Pass-Through Rate and (ii) the Servicing Fee Rate to the last day of the month in which such date occurs. "Repurchased Receivable" means a Receivable repurchased by Fleetwood Credit pursuant to Section 2.03(c). "Schedule of Receivables" means the schedule of Receivables attached as Schedule A hereto and as Schedule A to the Pooling and Servicing Agreement, as it may be amended or supplemented from time to time. 5 "Standard Terms and Conditions" means the Standard Terms and Conditions of Agreement (Senior/Subordinated) Effective September 1, 1996 for Fleetwood Credit Grantor Trusts. "Trustee" means The Chase Manhattan Bank, as trustee under the Pooling and Servicing Agreement, or any successor trustee thereunder. Section 1.02. Other Definitional Provisions. (a) All capitalized terms not otherwise defined in this Agreement shall have the defined meanings used in the Pooling and Servicing Agreement. (b) The words "hereof," "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; Section, subsection and Schedule references contained in this Agreement are references to Sections, subsections and Schedules in or to this Agreement unless otherwise specified; and the word "including" means including without limitation. 2 6 ARTICLE TWO CONVEYANCE OF RECEIVABLES Section 2.01. Conveyance of Receivables. (a) On the Closing Date Fleetwood Credit does hereby sell, transfer, assign and otherwise convey to the Purchaser, without recourse (subject to Fleetwood Credit's obligations hereunder): (i) all right, title and interest of Fleetwood Credit in and to the Receivables listed in the Schedule of Receivables and all monies due thereon and paid thereon or in respect thereof (including proceeds of the repurchase of Receivables by Fleetwood Credit pursuant to Section 2.03(c)) on or after the Cutoff Date, exclusive of Accrued Interest as of the opening of business on the Cutoff Date; (ii) the interest of Fleetwood Credit in the security interests in the related Financed Vehicles granted by the Obligors pursuant to the Receivables; (iii) the interest of Fleetwood Credit in any Liquidation Proceeds, in any proceeds of any physical damage insurance policies covering the related Financed Vehicles and in any proceeds of any credit life or credit disability insurance policies relating to the Receivables or the related Obligors; (iv) the interest of Fleetwood Credit in any proceeds from Dealer repurchase obligations relating to the Receivables; and (v) all proceeds of the foregoing. (b) In connection with such conveyance, on or prior to the Closing Date, Fleetwood Credit agrees to record and file, at its own expense, a financing statement with respect to the Receivables now existing and hereafter created for the sale of chattel paper (as defined in Section 9105 of the UCC as in effect in the State of California) meeting the requirements of applicable state law in such manner as is sufficient to perfect the sale and assignment of such Receivables to the Purchaser, and the proceeds thereof (and any continuation statements as are required by applicable state law), and to deliver a file-stamped copy of each such financing statement (or continuation statement) or other evidence of such filings (which may, for purposes of this Section, consist of telephone confirmation of such filing with the file stamped copy of each such filing to be provided to the Purchaser in due course), as soon as is practicable after Fleetwood Credit's receipt thereof. In connection with such conveyance, Fleetwood Credit further agrees, at its own expense, on or prior to the Closing Date, (i) to annotate and indicate in its computer files that the Receivables have been transferred to the Purchaser pursuant to this Agreement and (ii) to deliver to the Purchaser a computer file, printed or microfiche list containing a true and 3 7 complete list of all of the Receivables, identified by account number and by the Principal Balance of each Receivable as of the Cutoff Date. Such file or list shall be marked as Schedule A to this Agreement and is hereby incorporated into and made a part of this Agreement. The parties hereto intend that the conveyance hereunder be a sale. In the event that the conveyance hereunder is not for any reason considered a sale, the parties intend that Fleetwood Credit be deemed to have granted to the Purchaser a first priority perfected security interest in, to and under the Receivables, and other property conveyed hereunder and all proceeds of any of the foregoing and that this Agreement constitute a security agreement under applicable law. Section 2.02. Representations and Warranties of Fleetwood Credit. Fleetwood Credit hereby represents and warrants as of the date of this Agreement and as of the Closing Date (or as of such other date as specified below) that: (a) Organization and Good Standing. Fleetwood Credit is a California corporation duly organized, validly existing and in good standing under the laws of the State of California, and has power and authority to own its properties and to conduct its business as such properties are currently owned and such business is presently conducted, and had at all relevant times, and shall have, power, authority and legal right to acquire, own and sell the Receivables. (b) Due Qualification. As of the Closing Date, Fleetwood Credit shall be duly qualified to do business as a foreign corporation in good standing, and shall have obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business (including the servicing of the Receivables as required by the Pooling and Servicing Agreement) shall require such qualifications. (c) Power and Authority. Fleetwood Credit shall have the power and authority to execute and deliver this Agreement and to carry out its terms; and the execution, delivery and performance of this Agreement shall have been duly authorized by Fleetwood Credit by all necessary corporate action, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (d) Binding Obligation. This Agreement constitutes a legal, valid and binding obligation of Fleetwood Credit, enforceable against Fleetwood Credit in accordance with its terms, except as enforceability may be subject to or limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. 4 8 (e) No Violation. The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof shall not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the articles of incorporation or bylaws of Fleetwood Credit, or conflict with or breach any of the material terms or provisions of, or constitute (with or without notice or lapse of time) a default under, any indenture, agreement or other instrument to which Fleetwood Credit is a party or by which it may be bound; nor result in the creation or imposition of any lien upon any of its properties pursuant to the terms of any such indenture, agreement or other instrument (other than this Agreement); nor violate any law or, to the best of Fleetwood Credit's knowledge, any order, rule or regulation applicable to Fleetwood Credit of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over Fleetwood Credit or its properties. (f) No Proceedings. There are no proceedings or investigations pending or, to the best knowledge of Fleetwood Credit, threatened against Fleetwood Credit, before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or (iii) seeking any determination or ruling that, in the reasonable judgment of Fleetwood Credit, would materially and adversely affect the performance by Fleetwood Credit of its obligations under this Agreement. The representations and warranties set forth in this Section shall survive the transfer and assignment of the Receivables to the Purchaser on the Closing Date and the transfer and assignment of the Receivables by the Purchaser to the Trust. Upon discovery by Fleetwood Credit, the Purchaser or the Trustee of a breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the others. Section 2.03. Representations and Warranties of Fleetwood Credit Relating to this Agreement and the Receivables. (a) Eligibility of Receivables. Fleetwood Credit hereby represents and warrants as of the Cutoff Date (or as of such other date as specified below) that: (i) Characteristics of Receivables. Each Receivable (A) shall have been originated in the United States by a Dealer for the retail sale of the related Financed Vehicle in the ordinary course of such Dealer's business, shall have been fully and properly executed by the parties thereto, shall have been purchased by Fleetwood Credit from such Dealer under an agreement with Fleetwood Credit and shall have been validly assigned by such Dealer to Fleetwood Credit in accordance with its terms, (B) shall have created or shall create a valid, subsisting and enforceable first priority security interest in favor of Fleetwood Credit in the related Financed Vehicle, which security interest shall be assignable, and shall be so assigned, by the Purchaser to the Trustee, (C) shall contain customary and enforceable provisions such that the rights and remedies of the holder thereof shall be adequate for realization against the 5 9 collateral of the benefits of the security, (D) shall provide for level monthly payments (provided that the payment in the first or last month in the life of the Receivable may be minimally different from the level payment) that fully amortize the Amount Financed by maturity and shall provide for a finance charge or yield interest at its APR and (E) shall provide for, in the event that such Receivable is prepaid in full, payment of an amount that fully pays the Principal Balance and includes accrued but unpaid interest at least through the date of prepayment in an amount at least equal to its APR. (ii) Schedule of Receivables. The information set forth in the Schedule of Receivables shall be true and correct in all material respects as of the opening of business on the Cutoff Date, and no selection procedure adverse to the Purchaser shall have been utilized in selecting the Receivables from the Receivables of Fleetwood Credit which met the selection criteria set forth in this Section. (iii) Compliance with Law. Each Receivable and each sale of the related Financed Vehicle shall have complied at the time it was originated or made, and shall comply at the time of execution of this Agreement in all material respects with all requirements of applicable Federal, state and local laws, and regulations thereunder, including usury laws, the Federal Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act, the Magnuson-Moss Warranty Act, Federal Reserve Board Regulations B and Z, state adaptations of the National Consumer Act and of the Uniform Consumer Credit Code and other consumer credit, equal credit opportunity and disclosure laws. (iv) Binding Obligation. Each Receivable shall constitute the genuine, legal, valid and binding payment obligation in writing of the related Obligor, enforceable by the holder thereof in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights in general and by general principles of equity, regardless of whether such enforceability shall be considered in a proceeding in equity or at law. (v) No Government Obligor. None of the Receivables shall be due from the United States or any state or local government or from any agency, department or instrumentality of the United States or any state or local government. (vi) Security Interest in Financed Vehicle. Immediately prior to the sale, assignment and transfer thereof, each Receivable shall be secured by a validly perfected first security interest in the related Financed Vehicle in favor of Fleetwood Credit as secured party or all necessary and appropriate action with respect to such Receivable shall have been taken to perfect a first priority security interest in such Financed Vehicle in favor of Fleetwood Credit as secured party. 6 10 (vii) Receivables in Force. No Receivable shall have been satisfied, subordinated or rescinded, nor shall any Financed Vehicle have been released from the lien granted by the related Receivable in whole or in part. (viii) No Waiver. No provision of a Receivable shall have been waived in such a manner that such Receivable fails to meet all of the other representations and warranties made by Fleetwood Credit herein with respect thereto. (ix) No Amendments. No Receivable shall have been amended in such a manner that such Receivable fails to meet all of the other representations and warranties made by Fleetwood Credit herein with respect thereto. (x) No Defenses. No facts shall be known to Fleetwood Credit which would give rise to any right of rescission, setoff, counterclaim or defense, nor shall the same have been asserted or threatened, with respect to any Receivable. (xi) No Liens. To the knowledge of Fleetwood Credit, no Liens or claims shall have been filed, including Liens for work, labor or materials relating to a Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the security interest in such Financed Vehicle granted by the related Receivable. (xii) No Default. Except for payment defaults continuing for a period of not more than 30 days as of the Cutoff Date, no default, breach, violation or event permitting acceleration under the terms of any Receivable shall have occurred; no continuing condition that with notice or the lapse of time would constitute a default, breach, violation or event permitting acceleration under the terms of any Receivable shall have arisen; and Fleetwood Credit shall not have waived any of the foregoing. (xiii) Insurance. Fleetwood Credit, in accordance with its customary servicing procedures, shall have determined that each Obligor has obtained physical damage insurance covering the related Financed Vehicle. (xiv) Good Title. It is the intention of Fleetwood Credit that the transfer and assignment herein contemplated, taken as a whole, constitute a sale of the Receivables from Fleetwood Credit to the Purchaser and that the beneficial interest in and title to the Receivables not be part of the debtor's estate in the event of the filing of a bankruptcy petition by or against Fleetwood Credit under any bankruptcy law; no Receivable has been sold, transferred, assigned or pledged by Fleetwood Credit to any Person other than the Purchaser, and no provision of a Receivable shall have been waived, except as provided in clause (viii) above; immediately prior to the transfer and assignment herein contemplated, Fleetwood Credit had good and marketable title to each Receivable free and clear of all Liens and rights of others; immediately upon the transfer and assignment thereof, the Purchaser shall have good and marketable title to each Receivable, free and clear of all Liens and rights of others; and the transfer and assignment herein contemplated has been perfected under the UCC. 7 11 (xv) Lawful Assignment. No Receivable shall have been originated in, or shall be subject to the laws of, any jurisdiction under which the sale, transfer and assignment of such Receivable under this Agreement or pursuant to transfers of the Certificates shall be unlawful, void or voidable. (xvi) All Filings Made. All filings (including UCC filings) necessary in any jurisdiction to give the Trustee a first perfected ownership interest in the Receivables shall have been made. (xvii) One Original. There shall be only one original executed copy of each Receivable. (xviii) Additional Representations and Warranties of Fleetwood Credit. (A) Each Receivable conveyed hereby shall have an original maturity of not less than _____ months nor greater than _____ months; (B) each Receivable shall have an APR equal to or greater than _____%, each Receivable shall have an APR equal to or less than _____%, and the weighted average APR of the Receivables shall not be less than _____%; (C) each Receivable shall have no payment that is more than 30 days past due as of the Cutoff Date; (D) each Receivable File shall be kept at one of the locations listed in Schedule B to the Pooling and Servicing Agreement; (E) based on the Principal Balances of the Receivables as of the Cutoff Date, at least _____% of the Receivables shall be secured by motor homes; (F) the weighted average remaining term of the Receivables shall be less than or equal to _____ months; and (G) in the case of any Obligor in the military service (including an Obligor who is a member of the National Guard or is in the reserves) whose Receivable is subject to either Relief Act, no such Obligor has made a claim to Fleetwood Credit that (1) the amount of interest on the related Receivable should be limited to 6% during the period of such Obligor's active duty status pursuant to the Soldiers' and Sailors' Relief Act or (2) payments on such Receivable should be delayed pursuant to the Military Reservist Relief Act, in either case unless a court has ruled otherwise upon application of Fleetwood Credit. (b) Notice of Breach. The representations and warranties set forth in this Section shall speak as of the execution and delivery of this Agreement but shall survive the sale, transfer and assignment of the Receivables to the Purchaser pursuant to Article Two of the Pooling and Servicing Agreement. The Purchaser, Fleetwood Credit or the Trustee, as the case may be, shall inform the other parties promptly, in writing, upon discovery of any breach of Fleetwood Credit's representations and warranties pursuant to this Section which materially and adversely affects any Receivable. (c) Repurchase of Receivables. In the event of a breach of (i) any representation and warranty set forth in Section 2.03(a), unless the breach shall have been cured by the second Record Date following the discovery (or, at Fleetwood Credit's option, the first Record Date following the discovery), Fleetwood Credit shall repurchase any Receivable materially and adversely affected by the breach, as of such Record Date. In consideration of the repurchase of any such Receivable, Fleetwood Credit shall remit the Repurchase Amount 8 12 of such Receivable (less the amount of any Liquidation Proceeds with respect to such Receivable deposited, or to be deposited, by Fleetwood Credit, as Servicer, in the Certificate Account pursuant to Section 13.03 of the Standard Terms and Conditions) to the Purchaser. In the event that, as of the date of execution and delivery of this Agreement, any Liens or claims shall have been filed, including Liens for work, labor or materials relating to a Financed Vehicle, that shall be liens prior to, or equal or coordinate with, the lien granted by the related Receivable (whether or not Fleetwood Credit has knowledge thereof), and such breach materially and adversely affects the interests of the Receivable, Fleetwood Credit shall repurchase such Receivable on the terms and in the manner specified above. Upon such repurchase, the Purchaser shall, without further action, be deemed to transfer, assign, set-over and otherwise convey to Fleetwood Credit, without recourse, representation or warranty, all the right, title and interest of the Purchaser in, to and under such Repurchased Receivable, all monies due or to become due with respect thereto and all proceeds thereof. The Purchaser or the Trustee, as applicable, shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by Fleetwood Credit to effect the conveyance of such Receivable pursuant to this Section. The sole remedy of the Purchaser with respect to a breach of Fleetwood Credit's representations and warranties pursuant to subsection 2.03(a) hereof or with respect to the existence of any such Liens or claims shall be to require Fleetwood Credit to repurchase the related Receivables pursuant to this Section. Section 2.04. Covenants of Fleetwood Credit. Fleetwood Credit hereby covenants that: (a) Security Interests. Except for the conveyances hereunder, Fleetwood Credit will not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Receivable, whether now existing or hereafter created, or any interest therein; Fleetwood Credit will immediately notify the Purchaser of the existence of any Lien on any Receivable and such Receivable shall be repurchased from the Purchaser by Fleetwood Credit in the manner and with the effect specified in Section 2.03(c), and Fleetwood Credit shall defend the right, title and interest of the Purchaser in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under Fleetwood Credit; provided, however, that nothing in this subsection shall prevent or be deemed to prohibit Fleetwood Credit from suffering to exist upon any of the Receivables, Liens for municipal or other local taxes if such taxes shall not at the time be due and payable or if Fleetwood Credit shall currently be contesting the validity of such taxes in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto. (b) Delivery of Payments. Fleetwood Credit agrees to deliver in kind upon receipt to the Servicer under the Pooling and Servicing Agreement (if other than Fleetwood Credit) all payments received by Fleetwood Credit in respect of the Receivables as soon as practicable after receipt thereof by Fleetwood Credit, from and after the appointment of such Servicer pursuant to Section 19.02 of the Standard Terms and Conditions. 9 13 (c) Conveyance of Receivables. Fleetwood Credit covenants and agrees that it will not convey, assign, exchange or otherwise transfer the Receivables to any Person prior to the termination of this Agreement pursuant to Article Four hereof. (d) No Impairment. Fleetwood Credit shall take no action, nor omit to take any action, which would impair the rights of the Purchaser in any Receivable, nor shall it, except as otherwise provided in this Agreement or the Pooling and Servicing Agreement, reschedule, revise or defer payments due on any Receivable. 10 14 ARTICLE THREE PAYMENT OF PURCHASE PRICE Section 3.01. Payment of Purchase Price. In consideration of the sale of the Receivables from Fleetwood Credit to the Purchaser as provided in Section 2.01, on the Closing Date the Purchaser agrees to pay Fleetwood Credit $__________. 11 15 ARTICLE FOUR TERMINATION Section 4.01. Termination. The respective obligations and responsibilities of Fleetwood Credit and the Purchaser created hereby shall terminate, except for Fleetwood Credit's indemnity obligations as provided herein, upon the termination of the Trust as provided in Article Twenty One of the Standard Terms and Conditions. 12 16 ARTICLE FIVE MISCELLANEOUS PROVISIONS Section 5.01. Amendment. (a) This Agreement may be amended from time to time by the Purchaser and Fleetwood Credit to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to add any other provision with respect to matters or questions arising under this Agreement which shall not be inconsistent with the provisions of this Agreement or the Pooling and Servicing Agreement; provided, however, that such action shall not, as evidenced by an Opinion of Counsel of the Purchaser delivered to the Trustee, adversely affect in any material respect the interests of the Trust. (b) This Agreement may also be amended from time to time by the Purchaser and Fleetwood Credit with the consent of the Trustee for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement. Section 5.02. Protection of Right, Title and Interest to Receivables. (a) Fleetwood Credit at its expense shall cause this Agreement, all amendments hereto and/or all financing statements and continuation statements and any other necessary documents covering the Purchaser's right, title and interest to the Receivables and other property conveyed by Fleetwood Credit to the Purchaser hereunder to be promptly recorded, registered and filed, and at all times to be kept recorded, registered and filed, all in such manner and in such places as may be required by law fully to preserve and protect the right, title and interest of the Purchaser hereunder to all of the Receivables and such other property. Fleetwood Credit shall deliver to the Purchaser file-stamped copies of, or filing receipts for, any document recorded, registered or filed as provided above, as soon as available following such recording, registration or filing. The Purchaser and the Trustee shall cooperate fully with Fleetwood Credit in connection with the obligations set forth above and will execute any and all documents reasonably required to fulfill the intent of this subsection. (b) Within 30 days after Fleetwood Credit makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with paragraph (a) above seriously misleading within the meaning of Section 9402(7) of the UCC as in effect in the applicable state, Fleetwood Credit shall give the Purchaser notice of any such change and shall execute and file such financing statements or amendments as may be necessary to continue the perfection of the Purchaser's security interest in the Receivables and the proceeds thereof. (c) Fleetwood Credit will give the Purchaser prompt written notice of any relocation of any office from which Fleetwood Credit keeps records concerning the Receivables or of its principal executive office and whether, as a result of such relocation, the applicable provisions of the UCC would require the filing of any amendment of any 13 17 previously filed financing or continuation statement or of any new financing statement and shall execute and file such financing statements or amendments as may be necessary to continue the perfection of the interest of the Purchaser in the Receivables and the proceeds thereof. Section 5.03. Governing Law. This Agreement shall be construed in accordance with the laws of the State of California and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. Section 5.04. Notices. All demands, notices and communications hereunder shall be in writing and shall be deemed to have been duly given if personally delivered at or mailed by registered mail, return receipt requested, to (a) in the case of the Purchaser, to Fleetwood Credit Receivables Corp., 22840 Savi Ranch Parkway, P.O. Box 87024, Yorba Linda, California 92686-7024, Attention: Treasurer; (b) in the case of Fleetwood Credit Corp., 22840 Savi Ranch Parkway, P.O. Box 87024, Yorba Linda, California 92686-7024, Attention: Vice President-Treasurer; and (c) in the case of the Trustee, to the Corporate Trust Office of (if delivered) The Chase Manhattan Bank; or, as to any of such Persons, at such other address as shall be designated by such Person in a written notice to the other Persons. Section 5.05. Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions and terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement. Section 5.06. Assignment. This Agreement may not be assigned by the Purchaser or Fleetwood Credit except as contemplated by this Section and the Pooling and Servicing Agreement; provided, however, that simultaneously with the execution and delivery of this Agreement, the Purchaser shall assign all of its right, title and interest herein to the Trustee for the benefit of the Certificateholders as provided in Section 2.01 of the Pooling and Servicing Agreement, to which Fleetwood Credit hereby expressly consents. Fleetwood Credit agrees to perform its obligations hereunder for the benefit of the Trust and that the Trustee may enforce the provisions of this Agreement, exercise the rights of the Purchaser and enforce the obligations of Fleetwood Credit hereunder without the consent of the Purchaser. Section 5.07. Further Assurances. Fleetwood Credit and the Purchaser agree to do and perform, from time to time, any and all acts and to execute any and all further instruments required or reasonably requested by the other party hereto or by the Trustee more fully to effect the purposes of this Agreement, including, without limitation, the execution of any financing statements, amendments, continuation statements or releases relating to the Receivables for filing under the provisions of the UCC or other law of any applicable jurisdiction. Section 5.08. No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Purchaser, the Trustee or Fleetwood Credit, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or 14 18 partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law. Section 5.09. Counterparts. This Agreement may be executed in two or more counterparts (and by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. Section 5.10. Third-Party Beneficiaries. This Agreement will inure to the benefit of and be binding upon the parties hereto, and the Trustee for the benefit of the Certificateholders, which shall be considered to be a third-party beneficiary hereof. Except as otherwise provided in this Agreement, no other Person will have any right or obligation hereunder. Section 5.11. Merger and Integration. 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. Section 5.12. Headings. The headings herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. Section 5.13. Seller Indemnification. Fleetwood Credit shall indemnify and hold harmless the Purchaser, the Trust and the Trustee from and against any loss, liability, expense, damage or injury suffered or sustained by reason of any acts, omissions or alleged acts or omissions arising out of activities of Fleetwood Credit pursuant to this Agreement or as a result of the transactions contemplated hereby, including, but not limited to, any judgment, award, settlement, reasonable attorneys' fees and other costs or expenses incurred in connection with the defense of any actual or threatened action, proceeding or claim; provided, however, that Fleetwood Credit shall not indemnify the Purchaser, the Trust and the Trustee if such acts, omissions or alleged acts or omissions constitute negligence or willful misconduct by the Purchaser or the Trustee. Section 5.14. Merger or Consolidation of, or Assumption of the Obligations of, Fleetwood Credit. (a) Fleetwood Credit shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person, unless: (i) the corporation formed by such consolidation or into which Fleetwood Credit is merged or the Person which acquires by conveyance or transfer the properties and assets of Fleetwood Credit substantially as an entirety shall be organized and existing under the laws of the United States or any State, and, if Fleetwood Credit is 15 19 not the surviving entity, shall expressly assume, by an agreement supplemental hereto, executed and delivered to the Purchaser and the Trustee, in form satisfactory to the Purchaser and the Trustee, the performance of every covenant and obligation of Fleetwood Credit hereunder and shall benefit from all the rights granted to Fleetwood Credit hereunder; and (ii) Fleetwood Credit shall have delivered to the Purchaser and the Trustee an Officer's Certificate of Fleetwood Credit and an Opinion of Counsel each stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section and that all conditions precedent herein provided for relating to such transaction have been complied with. (b) The obligations of Fleetwood Credit hereunder shall not be assignable nor shall any Person succeed to the obligations of Fleetwood Credit hereunder except in each case in accordance with the provisions of Section 5.06 and this Section. 16 20 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers as of the day and year first above written. FLEETWOOD CREDIT CORP., as Seller By: ---------------------------------- Marvin T. Runyon, III Senior Vice President FLEETWOOD CREDIT RECEIVABLES CORP., as Purchaser By: ---------------------------------- Marvin T. Runyon, III Senior Vice President ACCEPTED: The Chase Manhattan Bank, as Trustee By: -------------------------------- Name: ------------------------- Title: ------------------------- -----END PRIVACY-ENHANCED MESSAGE-----